This is Fukumoto, General Manager of Finance and Accounting of IHI Group. I will explain IHI Group's financial results for the fiscal year 2021 based on the PowerPoint presentation materials disclosed at 3:00 P.M. today. This page shows the contents of today's presentation. Please turn to page four. This slide shows an overview of the results. In fiscal year 2021, the business environment continued to change dramatically, such as the emergence of geopolitical risks by Russia's aggression against Ukraine in late February, in addition to soaring raw material prices and prolonged supply shortage of semiconductors, while there has been modest recovery from the spread of COVID-19 in aero transportation demand. Under such business environment, IHI Group achieved the operating profit exceeding the forecast by reaping benefits from the steady implementation of various measures set forth in Project Change.
In vehicular turbochargers, the impact of the recent lockdown in China is beginning to become apparent, in addition to slower than expected recovery from reduced automobile production. On the other hand, three non-aero businesses as a whole generated profits steadily. In the civil aero engines business, the recovery trend of air transportation demand remained unchanged in the three-month period of the fourth quarter, and sales of our spare parts were more or less in line with expectations. Cash flows from operating activities recorded inflows exceeding JPY 100 billion due to working capital reduction efforts such as promotion of collection of payments for construction and inventory reduction. Free cash flow also marked large net inflows partially due to the impact from sale of assets. I will explain details in the following pages. Please refer to page five for consolidated results including orders received and income statement.
The forecast announced on February 8th at the end of the third quarter earnings announcement is indicated at the top left corner of each item for reference. Figures disclosed and explained today are broadly in line with the revised forecast announced on April 25th. Orders received increased by JPY 164.2 billion or up 15%. Revenue was up by JPY 59.9 billion, an increase of 5.4%. As shown in the middle of the page, the average exchange rate for revenue was JPY 112.68 to the US dollar. There was JPY 6.28 depreciation from the fiscal year 2020. As for the operating profit of JPY 81.4 billion, please refer to a waterfall chart that runs across at the bottom of the page.
In addition to the impact of changes in demand due to external factors in civil aero engines, vehicular turbochargers and others, and the impact from the sale of assets to secure the fund for investment, implementation of three measures which are expansion of life cycle businesses, strengthening the cost structure, and reforming the business structure as performance recovery drivers pushed up profit by JPY 25.9 billion. Please refer to page six. Orders received increased in all the reportable segments. In Resources, Energy and Environment, orders increased significantly centered on carbon solutions and nuclear energy. In Aero Engine, Space and Defense, orders increased in engines for the Ministry of Defense, in addition to recovery in demand for civil aero engines. As shown on the right, order backlog at the end of March increased in all the reportable segments and reached JPY 1,265 billion.
Please turn to page seven for revenue and operating profit by segment. Revenue increased in all the reportable segments. In Resources, Energy and Environment, revenue increased due to progress in construction work of plants overseas, also due to higher revenue in nuclear energy. In Aero Engine, Space and Defense, revenue increased due to increased sales of engines and spare parts in civil aero engines. As for operating profit, unfortunately, Aero Engine, Space and Defense recorded operating losses for two years in a row. However, the segment loss contracted substantially due to recovery in demand for civil aero engine and yen depreciation.
Three non-aero businesses, excluding aero engines, space and defense, recorded operating profits which were similar levels compared with the previous fiscal year, although some businesses were influenced by changes in their business environments, including soaring steel prices, increase in marine transportation costs, prolonged impact from reduced auto productions caused by semiconductor shortage and supply chain disruptions. I will explain the situation regarding civil aero engines and the vehicular turbochargers using pages nine and 10 respectively. Please turn to page eight. This is a breakdown by segment of the JPY 53.5 billion year-on-year increase in operating profit. Changes in revenue had JPY 5.4 billion in positive impact on the operating profit. This was mainly due to expansion of life cycle business and increased sales of spare parts in civil aero engines. Change in construction profitability pushed up the operating profit by JPY 16 billion.
