Business and Financial Impact of COVID-19

「(Notes on going concern) None applicable.」

「The company recorded operating losses for 3 consecutive fiscal years from the fiscal year ended March 2021 due to the spread of COVID-19. Although the operating loss was eliminated in the fiscal year ended March 2024, circumstances giving rise to significant doubt about the going-concern assumption continue to exist because borrowings due for repayment within 1 year after the end of the fiscal year amounted to ¥1,791 million, substantially exceeding cash and deposits of ¥1,691 million as of the end of the fiscal year.」

「The company recorded a net loss attributable to owners of the parent of ¥2,316 million for the fiscal year ended March 2021 due to the spread of COVID-19, and losses have continued since then, resulting in circumstances giving rise to significant doubt about the going-concern assumption.」

「The company recorded a net loss attributable to owners of the parent of ¥2,316 million for the fiscal year ended March 2021 due to the spread of COVID-19, and losses have continued since then, resulting in circumstances giving rise to significant doubt about the going-concern assumption. However, profitability has steadily improved through business structural reforms and management streamlining to date, and the financial foundation is also becoming stronger.」

「The company recorded a net loss attributable to owners of the parent of ¥2,316 million for the fiscal year ended March 2021 due to the spread of COVID-19, and losses have continued since then, resulting in circumstances giving rise to significant doubt about the going-concern assumption. However, profitability has steadily improved through business structural reforms and management streamlining to date, and the financial foundation is also becoming stronger.」

「However, profitability has steadily improved through business structural reforms and management streamlining to date, and the financial foundation is also becoming stronger. In addition, for the fiscal year ending March 2024, the company is pursuing a return to a growth trajectory by establishing a high-profitability structure, strengthening product competitiveness and developing the foundations for sustainable management, and expects to achieve profitability at every level of its full-year earnings forecast. Accordingly, the company has determined that there is no uncertainty regarding the going-concern assumption.」

「However, circumstances giving rise to significant doubt about the going-concern assumption continue, as the company has reported operating losses for 2 consecutive fiscal years since the fiscal year ended March 2021 and results for the fiscal year ending March 2023 are expected to be affected to a certain extent by COVID-19 and the uncertain economic environment.」

「The timing of the containment of COVID-19 remains uncertain, and as it may continue to affect results to a certain extent from the fourth quarter of the fiscal year ending March 2022 onward, circumstances giving rise to significant doubt about the going-concern assumption have arisen.」

「However, as the declaration of a state of emergency was repeatedly lifted and reissued and remained in effect through the end of September 2021, the assumptions for the first half of the fiscal year made at the beginning of the period changed substantially. We consequently assumed that the impact of COVID-19 would continue to a certain extent in the second half as well.」

「As of 31 March 2021, consolidated net assets were negative ¥399 million, resulting in negative net worth and circumstances giving rise to significant doubt about the going-concern assumption.」

「As a result, for the nine-month period of the fiscal year under review, consolidated net sales were ¥3,100 million, down 50.7% year on year, operating loss was ¥1,821 million, compared with operating income of ¥146 million in the same period of the previous year, ordinary loss was ¥1,743 million, compared with ordinary income of ¥130 million, and net loss attributable to owners of the parent was ¥1,653 million, compared with net income attributable to owners of the parent of ¥88 million. As of 31 December 2020, consolidated net assets were negative ¥376 million, resulting in negative net worth and circumstances giving rise to significant doubt about the going-concern assumption.」

「As a result, for the six months ended 30 September 2020, revenue was ¥1,701 million, down 58.5% year on year; the operating loss was ¥1,439 million, compared with operating income of ¥97 million in the year-earlier period; the ordinary loss was ¥1,376 million, compared with ordinary income of ¥86 million; and the net loss for the quarter attributable to owners of the parent was ¥1,376 million, compared with net income attributable to owners of the parent of ¥61 million. As consolidated net assets were negative ¥325 million as of 30 September 2020, resulting in insolvency, circumstances arose that raised significant doubt about the going-concern assumption.」

「In particular, at marriage agencies in the matchmaking area, requests to reconsider enrollment timing increased, and most matchmaking parties were canceled. In the casual wedding area, most wedding ceremonies and receptions and wedding after-parties were postponed or canceled.」

「As of the end of the fiscal year ended March 2020, our group held ¥1,039 million in cash and deposits. However, if the impact of the spread of infection lasts longer than our group expects, continued cash outflows are anticipated, potentially causing a significant deterioration in our group’s financial position.」