Recognition of Extraordinary Losses (Impairment Losses, etc.) and Revision of Earnings Forecasts
Consolidated subsidiary サンモール (subject to impairment testing) and the filing company (which expects to recognize a valuation loss on shares of the subsidiary and a provision for losses on the business of an affiliated company)
The region where サンモール's main stores are located and certain property, plant and equipment held by the company
Competition with other companies has intensified in the region where the main stores are located, slowing customer traffic and creating an expected divergence from the earnings plan originally assumed.
In the consolidated financial statements, the company expects to recognize impairment losses of ¥166 million on goodwill and ¥159 million on property, plant and equipment as extraordinary losses. In the non-consolidated financial statements, the company expects to recognize a ¥232 million valuation loss on shares of the subsidiary and a ¥151 million provision for losses on the business of an affiliated company as extraordinary losses. The extraordinary losses recognized in the non-consolidated financial statements will be eliminated in the consolidated financial statements.
Fiscal year ended February 2026 (1 March 2025 to 28 February 2026)
The full-year consolidated earnings forecasts will be revised. Net sales are expected to be revised from ¥29,900 million to ¥28,600 million, operating income from ¥410 million to ¥196 million, ordinary income from ¥440 million to ¥243 million, and net income attributable to owners of the parent from ¥230 million to a loss of ¥207 million. The company's non-consolidated earnings forecasts will also be revised, while the dividend forecast remains unchanged.
Based on a low-cost operating model, the company will further accelerate efforts to strengthen procurement and expand private-label products, while focusing on creating synergies with サンモール to improve the earnings power of the group as a whole. The company considers the extraordinary losses recognized this time to be a one-off loss with a limited impact on cash flow and business operations, and expects them to reduce the amortization burden from the next fiscal year onward.
| Item | Details |
|---|---|
| Event name | Recognition of Extraordinary Losses (Impairment Losses, etc.) and Revision of Earnings Forecasts |
| Subject Entity | Consolidated subsidiary サンモール (subject to impairment testing) and the filing company (which expects to recognize a valuation loss on shares of the subsidiary and a provision for losses on the business of an affiliated company) |
| Target Locations / Products | The region where サンモール's main stores are located and certain property, plant and equipment held by the company |
| Cause | Competition with other companies has intensified in the region where the main stores are located, slowing customer traffic and creating an expected divergence from the earnings plan originally assumed. |
| Amount of Impact on Business Performance | In the consolidated financial statements, the company expects to recognize impairment losses of ¥166 million on goodwill and ¥159 million on property, plant and equipment as extraordinary losses. In the non-consolidated financial statements, the company expects to recognize a ¥232 million valuation loss on shares of the subsidiary and a ¥151 million provision for losses on the business of an affiliated company as extraordinary losses. The extraordinary losses recognized in the non-consolidated financial statements will be eliminated in the consolidated financial statements. |
| Accounting period in which recognized | Fiscal year ended February 2026 (1 March 2025 to 28 February 2026) |
| Impact on Earnings Forecast | The full-year consolidated earnings forecasts will be revised. Net sales are expected to be revised from ¥29,900 million to ¥28,600 million, operating income from ¥410 million to ¥196 million, ordinary income from ¥440 million to ¥243 million, and net income attributable to owners of the parent from ¥230 million to a loss of ¥207 million. The company's non-consolidated earnings forecasts will also be revised, while the dividend forecast remains unchanged. |
| Outlook | Based on a low-cost operating model, the company will further accelerate efforts to strengthen procurement and expand private-label products, while focusing on creating synergies with サンモール to improve the earnings power of the group as a whole. The company considers the extraordinary losses recognized this time to be a one-off loss with a limited impact on cash flow and business operations, and expects them to reduce the amortization burden from the next fiscal year onward. |
Items this document does not state (17)
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.Competition with other companies has intensified in the region where サンモール's main stores are located, slowing customer traffic and creating an expected divergence from the original earnings plan. In addition, a challenging procurement environment, higher M&A-related expenses and depreciation, and サンモール's weak performance have put pressure on earnings.