We assess this positive impact was as a result of reaping benefits from steady progress in the company-wide initiatives aimed at improving the cost structures centered set forth in Project Change, including cost reductions of engines, curbing down total cost, and lowering the break-even point. The positive impact from the change in foreign exchange was JPY 8 billion. Change in SG&A pushed down the operating profit by JPY 12.3 billion, which was due to an increase in R&D expenses as well as a rise in other expenses along with a recovery in sales. Change in other income and expenses had JPY 36.4 billion positive impact on the operating profit. This includes the effect from sales of assets in fiscal year 2021 of JPY 6 billion in Aero Engine, Space and Defense, and JPY 53 billion in adjustment. Please turn to page nine.
The main graph shows the trend of quarterly revenue of civil aero engines in bars and spare parts transaction volume in a solid line. The recovery trend in demand for aero transportation in domestic lines and short-haul international lines remained unchanged, mainly in North America and Europe. Our transaction volume of spare parts for civil aero engines in the most recent three-month period were broadly in line with expectations. Despite being moderate, we expect to see continuous recovery of spare parts transaction volume in fiscal year 2022. Please turn to page 10. This page shows the number of deliveries of vehicular turbochargers and revenue by region on a quarterly basis.
Although the impact from reduced auto production caused by a shortage of semiconductors and the supply chain disruption is waning, with the impact having been most serious in the second quarter, recovery remains moderate and the impact is further protracted. More recently, the impact of recent lockdown in China is beginning to become apparent. Uncertainties are increasing, but toward the end of fiscal year 2022, we expect to see normalization.
Please turn to page 11, finance income and costs. Foreign exchange gains was JPY 7.5 billion as yen became even weaker against US dollar approaching to the fiscal year-end. Change of foreign currency exchange rate details are available at the bottom of the page. Share of profit in Japan Marine United, which is included in share of profit or investments accounted for using equity method, was again a small positive thanks to weaker yen, et cetera, although affected by higher steel price. Please turn to page 12, financial position. Outstanding interest-bearing liabilities, as shown in the middle, was JPY 505.5 billion, decreased by JPY 100.3 billion from the end of the previous fiscal year. Total equity was JPY 407.0 billion, increased by JPY 79.3 billion from the end of the previous fiscal year.
All in all, debt-to-equity ratio was 1.24x . Ratio of equity attributable to owners of parent was 20.3%, and soundness of the financial conditions improved from the end of the previous fiscal year. Cash conversion cycle was 112 days, slightly below the target, but did improve following the reduction in the working capital. We will continuously make effort to strengthen our cash generation ability. Please turn to page 13, consolidated cash flows. Cash flows from operating activities was JPY 114.1 billion, which was an unprecedented level of cash inflow. This was achieved as a result of better control over working capital by encouraging construction payment and controlling inventories. Cash flows from investing activities was JPY 27.9 billion. Major factor was the asset sales to secure the financing to create growth businesses.
Free cash flow combining the cash flows generated by operating and investing activities was JPY 142.0 billion. Now, let us share our forecast of the consolidated results for fiscal 2022. Please turn to page 17. We are expecting orders received to be JPY 1.28 trillion and revenue to be JPY 1.3 trillion. Operating profit is expected to be JPY 75 billion, incorporating JPY 10 billion risk buffer to be prepared for potential business performance for fluctuation. Foreign currency assumption, we are assuming one US dollar to be JPY 115 . Foreign exchange rate sensitivity for US dollar, JPY 1 move will have approximately JPY 1.2 billion impact on our operating profit on a full year basis.
The waterfall chart at the bottom of the page shows you how we will generate JPY 75 billion operating profit. Although effect of sales of large scale asset, which is part of the JPY 81.4 billion operating profit in fiscal 2021 will disappear, which will have a negative impact, we are expecting recovery in the business environment. For example, sales of civil aero engine spare parts should increase following the recovery in the airline industry. We will also fully capture the achievement by steadily executing the performance recovery drivers, i.e. expansion of life cycle business, strengthen cost structure, and reform business structure. On the other hand, research expense involved in strategic technologies to create growth businesses is expected to increase. We are also incorporating JPY 10 billion worth risk buffer to be prepared for a potential fluctuation in our business performance.
