Corporation. We now start the earnings briefing for the Q2 of the fiscal year ending March 2023, FY 2023. Allow me to introduce myself. My name is Modi from IR. I thank you for your support and cooperation to our IR activities. Today's briefing would basically be conducted in Japanese. The slides in Japanese will be projected, but we will be conducting Q&A session in Japanese and English. Simultaneous interpretation services are being provided in Japanese and English. Please choose the interpretation function on Zoom. In today's presentation, we'll just focus on the summary. On our company website, you can see the materials both in Japanese and English. For the slides that will be used in the presentations are uploaded on the website with the scripts. I will now introduce the four speakers. Director, Representative Executive Officer, President, and CEO, Yasuo Takeuchi.
Executive Officer, Chief Financial Officer, Chikashi Takeda. Executive Officer, Chief Operating Officer, Nacho Abia. Director, Executive Officer, Chief Administrative Officer, Chief Strategy Officer, ESG Officer, Stefan Kaufmann. Today, first, we will have Yasuo Takeuchi and Stefan Kaufmann make some comments relative to the timely disclosure made on October 21 regarding the changes of the representative executive officer and management team. Then CFO Chikashi Takeda will go over the results for the Q2 of FY 2023 and the forecast for FY 2023. Nacho Abia will talk about the GI Endotherapy growth strategy. We will have a Q&A session after the presentations. We are scheduled to end at 7:00 P.M. Japan time. We will now start the presentation. Thank you very much for joining us. I am Takeuchi, CEO. On 21st of October, we made a timely disclosure on the management team change starting next April.
Today, I would like to explain the background intent behind the new structure and briefly describe the reasons for the new appointments. In 2019, we announced Transform Olympus corporate transformation plan. In our corporate strategy, we indicated that we aim for sustainable growth as a truly global med tech company, ensuring adequate profitability. We have made a concerted company-wide effort over the past three and a half years, undaunted by the uncertainties brought on by the COVID-19 and others. As a result, achieving the strategic goal laid out in 2019 is now in sight, and our business foundations and corporate culture have been strengthened beyond comparison with when Transform Olympus was launched. We are now ready to move into the phase of accelerating growth by truly fulfilling our potential as a global med tech company to further contribute to the development of healthcare.
This is the management structure effective next year. The number of executive officers will increase to 10 with the addition of ESD Head Frank Drewalowski, JSD Head Gabriela Kaynor, HR Head Shigeto Ohtsuki, and Chief Quality Officer Pierre Boisier. The COO and CAO positions that have contributed to our transformation so far will be eliminated in a constructive manner, while executive officers needed for sustainable growth will be increased. The team led by the CEO will be flattened to enhance speed and agility to take actions. Of these structural changes, today I will briefly introduce three new appointments effective next April.
Stefan Kaufmann, newly appointed as CEO, Nacho Abia, who will focus on formulating corporate strategy to accelerate growth as a global med tech company, and Pierre Boisier, who will be appointed as an executive officer for the first time to head product safety and quality assurance, the key elements in a medical device manufacturer. First, new CEO, Stefan Kaufmann. After gaining experience overseeing our operations in Europe for many years, Stefan relocated to Japan in 2019 and has driven Transform Olympus with powerful leadership, successfully improving the management efficiency. He not only respects Japanese culture and the history of Olympus, but is also passionate about boosting the competitiveness as a global company. I believe he is the first person to serve as CEO as we reach the new milestones in greater management efficiency and accelerated growth. His appointment follows a very careful review by the nominating committee.
Nacho Abia, who has served as CEO to date, will assume the new post of Chief Strategy Officer. Olympus has been consolidating its business portfolio over the last 3.5 years, and following the transfer of Scientific Solutions business next year, we will become a dedicated medical device company. It is clear that Nacho's experience in driving efforts in the medical field and M&A will be important for the development of company-wide growth strategy. Thus, he is to assume the post of Chief Strategy Officer. Pierre Boisier, Chief Quality Officer, will be a newly appointed executive officer. He held key positions related to quality and safety assurance at Boston Scientific Corporation and Becton, Dickinson and Company and others before joining Olympus in 2021 when the Transform Olympus was underway, as he agreed with initiatives and potential.
