Impairment Risk from Deteriorating Profitability and Declining Market Value of Fixed Assets
First written in FY2020. 5 of 10 entries say "Materialised", first in FY2022. Latest entry: FY2026.
The whole theme swung hardest in 2020: 51 of 96 companies on the "Worse" side.
- FY2026MaterialisedAnnual report
「As a result, it became necessary to additionally recognize an asset, consisting of a building, for removal costs corresponding to the asset retirement obligation. Since an impairment indicator was identified for some of the leasing facilities owned in the district, the company tested for impairment and reduced the carrying amount of the asset group to its recoverable amount, recording the reduction as an impairment loss.」
An impairment loss of ¥1,647 million was recognized for the Haneda Airport 1-chome district, up from ¥1,223 million in the previous fiscal year. The impact of higher construction costs and revised demolition methods on the profitability and recoverability of fixed assets has materialized. - FY2026-H1MaterialisedAnnual report
「Due to the recent sharp rise in construction costs and the need to partially revise the demolition methods in the Haneda Airport 1-chome district, the company obtained the latest information and revised its estimate of demolition costs. The ¥2,354 million increase resulting from the change in estimate was added to the asset retirement obligation balance before the change. As a result, an asset, consisting of a building, was recognized as the removal cost corresponding to the asset retirement obligation, and an impairment loss of ¥1,647 million was recorded as an extraordinary loss.」
The risk of deteriorating profitability and impairment materialized in the form of a ¥1,647 million impairment loss in the Haneda Airport 1-chome district due to higher construction costs and the revision of demolition methods. - FY2025MaterialisedAnnual report
「For the Haneda Airport 1-chome district assets described above, an impairment indicator was identified for some of the leasing facilities owned in the district following the partial determination of the policy for the Haneda Airport 1-chome Project resolved at the Board of Directors meeting held on 28 November 2024. As a result of measuring impairment, the carrying amount of the asset group was reduced to its recoverable amount, and an impairment loss of ¥1,223.100 million was recognized.」
The risk of deteriorating profitability and declining market value of fixed assets actually materialized as an impairment loss of ¥1,223.100 million on leasing facilities in the Haneda Airport 1-chome district. - FY2024MitigatedAnnual report
「Extraordinary losses fell 98.3% year on year to ¥12 million, mainly because the impairment loss and valuation loss on shares of a subsidiary recorded in the previous fiscal year did not arise in the current fiscal year.」
No new impairment losses arose in FY2024 on the Kyoto hotel and other properties where impairment losses were recorded in the previous fiscal year, indicating that the impact of impairment has eased following asset rationalization, including sales. - FY2024-Q1MitigatedAnnual report
「Revenue also declined partly because of the impact of the sale in February 2023 of leased hotels and office buildings.」
The sale of hotel-leasing properties and other assets where the risk of deteriorating profitability and impairment had materialized was completed in February 2023, confirming that exposure to the fixed assets is being reduced. - FY2023-Q3MitigatedAnnual report
「To further improve asset efficiency and financial strength.」
For the hotel-leasing property in Kyoto on which an impairment loss was recognized, a transfer agreement was concluded citing the improvement of asset efficiency and financial strength, and measures to reduce exposure to the asset are progressing. - FY2022MaterialisedAnnual report
「The company recognized an impairment loss on leased hotel properties in Kyoto and decided to consider selling them to further improve asset efficiency, as the recovery in inbound demand has been delayed.」
The risk of deteriorating profitability and declining market value of fixed assets actually materialized as an impairment loss of ¥1,463.674 million on hotel-leasing properties in Kyoto. - FY2020First statedAnnual report
「If the profitability of invested fixed assets deteriorates significantly or their market value declines, the application of impairment accounting for fixed assets may result in the recognition of an impairment loss, which could affect the group's operating results and financial position.」
In connection with the real estate leasing business, the company has identified impairment risk from deteriorating profitability and declining market value of fixed assets as a major risk for the first time. This also relates to accounting estimates reflecting the impact of COVID-19.