Significant Doubt Regarding the Going-Concern Assumption Due to COVID-19
First written in FY2021-Q2. 7 of 23 entries say "Worsened", first in FY2021-Q3. Latest entry: FY2027-H1.
Naigai moved to the "Worse" side of this theme in 2025, 5 years after the typical company in this theme (2020).
The whole theme swung hardest in 2025: 2 of 10 companies on the "Worse" side.
1 other company's latest entry also says "Restated".
- FY2027-H1RestatedAnnual report
「Our Group recorded an operating loss in the previous consolidated fiscal year, while operating cash flow also remained negative. As an operating loss was recorded in the current interim consolidated period as well, we recognize that events or conditions raising substantial doubt about the going-concern assumption exist.」
Although recognition of conditions raising substantial doubt about the going-concern assumption continues due to the operating loss and negative operating cash flow, the Group maintains its determination that no material uncertainty exists, citing execution of the Sixth Medium-Term Management Plan, a shift in its earnings structure, improved inventory efficiency, optimization of fixed costs and continued lending as countermeasures. - FY2026WorsenedAnnual report
「Although our Group recorded operating income in the previous consolidated fiscal year, operating cash flow remained negative, and we recorded an operating loss in the current consolidated fiscal year. Based on these circumstances, we recognize that events or conditions raising substantial doubt about the going-concern assumption exist.」
After recording operating income in the previous consolidated fiscal year, the Group recorded an operating loss of ¥136 million in the current consolidated fiscal year, while negative operating cash flow continued. Recognition of the significant events therefore worsened. - FY2026-H1ReframedAnnual report
「Although our Group recorded positive operating income for 2 consecutive fiscal years in the previous consolidated fiscal year, operating cash flow remained negative. Accordingly, we recognize that events or conditions raising substantial doubt about the going-concern assumption continue to exist. To resolve these circumstances, our Group plans to turn operating cash flow positive through the steady execution of the Sixth Medium-Term Management Plan announced on 3 February 2025. Accordingly, we have determined that no material uncertainty exists regarding the going-concern assumption for our Group at present.」
Although operating income was positive for 2 consecutive fiscal years, conditions raising substantial doubt due to negative operating cash flow continue. The relevant response plan shifted from the Fifth Medium-Term Management Plan to the Sixth Medium-Term Management Plan. - FY2025-H1RestatedAnnual report
「Although our Group returned to positive operating income for the first time in 5 fiscal years, operating cash flow remained negative. Accordingly, we recognize that events or conditions raising substantial doubt about the going-concern assumption continue to exist.」
Even after operating income returned to positive territory in the previous consolidated fiscal year, negative operating cash flow led the Group to maintain its recognition that conditions raising substantial doubt about the going-concern assumption exist. At the same time, it stated that financial stability had been secured through cash on hand, including continued lending. - FY2025-Q1RestatedAnnual report
「Although our Group returned to positive operating income for the first time in 5 fiscal years, operating cash flow remained negative. Accordingly, we recognize that events or conditions raising substantial doubt about the going-concern assumption continue to exist. To resolve these circumstances, our Group will work to rebuild and secure its earnings base by executing the business portfolio strategy set out in the Fifth Medium-Term Management Plan. Regarding funding, we have secured sufficient cash on hand, including continued lending from financial institutions, and financial stability has been secured. Based on the foregoing, we have determined that no material uncertainty exists regarding the going-concern assumption for our Group at present.」
Recognition of conditions raising substantial doubt due to negative operating cash flow continues. However, the Group maintains its determination that no material uncertainty exists, citing the rebuilding of its earnings base under the Fifth Medium-Term Management Plan and sufficient cash on hand. - FY2024MitigatedAnnual report
「Although our Group returned to positive operating income for the first time in 5 fiscal years, operating cash flow remained negative for the 5th consecutive fiscal year. Accordingly, we recognize that events or conditions raising substantial doubt about the going-concern assumption continue to exist. To resolve these circumstances, our Group is advancing the initiatives described in “1. Management Policy, Business Environment and Issues to Be Addressed, (4) Issues to Be Addressed, 1. Rebuilding and Securing the Earnings Base through a Business Portfolio Strategy,” and our plan for the following consolidated fiscal year calls for positive operating cash flow. Regarding funding, we have secured sufficient cash on hand, including continued lending from financial institutions, and financial stability has been secured. Based on the foregoing, we have determined that no material uncertainty exists regarding the going-concern assumption for our Group at present.」
Although conditions raising substantial doubt due to negative operating cash flow for 5 consecutive fiscal years continue, the Group maintains its determination that no material uncertainty exists, citing its plan to turn operating cash flow positive in the following fiscal year and its sufficient cash on hand. - FY2024-Q3RestatedAnnual report
