Risk of construction work suspensions, project schedule extensions and worsening order conditions due to COVID-19

「Japan's economy saw signs of recovery in capital investment and corporate earnings as social and economic activity moved toward normalization following the reclassification of COVID-19 as a Category 5 disease under the Infectious Diseases Act.」

「Although Japan's economy remains in a difficult situation due to the impact of COVID-19,」

「The business environment surrounding our Group remains challenging, as competition for orders for power-related infrastructure construction has intensified and private-sector capital investment has contracted or been postponed due to the COVID-19 pandemic.」

「Revenue amounted to ¥5,951.4 million, down 10.5% year on year, despite progress on cogeneration equipment construction and safety-related work at nuclear power plants, due mainly to a decline from the previous fiscal year in construction work for large-scale thermal power and solar power equipment, as well as the postponement or cancellation of customers' construction plans because of the spread of COVID-19.」

「Meanwhile, sales were ¥39,657 million, down 11.6% year on year, as construction work for nuclear power generation facilities' safety measures and cogeneration facilities increased, but construction work for thermal power generation facilities and solar power generation facilities declined, while construction plans were postponed or cancelled due to the spread of COVID-19.」

「There have been no material changes to the assumptions described in the additional information to the securities report for the previous fiscal year, including assumptions regarding the future spread of COVID-19 and the timing of its end.」

「Japan's economy is experiencing constrained economic activity due to the spread of COVID-19 and the resulting calls for people to refrain from going out, with corporate earnings and personal consumption declining rapidly. The outlook is extremely uncertain.」

「As the timing of the end of the global spread of COVID-19 remains uncertain, construction suspensions and project delays, as well as deterioration in the order environment due to the stagnation of economic activity, are among the potential impacts. If these risks materialize, they could have a material impact on the operating results and other aspects of the Group's performance.」