Material Doubts Regarding Going Concern and Liquidity Management Measures
First written in FY2020. 20 of 25 entries say "Mitigated", first in FY2022-Q1. Latest entry: 2026-10-23.
The whole theme swung hardest in 2020: 30 of 71 companies on the "Worse" side.
38 other companies' latest entry also says "Mitigated".
- FY2025MitigatedAnnual report
「Net assets are expected to be ¥1,075 million at the end of the fiscal year ending February 2025, bringing the company into compliance with the listing maintenance criteria for net assets.」
The company stated that financial support through a private placement, debt waivers and debt-to-equity conversions, together with improved earnings and expenses, had turned net assets positive and further reduced the risks related to the going concern assumption and negative net worth. - FY2025-H1MitigatedAnnual report
「The company pursued its capital policy and, as described in the 23 May 2024 notice titled “Issuance of Class A and Class B Shares through a Private Placement, Completion of Payment for the Issuance of the First Series of Stock Acquisition Rights through a Private Placement, and Reduction in the Amounts of Stated Capital and Capital Reserves,” implemented a private placement and other capital increases, together with waivers of claims and other measures by lending financial institutions and others. As of the end of the interim accounting period, the negative net worth had been eliminated.」
A private placement and other capital increases, together with the waiver of claims by financial institutions and others, were implemented, eliminating the negative net worth as of the end of the interim accounting period. Although the company continued to recognize circumstances raising material doubt because operating losses had continued through previous fiscal years, it determined that no material uncertainty existed. - FY2025-Q1MitigatedAnnual report
「During the first quarter, we advanced our capital policy. As stated in the notice dated 23 May 2024 concerning the issuance of Class A and Class B shares through a third-party allotment, completion of payment for the issuance of the First Series of Stock Acquisition Rights through a third-party allotment, and reductions in the amounts of capital and capital reserves, the capital increase through a third-party allotment and other measures, as well as debt waivers and other support from transaction financial institutions, were implemented. As a result, net assets stood at ¥782 million at the end of the quarter, eliminating the negative net worth.」
A private placement and the waiver of claims and debt-to-equity conversion by financial institutions and others were implemented, eliminating the negative net worth. Although the company continued to recognize material doubt in light of operating losses through previous fiscal years, it determined that no material uncertainty existed. - FY2024MitigatedAnnual report
「On 23 May 2024, lending financial institutions implemented a debt waiver of approximately ¥1.5 billion and a debt-to-equity conversion of approximately ¥500 million. Together with approximately ¥500 million raised through a private placement carried out on the same date, these measures eliminated the negative net worth and established a sound financial base. Accordingly, the company determined that no material uncertainty related to the going concern assumption existed.」
The company implemented a debt waiver, a debt-to-equity conversion and financing through a private placement, and stated that the negative net worth had been eliminated, the financial base established and material uncertainty resolved. - FY2024-Q3MitigatedAnnual report
「On 31 October 2023, the company extended the term of its syndicated commitment line agreement totaling ¥1.15 billion, with Mizuho Bank, Ltd. as arranger and agent.」
As a liquidity measure, the company extended the term of its commitment line agreement totaling ¥1.15 billion on 31 October 2023. Meanwhile, material uncertainty continued because the process for eliminating the negative net worth had not been decided. - FY2024-Q2MitigatedAnnual report
「On 31 July 2023, the company extended the term of its syndicated commitment line agreement totaling ¥1.15 billion, with Mizuho Bank, Ltd. as arranger and agent.」
As a liquidity measure for risks related to the going concern assumption, the company extended the term of its commitment line agreement totaling ¥1.15 billion on 31 July 2023. - FY2024-Q2WorsenedAnnual report
「However, negative net worth had continued for 1.5 years. Although various measures to strengthen capital were steadily progressing, the company determined that material uncertainty related to the going concern assumption existed because no specific process for eliminating the negative net worth had been decided as of that time, amid the need to respond to further yen depreciation and other factors.」
The company changed from its previous determination that no material uncertainty existed to a determination that material uncertainty existed, stating that negative net worth had continued for 1.5 years and that no specific process for eliminating it had been decided as of that time. - FY2024-Q1MitigatedAnnual report
「On 28 April 2023, the company extended the term of its syndicated commitment line agreement totaling ¥1.15 billion, with Mizuho Bank, Ltd. as arranger and agent.」
As a liquidity measure, the company extended the term of its syndicated commitment line agreement totaling ¥1.15 billion on 28 April 2023. - FY2024-Q1MitigatedAnnual report
「The company recorded an operating loss of ¥785 million and a net loss of ¥1,050 million in the previous fiscal year, and had negative net assets of ¥1,933 million at the end of that fiscal year. Although it recorded operating income of ¥139 million and quarterly net income of ¥137 million in the cumulative first-quarter period, showing signs of a recovery in profitability, it recognized that circumstances raising material doubt about the going concern assumption continued to exist because it still had negative net assets of ¥1,771 million at the end of the period.」