All in all, we are expecting operating profit to be JPY 75 billion. Potential risks we are assuming are Russian invasion of Ukraine and the economic sanctions as a result, lockdown situation in China deteriorating the supply chain disruption, more shortage in raw materials and components, and price hikes. We are assuming both sales and procurement cost related situations. Moving on to shareholder return at the bottom of the page. Applying 30% consolidated payout ratio, annual dividend will be JPY 80, JPY 10 increase from fiscal 2021. Please turn to page 18. Orders received forecast by segment. On a total basis, we are expecting a slight increase in orders received. Resources, Energy and Environment, Social Infrastructure and Offshore Facilities, we are expecting negative rebound in nuclear energy and bridges, which performed well in fiscal 2021.
Industrial Systems and General-Purpose Machinery, we are likely to take more vehicular turbocharger orders to a certain extent following the recovery from the production adjustment. Aero Engine, Space and Defense, although we had large-scale Ministry of Defense orders in fiscal 2021, on a net basis we are expecting an increase in orders received thanks to the increase in civil aero engine orders following the recovery in the airline industry. Page 19, revenue and operating profit forecast by segment. Let me explain the details in revenue forecast changes on this page. Changes in operating profit will be explained on the next page. Resources, Energy and Environment, we are expecting revenue to be generated by nuclear energy will increase. Industrial Systems and General-Purpose Machinery revenue will increase following the expansion in lifecycle business and the business environment recovery in vehicular turbocharger business.
Aero Engine, Space and Defense, we are expecting civil aero, new engines and engine spare parts sales to be stronger following the recovery in the airline industry. Page 20, please. Reasons for the changes in operating profit compared to fiscal 2021 by factors. Industrial Systems and General-P urpose Machinery. Operating profit will increase by JPY 14.1 billion, not only because of the revenue increase, but also because we have accelerated our initiatives to improve the profitability, for example, by lowering the break-even point. Aero Engine, S pace and Defense operating profit will be JPY 30 billion, up by JPY 39.3 billion from fiscal 2021, thanks to the increase in civil aero engine spare parts sales following the recovery in the airline industry, and continuous effort to improve productivity.
As the adjustment effect of sales of large-scale assets will be conducted in fiscal 2021 will disappear, and we are incorporating JPY 10 billion worth risk buffer. Cash flows forecast. Cash flows from operating activities in fiscal 2022 is expected to be JPY 130 billion cash in. Cash flows from investing activities is expected to be JPY 90 billion cash out. We are aiming to secure greater than fiscal 2021 scale of operating cash flows by controlling the increase in working capital, even when we are generating more sales, and by stabilizing our cash generation ability. We will also accelerate our investment in creating growth businesses. Lastly, if we look back fiscal 2021, although some of our businesses were negatively affected by the worsening business environment, on a company total basis, we could generate greater than originally expected profit and cash.
We believe we have been making good progress in achieving results in performance drivers under Project Change. Although the future has even become more uncertain, we want to make sure that the achievements we made in fiscal 2021 are not going to be one-off. This year, which is the final year of Project Change, we will further accelerate the speed to execute various initiatives to meet the forecast we have announced today. This concludes my presentation.
I will present management review and explain progress with Project Change. I will mainly go over the five topics as you can see on this page. As always, please allow me first of all to confirm the positioning of Project Change. In response to the spread of COVID-19, the previous Group Management Policies 2019, while keeping the basic concept, were transformed to Project Change covering three years from fiscal year 2020 to fiscal year 2022, as a preparation period to reform businesses in response to changes in the operating climate. Initiatives set forth in Project Change include returning to growth trajectory, financial strategies, creating growth businesses, and forming the business structure to support such initiatives, including implementation of personnel policies and adopting new work practices. This page shows a summary of the fiscal year 2021, which was the second year of Project Change.
As explained by General Manager of Finance and Accounting earlier, fiscal year 2021 faced various unexpected incidents such as shortage of semiconductor, increase in raw material prices, energy cost, crisis in Ukraine, and lockdowns in China. Based on Project Change, we implemented various initiatives and made steady progress, including fixed cost reductions, early collection of receivables, and expansion of life cycle businesses. As a result, in fiscal year 2021, both revenue and profit increased year-on-year, and net profit attributable to owners of parent was record high. In that sense, I think it's fair to say that we were able to make progress and started to deliver results to a certain extent. The third bullet point in the assessment column says we accelerated efforts to create growth businesses, but the fact is that we just started sowing seeds.