Over a short time, he has demonstrated his experience, passion, and outstanding leadership in achieving a range of improvements. As for myself, in my new capacity as Director, Representative Executive Officer, and Executive Chairman starting next fiscal year, I will throw my full support behind Stefan and the new leadership team. We are announcing the new management structure at this juncture to ensure that the new corporate strategy and system development, which are to be announced early next fiscal year, will be carried out under the new management. While the number of executive officers will increase, the global governance and speed of decision-making enhanced over the last three and a half years have now taken root as our corporate culture, and I'm confident that swift management decisions will continue under the new management. Now I would like to ask Stefan to briefly introduce himself.
Stefan, over to you. Thank you very much, Yas, for your very friendly and warm words. Hello, everybody. My name is Stefan Kaufmann, and I would like to use the opportunity of this earnings call to briefly introduce myself to all of you. I mean, as you can imagine, I'm very honored and humbled that Yas, the nomination committee, and the board has selected me as the next CEO, and I think I should still say tentatively, to lead Olympus into the next phase of growth. Olympus is a Japanese company with a more than 100-year history. So I think that explains why I feel very humbled and honored that I've been chosen to enter with the company into the next chapter of our evolvement as a leading global med tech firm.
As you are aware, in 2019, under the leadership of Yas, we have started our transformation, and I think we can be extremely proud of what we have accomplished so far. While this is certainly not the time to present to you our next company strategy, I would like to reassure you that also under my leadership, our journey to be a leading global med tech company will continue. Now our next phase of growth, we will put a strong focus on elevating the standard of care to create value for society, for our customers, for our patients, and for our shareholders. We will continue to communicate transparently and constructively with our shareholders, our investors, and with all of you. Thank you very much for your trust and your continuous support of Olympus.
Thank you. Hello, I'm Chikashi Takeda, CFO. I would like to give an overview of our consolidated financial results for the Q2 of fiscal 2023, as well as full year forecast. First, slide 8. I'd like to describe changes in reporting structure. On August twenty-ninth, we disclosed the transfer of all shares in Evident Corporation, which engages in Olympus group's Scientific Solutions business. In accordance with IFRS, the Scientific Solutions business is classified as discontinued operation from this Q2 . Our briefing today will focus on continuing operations that excludes discontinued operation. Please refer to appendix for more details on discontinued operation. Now, gain on the transfer of Scientific Solutions business will be recorded as discontinued business on slide 17. There is a revised forecast and profit from discontinued operations of JPY 230 billion includes the gain on the transfer of scientific solutions.
This is the highlight of the Q2 results. In light of impact of the lockdown in Shanghai, the war in Ukraine, supply shortages of semiconductors and other components, and rising material costs, which were identified at the start of the fiscal year, we continued to take countermeasures to minimize various risks during the H1 of this fiscal year. Revenue was up 16% on a consolidated basis, with a double-digit growth for both ESD and TSD, setting record highs for both the Q2 and the first six months in the medical business. Operating profit and operating margin also set record highs for both the Q2 and the first six months. EPS of continuing operations stood at 55 JPY, up 20% year-on-year. As for full year forecast, we have revised revenue upward from the August forecast. Again, we're just focusing on the continuing operations.
This revenue upward revision is mainly due to the changes in foreign exchange assumptions. Based on the results up to the Q2 , we have slightly increased expenses as well. With these revisions, profit has been revised slightly downward, but we are still on track to achieve adjusted operating margin of over 20%, our target in the corporate strategy. We expect revenue to achieve JPY 892 billion, up 19% year-on-year, and operating profit to achieve record highs for both amount and ratio. Profit as the sum of continuing and discontinued operations is also expected to reach a record high of JPY 387 billion due to a gain on transfer of Scientific Solutions with EPS of JPY 305, up 238% year-on-year.
Profit of continuing operations is expected to reach JPY 157 billion, with EPS of JPY 124, up 44% year-on-year. As we announced in a timely disclosure today, we plan to implement a share buyback of approximately JPY 50 billion based on our capital allocation policy. For EPS calculation, we are assuming that this share buyback has been implemented. I will now explain the consolidated financial results and provide a business review for Q2. Slide 11. This is an overview of the consolidated financial results. First, changes in reporting structure in the profit and loss statements. On the left-hand side, from revenue down to profit from continuing operations, figures represent continuing operations that excludes discontinued operation. The results of FY 2022 have also been reclassified to allow year-on-year comparison.
