Sale of the Otake Warehouse and Hiroshima Branch and recognition of impairment loss

「The main source of cash was ¥261.287 million from the sale of property, plant and equipment, including the Fukuoka Branch, Hiroshima Branch and Otake Warehouse. The main uses of cash included ¥133.447 million for the acquisition of property, plant and equipment, including machinery, equipment, tools and fixtures for the Technical Center and company vehicles, and ¥89.776 million for the acquisition of intangible fixed assets, including costs for constructing a core system. As the resolution to sell the above asset group indicated that a loss was expected to arise upon delivery, its carrying amount was reduced to its recoverable amount, and the reduction was recognized as an impairment loss under extraordinary losses. The impairment loss recognized for the current consolidated fiscal year was ¥47.294 million.」

「Cash used in investing activities amounted to ¥137.195 million, compared with ¥89.541 million used in the same period of the previous year. The main source of cash was ¥26.750 million in deposits received in connection with the sale of the Fukuoka and Hiroshima branches. The main uses of cash included ¥52.023 million for the acquisition of machinery and equipment and other assets for the Technical Center, ¥89.180 million for the acquisition of intangible fixed assets, including costs for constructing a new core system, and ¥17.720 million for insurance reserve contributions.」

「As the recoverable amount fell below the carrying amount following the resolution to sell the Otake Warehouse and Hiroshima Branch, the Company recognized an impairment loss on corporate assets not included in reportable segments. The impairment loss recognized for the first quarter of the current consolidated cumulative period was ¥45.552 million.」