Fluctuations in Domestic Economic Conditions and Personal Consumption

「Fluctuations in Japan's domestic economy, sluggish personal consumption, and deterioration in the income environment could reduce demand for the group's businesses, resulting in lower sales and weaker profit margins. In addition, financing conditions tend to become more difficult during economic downturns, raising concerns that maintaining a stable financial base may become a challenge.」

「Consumer prices have risen across a broad range of goods, particularly resource-related items, against a backdrop of unstable international conditions and surging raw material and energy prices. Uncertainty over the outlook for Japan's economy has therefore continued.」

「In addition to the rapid spread of new variants, the outlook for the economy remains highly uncertain because of the impact of higher prices resulting from surging global resource prices and rising import purchase costs due to the weakening yen. The operating environment in Japan for the fiscal year ending March 2023 is therefore expected to remain difficult.」

「GDP was negative from July through September, and the decline in personal consumption became pronounced. From October onward, the number of COVID-19 cases fell sharply and consumer sentiment began to recover, but apparel spending did not achieve a full recovery over the quarter, while concerns about a sixth wave driven by the Omicron variant increased. The outlook therefore remained uncertain.」

「COVID-19 continued to spread, and the declaration of a fourth state of emergency in July restricted the movement of people and economic activity. As a result, personal consumption declined sharply, and apparel sales also remained difficult.」

「During the 3-month cumulative period of the current first quarter, Japan's economy remained difficult. There was no clear prospect of containing the spread of COVID-19, and the declaration of a third state of emergency in April restricted the movement of people and economic activity, causing personal consumption to decline sharply. Apparel sales also remained difficult. More recently, variants have been spreading at an unprecedented pace, and the economic outlook remains uncertain.」

「Because of the high transmissibility of the variants, the third state of emergency presented a different situation from the previous fiscal year. At some shopping centers, closures extended beyond specialty-store malls to the children's apparel sections operated by the company as in-store shops, and the operating environment for the fiscal year ending March 2022 is expected to remain even more difficult.」

「However, the spread of COVID-19 began to accelerate again nationwide around November, and the outlook for the economy has become extremely uncertain, with a state of emergency being declared again recently.」

「At present, all stores have resumed operations. However, the impact of the COVID-19 pandemic, which spread worldwide, has been severe across a broad range of industries, and a full recovery in Japan's economy is expected to take considerable time. The operating environment for the fiscal year ending March 2021 is therefore expected to remain extremely difficult.」

「During the 3-month cumulative period of the current third quarter, Japan's economy remained on a moderate recovery trend, supported by solid corporate earnings and the employment environment. However, the adverse effects of unstable international conditions on the domestic economy had not been dispelled, and the outlook remained uncertain.」

「In the apparel industry, consumers' strong inclination to economize on clothing has persisted amid price increases for daily necessities, and difficult conditions have continued.」

「Apparel sales remained sluggish, partly because consumer sentiment was dampened by record heat, torrential rain and typhoons, and higher-than-usual temperatures from October through November.」

「Real consumer spending declined for 4 consecutive months through May, partly due to unfavorable weather, and apparel sales consequently remained sluggish.」

「Meanwhile, although the employment environment has improved, real wages have been sluggish, consumers have felt little benefit from the economic recovery, and apparel sales have remained sluggish, so the outlook is expected to remain uncertain.」

「Meanwhile, although the economic recovery became the second-longest in the postwar period after the Izanagi boom, consumers have felt little benefit from it, and apparel sales have generally remained sluggish.」

「Meanwhile, although the economic recovery became the second-longest in the postwar period after the Izanagi boom, consumers have felt little benefit from it, and apparel sales have generally remained sluggish.」

「Although the employment environment has improved, wage growth has been sluggish, and real consumer spending continued to decline through May, with personal consumption remaining sluggish.」

「Although signs of a recovery have emerged in some areas, personal consumption has continued to lack strength amid concerns about economic conditions.」

「Although signs of a recovery have emerged in some areas, personal consumption has continued to lack strength amid concerns about economic conditions.」

「Amid growing concerns about the outlook, consumers have become increasingly focused on saving, and personal consumption has continued to lack strength.」

「Amid growing concerns about the outlook, consumers have become increasingly focused on saving, and personal consumption has remained weak.」

「Economic conditions, including domestic economic conditions and trends in personal consumption, may adversely affect the Group's operating results and financial position.」