Consolidated revenue amounted to JPY 417.1 billion in the first six months, up 16% year-on-year. Revenue in the medical business represents record highs for Q2 and the first six months, with double-digit growth in both ESD and TSD. Gross profit was JPY 277.5 billion, with gross profit margin deteriorating by 0.5 point. The impact of rising materials cost and a change in regional sales mix due to a decline in China were key factors. SG&A expenses were JPY 198.5 billion, with SG&A ratio deteriorating 0.7 point, due primarily to an increase in expenses associated with sales activities and strengthening of operational infrastructure, such as QARA.
In other income and expenses, a gain of JPY 14.6 billion, due mainly to a gain of JPY 16.4 billion on the sale of land in Tokyo in Q1 as other income. Operating profit was JPY 93.6 billion, up JPY 22.9 billion or 32% year-on-year. Operating margin improved 2.8 points to 22.4%. Adjusted operating margin, excluding other income and expenses, which is a milestone in our corporate strategy, was 19%. Profit from continuing operations was JPY 69.5 billion, with EPS of JPY 55, up JPY 22 or 20% year-on-year. Our total profit, including both continuing and discontinued operations, was JPY 66.9 billion, with EPS of JPY 53, up 8% year-on-year. Even in an uncertain environment, the performance of continuing operations in Q2 was trending positive quarter-on-quarter.
I would like to skip to the outlook, page 17. I explained in May that some growth inhibitors due to changes in the external environment had been factored into the full year forecast.
We have worked, as I mentioned in the beginning, to get through these factors, which were, as expected, negative. We have implemented measures, and as for these measures, we would like to continue to implement them since this environment is expected to continue for some time. For the continuing operations, we have separated the discontinued and continuing operations. We have made upward revision, mainly due to the exchange rate change. We expect revenue to achieve JPY 892 billion, up 19% year-on-year. The forecast assumptions for FX is 140 yen to the dollar and 139 yen to the euro. For more details, please refer to page 33, which includes FX sensitivity. Based on the results to the Q2 , we have slightly increased expenses.
For example, we had factored a certain increase in raw material prices in our original forecast, but we decided that it could be appropriate to add more. With these revisions, profit has been revised slightly downward, but are still on track to achieve adjusted operating profit margin of more than 20%, our target in corporate strategy. We expect operating profit to achieve JPY 212 billion, up 45% year-on-year, record highs of both amount and ratio, and adjusted OPM is expected to reach 22.5%. Profits are also expected to reach record high of JPY 387 billion due to gain on transfer of scientific solutions business, with EPS JPY 305 up 238%.
Profit of continuing operations is expected to be JPY 157 billion, with EPS of 124 yen at 44% year-on-year. In fiscal 2023, we plan to pay a dividend of 16 yen per share, unchanged from the announcement in May. As we announced in the time of this quarter today, we have planned to implement a share buyback of approximately JPY 50 billion, and the EPS is reflective of this share buyback. Lastly, page 18, forecast by segment. We expect both ESD and TSD to grow double digits year-on-year. As a result, the combined revenue of the two divisions in the medical field is expected to reach record highs again. We are seeing continuing recovery in procedure volume around the world.
Even in China, hit hard by the impact of Shanghai lockdown, we expect a shift in growth in the H2 of the fiscal year due to recovery in the number of tenders since August and policy support, such as low interest loan program for medical devices. We expect further contributions from growth driver products. EVIS X1 in ESD will accelerate the penetration in Japan, Europe and Asia, and will be launched in the US. Sales of VISERA ELITE III are also expected to expand since it's been launched in Japan and Europe. This is growth continued to be centered around these three focus areas. For both divisions, we have revised our operating profit forecast from the previous forecast, with the impact of rising material costs being taken into account.
In the meantime, we have seen an improvement in the situation of parts supply shortages, including semiconductors, since October. Also, we are already implementing tighter cost controls such as hiring restraint, review of various projects limited to non-essential overseas trips, and review of R&D priorities. While we anticipate that the business environment will remain unstable and uncertain, the management team will continue to take a lead in company-wide collaboration to achieve the goals. Discontinued operation is expected to achieve a significant profit increase due to the gain on transfer. That concludes my financial part.
