Risk of loss of benefit of time on borrowings with financial covenants
First written in FY2020-Q3. 3 of 11 entries say "Materialised", first in FY2021. Latest entry: FY2026.
Yamaki moved to the "Worse" side of this theme in 2021, 2 years before the typical company in this theme (2023).
21 other companies' latest entry also says "Dropped".
- FY2026DroppedAnnual reportThe FY2026 Annual Securities Report's descriptions of business risks and financial policies do not contain the previous disclosure regarding the risk of acceleration resulting from breaches of financial covenants.
- FY2024MitigatedAnnual report
「In addition, the Group is securing highly liquid cash and deposits on hand, continuing its overdraft facilities and making scheduled repayments on long-term borrowings subject to financial covenants. Accordingly, there are no material concerns regarding its cash flow.」
The Group is securing liquidity on hand, continuing its overdraft facilities and making repayments on long-term borrowings subject to financial covenants, and explained that there are no cash flow concerns. - FY2024-Q2MitigatedAnnual report
「At the end of the previous consolidated fiscal year, some of the financial covenants for the following (1) and (2) long-term borrowings, including long-term borrowings due for repayment within 1 year, had been breached. However, the Group maintains close relationships with its principal relationship banks and has obtained their consent not to exercise their rights with respect to (2). In addition, even if (1) and (3) breach the relevant covenants, this would only create the possibility of an interest rate change and would not result in acceleration.」
Although breaches of financial covenants remained at the end of the previous consolidated fiscal year, the Group obtained its principal relationship banks' consent not to exercise their rights. It explained that some covenants would result only in an interest rate change and not in acceleration. - FY2023WorsenedAnnual report
「At the end of the consolidated fiscal year, some of the financial covenants for the following (1), (2) and (3) long-term borrowings, including long-term borrowings due for repayment within 1 year, and (4) short-term borrowings had been breached.」
Breaches of the financial covenants continued, and breaches involving short-term borrowings were also disclosed in addition to those under multiple long-term borrowing agreements. However, because of the Group's relationship with its principal relationship banks, some breaches are not expected to result in acceleration, while other covenants may result only in an interest rate change. - FY2023-Q2RestatedAnnual report
「The following long-term borrowings, including amounts due for repayment within 1 year, among the long-term borrowings, including amounts due for repayment within 1 year, outstanding at the end of the second quarter of the consolidated fiscal year are each subject to the financial covenants set out below. At the end of the previous consolidated fiscal year, some of the financial covenants for the following (1) and (2) long-term borrowings, including long-term borrowings due for repayment within 1 year, had been breached. However, the Group maintains close relationships with its principal relationship banks and, with respect to (1), does not expect the right to demand acceleration to be exercised.」
The Group continues to disclose the breach of some financial covenants and its expectation that the right to demand acceleration will not be exercised because of its relationship with its principal relationship banks. - FY2023-Q1RestatedAnnual report
「At the end of the previous consolidated fiscal year, some of the financial covenants for the following (1) and (2) long-term borrowings, including long-term borrowings due for repayment within 1 year, had been breached. However, the Group maintains close relationships with its principal relationship banks and, with respect to (1), does not expect the right to demand acceleration to be exercised.」
The Group reconfirmed that some financial covenants had been breached at the end of the previous consolidated fiscal year and that it does not expect its principal relationship banks to exercise their right to demand acceleration. - FY2022-Q3MaterialisedAnnual report
「Of the long-term borrowings, including amounts due for repayment within 1 year, outstanding at the end of the third quarter of the consolidated fiscal year, the ¥280 million syndicated loan agreement contains financial covenants. At the end of the second quarter of the consolidated fiscal year, some of the following financial covenants had been breached. However, the Group maintains close relationships with its principal relationship banks and does not expect the right to demand acceleration to be exercised.」
Although the breach of the financial covenants under the ¥280 million syndicated loan continues, the Group expects that the right to demand acceleration will not be exercised because of its relationship with its principal relationship banks. - FY2022-Q2MaterialisedAnnual report
「Of the long-term borrowings, including amounts due for repayment within 1 year, outstanding at the end of the second quarter of the consolidated fiscal year, the ¥320 million syndicated loan agreement contains the following financial covenants, which have been breached. However, the Group maintains close relationships with its principal relationship banks and expects to receive their continued support, and therefore does not expect the right to demand acceleration to be exercised.」
A breach of the financial covenants under the ¥320 million syndicated loan occurred again at the end of the second quarter. However, the Group expects that the right to demand acceleration will not be exercised with the support of its principal relationship banks. - FY2021MaterialisedAnnual report
「At the end of the consolidated fiscal year, the Group was in breach of the financial covenants under the ¥400 million syndicated loan agreement entered into during the consolidated fiscal year. To avoid acceleration resulting from the breach, the Group requested and obtained the consent of all relevant financial institutions not to demand acceleration.」
A breach of the financial covenants under the ¥400 million syndicated loan actually occurred, and the Group obtained the financial institutions' consent not to demand acceleration. - FY2020Details of the borrowings subject to the covenantsAnnual report
「Certain short-term and long-term borrowings among the Company’s short-term and long-term borrowings are subject to the financial covenants set out below. If any of these matters is breached, the Company may lose the benefit of time with respect to the relevant borrowings.」
For portions of short-term borrowings of ¥1,080 million and long-term borrowings of ¥2,789 million, the Company provided fuller disclosure in its annual filing of covenants requiring the maintenance of net assets, avoidance of consecutive operating losses and ordinary losses, and interest-bearing debt of ¥6.5 billion or less, among others. - FY2020-Q3First statedAnnual report
「The borrowings are subject to financial covenants, and if any of the following covenants is breached, the Company may lose the benefit of time with respect to all obligations under the agreement.」
For a term loan with a repayment date of 31 March 2022 and a contractual amount of ¥300 million, the financial covenants require standalone net assets to be maintained at 75% or more of the benchmark amount and ordinary profit or loss not to be negative for 2 consecutive periods.