Decline in usage due to fluctuations in the supply, demand and prices of fresh produce

「On the domestic agriculture and production side, the risk of declining agricultural production and unstable supply caused by damage from abnormal weather, including record-high temperatures, as well as pests, diseases and wildlife damage, is becoming a persistent feature of the operating environment.」

「Apple collection volumes for the 2023 crop were insufficient due to adverse weather and other factors, resulting in lower revenue. … Procurement of domestic products remained unstable due to adverse weather and other factors, and efforts were made to strengthen the procurement structure.」

「Regarding the apple and domestically produced fresh-produce sales business, insufficient collection volumes of apples from the 2023 crop due to adverse weather and other factors resulted in lower revenue year on year.」

「Because the volume of apples from the 2023 crop that could be collected was insufficient compared with the previous year due to adverse weather and other factors, shipments were made earlier than originally planned in consideration of quality, and efforts were made to sell the apples at higher prices.」

「On the other hand, delays in various plans due to labour shortages, poor crop growth caused by recent abnormal weather, the resulting decline in market distribution volumes and insufficient procurement volumes led to lower revenue and lower profit.」

「Regarding the organic agricultural-product sales business, procurement was intermittently unstable due to weather-related quality problems and other factors, but strong sales of imported organic products drove overall revenue growth.」

「Regarding the organic agricultural-product sales business, procurement of the main product, organic bananas, was temporarily unstable due to weather-related quality problems and other factors, but recovered.」

「In the subsidiary's organic agricultural-product sales business, there were temporary supply-chain disruptions and quality problems affecting imported organic products such as bananas, the main products, but conditions recovered. Spot sales of processed products and other items also contributed, and revenue for the business as a whole increased.」

「In the subsidiary's organic agricultural-product sales business, imported organic bananas, the main product, were temporarily unavailable and costs increased, but revenue remained at the previous year's level.」

「In the subsidiary's organic agricultural-product sales business, imported organic bananas, the main product, were temporarily unavailable due to supply-chain disruptions, but procurement has been recovering.」

「In the subsidiary's organic agricultural-product sales business, procurement of imported organic products such as bananas became unstable, while handling of domestically produced organic vegetables grew and revenue increased.」

「Regarding the apple and domestically produced fresh-produce sales business, the volume of apples collected from the 2021 crop increased, while the unit sales price declined.」

「At production areas and wholesale markets, demand for vegetables for commercial processing declined as restaurants suspended or restricted operations during the COVID-19 pandemic, heightening concerns among producing regions. Alongside efforts to increase transaction volumes with existing customers, efforts such as developing new customers are expected to increase in conjunction with amendments to the Wholesale Market Act and other measures.」

「On the other hand, during the COVID-19 pandemic, the supply chains of small and medium-sized supermarkets were weaker than those of major supermarkets, resulting in deliveries not arriving. In addition, major supermarkets narrowed their supply-chain operations, making some products unavailable for procurement.」

「Over the medium to long term, consumption of fresh products itself is expected to decline due to population decline and population ageing in the fresh-produce industry, our Group's main business area.」

「During the six-month period ended [the current second quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」

「Production volumes and quality of fresh produce are affected by weather. In addition, our services use a usage-based pricing model based on the volume of data processed by customers' systems and the volume of outsourced work. Accordingly, if adverse weather or natural disasters cause a significant decline in fresh-produce production and reduce the volume of business we handle, or if market conditions cause agricultural-product purchase prices to rise and sales prices to fall, this may affect our operating results.」

「The company is strengthening apple sales, its relationships with organic agricultural product suppliers and its proactive sales activities, but procurement of some agricultural products did not proceed as planned because of factors including the heavy rains in July 2018.」

「If adverse weather or natural disasters cause a significant decline in the production of fresh produce and reduce the volume of business we handle, or if market conditions cause agricultural-product purchase prices to rise and sales prices to fall, this may affect our operating results. In addition, for imported fresh produce, a decline in imports to Japan due to political conditions in producing countries or foreign-exchange rates may also affect our operating results.」

「During the nine-month period ended [the current third quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」

「During the six-month period ended [the current second quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」

「During the three-month period ended [the current first quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」

「Supply and demand for fresh produce are subject to significant fluctuations due to factors such as natural disasters, abnormal weather, growing conditions and rumours. Accordingly, if these supply-and-demand conditions cause significant fluctuations in the transaction volume or prices of fresh produce, usage of the services provided by our Group may decline, along with revenue.」