Material Doubt Regarding Going Concern Arising from Breach of Financial Covenants
First written in FY2018. 14 of 25 entries say "Restated". Latest entry: FY2027-H1.
W-Scope moved to the "Worse" side of this theme in 2020, 2 years before the typical company in this theme (2022).
The whole theme swung hardest in 2022: 4 of 13 companies on the "Worse" side.
7 other companies' latest entry also says "Restated".
- FY2027-H1RestatedAnnual report
「The Group had events or conditions at the end of the current interim consolidated fiscal period that raised material doubt about the going concern assumption due to continued operating losses. However, in terms of the Group's financial position, taking into account the cash on hand secured at the end of the current interim consolidated fiscal period, projected future income and expenses, and financing plans with financial institutions, the company determined that no material uncertainty existed regarding the going concern assumption.」
Although circumstances raising material doubt have continued because of continued operating losses, the company maintains its determination that no material uncertainty exists based on cash on hand, projected income and expenses, and financing plans. - FY2026RestatedAnnual report
「The Group had events or conditions at the end of the current consolidated fiscal year that raised material doubt about the going concern assumption due to a substantial decline in revenue and continued and significant operating losses. However, in terms of the Group's financial position, it recorded positive cash flow from operating activities during the current consolidated fiscal year. Taking into account the cash on hand secured at the end of the current consolidated fiscal year, projected future income and expenses, financing plans with financial institutions, and the establishment of prospects for receiving subsidies from the Hungarian government, the company determined that no material uncertainty existed regarding the going concern assumption.」
Although circumstances raising material doubt have continued because of a substantial decline in revenue and continued operating losses, the company maintains its determination that no material uncertainty exists based on operating cash flow, cash on hand and financing plans. - FY2026-H1RestatedAnnual report
「The Group had events or conditions at the end of the current interim consolidated fiscal period that raised material doubt about the going concern assumption due to continued and significant operating losses. However, in terms of the Group's financial position, it recorded positive cash flow from operating activities during the current interim consolidated fiscal period. Taking into account the cash on hand secured at the end of the current interim consolidated fiscal period, projected future income and expenses, and financing plans with financial institutions, the company determined that no material uncertainty existed regarding the going concern assumption.」
Although circumstances raising material doubt have continued because of continued and significant operating losses, the company maintains its determination that no material uncertainty exists based on positive cash flow from operating activities, cash on hand, projected income and expenses, and financing plans. - FY2025Significant events disclosed againAnnual report
「In light of these circumstances, events or conditions existed as of the end of the current consolidated fiscal year that raised material doubt about the going concern assumption. However, based on the cash on hand secured at the end of the current consolidated fiscal year, projected future income and expenses under the company's annual business plan, and cash management including its consolidated subsidiaries, the company determined that no material uncertainty existed regarding the going concern assumption.」
Significant events regarding the going concern assumption, which had not been separately disclosed in the previous fiscal year, were disclosed again. Although concerns remained regarding the parent company's operating cash flow and debt payments, the company stated that it determined that no material uncertainty existed. - FY2024DroppedAnnual reportNo separate disclosure of material doubt or uncertainty regarding the going concern assumption could be identified in this annual securities report.