Thank you, Chikashi. My name is Nacho Abia, Chief Operating Officer of Olympus Corporation, and today I would like to provide you some information about our gastrointestinal endotherapy business for current and future growth drivers. Next slide, please. Last quarter, we presented to you the three therapeutic areas where Therapeutic Solutions Division is focused for growth: GI Endotherapy, urology and respiratory. We also discussed about the targeted clinical areas and procedures where each of these Olympus business units are focused and where we believe we can elevate the standard of care as the core of our strategy. Today, we are going to proceed with a deep dive in our endotherapy business and in how Olympus is planning to continue growing this segment. Next slide, please. The GI Endotherapy business focuses on both major GI diseases areas.
Pancreaticobiliary disease, often referred to by a common procedure, ERCP, and gastric diseases, which could be either colorectal or gastric. In addition to these diseases, Olympus offers solutions that are used across GI diseases, most notably our visualization portfolio and our hemostasis portfolio. Collectively, the worldwide opportunity for GI Endotherapy solutions is in excess of JPY 300 billion, growing annually at mid-single digits. This is a great market segment for Olympus to be competing in, and where we believe we have a strong right to win, right to win. There are a few things to consider. Pancreaticobiliary disease affects 60 million patients annually, representing an estimated larger than JPY 100 billion worldwide opportunity. Colorectal cancer is the second leading cause of cancer death, with more than 50 million colonoscopy procedures performed annually to detect and diagnose cancer.
Most of you will recognize Olympus as the market leader in visualization, and it goes without saying that you must first be able to see inside the body in order to conduct any kind of minimally invasive therapy. The demand for novel and improved visualization features and solutions is ever-present. This offers us strong synergies and opportunities to maximize value to our customers in both visualization and endotherapy solutions. Additionally, the hemostasis segments to control and stop bleeding is the number one expense in a typical GI industry, is an opportunity worth more than JPY 100 billion globally. Hemostasis is one place where there are significant pressures to improve, both clinically and economically.
Hopefully you can share our view that the Olympus GI Endotherapy business is involved in some very exciting market segments, and our experience and customer relations in GI field offer us a great opportunity to succeed. Next slide, please. As stated on the previous slide that the GI Endotherapy business is involved in very attractive markets. What we're going to discuss now is about some of the specific products and solutions we successfully have introduced in those markets. In totality, Olympus is the No. 2 player in the market, which represents approximately 50% of the Therapeutic Solutions Division revenue. Thinking about the GI diseases first, we spoke last time about the strong position that Olympus has in guidewires and sphincterotomes in pancreaticobiliary disease. VisiGlide and CleverCut 3V are the global market leaders for each of those categories, respectively.
When you consider the rest of the portfolio of products needed to complete an ERCP procedure, Olympus has a highly differentiated and extensive portfolio, including fine needle aspiration and biopsy needles, and intraluminal balloons and baskets, among other devices. Moving to the GI tract, let's talk first about ENDOCUFF, which Olympus acquired as part of the Arc Medical acquisition. This innovation enables GI physicians to recognize a polyp when performing a colonoscopy more quickly and easily. This single-use device is opening a whole new product category because it has been clinically proven to improve adenoma detection rate, which as you know, is an important quality metric for measuring polyp recognition that has been adopted globally by the leading clinical guidelines. Endoscopic submucosal dissection, or ESD, is also a high-growth procedures for GI tract diseases.
Olympus was an early innovator in ESD and continues to have the number one market position. Olympus has the broadest portfolio of ESD products, including knives, forceps, injection needles, and traction devices. In visualization, Olympus is the undisputed number one market leader, and we are also developing a single-use colonoscope, which will further build out of our broad portfolio of ERCP tools, while giving physicians another differentiated demanding solution. Lastly, in the hemostasis segment, Olympus offers a comprehensive portfolio of endoscopically delivered products designed to stop bleeding quickly and effectively. Olympus has the broadest portfolio of products in this category, and it's also the only supplier that offers both reloadable and preloaded clips to address a variety of physician preferences and patient conditions.
