Financial Covenants Associated with Acquisition Financing
First written in FY2016. 7 of 21 entries say "Restated". Latest entry: FY2026-H1.
5 other companies' latest entry also says "Reframed".
- FY2026-H1ReframedAnnual report
「Financial covenants: ① Maintain the amount of net assets on a consolidated and unconsolidated basis at or above 75% of the higher of the amount at the end of the fiscal year ending March 2025 or at the end of the most recent fiscal year. ② Do not record ordinary losses on a consolidated or unconsolidated basis for 2 consecutive fiscal years.」
The new agreement refinancing the bridge loan for the Arnetz acquisition into long-term borrowings also includes financial covenants requiring net assets to be maintained at 75% or more and prohibiting ordinary losses for 2 consecutive fiscal years. - FY2025MitigatedAnnual report
「For the current consolidated fiscal year, consolidated results were net sales of ¥6.099403 billion, down 17.3% year on year, operating income of ¥527.550 million, compared with an operating loss of ¥185.329 million in the previous year, and ordinary income of ¥543.866 million, compared with an ordinary loss of ¥168.112 million in the previous year.」
The Company moved from recording losses through the previous year to operating income and ordinary income, while net assets increased to ¥3.227763 billion. Although resolution of the financial covenant breaches was not explicitly reported, the disclosed results indicated an improvement in its financial condition. - FY2024WorsenedAnnual report
「The Group recorded ordinary losses for 2 consecutive fiscal years in its unconsolidated and consolidated statements of income. ... Accordingly, it was in breach of the financial covenants under the term loan agreements and commitment line agreements entered into with its lending financial institutions.」
The breach of the financial covenants for the term loans and commitment line was explicitly reported for the full fiscal year as a result of ordinary losses for 2 consecutive fiscal years. The financial institutions responded that they would not demand the loss of the benefit of time. - FY2024-Q2RestatedAnnual report
「During the cumulative second quarter under review, there were no significant changes in the matters described in this quarterly report regarding the business and accounting conditions that management recognizes could materially affect the financial position, operating results and cash flows of the consolidated companies, or in the “Business and Other Risks” described in the securities report for the previous fiscal year.」
The Company stated that there had been no material changes in the financial covenants related to acquisition financing borrowings and syndicated loans. - FY2023-Q2MitigatedAnnual report
「Cash used in financing activities was ¥741.541 million, a decrease of ¥676.931 million from the same period of the previous year. This was mainly attributable to ¥459.962 million in repayments of long-term borrowings and ¥275.193 million in dividend payments.」
The Company repaid ¥459.962 million in long-term borrowings, and current maturities of long-term borrowings also decreased by ¥96.666 million. Its financial position continued to improve in relation to the borrowing burden and financial covenants. - FY2022-Q3MitigatedAnnual report
「This was mainly due to a ¥1.4 billion decrease in short-term borrowings resulting from repayments.」
In relation to the financial covenants and borrowing burden, short-term borrowings decreased by ¥1.4 billion, and current liabilities decreased by ¥1.134459 billion from the end of the previous consolidated fiscal year. - FY2021MitigatedAnnual report
「As a result, the current ratio, which measures the balance between current assets and current liabilities, was calculated at a higher level, and the Company's financial position improved substantially.」
The Company disclosed improvements in liquidity and its financial position related to the financial covenants by shifting borrowings scheduled for short-term repayment to long-term borrowings through the effective renewal of the M&A loan, together with a third-party allotment. - FY2021-Q3MitigatedAnnual report
「During the third quarter of the consolidated accounting period, the Company entered into a syndicated loan, effectively renewing the M&A loan executed in December 2015, and made repayments. Current liabilities decreased by ¥2.145609 billion in current maturities of long-term borrowings and ¥200 million in short-term borrowings, while non-current liabilities increased by ¥1.792253 billion in long-term borrowings.」
The Company entered into a syndicated loan that effectively renewed the M&A loan, shifting near-term repayment obligations from short-term borrowings to long-term borrowings. The Company explained that its financial position related to the breach of the financial covenants had improved. - FY2021-Q2RestatedAnnual report
「During the previous consolidated fiscal year, the Company was in breach, among other matters, of the financial covenant requiring net assets to be maintained at 75% of the net assets at the borrowing base fiscal year or at the end of the second preceding consolidated fiscal year.」
The breach of the covenant requiring net assets to be maintained at 75% or more continued. Although agreements had been reached with financial institutions not to exercise their rights to demand the loss of the benefit of time, and an increase in net assets through a third-party allotment was also expected, the breach had not been reported as resolved as of the quarter-end. - FY2020WorsenedAnnual report
「At the end of the current consolidated fiscal year, the Company was in breach of the financial covenant requiring net assets to be maintained at 75% of the net assets at the borrowing base fiscal year or at the end of the previous consolidated fiscal year, due to the recording of a consolidated ordinary loss of ¥992.013 million and restructuring expenses of ¥184.634 million at a U.S. subsidiary.」
