Risk of Post-M&A Integration Burdens, Failure to Achieve Synergies and Goodwill Impairment

「To pursue M&A transactions and similar activities that contribute to increasing the Group's corporate value, the Group first reviews the target company's operating condition and determines whether to proceed only after fully assessing its actual condition and value, including the presence or absence of financial and legal risks. After completing an M&A transaction or similar activity, the Group works to expand its business further by promoting cooperation among Group companies and increasing synergies.」

「Following an M&A transaction or similar activity, greater-than-expected burdens in aligning management policies with the target company or integrating various systems and procedures within operating divisions could prevent the Group from achieving the expected synergies. In addition, if operating performance falls short of expectations and future operating profit is expected to fall below forecasts, goodwill may need to be impaired, which could affect the Group's operating results and financial position.」

「In extraordinary income and expenses, the Company recorded an extraordinary loss of ¥210 million due to the impairment of goodwill at its consolidated subsidiary 株式会社トムス. As a result, net income attributable to owners of the parent was ¥144 million, down 34.5% year on year.」

「If aligning management policies with the other company or integrating various systems and frameworks in administrative divisions following an M&A transaction or similar initiative creates a greater-than-expected burden, the anticipated synergies may not be achieved. In addition, if results fail to meet expectations and future operating profit falls below forecasts, goodwill may need to be impaired, potentially affecting the Group’s business results and financial condition.」