Risks Associated with Operations in China and the Philippines

「At our domestic and overseas sites, the Group actively promotes technical exchanges and mutual support and is building a structure that enables rapid and effective mutual backup in an emergency by sharing technology and knowledge.」

「In the electronic components industry to which our Group belongs, the outlook remains difficult, as production stoppages and inventory adjustments caused by the decline in private consumption in China and supply-chain disruptions have occurred intermittently.」

「The Group has been strongly affected by supply chain disruptions caused by lockdowns in China and soaring global consumer and energy prices resulting from the situation in Ukraine and other factors.」

「In the electronic components industry in which our Group operates, global demand for automobiles and industrial equipment remains high. However, supply chain disruptions caused by lockdowns in China and Russia's invasion of Ukraine have led to periods of unstable production, particularly in the automotive industry.」

「At our domestic and overseas sites, the Group actively promotes technical exchanges and mutual support and is building a structure that enables rapid and effective mutual backup in an emergency by sharing technology and knowledge.」

「ENOMOTO PHILIPPINE MANUFACTURING Inc. (the Philippines) was located in an area subject to lockdowns in the first half of 2020, resulting in disruptions including the suspension of deliveries to customers, worsening transportation conditions, reduced employee attendance as a result of measures taken by local authorities, and logistics backlogs. However, the order environment recovered sharply from the summer onward. ZHONGSHAN ENOMOTO Co.,Ltd. (Guangdong Province, China) was also affected in the first half of 2020, including by the extension of the Chinese New Year holiday, but employees subsequently returned to work promptly and the company maintained a favorable order environment.」

「At the Chinese subsidiary, production was temporarily suspended after the Chinese New Year holiday was extended. Employees subsequently returned to work promptly, and although operations were affected by worsening logistics conditions and other factors, the utilization rate has now recovered to the level of normal operations. At the Philippine subsidiary, however, disruptions have occurred due to local lockdowns imposed by the government, including the suspension of deliveries to customers, worsening transportation conditions, reduced employee attendance as a result of measures taken by local authorities, and logistics backlogs.」

「To address the globalization of customer needs, our Group has expanded its production footprint overseas, in China and the Philippines. In these countries, unexpected changes in laws or tax systems, adverse political or economic factors, and social disruption caused by terrorism, war or other factors could seriously affect the Group's ability to conduct its business.」

「To address the globalization of customer needs, our Group has expanded its production footprint overseas, in China and the Philippines. In these countries, unexpected changes in laws or tax systems, adverse political or economic factors, and social disruption caused by terrorism, war or other factors could seriously affect the Group's ability to conduct its business.」

「To address the globalization of customer needs, our Group has expanded its production footprint overseas, in China and the Philippines. In these countries, unexpected changes in laws or tax systems, adverse political or economic factors, and social disruption caused by terrorism, war or other factors could seriously affect the Group's ability to conduct its business.」