The breach of the financial covenants continued and became explicit, caused by the full-year consolidated ordinary loss and restructuring expenses at the U.S. subsidiary. - FY2020-Q2RestatedAnnual report
「During the first six months of the current consolidated fiscal year, there were no newly arising business or other risks. In addition, there were no material changes to the business and other risks described in the annual securities report for the previous fiscal year.」
The Company stated that there had been no new financial covenant breaches or material changes related to acquisition financing borrowings and syndicated loans. - FY2019-Q2RestatedAnnual report
「Through the previous consolidated fiscal year, the Group had been in breach of the financial covenants under its loan agreements with financial institutions as a result of recording consolidated ordinary losses for 2 consecutive fiscal years.」
The breach of the financial covenants continued to be attributed to ordinary losses for 2 consecutive fiscal years in the past, while the agreement that the financial institutions would not exercise their right to demand the loss of the benefit of time also remained in place. - FY2019-Q1MitigatedAnnual report
「As a result of the decisions of the respective financial institutions, an agreement has been reached not to exercise the right to demand the loss of the benefit of time, and we have determined that no material uncertainty exists regarding the going-concern assumption.」
Although the breach of the financial covenants remains, the Company confirmed that an agreement with the financial institutions prevents the right to demand the loss of the benefit of time from being exercised. - FY2018WorsenedAnnual report
「During the current consolidated fiscal year, the Group was in breach of the financial covenants under its loan agreements as a result of recording consolidated ordinary losses for 2 consecutive fiscal years in relation to items ① through ⑦ above.」
Breaches of financial covenants under multiple loan agreements continued and became explicit as a result of consolidated ordinary losses for 2 consecutive fiscal years. - FY2018-Q3ReframedAnnual report
「At a meeting of the Board of Directors held on 22 December 2017, the Company resolved to enter into a commitment line agreement arranged by The Bank of Tokyo-Mitsubishi UFJ, Ltd. to secure flexible working capital financing as the business expanded. The agreement was executed on 17 January 2018, and the Company borrowed ¥1 billion on 22 January 2018, the drawdown date.」
The Company entered into a new ¥1.3 billion commitment line agreement as its business expanded and borrowed ¥1 billion. The facility includes financial covenants requiring net assets to be maintained at 75% or more and prohibiting ordinary losses for 2 consecutive fiscal years. - FY2018-Q2RestatedAnnual report
「No new business or other risks arose during the six months ended 30 September. There were also no material changes to the business and other risks described in the securities report for the previous fiscal year.」
The Company explained that there had been no new financial covenant breaches or material changes related to acquisition financing borrowings and syndicated loans. - FY2018-Q1RestatedAnnual report
「During the first quarter of the current consolidated fiscal year, there were no newly arising business or other risks. In addition, there were no material changes to the business and other risks described in the annual securities report for the previous fiscal year.」
The Company explained that there had been no new financial covenant breaches or material changes related to acquisition financing borrowings and syndicated loans. - FY2017MaterialisedAnnual report
「The Company is in breach of financial covenants as a result of recording a consolidated ordinary loss for the current consolidated fiscal year, but has obtained the consent of the lending financial institution that serves as arranger and agent for the commitment line not to exercise its right concerning the loss of the lenders' obligation to provide funds.」
The recording of a consolidated ordinary loss resulted in an actual breach of the financial covenants for the commitment line. The Company also stated that it had obtained the financial institution's consent not to exercise its rights. - FY2017-Q3RestatedAnnual report
「No new business or other risks arose during the cumulative third quarter under review. In addition, there have been no material changes to the business and other risks described in the annual securities report for the previous fiscal year.」
The Company explained that there had been no material change in the existing risks related to financial covenants for acquisition financing borrowings and syndicated loans. - FY2017-Q1ReframedAnnual report
「① At the end of each fiscal year, the total amount of net assets in the unconsolidated and consolidated balance sheets must be maintained at or above 75% of the higher of the total amount of net assets at the end of the fiscal year ended March 2016 or at the end of the previous fiscal year.」
Similar financial covenants were established not only for acquisition financing borrowings but also for syndicated loans for working capital. - FY2016First statedAnnual report
「At the end of each fiscal year, the total amount of net assets in the unconsolidated and consolidated balance sheets must be maintained at or above 75% of the higher of the total amount of net assets at the end of the fiscal year ended March 2015 or at the end of the previous fiscal year.」
The Company disclosed covenants for borrowings related to the EvD acquisition financing, including maintaining net assets at 75% or more and avoiding ordinary losses for 2 consecutive fiscal years. If a covenant is breached, the borrowings must be repaid in full.