Financial covenants in loan agreements and funding risk
First written in FY2016. 6 of 12 entries say "Mitigated", first in FY2017. Latest entry: FY2026.
Nippon Coke & Engineering moved to the "Worse" side of this theme in 2024, 3 years after the typical company in this theme (2021).
The whole theme swung hardest in 2025: 24 of 80 companies on the "Worse" side.
1 other company's latest entry also says "Reframed".
- FY2026ReframedAnnual report
「The financial covenants were amended on 24 April 2026 and 30 April 2026.」
The net-assets threshold under the financial covenants was changed from 70% or more of the base-period level to 80% or more of net assets for the fiscal year ending March 2026, and the commitment line expiry was extended to 30 April 2027. - 2026-05-15OtherResults
「変更後の財務上の特約の内容 ①連結決算および個別決算において、本決算期の純資産の金額を2026年３月期の80％以上とする。②連結決算および個別決算において、本決算期の営業損益を二期連続マイナスとしない。」
財務制限条項について、基準となる期を2026年3月期に変更し、純資産維持水準を同基準期の80％以上とする変更が示された。 - FY2025WorsenedAnnual report
「Fiscal year ended 31 March 2025: The following financial covenants apply to ¥22,890 million of short-term borrowings (the outstanding amount drawn under a loan commitment agreement) and ¥39,730 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
Borrowings subject to the financial covenants increased from ¥12,555 million in the previous fiscal year to the equivalent of ¥62,500 million. The net-assets maintenance covenant and the covenant requiring the avoidance of operating losses for two consecutive fiscal years remain in place. - FY2024WorsenedAnnual report
「Fiscal year ended 31 March 2024: The following financial covenants apply to ¥12,555 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
Borrowings subject to the financial covenants increased from ¥11,415 million in the previous fiscal year to ¥12,555 million. The requirements to maintain net assets at 70% or more and avoid operating losses for two consecutive fiscal years remain in place. - FY2023MitigatedAnnual report
「Fiscal year ended 31 March 2023: The following financial covenants apply to ¥11,415 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
Borrowings subject to the financial covenants decreased from ¥15,905 million in the previous fiscal year to ¥11,415 million. The requirements to maintain net assets at 70% or more and avoid operating losses for two consecutive fiscal years remain in place. - FY2022MitigatedAnnual report
「Fiscal year ended 31 March 2022: The following financial covenants apply to ¥15,905 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
Borrowings subject to the financial covenants decreased from ¥22,837 million in the previous fiscal year to ¥15,905 million. The requirements to maintain net assets at 70% or more and avoid operating losses for two consecutive fiscal years remain in place. - FY2021MitigatedAnnual report
「The following financial covenants apply to ¥22,837 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
Borrowings subject to the financial covenants decreased from ¥30,400 million in the previous fiscal year to ¥22,837 million. The requirements to maintain net assets at 70% or more and avoid operating losses for two consecutive fiscal years remain in place. - FY2020MitigatedAnnual report
「The following financial covenants apply to ¥630 million of short-term borrowings (the outstanding amount drawn under a loan commitment agreement) and ¥29,770 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
Borrowings subject to the financial covenants decreased from ¥36,702 million in the previous fiscal year to ¥30,400 million. Meanwhile, the structure now also applies a net-assets maintenance covenant to short-term borrowings. - FY2019WorsenedAnnual report
「The following financial covenants apply to ¥36,702 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
Borrowings subject to the financial covenants increased from ¥29,635 million in the previous fiscal year to ¥36,702 million. The requirements to maintain net assets at 70% or more and avoid operating losses for two consecutive fiscal years remain in place. - FY2018MitigatedAnnual report
「The following financial covenants apply to ¥4,918 million of short-term borrowings (the outstanding amount drawn under a loan commitment agreement) and ¥29,635 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
Borrowings subject to the financial covenants decreased from ¥36,067 million in the previous fiscal year to ¥29,635 million. The requirements to maintain net assets at 70% or more and avoid operating losses for two consecutive fiscal years remain in place. - FY2017MitigatedAnnual report
「The following financial covenants apply to ¥3,387 million of short-term borrowings (the outstanding amount drawn under a loan commitment agreement) and ¥36,067 million of long-term borrowings (including long-term borrowings due for repayment within one year).」
The financial covenants continue to require net assets to be maintained at 70% or more and operating losses to be avoided for two consecutive fiscal years, while the borrowings subject to the covenants decreased from ¥42,500 million in the previous fiscal year to ¥36,067 million. - FY2016First statedAnnual report
「If the Company's or the Group's operating results or financial position deteriorate and it becomes apparent that the relevant covenants cannot be met, the lenders will not immediately require repayment of the borrowings in full. However, the Company will discuss future action with the lenders and other parties, and depending on the outcome, it may lose the benefit of the term of the loans, which could affect its ability to secure stable and continuous funding going forward.」
During the current fiscal year, covenants were attached to ¥42,500 million of borrowings, requiring net assets to be maintained at 70% or more of the base-period level and prohibiting operating losses for two consecutive fiscal years.