Inventory Obsolescence and Write-Down Risk
First written in FY2020. 4 of 9 entries say "Worsened", first in FY2022. Latest entry: FY2026.
King Jim moved to the "Worse" side of this theme in 2021, 1 year before the typical company in this theme (2022).
The whole theme swung hardest in 2022: 13 of 37 companies on the "Worse" side.
7 other companies' latest entry also says "Mitigated".
- FY2026MitigatedAnnual report
「The ending inventory balance is stated after a write-down of carrying value due to lower profitability, and the inventory write-down for the current consolidated fiscal year is included in cost of sales. ¥239.075 million」
The inventory write-down declined from ¥364.121 million in the previous fiscal year to ¥239.075 million, but write-downs continued to be recorded. - FY2025MitigatedAnnual report
「The ending inventory balance is stated after a write-down of carrying value due to lower profitability, and the inventory write-down for the current consolidated fiscal year is included in cost of sales. ¥364.121 million」
The inventory write-down declined from ¥621.468 million in the previous fiscal year to ¥364.121 million, but write-downs continued to be recorded. - FY2024-Q3WorsenedAnnual report
「In terms of profit, the cost-of-sales ratio improved following price revisions, but the improvement was limited by the yen's depreciation, which exceeded expectations, while the disposal of inventories of COVID-19-related products and higher SG&A expenses also weighed on results.」
The disposal of inventories of COVID-19-related products continued to weigh on earnings and led to a wider operating loss. - FY2024-Q2WorsenedAnnual report
「However, due in part to lower sales of products such as TEPRA and the Tette hand sanitizer dispenser, revenue was ¥11,551.08 million, down 3.4% year on year. Although price revisions improved the cost ratio, the disposal of inventories of COVID-19-related products and increases in selling, general and administrative expenses resulted in an operating loss of ¥919.73 million, compared with a loss of ¥456.62 million in the same period of the previous year.」
The disposal of inventories of COVID-19-related products emerged as a factor worsening earnings in the stationery and office supplies business, and the operating loss widened from the same period of the previous year. - FY2023WorsenedAnnual report
「The ending inventory balance is stated after a write-down of carrying value due to lower profitability, and the inventory write-down for the current consolidated fiscal year is included in cost of sales. ¥258.289 million」
The inventory write-down increased from ¥229.224 million in the previous fiscal year to ¥258.289 million. - FY2022WorsenedAnnual report
「The ending inventory balance is stated after a write-down of carrying value due to lower profitability, and the inventory write-down for the current consolidated fiscal year is included in cost of sales. ¥229.224 million」
The inventory write-down increased from ¥183.126 million in the previous fiscal year to ¥229.224 million. - FY2021MaterialisedAnnual report
「The ending inventory balance is stated after a write-down of carrying value due to lower profitability, and the inventory write-down for the current consolidated fiscal year is included in cost of sales. ¥183.126 million」
An inventory write-down of ¥183.126 million was recorded in cost of sales, and the risks of obsolescence and lower profitability materialized as an accounting loss. - FY2021-Q1RestatedAnnual report
「During the first quarter of the current consolidated fiscal year, there were no newly arising business or other risks, and no material changes to the business or other risks described in the securities report for the previous fiscal year.」
The company stated that there had been no material changes to the risk of inventory obsolescence and write-downs. - FY2020First statedAnnual report
「Changes in market conditions or discrepancies between expected and actual sales may cause actual sales to fall significantly below initial forecasts. If inventory cannot be sold at net realizable value because of a substantial decline in value due to obsolescence or other factors, or because of lower profitability, an inventory write-down will be recorded, which could affect our Group's performance.」
The company identified the possibility of inventory write-downs caused by discrepancies between demand forecasts and actual sales, obsolescence and lower profitability as a separate risk.