「Although operating income had not yet returned to positive territory in the nine months ended the third quarter, it had improved substantially from the previous year. The Group maintains its expectation of a return to full-year profitability and its determination that no material uncertainty exists.」
Although operating income had not yet returned to positive territory in the nine months ended the third quarter, it had improved substantially from the previous year, and the Group maintained its expectation of a return to full-year profitability and its determination that no material uncertainty exists. - FY2024-Q2MitigatedAnnual report
「In the previous consolidated fiscal year, our Group recorded operating income and operating cash flow losses for 4 consecutive fiscal years due to the effects of COVID-19, the sharp depreciation of the yen since the beginning of the year and surging global raw material prices. Accordingly, we recognize that conditions raising substantial doubt about the going-concern assumption exist. Under these circumstances, during the current consolidated fiscal year we are securing financial stability, including continued lending from financial institutions, and focusing on operating measures aimed at returning operating income to positive territory. As announced on 17 March 2023, our forecast for the current consolidated fiscal year calls for consolidated net sales of ¥13.5 billion and a return to positive operating income of ¥200 million for the full year. Although profitability had not yet been restored in the six months ended the second quarter of the current consolidated fiscal year, operating income improved substantially year on year as progress remained in line with the plan, and we recognize that a return to profitability is expected for the full year. Based on the foregoing, we have determined that no material uncertainty exists regarding the going-concern assumption for our Group at present.」
Although recognition of substantial doubt due to operating income and operating cash flow losses for 4 consecutive fiscal years continues, the Group maintains its forecast for full-year consolidated net sales of ¥13.5 billion and a return to positive operating income of ¥200 million. As operating income improved year on year in the cumulative period through the current quarter, it has determined that no material uncertainty exists. - FY2024-Q1MitigatedAnnual report
「In the previous consolidated fiscal year, our Group recorded operating losses and negative operating cash flow for 4 consecutive fiscal years due to the effects of COVID-19, the sharp depreciation of the yen since the beginning of the year and surging global raw material prices. Accordingly, we continue to recognize the existence of conditions that raise substantial doubt about the going-concern assumption. Under these circumstances, during the current consolidated fiscal year we are securing financial stability, including continued lending from financial institutions, and focusing on operating measures aimed at returning operating income to positive territory. As announced on 17 March 2023, our forecast for the current consolidated fiscal year calls for consolidated net sales of ¥13.5 billion and a return to positive operating income of ¥200 million for the full year. Although the first quarter of the current consolidated fiscal year did not return to profitability for the period, progress was broadly in line with the plan, and the operating loss declined substantially from the previous year. We recognize that the announced forecast for a return to full-year profitability is achievable. Based on the foregoing, we have determined that no material uncertainty exists regarding the going-concern assumption for our Group at present.」
Although recognition of substantial doubt due to operating income and operating cash flow losses for 4 consecutive fiscal years continues, the Group expects full-year consolidated net sales of ¥13.5 billion and a return to positive operating income of ¥200 million. As the operating loss narrowed substantially from the previous year this quarter, it has determined that no material uncertainty exists. - FY2023WorsenedAnnual report
「In addition to the unstable economic and consumption environment amid the COVID-19 pandemic, whose complete resolution remains uncertain, our Group was affected by surging global resource and energy prices stemming from the war in Ukraine and a sharp depreciation of the yen due to the widening interest-rate differential between Japan and the United States. As a result, we did not achieve a return to positive operating income or operating cash flow in the current consolidated fiscal year and recorded a substantial operating loss. Accordingly, we continue to recognize the existence of conditions that raise substantial doubt about the going-concern assumption.」
Recognition of conditions raising substantial doubt about the going-concern assumption continued against a backdrop of operating losses and negative operating cash flow for 4 consecutive fiscal years. - FY2023-Q3WorsenedAnnual report
「In the previous consolidated fiscal year, our Group did not achieve a return to positive operating income or operating cash flow due to the effects of intermittent operating restrictions and lost consumption opportunities accompanying the spread of COVID-19. In addition, an operating loss of ¥903 million was recorded in the nine months ended the third quarter of the current consolidated fiscal year. Accordingly, we continue to recognize the existence of conditions that raise substantial doubt about the going-concern assumption.」
Recognition of conditions raising substantial doubt about the going-concern assumption continued, and the operating loss for the nine months ended the third quarter was ¥903 million. The deficit widened from the ¥338 million operating loss in the same quarter of the previous year. - FY2023-Q2WorsenedAnnual report