Since this segment is an area of Olympus that might not be well known to many of you, let's take a deeper look into our hemostasis strategy. Next slide, please. Olympus has been innovating in the hemostasis segment for a long time. Over the years, Olympus has developed a broad portfolio of hemostasis solutions to serve the various clinical needs of physicians, such as our first to market and popular QuickClip family of preloaded clips. We want to talk today about our more recent innovation, and there is a lot that has been done in this area in recent years. In 2019, Olympus introduced its argon plasma coagulation probes, which use the proprietary smart argon algorithm to automatically detect the distance of the probe to the tissue and precisely adjust the power level for optimal hemostasis.
In 2020, Olympus was also the first company to offer a reloadable clip in the USA when it launches an updated EZ Clip. A reloadable clip can improve procedural efficiency and be more cost effective as the applicator handle can be reused with multiple clips, instead of having to use a new handle with new clip, and this can offers healthcare facilities savings in ERCP procedures which requires more than one clip. More recently, this year in 2022, we have launched two new products to the market. SutuArt, which is now available in Japan and Europe, the first product of its kind for suturing through an endoscope. EndoClot, also now available in the U.S. It's a powder that is delivered through an endoscope to stop bleeding.
EndoClot is exciting as the hemostasis powder market is in its early days and growing very quickly. Clinical studies have shown EndoClot to be effective at stopping small bleeds on its own, as well as stopping any procedural bleeding which, when used with other hemostasis products, such as our QuickClip family. One factor standing out to our U.S. customers about EndoClot is that it's eligible for additional reimbursement through December 2023 with the CMS Transitional Pass-Through Payment Program. That's all from me today, but I hope from this overview you can clearly see that Olympus has many opportunities to leverage the strong position in GI endoscopes to also provide complementary and innovative endotherapy devices that help elevate the standard of care. Thank you very much.
We'll now move to the Q&A session. Before we do that, we would like to answer the questions that have been brought to us before this. During the H1 compared to the internal plan, how was the results, and what is your view for the H2 ? On this particular question, our CFO, Takeda, will respond. Thank you. I did respond partially in my presentation, so I might be repeating myself. Bear with me. Compared to the internal plan in terms of revenue, almost on par. TSD, ESD, some differences, but on a consolidated basis, almost on par with the internal plan budget. The foreign exchange. Based on last year's foreign exchange, when we use last year's on a constant currency basis, some points, or you might feel that the growth rate is not that large.
As I said, the semiconductor supply shortage risk and Shanghai lockdown and Ukraine situation, we were impacted by these factors during the H1 as anticipated. If we exclude those factors, the growth rate should have been 5% or 6%. As expected, the growth may seem low year-on-year, but this is due to the external factors, external risk factors. That was the biggest factor. For the H2 revenue. First, globally, the number of procedures is recovering, and we expect to return to the pre-COVID level. For ESD, the effect of X1, the new launch in Japan, Europe, and Asia, the launches have been made, and they're still growing.
In the US, in the H2 of this fiscal year, the launch will be made. VISERA ELITE III launched in Japan and Europe for surgical therapy. We believe this will be another positive. ESD again increased recovery and procedure. New products, SOLTIVE and Plus, they are driving the growth, and we continue to expect. The effect of Shanghai lockdown. In the H1 , we saw a severe impact, but for the H2 , what was not executed in the H1 , the budget, we expect it to be executed. We expect some restrictions on some supply will be recovered. In fact, in terms of the bidding, we see year-on-year growth expected.
More recently, the Chinese government is expected to provide low-interest rate loans to some companies. We expect a budget to be executed in Q3 to Q4. For the H2 , 2% on a constant currency basis, this 2% in the H1 to be raised to 6% on a full year basis, and this should come from the recovery in the H2 . We expect this could be achieved given the reasons I cited. In terms of expenses, the cost of sales, more or less, we were expecting the materials prices to go up, but it was going up faster than we expected. As for expenses, there are many factors for increase and decrease. With those ups and downs, looks like the flexibility of that has changed.
It's not a big issue on a company-wide basis, but more individually, the inflation is affecting. With that affecting, we are losing flexibility in operation, which is pushing up expenses somewhat. Overall, it is within our expectation, but we need to keep an eye on that. That was a trigger for the increase in expenses in our revised forecast. One of the assumptions for achieving the forecast is there are some cost increases that we need to accept, but at the same time, cost reduction measures are to be enhanced further. The four items that I mentioned in my presentation, we'll be focusing on those over the remaining five months to keep the optimal level of expenses. I apologize for the long response.