- FY2022-Q3MitigatedAnnual report
「As a result of the measures taken by the Group, the company's cash management had improved as of the end of the third quarter of the current consolidated fiscal period, and it was in a position to sufficiently cover working capital for the foreseeable future. Accordingly, the company determined that no events or conditions existed that raised material doubt about the Group's ability to continue as a going concern and that no material uncertainty existed regarding the going concern assumption.」
Following financing through the listing of WCP, production optimization and earnings improvement, cash management improved, and the company's assessment changed to no events or conditions raising material doubt and no material uncertainty. - FY2022-Q2RestatedAnnual report
「As a result of the measures taken by the Group, the company's cash management improved and it was in a position to sufficiently cover working capital for the foreseeable future. Accordingly, although events or conditions existed that raised material doubt about the Group's ability to continue as a going concern, the company determined that no material uncertainty existed regarding the going concern assumption.」
Although events or conditions that raise material doubt continue to exist, the company maintains its determination that no material uncertainty exists based on improved cash management and the securing of sufficient working capital for the foreseeable future. - FY2022-Q1MitigatedAnnual report
「As a result of the measures taken by the Group, the company's cash management improved and it was in a position to sufficiently cover working capital for the foreseeable future. Accordingly, although events or conditions existed that raised material doubt about the Group's ability to continue as a going concern, the company determined that no material uncertainty existed regarding the going concern assumption.」
Although events or conditions that raised material doubt remained, the company's assessment changed to no material uncertainty based on improved cash management and the securing of sufficient working capital for the foreseeable future. - FY2021Cash-management concerns at the parent company continued even after the return to operating profitabilityAnnual report
「The Group's operating results returned to profitability and it recorded positive cash flow from operating activities during the current consolidated fiscal year. However, the company continued to record negative operating cash flow and had concerns about debt payments, making it necessary to consider cash management for the Group, including its consolidated subsidiaries.」
Although the Group as a whole improved to operating profitability and positive operating cash flow, the reporting company had negative operating cash flow, and doubt regarding the going concern assumption remained. - FY2021-Q3Cash-management concerns continued even after the financial covenant breaches were resolvedAnnual report
「At the end of the previous quarter's consolidated fiscal period, the Group had circumstances that raised material doubt about the going concern assumption due in part to breaches of financial covenants relating to the acceleration of the company's long-term borrowings and the convertible bonds with share acquisition rights of a consolidated subsidiary. However, after the company sold part of its shares in its subsidiary W-SCOPE CHUNGJU PLANT CO., LTD. (hereinafter, WCP) in September 2021, it used the proceeds to repay in full the long-term borrowings that were subject to the covenant breaches, thereby resolving the company's breach of financial covenants relating to its long-term borrowings.」
Repaying all long-term borrowings with proceeds from the partial sale of WCP shares resolved the financial covenant breaches, but material doubt and uncertainty regarding the going concern assumption remained because of negative operating cash flow and cash-management concerns, including at subsidiaries. - FY2021-Q2RestatedAnnual report
「The Group continued to record operating losses and ordinary losses during the previous consolidated fiscal year. In addition, due in part to the recognition of impairment losses on non-current assets, total net assets on the consolidated balance sheet for the fiscal year ended December 2020 fell below 75% of total net assets on the consolidated balance sheet for the fiscal year ended December 2019. As a result, the Group breached financial covenants relating to the acceleration of long-term borrowings of the company and convertible bonds with share acquisition rights of a consolidated subsidiary. If those financial covenants were applied, the company would lose the benefit of the term with respect to its long-term borrowings and other obligations. In addition, of the company's long-term borrowings at the end of the second quarter of the current consolidated fiscal period, ¥2,543 million and ¥4,550 million were respectively due for repayment in November 2021 and December 2021. In light of these circumstances, events or conditions existed as of the end of the second quarter of the current consolidated fiscal period that raised material doubt about the going concern assumption.」
The filing states that material doubt regarding the going concern assumption continues, against the backdrop of continued operating and ordinary losses, net assets below 75%, breaches of financial covenants and repayment due in November and December 2021. - FY2021-Q1RestatedAnnual report
「In light of these circumstances, events or conditions existed as of the end of the first quarter of the current consolidated fiscal period that raised material doubt about the going concern assumption.」
