Recognition of a Loss on Business Restructuring in Connection with the Discontinuation of a Consolidated Subsidiary’s Business (Consolidated Financial Statements), and an Expense for Provision for Subsidiary Support Losses in Connection with a Capital Increase in the Consolidated Subsidiary (Non-Consolidated Financial Statements)
青島瑪莎礼服有限公司 (a consolidated subsidiary wholly owned by the filing company), and the filing company
The Qingdao factory operated by 青島瑪莎礼服有限公司; Qingdao, China; the manufacture and sale of wedding dresses
Rising production costs, including labor costs, accompanying China’s economic development, as well as the aging of employees at the Qingdao factory and a decline in personnel. The Company determined that it could maintain a more stable production structure and quality at its Vietnam factory.
Consolidated: The Company expects to recognize a loss on business restructuring of approximately ¥170 million as a special loss. Non-consolidated: The Company expects to recognize an expense for provision for subsidiary support losses of US$1,050,000 (approximately ¥170 million) as a special loss. The non-consolidated expense will be eliminated in the consolidated financial statements.
Fiscal year ending August 2026
The consolidated earnings forecast for the fiscal year ending August 2026 is currently under review. The Company will promptly disclose any matters that should be disclosed. The non-consolidated expense for provision for subsidiary support losses will be eliminated in the consolidated financial statements and will have no impact on consolidated results.
Company response
Discontinuation of the Qingdao factory’s business, comprising the manufacture and sale of wedding dresses
青島瑪莎礼服有限公司 will begin considering the disposal and liquidation of its owned real estate, including leasehold rights and buildings. The Company will position its Vietnam factory as its primary production facility and seek to further expand and improve the efficiency of wedding-dress production.
The Company will promptly disclose any matters that should be disclosed.
| Item | Details |
|---|---|
| Event name | Recognition of a Loss on Business Restructuring in Connection with the Discontinuation of a Consolidated Subsidiary’s Business (Consolidated Financial Statements), and an Expense for Provision for Subsidiary Support Losses in Connection with a Capital Increase in the Consolidated Subsidiary (Non-Consolidated Financial Statements) |
| Date of occurrence | 25 August 2026 (the date on which the Board of Directors resolved to discontinue the Qingdao factory’s business and conduct the capital increase) |
| Subject Entity | 青島瑪莎礼服有限公司 (a consolidated subsidiary wholly owned by the filing company), and the filing company |
| Target Locations / Products | The Qingdao factory operated by 青島瑪莎礼服有限公司; Qingdao, China; the manufacture and sale of wedding dresses |
| Cause | Rising production costs, including labor costs, accompanying China’s economic development, as well as the aging of employees at the Qingdao factory and a decline in personnel. The Company determined that it could maintain a more stable production structure and quality at its Vietnam factory. |
| Amount of Impact on Business Performance | Consolidated: The Company expects to recognize a loss on business restructuring of approximately ¥170 million as a special loss. Non-consolidated: The Company expects to recognize an expense for provision for subsidiary support losses of US$1,050,000 (approximately ¥170 million) as a special loss. The non-consolidated expense will be eliminated in the consolidated financial statements. |
| Accounting period in which recognized | Fiscal year ending August 2026 |
| Impact on Earnings Forecast | The consolidated earnings forecast for the fiscal year ending August 2026 is currently under review. The Company will promptly disclose any matters that should be disclosed. The non-consolidated expense for provision for subsidiary support losses will be eliminated in the consolidated financial statements and will have no impact on consolidated results. |
| Suspended operations | Discontinuation of the Qingdao factory’s business, comprising the manufacture and sale of wedding dresses |
| Outlook | 青島瑪莎礼服有限公司 will begin considering the disposal and liquidation of its owned real estate, including leasehold rights and buildings. The Company will position its Vietnam factory as its primary production facility and seek to further expand and improve the efficiency of wedding-dress production. |
| Planned follow-up disclosure | The Company will promptly disclose any matters that should be disclosed. |
Items this document does not state (14)
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.Production costs in China, including labor costs, have risen, while the Qingdao factory has experienced an aging workforce and a decline in personnel. The Company also determined that it could maintain a stable production structure and quality at its Vietnam factory.