Recognition of Extraordinary Loss (Provision for Doubtful Accounts) and Impairment of Shares in an Affiliated Company (Shares in an Associate Accounted for Under the Equity Method)
Wedge Holdings CO.,LTD., Showa Holdings Co.,Ltd., Group Lease Public Company Limited (GL), ENGINE HOLDINGS ASIA PTE. LTD. (EHA), and 株式会社日本橋本町菓子処
Loans and other receivables from Showa Holdings Co.,Ltd., shares in GL, loans to EHA, and receivables held by EHA
Showa Holdings Co.,Ltd.'s financial condition, its petition dated 17 July 2026 for commencement of corporate rehabilitation proceedings, and the issuance of an order for preservation administration. With respect to GL, the first-instance judgment in the lawsuit filed by J Trust Asia Pte. Ltd., GL's performance, and the progress of other related litigation.
Consolidated financial statements: ¥1,384 million in extraordinary loss (provision for doubtful accounts) and ¥1,255 million in non-operating expenses (equity-method investment loss). Non-consolidated financial statements: ¥1,917 million in extraordinary loss (provision for doubtful accounts). Breakdown: ¥1,174 million relating to Showa Holdings Co.,Ltd.; ¥742 million in loans to EHA associated with the impairment of the GL shares; ¥209 million in EHA's provision for doubtful accounts; and ¥247 million in equity-method investment loss associated with the impairment of the GL shares.
The cumulative third quarter and full fiscal year ending September 2026
The adjustment is expected to affect results for the cumulative third quarter and full fiscal year ending September 2026. Information concerning revisions to the earnings forecast is Not disclosed.
¥1,174 million in loans and other receivables from Showa Holdings Co.,Ltd., ¥742 million in loans from the Company to EHA, and ¥209 million in receivables held by EHA
Related procedures
First-instance judgment in the damages claim lawsuit filed by J Trust Asia Pte. Ltd., Showa Holdings Co.,Ltd.'s petition for commencement of corporate rehabilitation proceedings, and the issuance of an order for preservation administration
J Trust Asia Pte. Ltd.（JTA）
Group Lease Public Company Limited (GL)
Payment of a total of 5,522,400,000 baht (approximately ¥26.4 billion)
Company response
Discussions with Aria Audit Corporation. The establishment of a third-party committee or special investigation committee is Not disclosed.
The Company will not waive its receivables from Showa Holdings Co.,Ltd. and will continue legal proceedings and other measures to recover them. The Company will also continue to assert its legal position in the main action and other proceedings. GL intends to contest the first-instance judgment on appeal, and the Company will continue to monitor GL's performance and the progress of related litigation.
| Item | Details |
|---|---|
| Event name | Recognition of Extraordinary Loss (Provision for Doubtful Accounts) and Impairment of Shares in an Affiliated Company (Shares in an Associate Accounted for Under the Equity Method) |
| Date of occurrence | 14 August 2026 (the date on which the Company decided to recognize the accounting adjustments). The related petition by Showa Holdings Co.,Ltd. for commencement of corporate rehabilitation proceedings and the issuance of an order for preservation administration occurred on 17 July 2026, and the announcement concerning the judgment involving GL was made on 10 August 2026. |
| Subject Entity | Wedge Holdings CO.,LTD., Showa Holdings Co.,Ltd., Group Lease Public Company Limited (GL), ENGINE HOLDINGS ASIA PTE. LTD. (EHA), and 株式会社日本橋本町菓子処 |
| Target Locations / Products | Loans and other receivables from Showa Holdings Co.,Ltd., shares in GL, loans to EHA, and receivables held by EHA |
| Cause | Showa Holdings Co.,Ltd.'s financial condition, its petition dated 17 July 2026 for commencement of corporate rehabilitation proceedings, and the issuance of an order for preservation administration. With respect to GL, the first-instance judgment in the lawsuit filed by J Trust Asia Pte. Ltd., GL's performance, and the progress of other related litigation. |
| Amount of Impact on Business Performance | Consolidated financial statements: ¥1,384 million in extraordinary loss (provision for doubtful accounts) and ¥1,255 million in non-operating expenses (equity-method investment loss). Non-consolidated financial statements: ¥1,917 million in extraordinary loss (provision for doubtful accounts). Breakdown: ¥1,174 million relating to Showa Holdings Co.,Ltd.; ¥742 million in loans to EHA associated with the impairment of the GL shares; ¥209 million in EHA's provision for doubtful accounts; and ¥247 million in equity-method investment loss associated with the impairment of the GL shares. |
| Accounting period in which recognized | The cumulative third quarter and full fiscal year ending September 2026 |
| Impact on Earnings Forecast | The adjustment is expected to affect results for the cumulative third quarter and full fiscal year ending September 2026. Information concerning revisions to the earnings forecast is Not disclosed. |
| Type of litigation or proceeding | First-instance judgment in the damages claim lawsuit filed by J Trust Asia Pte. Ltd., Showa Holdings Co.,Ltd.'s petition for commencement of corporate rehabilitation proceedings, and the issuance of an order for preservation administration |
| Plaintiff | J Trust Asia Pte. Ltd.（JTA） |
| Defendant | Group Lease Public Company Limited (GL) |
| Date of filing / date of action | 17 July 2026 (the date of Showa Holdings Co.,Ltd.'s petition for commencement of corporate rehabilitation proceedings and the issuance of the order for preservation administration). The filing date and judgment date of the JTA lawsuit are Not disclosed. |
| Claim amount / surcharge amount | Payment of a total of 5,522,400,000 baht (approximately ¥26.4 billion) |
| Amount of receivables at risk of non-collection or delayed collection | ¥1,174 million in loans and other receivables from Showa Holdings Co.,Ltd., ¥742 million in loans from the Company to EHA, and ¥209 million in receivables held by EHA |
| Investigation structure | Discussions with Aria Audit Corporation. The establishment of a third-party committee or special investigation committee is Not disclosed. |
| Outlook | The Company will not waive its receivables from Showa Holdings Co.,Ltd. and will continue legal proceedings and other measures to recover them. The Company will also continue to assert its legal position in the main action and other proceedings. GL intends to contest the first-instance judgment on appeal, and the Company will continue to monitor GL's performance and the progress of related litigation. |
Items this document does not state (9)
These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.
The reasons the company gives
The company's own explanation, not something inferred from the numbers.Following discussions with Aria Audit Corporation, the Company reviewed the collectibility of the receivables in light of Showa Holdings Co.,Ltd.'s financial condition, its petition for commencement of corporate rehabilitation proceedings, and the issuance of an order for preservation administration. As a result, the Company decided to recognize a provision for doubtful accounts covering the full amount of the relevant receivables. In addition, in light of the first-instance judgment received by GL in a damages claim lawsuit, GL's performance, and the progress of related litigation, the Company reassessed the intrinsic value of the GL shares and the collectibility of receivables held by EHA.