The filing states that material doubt and uncertainty regarding the going concern assumption continue, against the backdrop of continued operating and ordinary losses, the level of net assets, breaches of financial covenants and long-term borrowings of ¥6,679 million due for repayment at the end of April 2021. - FY2020WorsenedAnnual report
「The Group continued to record operating losses and ordinary losses during the current consolidated fiscal year. In addition, due in part to the recognition of impairment losses on non-current assets, total net assets at the end of the current consolidated fiscal year fell below 75% of total net assets at the end of the previous consolidated fiscal year.」
In addition to continued operating and ordinary losses, impairment losses reduced net assets to below 75% of the level at the end of the previous fiscal year. Material uncertainty continued, together with breaches of financial covenants and repayment due in March 2021. - FY2020-Q3RestatedAnnual report
「In light of these circumstances, events or conditions existed as of the end of the third quarter of the current consolidated fiscal period that raised material doubt about the going concern assumption.」
Material doubt and uncertainty regarding the going concern assumption continue against the backdrop of operating losses, ordinary losses, the possibility of breaches of financial covenants and remedial measures that remain in progress. - FY2020-Q2WorsenedAnnual report
「Although sales of automotive batteries to major customers increased substantially during the second quarter of the current consolidated cumulative period, sales stagnated because some production lines were shut down from mid-April through May due to the spread of COVID-19, resulting in an operating loss and an ordinary loss.」
Although sales for automotive batteries grew, the shutdown of production lines and stagnation in sales caused by the impact of COVID-19 resulted in an operating loss and an ordinary loss, and material uncertainty regarding the going concern assumption continued. - FY2020-Q1RestatedAnnual report
「The company continues to recognize that material uncertainty exists regarding the going concern assumption as of the end of the first quarter of the current consolidated fiscal period.」
Because the measures remain in progress and business progress and financing could materially affect cash management, the company continues to recognize that material uncertainty exists. - FY2019WorsenedAnnual report
「In light of these circumstances, the measures being implemented by the company to resolve the material doubt regarding the going concern assumption are still in progress, and may materially affect the company's cash management depending on future business progress and the status of additional financing. Accordingly, the company recognizes that material uncertainty exists regarding the going concern assumption.」
The company's assessment changed from the previous determination that no material uncertainty existed to recognition that material uncertainty exists because the measures remain in progress and may affect cash management. - FY2019-Q3RestatedAnnual report
「Accordingly, although circumstances exist that raise material doubt about the Group's ability to continue as a going concern, the company has determined that no material uncertainty exists regarding the going concern assumption.」
The company continues to state that operating losses, ordinary losses and breaches of financial covenants raise material doubt about the going concern assumption, while maintaining its determination that no material uncertainty exists on the basis of remedial measures and waiver agreements with financial institutions. - FY2019-Q2WorsenedAnnual report
「In light of these circumstances, circumstances exist that raise material doubt about the going concern assumption. However, as described in "2. Management's Discussion and Analysis of Financial Condition, Operating Results and Cash Flows, (3) Remedial Measures to Resolve Significant Events and Conditions Related to the Going Concern Assumption," the company has determined that no material uncertainty exists regarding the going concern assumption because it is taking measures to resolve and improve these significant events and conditions.」
The previous quarter stated that no significant events or conditions existed, whereas the current quarter expressly states that circumstances exist that raise material doubt about the going concern assumption. However, the company continues to determine that no material uncertainty exists based on its remedial measures. - FY2019-Q1RestatedAnnual report
「During the first quarter of the current consolidated cumulative period, there were no occurrences of matters that could have a material impact on investors' decisions among those relating to the business conditions, financial condition and other matters described in this quarterly report, nor were there any material changes to the "Business and Other Risks" described in the annual securities report for the previous fiscal year. In addition, no significant events or conditions existed.」
The filing states that there were no material changes to the business and other risks and that no significant events or conditions existed. The breach of financial covenants itself continues to be disclosed in the notes. - FY2018First statedAnnual report
「Accordingly, although circumstances exist that raise material doubt about the Group's ability to continue as a going concern, the company has determined that no material uncertainty exists regarding the going concern assumption.」
A separate statement was included regarding circumstances that raise material doubt about the going concern assumption, against the backdrop of breaches of financial covenants and ordinary losses for 2 consecutive fiscal years. However, the company has determined that no material uncertainty exists based on waiver agreements with all financial institutions.