Recognition of Other Income and Other Expenses (IFRS)
Certain consolidated subsidiaries (individual names not disclosed)
Goodwill, contingent consideration and NCI puts at certain consolidated subsidiaries (the names of the subsidiaries are not disclosed)
Under IFRS, contingent consideration and NCI puts must be remeasured at fair value each period; conservative estimates were used to limit potential future valuation losses; impairment losses were recognized as a result of conservative estimates of future cash flows; and revenue and profit at certain consolidated subsidiaries grew beyond the conservative estimates.
Other income: ¥1,079 million decrease in the fair value of contingent consideration and ¥112 million decrease in the fair value of NCI puts. Other expenses: ¥784 million in impairment losses and a ¥140 million increase in the fair value of contingent consideration.
Cumulative consolidated period for the second quarter (interim period) of the fiscal year ending December 2026 (the impairment losses relate to the interim consolidated accounting period)
There is no change to the full-year consolidated earnings forecast for the fiscal year ending December 2026 announced on 13 February 2026.
The other income and other expenses recognized have been reflected in the Consolidated Financial Results for the Second Quarter (Interim Period) of the Fiscal Year Ending December 2026 [IFRS] released today. The full-year consolidated earnings forecast will remain unchanged.
| Item | Details |
|---|---|
| Event name | Recognition of Other Income and Other Expenses (IFRS) |
| Date of occurrence | As of the end of June 2026 (cumulative first-half period) and during the interim consolidated accounting period |
| Subject Entity | Certain consolidated subsidiaries (individual names not disclosed) |
| Target Locations / Products | Goodwill, contingent consideration and NCI puts at certain consolidated subsidiaries (the names of the subsidiaries are not disclosed) |
| Cause | Under IFRS, contingent consideration and NCI puts must be remeasured at fair value each period; conservative estimates were used to limit potential future valuation losses; impairment losses were recognized as a result of conservative estimates of future cash flows; and revenue and profit at certain consolidated subsidiaries grew beyond the conservative estimates. |
| Amount of Impact on Business Performance | Other income: ¥1,079 million decrease in the fair value of contingent consideration and ¥112 million decrease in the fair value of NCI puts. Other expenses: ¥784 million in impairment losses and a ¥140 million increase in the fair value of contingent consideration. |
| Accounting period in which recognized | Cumulative consolidated period for the second quarter (interim period) of the fiscal year ending December 2026 (the impairment losses relate to the interim consolidated accounting period) |
| Impact on Earnings Forecast | There is no change to the full-year consolidated earnings forecast for the fiscal year ending December 2026 announced on 13 February 2026. |
| Outlook | The other income and other expenses recognized have been reflected in the Consolidated Financial Results for the Second Quarter (Interim Period) of the Fiscal Year Ending December 2026 [IFRS] released today. The full-year consolidated earnings forecast will remain unchanged. |
Items this document does not state (16)
These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.
The reasons the company gives
The company's own explanation, not something inferred from the numbers.Under IFRS, contingent consideration and NCI puts must be remeasured at fair value each period, with the resulting changes in fair value recognized as other income or other expenses. Conservative estimates were used to limit potential future valuation losses, resulting in decreases in fair value being recognized as income. At some consolidated subsidiaries, however, revenue and profit grew beyond the conservative estimates, resulting in an increase in the fair value of contingent consideration being recognized as an expense. In addition, impairment losses were recognized, primarily on goodwill at certain consolidated subsidiaries, following conservative estimates of future cash flows.