We would like to open the floor for questions. Maybe I should ask Takeda, but on page 26, there is a bridge analysis, and this is for the H1 , and you don't have one for Q2 . Q2 , maybe the microscope is not included. Yes. The cost fluctuation, this was about JPY 4 billion in the H1 . If we exclude this in the Q2 , JPY 4.3 billion fluctuation in terms of costs and mixed improvement and also capacity utilization improvements are difficult to understand from outside perspective. Sometimes we try to include that in our analysis. Endoscopy EGD sales ratio actually is increasing compared in Q2. I suspect that there was maybe a mix improvement, but the cost of sales fluctuation is not really changing, so maybe you're not really doing anything about the inflation impact.
Can you please break this down for me? JPY 1 to 1.5 billion was semiconductor price increase in the Q1 . In China, Q1 , there was a big decline. I think there was a slight decline again in this quarter. But I'm sure that you're making efforts on the other hand, so the cost of sales changes. Can you please break this down for me? That's my first question. Thank you for your question. If you break this down, approximately half is related to raw materials cost increase, more than 50%, I would say, according to our analysis. Then we have China. China is actually doing relatively well. In the consolidated statement, the sales ratio is still low. Maybe this is approximately JPY 1 to 1.5 billion yen impact, according to my memory.
The rest is made up of various factors. On the other hand, improvements have been planned. We're talking about JPY 1 billion or JPY 1.5 billion in that range for the full year, which means that we don't really see the impact of that on this slide yet. That would be my answer. Half of this is raw materials, so JPY 4 billion. This is not just semiconductor, but also other materials going up in price. That's correct. What are they and what will happen to them going forward? JPY 1 to 1.5 billion yen improvement, maybe this is probably pass-through to your selling price. Is that correct? First of all, this is cost of material, and the majority of that, of course, is the semiconductors. Other parts and components are also going up in price.
That's one point that I want to clarify. Then what was the rest of your question? JPY 1.5 billion are you going to pass through to your selling price? Are you going to improve the product mix? Yes. Volume and also improvement activities. Those are the things that are being planned, but it will be bunched under others here. I cannot really provide you with a more detailed analysis. This is something that we are doing as part of our normal activities. The raw material cost has gone up, and especially in the H1 . Structurally, if we see a decline in China, this ratio does deteriorate. That is the uniqueness of the company. That's very clear to me. Thank you.
As far as price increase, selling price increase is concerned, it will take time before we see the impact of the price hike. Contract-based business is about 80% of the total, which means that we have a 1-year, 2-year, or 3-year contract, and we have to wait for the renewal of the contract in order to revise the pricing. Which means that it will take some time, according to assessment, but we believe that it will be effective in the future. The price is basically not included in this bridge slide. That's very clear to me. Thank you.
I'm looking at slide 17. Looking from outside, what you're showing in terms of operating income, JPY 231 billion, and you're saying that this has changed because you are just looking at the continuing operations. It says minus 1.5 here. Given the size of the operation, JPY 1.5 billion reduction is only 0.7%. You could have made up for this through others. You are showing JPY 1.5 billion reduction. And that really catches our attention, which sends out a wrong message, I'm afraid. Why did you do this? Thank you. This is Takeda. Well, every quarter we review and revisit forecasts and try to have a good fidelity in terms of what we think would be a more accurate forecast. Having said that, billions of yen difference.
You're saying that maybe we should have kept the earlier revision. I think that's what you are alluding to. As I said, I think in my presentation. Especially materials prices and, SG&A, ex, flexibility being lost. That was already felt and, visible in the H1 , and we felt that that should be reflected in our full year forecast. It is based on that thinking that we have made this revision. Of course, before getting to this number, there were pluses and minuses which were very thoroughly studied. We decided that this factor should be kept as a revised forecast, thus JPY -1.5 billion. I see. Thank you. A follow-up question.