The company recorded operating income and quarterly net income in the first quarter, indicating signs of a recovery in profitability. However, negative net assets of ¥1,771 million and material doubt remained, and the company continued to secure working capital through coordination with financial institutions and borrowing facilities. - FY2023MitigatedAnnual report
「As a result of implementing these measures, operating cash flow turned positive in the current fiscal year, with an inflow of ¥149 million, the first positive figure since the fiscal year ended February 2018. In addition to soliciting applications for voluntary retirement, the company will work to eliminate its negative net worth during the fiscal year ending February 2024 through the steady implementation of various measures, as described in “2. Operating Conditions, 1. Management Policies, Operating Environment and Issues to Be Addressed, (3) Business and Financial Issues to Be Addressed as a Priority.”」
Although material events related to the going concern assumption remained, operating cash flow turned positive for the first time since the fiscal year ended February 2018, and the company continued to solicit applications for voluntary retirement and implement measures to eliminate its negative net worth. - FY2023-Q3MitigatedAnnual report
「The company recorded an operating loss of ¥2,153 million, a net loss of ¥2,146 million and an operating cash flow outflow of ¥2,219 million in the previous fiscal year, and an operating loss of ¥691 million and a quarterly net loss of ¥676 million in the cumulative third-quarter period. Accordingly, circumstances raising material doubt about the going concern assumption continued to exist. As measures to resolve this material doubt, the company entered into an overdraft agreement totaling ¥1.35 billion and a syndicated commitment line totaling ¥1.15 billion with its lending financial institutions, and determined that it could secure sufficient working capital through short-term borrowings of ¥373 million, long-term borrowings of ¥1,164 million and other measures. In addition, at a meeting of the Board of Directors held on 10 January 2023, the company resolved to solicit applications for voluntary retirement. Accordingly, it determined that no material uncertainty related to the going concern assumption existed.」
Although material doubt about the going concern assumption remained on a cumulative basis, the operating and net losses narrowed from the same period of the previous year. In addition to liquidity measures through borrowing facilities, the company resolved to solicit applications for voluntary retirement. The company determined that no material uncertainty existed. - FY2023-Q2MitigatedAnnual report
「As measures to resolve the material doubt about the going concern assumption, the company entered into an overdraft agreement totaling ¥1.35 billion and a syndicated commitment line totaling ¥1.15 billion with its lending financial institutions, and determined that it could secure sufficient working capital through short-term borrowings of ¥370 million, long-term borrowings of ¥1,175 million and other measures. Accordingly, it determined that no material uncertainty related to the going concern assumption existed.」
Operating losses, net losses and operating cash flow outflows continued, but the company continued measures to secure working capital through overdrafts, a commitment line and short- and long-term borrowings, reaffirming its determination that no material uncertainty existed. The commitment line agreement was also extended on 25 July 2022. - FY2023-Q1MitigatedAnnual report
「The company recorded an operating loss of ¥2,153 million, a net loss of ¥2,146 million and an operating cash flow outflow of ¥2,219 million in the previous fiscal year, and an operating loss of ¥145 million and a quarterly net loss of ¥139 million in the cumulative first-quarter period. Accordingly, circumstances raising material doubt about the going concern assumption continued to exist. As measures to resolve this material doubt, the company entered into an overdraft agreement totaling ¥1.35 billion and a syndicated commitment line totaling ¥1.15 billion with its lending financial institutions, and determined that it could secure sufficient working capital through short-term borrowings of ¥373 million, long-term borrowings of ¥1,185 million and other measures. Accordingly, it determined that no material uncertainty related to the going concern assumption existed.」
Although material doubt about the going concern assumption continued, the loss for the quarter narrowed from the same period of the previous year. After presenting measures to secure working capital through overdrafts, a commitment line and borrowings, the company determined that no material uncertainty existed. - FY2022MitigatedAnnual report
「The company is coordinating with its lending financial institutions to avoid disruptions to future liquidity management. In addition to an overdraft agreement totaling ¥1,467 million, it has entered into a syndicated commitment line totaling ¥1.15 billion and obtained short-term borrowings of ¥373 million and long-term borrowings of ¥1,196 million. Accordingly, it determined that no material uncertainty related to the going concern assumption existed.」
The material events continued due to an operating loss of ¥2,153 million, a net loss of ¥2,146 million and an operating cash flow outflow of ¥2,219 million. Meanwhile, the company continued liquidity measures through overdrafts, a commitment line and short- and long-term borrowings, obtained a waiver from its financial institutions for the current-period determination under the net worth maintenance covenant, and determined that no material uncertainty existed. - FY2022-Q3MitigatedAnnual report
「The company recorded an operating loss of ¥3.4 billion, a net loss of ¥3,139 million and an operating cash flow outflow of ¥1,457 million in the previous fiscal year, and an operating loss of ¥1,589 million and a quarterly net loss of ¥1,570 million in the cumulative third-quarter period. Accordingly, circumstances raising material doubt about the going concern assumption continued to exist.」
