We made upward revisions to our sales and income forecast for the fiscal year ending March 2012, which we announced on November 1 last year.
Net sales are expected to fall 80.6 billion yen, or 5.1%, year on year to total 1.5 trillion yen. Although we project a 5.8 billion yen year-on-year revenue increase coming from the Industrial Products Division, etc., we will see foreign exchange losses totaling 79.7 billion yen due to the strong yen as well as a loss of 6.7 billion yen resulting from the sales mix variance.
Operating income is projected to total 38.0 billion yen, down 46.1 billion yen, or 54.8%, year on year. Factors behind this decline include foreign exchange losses resulting from the strong yen, an unfavorable sales mix variance due to the negative impact of the devastating earthquake, hikes in material prices, and increased R&D expenses, which we won't be able to offset via gains from reductions in SG&A expenses. This will be examined in greater detail later on.
Ordinary income is expected to drop 45.2 billion yen, or 55.0%, to total 37.0 billion yen while income before income taxes and minority interests will total 53.0 billion yen, down 10.2 billion yen, or 16.2%, year on year. We do not expect any major impact on our bottom line other than from the gain on the sale of the Subaru Building and loss due to disaster posted during the first half.
Net income will amount to 41.0 billion yen, a 9.3 billion yen or 18.5% drop, due to tax expenses related to our subsidiaries, etc.