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In addition, the Company relocated its head office in March 2022 and gathered various companies and divisions from the Avex Group at the largest one-floor working space (approx. 750 seats) in Tokyo to promote teamwork and active communication. The Group also promoted hybrid working styles allowing employees to select more accessible flexible working styles using approximately 400 new co-working spaces.

In addition to these activities, an increase in the number of live events thanks to the gradual easing of restrictions on live events and strong sales of music packaged products resulted in year-on-year growth in sales. As a result, net sales amounted to 98,437 million yen (up 20.7% year on year) with an operating income of 2,582 million yen (up from an operating loss of 6,278 million yen in the previous period), marking a period of increase to both sales and profit. Profit attributable to owners of parent fell 919 million yen (down 92.8% year on year) due to the posting of significant extraordinary income, including gain on the sale of noncurrent assets in the preceding period.

In the domestic music market, the market for packaged music has been on the decline since peaking in 2000, but in recent years the decline has eased. I believe that one of the factors behind this is that demand for high unit-value products has risen due to Japan's high-quality packaged goods being offered in a format that enhances their value to fans. Meanwhile, the digitalization of the online distribution market has steadily expanded. Streaming, in particular, has continued strong growth, with the size of the market increasing around 1.3 times the previous year, and is expected to overtake the package market within the next several years. The global music market, as with Japan, has seen a declining trend in the market for packaged music, but the decline has been covered through streaming and other digital formats, transforming into a growth market around 2014. Particularly in the Asian market, excluding Japan, sales have been growing to around 1.3 times the previous year.

In this way, the music industry is a global growth industry, and even by its size, I believe the Japanese market can also change into an extremely promising one.

Digitalization has changed the environment for monetization, boosting the value of the intellectual property. We will shift away from temporary monetization focused on expanding the range of sales at a given time, like packaged product sales, enabling ongoing monetization through streaming and online distribution. In fact, looking at total revenue for the top five artists in the world, steaming and rights-based revenue already far exceeds packaged music sales.

For the animation and video market, despite a temporary downturn in the domestic market due to the COVID-19 pandemic in 2020, recently the size of the overseas animation market exceeded that of the domestic animation market for the first time.

With digital video distribution platforms exhibiting continued growth, there are more opportunities where Japanese animation is being demanded overseas, and progress has been made in reaching agreements with overseas entities for many animations and video titles. This expansion, in terms of both area and recognition, has led to ongoing growth in the number of participants related to animation and video IPs.

To clarify the purpose of its corporate activities and the social significance of its presence in light of these changes to the market environment, Avex defined a new corporate philosophy and formulated the avex vision 2027 Medium-term Management Plan, with the fiscal year ending March 2027 as its final year.

Although we expect a reduced impact from the COVID-19 pandemic, we will make investments in IPs to achieve the goals of the Medium-term Management Plan, As a result, we forecast operating income of 1 billion yen (down 61.3% year on year) and profit attributable to owners of parent of 400 million yen (down 56.5% year on year) for our forecast for the fiscal year ending March 2023.

We have a payout policy of maintaining a consolidated payout ratio of at least 35% and paying an annual dividend of at least 50 yen per share. For the fiscal year ended March 2022, we offered an annual dividend of 50 yen per share. For the fiscal year ending March 2023, we plan to pay an annual dividend of 50 yen per share in accordance with this policy.