Although circumstances raising material doubt about the going concern assumption continued, the operating and net losses for the cumulative third-quarter period narrowed from the same period of the previous year. The company determined that it could secure working capital through a ¥1,477 million overdraft, an ¥1.15 billion commitment line and ¥1.2 billion in borrowings, and stated that no material uncertainty existed. - FY2022-Q2MitigatedAnnual report
「The company recorded an operating loss of ¥3.4 billion, a net loss of ¥3,139 million and an operating cash flow outflow of ¥1,457 million in the previous fiscal year, and an operating loss of ¥1,279 million, a quarterly net loss of ¥1,294 million and an operating cash flow outflow of ¥2,159 million in the cumulative second-quarter period. Accordingly, circumstances raising material doubt about the going concern assumption continued to exist.」
Although circumstances raising material doubt about the going concern assumption continued, the operating and net losses for the cumulative second-quarter period narrowed from the same period of the previous year. Measures to secure working capital through an overdraft totaling ¥1.4 billion, an ¥1.15 billion commitment line and ¥1 billion in long-term borrowings also continued. - FY2022-Q1MitigatedAnnual report
「As measures to resolve the material doubt about the going concern assumption, the company entered into an overdraft agreement totaling ¥1.4 billion with its lending financial institutions and a syndicated commitment line totaling ¥1.15 billion, and determined that it could secure sufficient working capital through ¥1 billion in long-term borrowings and other measures. The company is implementing measures to resolve these material events. Accordingly, it determined that no material uncertainty related to the going concern assumption existed.」
Although circumstances raising material doubt about the going concern assumption continued, the company indicated that it would secure working capital through an overdraft agreement, a commitment line and long-term borrowings, and determined that no material uncertainty existed. - FY2021-Q3WorsenedAnnual report
「The company recorded an operating loss of ¥431 million, a net loss of ¥1,051 million and an operating cash flow outflow of ¥128 million in the previous fiscal year, and an operating loss of ¥2,544 million and a quarterly net loss of ¥2,439 million in the cumulative third-quarter period. Accordingly, circumstances raising material doubt about the going concern assumption continued to exist, but as described in “2. Operating Conditions, (2) Analysis of Financial Position, Operating Results and Cash Flows by Management, (5) Material Events Related to the Going Concern Assumption,” the company is implementing measures to resolve these material events.」
Material doubt about the going concern assumption continued due to an operating loss of ¥2,544 million and a quarterly net loss of ¥2,439 million in the cumulative third-quarter period. The company also implemented liquidity measures including a ¥1.4 billion overdraft agreement, an ¥1.15 billion commitment line, a payment deferral program and ¥500 million in borrowings. - FY2021-Q2WorsenedAnnual report
「The company recorded an operating loss of ¥431 million, a net loss of ¥1,051 million and an operating cash flow outflow of ¥128 million in the previous fiscal year, and an operating loss of ¥2,031 million, a quarterly net loss of ¥1,952 million and an operating cash flow outflow of ¥2,360 million in the cumulative second-quarter period. Accordingly, circumstances raising material doubt about the going concern assumption continued to exist, but as described in “2. Operating Conditions, (2) Analysis of Financial Position, Operating Results and Cash Flows by Management, (6) Material Events Related to the Going Concern Assumption,” the company is implementing measures to resolve these material events.」
Material doubt about the going concern assumption continued due to an operating loss of ¥2,031 million, a net loss of ¥1,952 million and an operating cash flow outflow of ¥2,360 million in the cumulative second-quarter period. - FY2021-Q1WorsenedAnnual report
「The company recorded an operating loss of ¥431 million, a net loss of ¥1,051 million and an operating cash flow outflow of ¥128 million in the previous fiscal year, and an operating loss of ¥1,066 million and a quarterly net loss of ¥1,049 million in the cumulative first-quarter period. Accordingly, circumstances raising material doubt about the going concern assumption continued to exist, but as described in “2. Operating Conditions, (2) Analysis of Financial Position, Operating Results and Cash Flows by Management, (5) Material Events Related to the Going Concern Assumption,” the company is implementing measures to resolve these material events.」
Material doubt about the going concern assumption continued from the previous fiscal year, and the company recorded an operating loss of ¥1,066 million and a quarterly net loss of ¥1,049 million in the first quarter. It is implementing measures including a ¥1.3 billion overdraft agreement and an ¥1.15 billion commitment line. - FY2020MaterialisedAnnual report
「The company determined that circumstances existed that raised material doubt about the going concern assumption because it recorded an operating loss of ¥1,623 million, a net loss of ¥2,013 million and an operating cash flow outflow of ¥116 million in the previous fiscal year, and an operating loss of ¥431 million, a net loss of ¥1,051 million and an operating cash flow outflow of ¥128 million in the current fiscal year.」
Against the backdrop of losses and operating cash flow outflows in the previous and current fiscal years, the company for the first time described as a separate material matter the existence of circumstances raising material doubt about the going concern assumption. It also presented measures to secure working capital through overdraft agreements, borrowings, the securitization of financial instruments, and tax and social insurance payment deferral programs.