Earnings Pressure from Goodwill Amortization Related to M&A
First written in FY2019-Q3. 6 of 17 entries say "Materialised", first in FY2019. Latest entry: FY2026.
Vector moved to the "Worse" side of this theme in 2019, 1 year before the typical company in this theme (2020).
The whole theme swung hardest in 2020: 4 of 12 companies on the "Worse" side.
4 other companies' latest entry also says "Worsened".
- FY2026WorsenedAnnual report
「This was mainly due to the recording of impairment losses of ¥1,220 million on goodwill at the Company's consolidated subsidiaries ビジコネット株式会社 and Owned株式会社, as well as an impairment loss of ¥634 million on software at 株式会社あしたのチーム.」
Impairment losses rose sharply from ¥264 million in the previous fiscal year to ¥1,885 million. The downside to earnings outlooks for M&A- and new-business-related assets, including goodwill at ビジコネット and Owned and software at あしたのチーム, became more pronounced in the results. - FY2025MitigatedAnnual report
「Impairment losses of ¥264 million were recorded during the current consolidated fiscal year.」
Impairment losses declined from ¥426 million in the previous fiscal year to ¥264 million. However, goodwill impairment of ¥155 million in the PR and advertising business and ¥99 million in the press release distribution business occurred, leaving the risk of a downside to the earnings outlook for M&A-related businesses. - FY2024MitigatedAnnual report
「Impairment losses 426」
Impairment losses declined from ¥793 million in the previous fiscal year to ¥426 million. However, impairment of ¥334 million of goodwill and other assets occurred in the PR and advertising business, leaving the risk of a downside to the earnings outlook for M&A-related businesses. - FY2023WorsenedAnnual report
「Impairment losses of ¥793 million were recorded during the current consolidated fiscal year.」
The continued downside in earnings outlooks for businesses and companies acquired through M&A and other transactions led impairment losses to increase from ¥52 million in the previous fiscal year to ¥793 million. The breakdown includes ¥345 million of goodwill for the PR and advertising business. - FY2023-Q3MaterialisedAnnual report
「During the nine months ended the third quarter, impairment losses were recorded in the video release distribution business segment and the direct marketing business segment due to declining profitability of fixed assets. The amounts were ¥242 million and ¥38 million, respectively.」
The video release distribution business and direct marketing business incurred impairment losses due to declining profitability of fixed assets, resulting in a total charge of ¥280 million. - FY2022MitigatedAnnual report
「During the current consolidated fiscal year, the Company recognized impairment losses of ¥57 million on operating investment securities and ¥745 million on investment securities, comprising ¥745 million on unlisted shares classified as other securities.」
Although impairment of investment securities and other assets continued, total impairment losses declined from ¥1,314 million in the previous year to ¥802 million. - FY2022-Q1MaterialisedAnnual report
「In the video release distribution business segment, the Company recorded an impairment loss on software that continued to perform below its original plan. The impairment loss was ¥3 million for the three months ended the first quarter of the current fiscal year.」
An impairment loss of ¥3 million was recorded on software in the video release distribution business that was performing below its original plan. - FY2021MitigatedAnnual report
「Impairment losses for the current consolidated fiscal year totaled ¥83.892 million.」
Although impairment of goodwill and business assets associated with M&A and other transactions continued, impairment losses fell sharply from ¥1,030.632 million in the previous fiscal year to ¥83.892 million, while goodwill amortization also declined from ¥513.283 million to ¥250.678 million. - FY2021-Q2MaterialisedAnnual report
「In the press release distribution business segment, because the U-NOTE business continued to perform below its original plan, the carrying amount of the asset group related to that business, including goodwill and software, was reduced to its recoverable amount, with the reduction recorded as an impairment loss. The impairment loss was ¥33.316 million for the six months ended the second quarter of the current fiscal year.」
Following the U-NOTE business's shortfall against plan, an impairment loss of ¥33.316 million was recorded on goodwill and software. - FY2020WorsenedAnnual report
「As an extraordinary loss, the Company recorded an impairment loss of ¥1,601 million on the grounds that the originally projected earnings could no longer be expected from the relevant business or consolidated subsidiary.」
Due to the earnings shortfall at businesses and subsidiaries acquired through M&A and other transactions, impairment losses increased from ¥1,258 million in the previous fiscal year to ¥1,601 million. - FY2020-Q3WorsenedAnnual report
「Depreciation and amortization ¥312.332 million Goodwill amortization ¥675.911 million」
Goodwill amortization for the nine months ended the third quarter was ¥675.911 million, up from ¥646.840 million in the same period of the previous year. The earnings burden from businesses and companies acquired through M&A and other transactions is increasing. - FY2020-Q2MaterialisedAnnual report
「In connection with M&A and investment activities, the Company recorded an impairment loss on goodwill as an extraordinary loss for the relevant business because the performance of part of a subsidiary's business acquired through M&A and other transactions fell below expectations.」
Following the shortfall against expectations at a business acquired through M&A and other transactions, an impairment loss of ¥453.359 million was recorded. This included goodwill impairment losses of ¥52.000 million for the PR business, ¥70.912 million for the news release business and ¥248.794 million for the media business. - FY2020-Q1WorsenedAnnual report
「Goodwill amortization 240,040」
Goodwill amortization increased from ¥168.123 million in the same period of the previous year to ¥240.040 million. The quarterly earnings burden from businesses and companies acquired through M&A and other transactions is increasing. - FY2019MaterialisedAnnual report
「As an extraordinary loss, the Company recorded an impairment loss of ¥1,258 million on the grounds that the originally projected earnings could no longer be expected from the relevant business or consolidated subsidiary.」
As earnings fell short at businesses and subsidiaries acquired through M&A and other transactions, an impairment loss of ¥1,258 million was recorded. The breakdown includes ¥63.443 million of goodwill for OPENERS and ¥773.977 million of goodwill for あしたのチーム, among others. - FY2019-Q3First statedAnnual report
「In addition, the amortization of goodwill arising from the acquisition of businesses and companies, including those businesses, also affected earnings, which fell below the level of the same period of the previous year.」
For the first time, the amortization of goodwill associated with business and company acquisitions was separately identified as a factor depressing earnings. Goodwill amortization for the nine months ended the third quarter was ¥646.840 million and was in fact a downside factor for earnings.