You might have seen some of our initiatives thanks to a number of media coverage. In fiscal year 2022 and onward, we will concentrate working on our efforts to produce solid results. As for the business climate, this is true not only for our group, but for others, that we are in a world that constantly faces dramatic changes, including major natural disasters, prolonged impact of COVID-19 pandemic, surging toward carbon neutrality, and increasing uncertainties. These changes are so dramatic. In such a business climate, we need to strive to establish an earnings base which is resistant to changes as a top priority. As set forth in Project Change, we have worked on strengthening cash flow generation as a number one priority. I believe we need to further strengthen our effort on this.
Assuming that dramatic change is becoming a norm, we need to change the way we do businesses, even for existing business, for instance. Because I think if we continue to do business in a conventional manner, that may not be always successful. Based on that understanding, I believe we also need to overhaul our business structure. Management results and targets have already been explained by General Manager of Finance and Accounting earlier. In fiscal year 2021, the group recorded record high profit, but the result includes gain on sale of assets worth JPY 59 billion. The targets for fiscal year 2022 look lower on a year-on-year basis against fiscal year 2021, but they represent the underlying trend, not including gain on sale of assets.
We are falling short of the original fiscal year 2022 targets of the operating profit margin of 8% and cash conversion cycle of 80 days set in Project Change. We will keep these targets of 8% and 80 days by expanding the lifecycle business, realizing recovery of Aero Engines business, although achieving them might be one year later than the original schedule. I will not repeat explaining this page, showing factors for changes in operating profit, as it was already explained earlier. We will continue to work on strengthening the earnings base for each of our business in response to changes in external operating climate and various risks. By doing so, we are targeting to achieve record high operating profit. Next, I will talk about strengthening cash flow generation.
As also explained by General Manager of Finance and Accounting, we will still need to improve the cash conversion cycle. On the other hand, we pursued cash generation efforts in our business operations and also made much effort to constrain working capital.
As a result, operating cash flow exceeded JPY 100 billion for the first time in fiscal year 2021, and we seek for further expansion in fiscal year 2022. Moving on to expanding lifecycle business. We made a lot of progress in the last two years. As a result, revenue of lifecycle business increased 17% in fiscal year 2021 from the fiscal year 2019 level. Going forward, we will further accelerate our efforts steadily in expanding lifecycle business with a view to attaining the revenue growth target of 30% or higher from the 2019 level. We are pursuing various efforts to expand lifecycle business, including resource shifts, digital transformation, and also global deployments, which is one of our major challenges to tackle, as it's still not sufficient. By accelerating global deployments, we aim at growing revenue of lifecycle business higher than 30% plus.
From here, I will briefly explain progress by business area. First of all, Resources, Energy and Environment. We made much progress in expanding lifecycle business centered on the Carbon Solution SBU, including nuclear energy. However, fiscal year 2021 was an off-season for lifecycle business of the Carbon Solution SBU, particularly for thermal power generation plants, and saw a slight drop in revenue. However, looking ahead, we received orders for a 20-year-long maintenance contract of biomass power generation facilities and 25-year-long operations and maintenance contract for energy storage systems in North America. As regards business structure reforms, we signed memorandum of understanding to transfer large marine engines business and completed transfer of pharmaceutical plant engineering, procurement and construction business. We will continue accelerating our efforts in reforming the business structure.
Regarding growth business initiatives, some of our achievements include progress made in ammonia combustion technology and participation in small modular reactor business. Next is Social Infrastructure and Offshore Facilities. Most importantly, we could receive record high bridge maintenance orders in Japan. As one of the initiatives under lifecycle business, we have established Disaster prevention and Water Gate Technical Training research facility and started to initiate early training of engineers. Following the situation, with increasing number of natural disasters, especially floods, have been taking place in Japan, and with the number of maintenance engineers has been decreasing because they are becoming older. We have also been working on DX. We are using digital technologies to transfer experienced engineers' expertise to the younger generation. By promoting DX, we believe we have been able to improve operational processes. Moving on to growth business initiatives.
