Risk to Business Activities and Demand Trends from COVID-19

「The global spread of COVID-19 had a substantial impact on economic activity in countries worldwide. In Japan, following the reclassification of COVID-19 as a Category V disease under the Infectious Diseases Control Law in May 2023, the response to infection has shifted to one that respects individual choice and is based on voluntary public efforts. However, amid concerns over the global spread of mpox (monkeypox), if the spread of various infectious diseases within our Group causes plant shutdowns or disruptions to sales activities, this could affect the Group's business results and financial position.」

「During the second quarter cumulative consolidated period (1 July 2023 to 31 December 2023), Japan's economy showed signs of recovery as restrictions on activities and entry into the country were substantially eased following the reclassification of COVID-19 as a Category V disease under the Infectious Diseases Control Law.」

「During the third quarter cumulative consolidated period, there were no material changes to the matters described in the annual securities report for the previous consolidated fiscal year.」

「During the second quarter cumulative consolidated period, there were no material changes to the matters described in the annual securities report for the previous consolidated fiscal year.」

「The global spread of COVID-19 has had a substantial impact on economic activity in countries worldwide. Although vaccination is progressing in Japan and overseas, it is difficult to predict when infections will subside, and we expect uncertainty to continue for the time being.」

「Our Group is working to address management issues under the basic policy of “Through bold challenges in domestic and overseas markets, establish a foundation for business growth and profitability and reliably achieve the first stage, ‘Growth Trajectory.’” We have entered the first year of the second medium-term management plan, covering July 2021 to June 2026, with the aim of achieving the “ICHIMASA30 Vision” (the desired state for fiscal 2045).」

「Although economic activity had been gradually returning after the lifting of the state of emergency and other measures in October, the threat of a rapid spread of the new Omicron variant has been growing, and the outlook for an economic recovery remains unpredictable.」

「The postponement of the economic recovery due to the Tokyo Olympic and Paralympic Games being held without spectators, a sharp increase in new infections caused by COVID-19 variants, and the prolonged continuation of the state of emergency and other priority measures, together with weak personal consumption, has left the outlook unpredictable.」

「If infections occur and spread within our Group, resulting in plant shutdowns or disruptions to sales activities, this could affect the Group's business results and financial position.」

「As people refrain from dining out to prevent COVID-19 infections and the trend toward eating at home increases, demand for food delivery and shopping on e-commerce sites has risen. As society adapts to the new lifestyle known as the new normal, consumer values and purchasing behavior have changed substantially.」

「As consumers refrained from eating out in response to COVID-19, more meals were prepared at home and purchases through food delivery services and e-commerce sites increased, resulting in major changes in consumer consumption and purchasing behavior as consumers adapted to the new lifestyle known as the new normal.」

「As a new lifestyle, the so-called new normal, is required to address COVID-19, stay-at-home consumption has increased, dining out has been avoided and demand for delivery services has risen, creating socioeconomic conditions in which it is difficult to forecast future consumer demand trends.」

「Unprecedented consumption patterns have emerged, including increased stay-at-home consumption and stockpiling of certain daily necessities driven by anxiety, making it difficult to forecast future demand trends. In addition, costs such as labor expenses are expected to increase against the backdrop of higher raw-material prices and labor shortages, and the business environment surrounding our Group remains challenging.」

「The spread of COVID-19 could affect the business activities of our Group depending on developments going forward, and we will continue to monitor the situation closely. As people are being asked to change their behavior, including refraining from nonessential and nonurgent outings to prevent the spread of COVID-19, unprecedented consumption patterns have emerged, including increased stay-at-home consumption and stockpiling of certain daily necessities driven by anxiety. This has made it difficult to forecast future demand trends.」