Looking at slide 18 for discontinued JPY 17.5 billion operating profit, but for the Q1 , from what we can see, it was JPY 26.5 billion for scientific solutions. To 26.5, but now you're saying it was 17.5. Why is this disclosed figure different, the operating profit? Revenue JPY 145 billion. No change. No change in revenue even with that three-month difference? Let us check, and we'll come back on this. Earlier, there was a question regarding the scientific solutions full year forecast. The August forecast, and JPY 145 billion yen revenue, only profit has changed from JPY 26.5 to 17.8 billion yen. Regarding this was just the forecast announced in August. We are talking about the full year forecast, so we're including all four quarters.
Initially, on a consolidated basis, expenses in corporate, the cost related to the divestiture or separation of Scientific Solutions that have been included retroactively. 26.5 billion operating profit was the forecast in August, but the cost for separation is now included in the discontinued, and that's why 17.5.
Page 17, JPY 1.5 billion operating profit revision. Can you please the factor analysis on this, negative impact from material cost and maybe JPY 3 to 4 billion positive impacts from FX and cost reduction measures, semiconductor or market unrelated? For example, maybe you have made some strategic investments and invested into stronger platform, perhaps. Can you please do a factor analysis on this JPY 1.5 billion for us? Thank you.
JPY 1.5 billion, we have already discussed this to some extent with the earlier question. As far as the company management is concerned, FX impact excluded is the starting point when we do the calculation. This is billions of yen, which is not a large amount, so we usually don't really talk about this, but we have made a revision this time. Therefore, I would like to provide some simple explanation. After adjusting for FX, if we calculate this at constant exchange rate, JPY 3.6 billion in revenue. This is 0. something% difference. Also, gross profit is JPY -36, I think. 3.6%. Operating profit would be JPY -8.7 billion. Adjusted operating profit goes to the bottom is JPY -8.3 billion.
If we apply the same exchange rate as the previous time, this is the number. JPY -1.5 billion operating profit and after adjustment, JPY -1 billion. This is after applying the FX. Revenue is increased, but gross profit is decreasing. This is mainly due to increase in the materials cost, among others. Down to JPY 8.7 billion, this is basically increase in SG&A. Increase of certain factors and increase of specific numbers, it's not that simple in terms of relationship. We have many new projects, and we have many old projects disappearing, and we have to face new challenges all the time. It is very difficult to pinpoint where these numbers are coming from. QARA enhancement cost is one example.
Also delayed development, making some impact, but this is not the specific reason why the number is going up. There is not necessarily a very direct relationship.
Go again.
One follow-up question. Material-wise on quarter basis, JPY 2 billion approximately. Is that the amount of increase that we should understand? Yes. On a quarterly basis, that would be the right sensitivity level. That's all. Thank you.
Takeuchi-san, thank you for all your work. I know you're gonna be there for quite a while, but I'd like to take this opportunity to thank. Looking back on Transform Olympus and also the future, the Transform Olympus, especially when the corporate strategy was announced as focus and simplify, you said, was what you need to focus on, and focus and perform was another pillar. High-performance culture to take root and strengthening your functions, all of the initiatives that you were talking about then, I think have all but been completed. Are there any remaining items that are not visible to us? Any remaining items that need to be achieved? And also, Stefan, the new CEO, I have a question for you as well.
As the next step to the past three years, Compete to Grow is the important phase, and you are thinking a proactive M&A, proactive investments that was indicated previously. I'd like to know if this remains unchanged under your leadership. If, in terms of business development, if there are anything you could add, I'd like to hear about that as well from Nacho. Initially, when we presented Transform Olympus for corporate transformation, really transformation throughout the company. If you just focus on some key points, what you mentioned are how my intentions were interpreted. Of course, the effect is being felt in many different aspects.
At the board of directors, we have now shifted to the nominating committee and other governance related things. Efficiency improvement is another area. When we started, imaging, SSD were fully operational. Looking back at the history, optical technology and precision manufacturing and processing technology-driven innovation has been the main thrust. That essence, of course, will remain unchanged. We are not a purebred medical device company, and so it's not something that transformation cannot be done overnight. I think this will relate to the next phase of compete to grow to become a truly med tech company, the efforts to do so. As Takeda-san mentioned when he talked about various expenses, the QARA element was picked. Of course, that's one area where we will continue to work on.
As for investments, of course, R&D would be important. Leading global med tech is the major goal for Transform Olympus, and that remains unchanged. Capability building, capability enhancement type of investments towards that will continue.