IHI would like to make progress in upgrading the integrated water usage and flood control systems. Next is Industrial Systems and General-P urpose Machinery. We are working on to expand the lifecycle businesses. The first bullet point says integrated services sites for multiple businesses. What this means is we have started to integrate multiple business service sites, including service sites for rotating machineries, logistics systems and multipurpose boilers. Integrated sites can be a one-stop multiple service providers for our customers. We are aiming to further accelerate and expand this initiative. Cost structure reinforcement. We are aiming to take more orders by shortening the delivery time. Here we are sharing one example using industrial furnace as an example. We have been able to shorten the construction lead time from five months to two months.
We would like to do the same in other businesses as well, since this will bring great value to our customers. Growth business initiatives. In addition to develop, especially fuel cell vehicle electric turbochargers, we are focusing on energy management at our customer sites since we do have a lot of industrial system customers. Next, Aero Engine, S pace and Defense. Cost structure reinforcement. We have been especially focusing on cost reduction and productivity improvement in our new engine business, including employment of just-in-time procurement and digital transformation to stabilize the production processes. Moving on to lifecycle businesses. We have started to operate Lifecycle Solution Center from April 1, aiming to further expand our engine maintenance business by integrating the operations of several aero engine maintenance business and the facilities we have in Mizuho and in Tsurugashima. Growth business initiatives.
We would like to further accelerate the development of composite fan blades and ceramic matrix composites, since one of the most effective ways to reduce the gas emission is to make things lighter. Also, we would like to make progress in designing the concept of new next generation engines for the future single aisle aircraft with 150 seats. Next is growth business creation. Over the past two years, we have been controlling the amount of investment, but in fiscal year 2022, we will increase our investment significantly and planning to spend a little bit less than JPY 150 billion, out of which roughly 1/3 will be spent to create new businesses, i.e., we will proactively make investment in creating future IHI businesses. Our growth business creation has been covered by various media. One of the major pillars is to build ammonia value chain.
In terms of usage and combusting ammonia, we believe we have been able to lead the market. Since we have the capability to use, we should generate demand and build the value chain by well capturing these generated demands. Based on such thinking, we are currently developing technologies to produce, receive, and store ammonia, and working together with various partners. We are also working together with Singapore's Institute of Sustainability for Chemicals in developing carbon dioxide recycling technologies. The areas of research and development include methanation, lower olefins, and sustainable aviation fuels. We are also participating in small modular reactor business. We are working together with JBIC, Japan Bank for International Cooperation, and JGC Holdings Corporation as Team Japan in this nuclear area. By providing key equipment and engineering services, we are aiming to play pivotal role in this business. Next is rocket, satellite, and data applications.
Nanosatellite developed by IHI has been already deployed. We are also accelerating our efforts to secure orders for commercial missions and launch services, and have formed business alliance with Sumitomo Forestry for satellite database management of tropical peatland. The other area is conservation and disaster prevention and mitigation. As mentioned earlier, we are aiming to contribute in disaster prevention and mitigation through advanced water utilization and flood control management systems. We will proactively collaborate with various institutions and corporations in this area as well. Lastly, let me share some ESG highlights. In November 2021, we announced IHI Group's ESG management. Although we are still underway to make enough progress, we have been able to make some progress. First, IHI stock is now included in leading ESG index.
Global index provider FTSE Russell included IHI in the FTSE Blossom Japan Sector Relative Index, which the GPIF of Japan uses as a benchmark for ESG investments. In addition, the transition bond we are planning to issue in fiscal 2022 has been selected as one of the METI, Ministry of Economy, Trade and Industry's 2021 climate transition finance model projects. Like this way, we will continuously and proactively make progress in ESG related areas. Fiscal year 2022 is going to be the final year of Project Change. Therefore, we, as a whole company, are aiming to achieve record high performance, including operating profit and cash flow. In the meantime, we will further accelerate our investments to create growth businesses. This concludes my presentation.