Reliance on Long-Term Lease Agreements for Company-Operated Stores
First written in FY2016. 2 of 4 entries say "Restated". Latest entry: FY2023.
The whole theme swung hardest in 2024: 3 of 12 companies on the "Worse" side.
18 other companies' latest entry also says "Restated".
- FY2023RestatedAnnual report
「In principle, the Company's directly operated stores do not purchase land but lease it from landowners and others seeking to make effective use of their land. Before opening a store under a lease, the Company assesses the counterparty's credit standing. However, lease terms are often long, and if, during such a long contract period, the Company is forced to terminate a contract because of the landlord's bankruptcy or another unforeseen deterioration in the landlord's credit standing, it is expected that continuing to operate directly operated stores would become difficult, which could affect the Company's operating results and financial position.」
The Company continues to disclose the risk that long-term leases for directly operated stores and deterioration in landlords' credit standing could make it difficult to continue operations. - FY2022RestatedAnnual report
「In principle, the Company's directly operated stores do not purchase land but lease it from landowners and others seeking to make effective use of their land. Before opening a store under a lease, the Company assesses the counterparty's credit standing. However, lease terms are often long, and if, during such a long contract period, the Company is forced to terminate a contract because of the landlord's bankruptcy or another unforeseen deterioration in the landlord's credit standing, it is expected that continuing to operate directly operated stores would become difficult, which could affect the Company's operating results and financial position.」
The Company continues to disclose the risk that long-term leases for directly operated stores and deterioration in landlords' credit standing could make it difficult to continue operations. - FY2018SoftenedAnnual report
「Before opening a store under a lease, the Company assesses the counterparty's credit standing. However, lease terms are often long, and if, during such a long contract period, the Company is forced to terminate a contract because of the landlord's bankruptcy or another unforeseen deterioration in the landlord's credit standing, it is expected that continuing to operate directly operated stores would become difficult」
The risk associated with dependence on long-term leases for directly operated stores continues, but the specific reference to a period of “10 to 15 years” included previously has been removed, making the wording less specific. - FY2016First statedAnnual report
「Lease terms are often long, ranging from 10 to 15 years. If, during such a long contract period, the Company is forced to terminate a contract because of the landlord's bankruptcy or another unforeseen deterioration in the landlord's credit standing, it is expected that continuing to operate directly operated stores would become difficult」
This indicates an operating model in which land for directly operated stores is leased rather than purchased, as well as the risk that deterioration in a landlord's credit standing could make it difficult to continue operations.