"Review on Compliance with the New Regulatory Requirements"

• JNFL accepts the strict words of guidance expressed in past review meetings and the meeting of the Nuclear Regulation Authority held the day before yesterday, and shall reflect upon the feedback in preparing for future reviews.
• It appears extremely difficult to meet the estimated completion date for the reprocessing plant in view of the current status of the government's review, which was originally estimated to take approx. 6 months.
• At this stage, JNFL does not expect to declare the Reprocessing Plant to be completed in October, but observing the future course of the review, the completion timing will continue to be examined.
• In regard to the trench surveys at the southern edge of the Deto West Fault, JNFL has so far drilled approximately 100 meters long, 50 meters wide and 10 meters deep (15 meters when finished) to conduct geological observation. The results up until now showed that there is no need to alter the existing assessment.
• In the review meeting on May 30, the need to expand the scope of the trench surveys was pointed out. In response, JNFL is currently preparing to extend the length to approximately 100 meters to the east. Findings from the expanded surveys will be reported at the next review meeting or other occasions.

"Overview of FY2013 Financial Results"

• As stated in the "Profit and Loss Statement", JNFL posted 286.8 billion yen in "net sales", down 7.2 billion yen from the previous year primarily due to a drop in spent fuel reprocessing revenues. The "cost of sales" stood at 242.9 billion yen, down 5.5 billion yen from the previous year as a result of maximum cost-cutting efforts across the board, including the suppression of repair costs, despite an increase in the cost of addressing the New Regulatory Requirements.
• As a result, the "gross profit on sales" registered 43.9 billion yen, and the operating profit, which is the gross profit on sales with the "selling, general and administrative expenses" subtracted, remained almost steady at 22.1 billion yen. The "ordinary profit", which reflects non-operating income, marked 9 billion yen, down 3.6 billion yen from the previous year. The "current term net profit", which excludes "extraordinary losses" such as the cost of retiring fixed assets and "corporate taxes, etc.", ended at 5.4 billion yen, slightly lower than the previous year, indicating that JNFL closed this fiscal term with lower earnings and lower revenues.

"Message from President Kawai"

I am leaving the post of JNFL President at the general shareholders meeting to be held on June 30.
Looking back, it has been almost five years since I took over the helm of the JNFL from the previous President Isami Kojima in August 2009. Let me express my deepest gratitude to the people of Rokkasho Village and the rest of Aomori Prefecture, as we could not have progressed our operation to this point without their understanding and cooperation.
A lot has happened in the last five years, but the Great East Japan Earthquake on March 11, 2011 and subsequent accident at the Fukushima Daiichi Nuclear Power Station most drastically transformed the business environment that surrounds JNFL. Tough business conditions still continue. Yet, on a positive note, the deadlock over the Reprocessing Plant's vitrification tests was resolved, albeit after a considerable amount of time and after thorough examination. The tests were successfully completed in May last year, clearing technical challenges. As for the Uranium Enrichment business, R&D that started in the year 2000 led to the 2012 launch of the commercial operation of a new centrifugal separator, which we boast to have the world's highest performance. While the MOX Fuel Fabrication Plant project had to be put in long term abeyance after the Great East Japan Earthquake, the construction work has since resumed. The foundation bedrock cleared tests at the end of the year before last, and JNFL is currently working on constructing buildings.
Steadily but surely, JNFL has managed to progress each of our business operations forward. This is attributed to the understanding of the local people, and also to the dedication of our engineering team, of which I am extremely proud of. On April 11, the Cabinet approved the new Basic Energy Plan, expressing a firm commitment to promoting the nuclear fuel cycle program we are working on. This was indeed a truly significant development.
JNFL's biggest task is to achieve compliance with the New Regulatory Requirements, for which reviews are being carried out. I have been telling all JNFL employees to take on this task with a determination to create the world's safest nuclear fuel cycle facility. In order to win the trust of local residents, it is our responsibility to clear the new requirements, which JNFL is determined to achieve.
While no longer in the current capacity, I will continue to live in Aomori and provide sideline support for the new JNFL management team.
Let me conclude this message by thanking everyone at the Aomori Prefectural Reporters' Club.