Borrowing, Interest Rate and Financial Covenant Risks
First written in FY2023. 6 of 12 entries say "Mitigated", first in FY2024-Q1. Latest entry: FY2026.
The whole theme swung hardest in 2025: 23 of 75 companies on the "Worse" side.
17 other companies' latest entry also says "Other".
- FY2026Debt outstanding increased, while the ratio declined and covenant breach continuedAnnual report
「At the end of the current consolidated fiscal year, the Group's interest-bearing debt was ¥4,293,488 thousand, representing 62.5% of total assets. Risks include higher borrowing costs and restrictions on financing methods caused by changes in financial markets or the Group's creditworthiness. Some borrowings are also subject to financial covenants. The Company is in breach of covenants attached to loan agreements executed with certain financial institutions.」
Interest-bearing debt increased from ¥4,231,630 thousand to ¥4,293,488 thousand, while the ratio to total assets declined from 64.4% to 62.5%. The breach of financial covenants continues. - FY2026-H1MitigatedAnnual report
「At the end of the interim consolidated accounting period, liabilities decreased by ¥471.758 million from the end of the previous consolidated fiscal year to ¥4,472.945 million. This was mainly due to decreases of ¥500.000 million in short-term borrowings and ¥88.737 million in long-term borrowings. This was mainly because retained earnings decreased by ¥102.689 million due to the recognition of an interim net loss attributable to owners of the parent, while the foreign currency translation adjustment increased by ¥147.177 million. As a result, the equity ratio increased by 2.59 percentage points to 27.32%.」
Short-term borrowings decreased by ¥500.000 million and long-term borrowings by ¥88.737 million, while the equity ratio rose from 24.73% to 27.32%. Although risks relating to financial covenants and other matters remain, financial exposure decreased during the interim period. - FY2025WorsenedAnnual report
「At the end of the consolidated fiscal year, the Group's interest-bearing debt totaled ¥4,231.630 million, equivalent to 64.4% of total assets. There is a risk that fluctuations in financial markets or the Group's creditworthiness may result in higher borrowing rates or restrictions on financing methods. Some borrowings are also subject to financial covenants.」
Interest-bearing debt increased from ¥3,968.734 million in the previous period to ¥4,231.630 million, while the ratio to total assets rose from 41.7% to 64.4%. In addition, a breach of financial covenants was disclosed, increasing financing risk. - FY2025-H1MitigatedAnnual report
「This was mainly due to decreases of ¥269.800 million in short-term borrowings, ¥87.862 million in provision for bonuses and ¥467.184 million in long-term borrowings. As a result, the equity ratio increased by 2.87 percentage points to 52.17%.」
Short- and long-term borrowings decreased, and the equity ratio rose from 49.30% at the end of the previous consolidated fiscal year to 52.17%, temporarily reducing the financial exposure relating to borrowings and financial covenants. - FY2024WorsenedAnnual report
「At the end of the consolidated fiscal year, the Group's interest-bearing debt totaled ¥3,968.734 million, equivalent to 41.7% of total assets. There is a risk that fluctuations in financial markets or the Group's creditworthiness may result in higher borrowing rates or restrictions on financing methods.」
Interest-bearing debt increased from ¥3,212.197 million in the previous period to ¥3,968.734 million, while the ratio to total assets rose from 38.8% to 41.7%. Financial covenants also remain in place. - FY2024-Q3MitigatedAnnual report
「This was mainly due to decreases of ¥209.248 million in electronically recorded obligations, ¥303.337 million in long-term borrowings and ¥217.319 million in other current liabilities. As a result, the equity ratio increased by 11.66 percentage points to 56.87%.」
Long-term borrowings decreased by ¥303.337 million, and the equity ratio rose to 56.87%. The financial exposure relating to borrowings and financial covenants has decreased further. - FY2024-Q2MitigatedAnnual report
「This was mainly due to a ¥125.084 million decrease in long-term borrowings.」
Long-term borrowings decreased from the end of the previous consolidated fiscal year, and the equity ratio rose to 56.58%, further reducing the financial exposure relating to borrowings and financial covenants. - FY2024-Q1MitigatedAnnual report
「As a result, the equity ratio increased by 8.38 percentage points to 53.59%.」
Net assets increased due to the capital increase accompanying the listing, and the equity ratio rose. The financial exposure relating to borrowings, interest rates and financial covenants has relatively decreased. - FY2023First statedAnnual report
「At the end of the consolidated fiscal year, the Group's interest-bearing debt totaled ¥3,212.197 million, equivalent to 38.8% of total assets. There is a risk that fluctuations in financial markets or the Group's creditworthiness may result in higher borrowing rates or restrictions on financing methods.」
Multiple loan agreements contain financial covenants, including requirements to maintain net assets, ordinary income and a DSCR of at least 1.0x.