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## Selling, General and Administrative (SG&A) Expenses, Research and Development (R&D) Expenses, Amortisation of Intangible Assets 

SG&A expenses increased 24.5% to ¥397.0 billion, which in addition to the foreign exchange rate impact, was partly due to increased expenditures related to the oncology business in the U.S. and EMEA, including payment for co-promotion of XTANDI in the U.S. 

R&D expenses rose by 20.3% to ¥191.5 billion, which in addition to the foreign exchange rate impact, was partly due to increased development expenses related to a stra- tegic alliance with Amgen Inc. The ratio of R&D expenses to sales rose 0.6 of a percentage point to 16.8%. 

Amortisation of intangible assets was ¥36.0 billion, up 27.4% year on year, which in addition to the foreign exchange rate impact, was partly due to an increase resulting from launches of new products. 

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## Core Operating Profit 

As a result of the above-mentioned factors, core operating profit increased 10.9%, to ¥186.3 billion. The ratio of gross profit to sales increased, while the ratio of R&D expenses to sales and the ratio of SG&A expenses to sales also increased. Consequently, the operating margin declined 0.8 of a percentage point to 16.3%. 

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## Core Profit for the Year 

Finance income on a core basis decreased ¥0.3 billion to ¥1.6 billion. Finance expense on the same basis was ¥0.4 billion, mostly unchanged from the previous fiscal year. Consequently, core profit before tax rose ¥17.9 billion, or 10.6%, to ¥187.5 billion. 

Income tax expense increased by ¥3.9 billion, or 7.8%, to ¥54.7 billion. The income tax burden rate fell 0.8 of a percentage point to 29.2% compared to the previous fiscal year. 

As a result, core profit for the year increased by ¥14.0 billion, or 11.8%, to ¥132.8 billion. 

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