「In the previous consolidated fiscal year, our Group did not achieve a return to positive operating income or operating cash flow due to the effects of intermittent operating restrictions and lost consumption opportunities accompanying the spread of COVID-19. In addition, an operating loss of ¥569 million was recorded in the six months ended the second quarter of the current consolidated fiscal year. Accordingly, we continue to recognize the existence of conditions that raise substantial doubt about the going-concern assumption.」
Because the Group did not achieve a return to positive operating income or operating cash flow for the second consecutive fiscal year and recorded an operating loss of ¥569 million in the six months ended the second quarter, its recognition of substantial doubt about the going-concern assumption continued. - FY2023-Q1WorsenedAnnual report
「In the previous consolidated fiscal year, our Group did not achieve a return to positive operating income or operating cash flow due to the effects of intermittent operating restrictions and lost consumption opportunities accompanying the spread of COVID-19. In addition, an operating loss of ¥357 million was recorded in the nine months ended the first quarter of the current consolidated fiscal year. Accordingly, we continue to recognize the existence of conditions that raise substantial doubt about the going-concern assumption.」
Because the Group did not achieve a return to positive operating income or operating cash flow in the previous consolidated fiscal year and recorded an operating loss of ¥357 million this quarter, it continues to recognize conditions raising substantial doubt about the going-concern assumption. - FY2022MitigatedAnnual report
「Operating efficiency achieved through cost and inventory controls also contributed to earnings. Although an ordinary loss of ¥26 million remained, ordinary profit improved by ¥1,720 million, and net income attributable to owners of the parent improved by ¥1,961 million, including the recognition of extraordinary income, resulting in a return to profitability.」
Although an ordinary loss remained, ordinary profit improved by ¥1,720 million, and net income attributable to owners of the parent returned to profitability. In light of the plan to turn operating income and operating cash flow positive in the next fiscal year, it was determined that no material uncertainty exists. - FY2022-Q3MitigatedAnnual report
「As a result, by the nine-month period ended 31 December 2020, revenue had increased by ¥893 million and ordinary profit had improved by ¥1,014 million. As the full-year outlook calls for a return to positive ordinary profit through higher revenue and profit, we have determined that, at this time, there is no material uncertainty regarding the going-concern assumption for our group.」
While recognizing the existence of conditions raising substantial doubt about the going-concern assumption, it was determined that no material uncertainty exists at present, based on improved cumulative performance and the outlook for positive ordinary income for the full year. - FY2022-Q1MitigatedAnnual report
「As a result, during the nine-month period ended 30 June 2020, sales recovered broadly in line with plan, and operating profit and operating cash flow were also progressing toward a return to positive territory. Accordingly, we have determined that, at this time, there is no material uncertainty regarding the going-concern assumption for our group.」
Although the recognition of conditions raising substantial doubt continued due to the substantial decline in revenue, operating loss and negative operating cash flow in the previous consolidated fiscal year, it was determined, in light of the return to profitability this quarter, that no material uncertainty exists at present. - FY2021MitigatedAnnual report
「As a result, operating cash flow for the current consolidated fiscal year recovered substantially to positive territory in the fourth quarter and was reduced to a negative ¥321 million for the full year, enabling us to maintain a net cash position sufficient to continue the business.」
Although conditions raising substantial doubt about the going-concern assumption remain, it was determined that no material uncertainty exists at present, based on additional financing, inventory reduction and the recovery of operating cash flow. - FY2021-Q3WorsenedAnnual report
「During the nine months ended the third quarter of the consolidated fiscal year ending January 2021, major commercial facilities nationwide closed and operating activities were restricted due to states of emergency and other measures accompanying the spread of COVID-19. Even after commercial facilities reopened following the lifting of the states of emergency, domestic consumption remained weak as the number of new infections repeatedly rose and fell. As a result, revenue declined substantially, an operating loss was recorded, and operating cash flow was negative.」
Conditions raising substantial doubt about the going-concern assumption continued, with a substantial decline in revenue, an operating loss and negative operating cash flow in the nine months ended the third quarter. - FY2021-Q2First statedAnnual report
「Based on these circumstances, we recognize that conditions exist that raise substantial doubt about the going-concern assumption. However, as described in “2. Management’s Analysis of Financial Position, Operating Results and Cash Flows, (4) Significant Events and Other Matters Related to the Going-Concern Assumption,” we have implemented measures to resolve these significant events. Accordingly, we have determined that no material uncertainty exists regarding the going-concern assumption.」
Against a backdrop of prolonged closures, a substantial decline in revenue, operating losses and negative operating cash flow due to COVID-19, the company stated for the first time that conditions existed that raised substantial doubt about the going-concern assumption. However, it determined that no material uncertainty exists because countermeasures are being implemented.