Yeah, thank you very much for the question. While at this stage, I will not be able to outline our strategy to compete to grow in detail because we are at the moment in the process to develop this. As Yasuo Takeuchi mentioned in his words of introduction, the reason why we announced leadership change so early is that Yasuo Takeuchi wants the new leadership team to own the process of strategy development and to be accountable for the execution of the strategy. I think I still can answer your question in general terms. I think there are three ways to grow and to create value. One obviously is through innovation, that means organic growth.
The second way is through M&A, and the third one is extending our reach to areas where we see that there's still a lot of unmet need to satisfy. I'm currently in Singapore on a business trip, and I just met before our call with the chairman of the Endoscopic and Laparoscopic Surgeons of Asia. We are one of the main supporters of this association. The purpose of this association is to improve healthcare access and healthcare standards in emerging markets.
Just this meeting with this professor was so inspirational for me that I'm honestly speaking, not worried that we cannot find areas to compete, to grow and to create value and to serve our purpose to make life of people healthier, safer, and more fulfilling. That's very general and more to come in the H1 year of 2023 when we will be able to outline our strategy in a more granular level to you.
Over the last years, I've been devoting my time to help the company and to help the executive team to move ourselves into this direction of becoming a global leading medical technology company. Within many aspects we are already, but in many aspects still there is a lot of work to do. My job over the last three years as chief operating officer and still for the next six months or five months has been to make sure that our divisional medical board, Endoscopic Solutions Division, and Therapeutic Solutions Division started and implemented the changes that would allow us now to be on this starting this commit to growth new era.
I believe that over the last years, a lot of improvements has been done in our product development capabilities, in our portfolio discussions in our, in the areas we compete. The good thing is that, there's still a lot to do. Even the last three years results has been excellent. I think from the execution point of view, and the corporate strategy, I think there's still much more to come.
In my new role, what I would focus more would be to continue helping more from a corporate point of view, but to continue helping the divisions in order to realize their strategies and putting in place all the different tactics and strategies that has been developed over the last years. Also to make sure that from the entire view of the corporation, I think that we don't leave any stone unturned in order to identify potential areas to grow. I think that it will be a natural evolution of flattening a little bit the organization and elevating the level of the divisions, which I think now they are mature to report directly to the CEO.
at the same time, I think that we're still gonna need a solid corporate strategy around our journey to become a even greater medical technology leader in this space. This is what my contribution I hope will be over the next years. Thank you very much.
I have a question on materials, prices, cost, and semiconductor shortage. Capital equipment companies say that the impact of semiconductor shortage will be felt more during the H2. The high-priced semiconductors were purchased and they are now inventories, and they'll be using those to manufacture in the H2 . Therefore, they're going to feel the effect more strongly in the H2 . I'm wondering if that is the case with Olympus as well. Has the impact of materials cost and semiconductor shortages been exhausted during the H1 , or should you expect more impact in the H2 ? Thank you. Takeda will respond. The semiconductor shortages. Of course, we've been talking about that even before the start of this fiscal year.
We considered that to be a major risk, so we set up a special team for that to consider and implement various actions. In that process, procuring the supplies we can't secure or get from the ordinary suppliers, so we needed to procure from the spot market sometimes. I can't really recall the exact timing, but from rather early on to secure the necessary amount in addition to the regular distribution supply channel, we secured through the spot market as well. We are using the total average method. What we procure are reflected in the selling prices. What we procured from the spot market had the biggest impact, and several times during the H1 , we secured through that channel. In the H2 , we might.
We plan to resort to the same method. It's not that there is a contrasting difference between the H1 and H2 . I see. Thank you. A follow-up question. In slide on ESD segment, I think you skipped that page for GI. I think there was a slide separating different divisions and opportunity loss due to the semiconductor, and I think that's only for SE, surgical endoscopy. But in terms of revenue, it did not have much impact on GI, only SE? Would that be a fair statement? If this is the slide that you are looking at, and if that is your interpretation, no, that is not the correct fair statement. GI was impacted as well. I see. Thank you. That's all.
We do apologize that we overshot the schedule, but we would like to conclude the Q&A session. That concludes our earnings announcement for Olympus. Thank you very much for taking time out of your very busy schedule to join us today. Thank you and goodbye.