Early Resolution of Doubts Regarding the Going-Concern Assumption

「To resolve these circumstances, the Company is promoting management centered on investment in human capital under the slogan “Design the Evolution—Designing the Future Around Tradition.” Specifically, it will improve employee engagement and productivity by enhancing its training system and clarifying career paths to improve hairstylists' technical and proposal capabilities. In addition, by strengthening customer service to increase the visit frequency of existing customers and raise average customer spending, while acquiring new customers through the use of e-commerce and digital initiatives, the Company aims to increase revenue by maximizing the value of its human capital.」

「In the current fiscal year, the Company will continue working as one to further refine the initiatives under the plan and firmly establish improvements in profitability and stable earnings. Specifically, it is implementing the following 3 key initiatives.」

「In light of these circumstances, the Company recognizes that material uncertainty exists regarding the going concern assumption because the measures being taken to resolve the material doubts regarding the going concern assumption are still in progress and may have a material impact on the Company's liquidity depending on future business progress and the status of additional financing.」

「Steady improvements in customer visits and average spending per customer at existing stores enabled the Company to achieve operating and ordinary profits in the second half. In fiscal 2024, the final year of the medium-term management plan and the 60th anniversary of the Company's founding, the Company will focus on the following 3 initiatives to build a structure capable of generating stable earnings.」

「In the third quarter of the current fiscal year, the 3-month results for the third-quarter accounting period showed an operating profit and quarterly net profit, reflecting the effects of closing additional unprofitable stores and thoroughly reducing costs through fundamental reforms to the head-office structure implemented in the previous fiscal year. In the fourth quarter, the Company will continue to strengthen profitability by rebuilding its directly operated hair salons, introducing new services through collaboration with the Svenson Group and accelerating the rollout of freelance hair salons.」

「In the second quarter accounting period, the effects of further closures of unprofitable stores carried out in the previous fiscal year and thorough cost reductions through fundamental head office structural reform have begun to emerge. Going forward, on the sales front, we will strengthen earnings power by rebuilding directly operated salons, introducing new services through collaboration with the Svenson Group, and accelerating the rollout of freelance salons.」

「In the first quarter of the current fiscal year, the effects of closing additional unprofitable stores and thoroughly reducing costs through fundamental reforms to the head-office structure implemented in the previous fiscal year began to emerge. Going forward, the Company will strengthen profitability by rebuilding its directly operated hair salons, introducing new services through collaboration with the Svenson Group and accelerating the rollout of freelance hair salons.」

「In light of these circumstances, the Company recognizes that material uncertainty exists regarding the going concern assumption because the measures being taken to resolve the material doubts regarding the going concern assumption are still in progress and may have a material impact on the Company's liquidity depending on future business progress and the status of additional financing.」

「The Company formulated the medium-term management plan “T-ip60” for fiscal 2022 through fiscal 2024. With the goal of increasing the stability of profitability and establishing a foundation for growth in fiscal 2024, the 60th anniversary of the Company's founding, the Company will fundamentally review its management platform and promote a shift to a profit-generating structure based on 3 strategies: (1) growth strategy, (2) human resources and technical training strategy, and (3) corporate strategy.」

「To address this situation, we formulated the T-ip60 Medium-Term Management Plan (fiscal 2022 to fiscal 2024). With the goal of enhancing earnings stability and establishing a growth platform by the company’s 60th anniversary in fiscal 2024, the plan is built around 3 strategies: (1) growth, (2) human resources and technical training, and (3) corporate strategy. We will fundamentally review our management foundation and promote a shift toward a profit-generating structure.」

「To address this situation, we formulated the T-ip60 Medium-Term Management Plan (fiscal 2022 to fiscal 2024). With the goal of enhancing earnings stability and establishing a growth platform by the company’s 60th anniversary in fiscal 2024, the plan is built around 3 strategies: (1) growth, (2) human resources and technical training, and (3) corporate strategy. We will fundamentally review our management foundation and promote a shift toward a profit-generating structure.」

「To resolve these circumstances, the Company is promoting the “T9” business structure reform plan for fiscal 2021 (April 2021 to March 2022) to achieve an early improvement in performance and build an organizational foundation capable of returning to growth. The plan's key initiatives comprise 9 measures: ① rebuilding store operations, ② retaining high-value customers, ③ strengthening branding capabilities, ④ pursuing productivity, ⑤ strengthening sales and technical capabilities, ⑥ expanding product sales, ⑦ reducing fixed costs, ⑧ reorganizing the organization to accelerate management decision-making, and ⑨ promoting ESG. Through these measures, the Company will work to improve profitability in its business and reduce head-office expenses, as well as sell assets and restrain capital investment, in an effort to improve the situation. Based on these measures, the Company has determined that no material uncertainty exists regarding the going concern assumption.」

「The Company will work to improve profitability in its business and reduce head-office expenses, as well as sell assets and restrain capital investment, in an effort to improve the situation.」

「After considering cash management for future business operations, taking into account the implementation of these measures, repayment of borrowings through asset sales and the securing of working capital, the Company has determined that there are no concerns about the continuity of business activities for the foreseeable future and that no material uncertainty exists regarding the going concern assumption.」

「To resolve these circumstances, the Company is implementing measures including improving profitability in its business and reducing head-office expenses, and is working to improve the situation.」

「To resolve these circumstances, the Company is implementing measures including improving profitability in its business and reducing head-office expenses, and is working to improve the situation.」

「To resolve these circumstances, the Company is implementing measures including improving profitability in its business and reducing head-office expenses, and is working to improve the situation.」

「The Company recognizes that its most important task is to promptly and steadily implement the measures described in “2. [Business and Other Risks] (9) Significant Events and Other Matters Concerning the Going Concern Assumption” and “Notes (Matters Concerning the Going Concern Assumption)” and resolve the doubts regarding the going concern assumption at an early stage.」