Tama Home Co., Ltd.

Because deliveries of detached houses have a structural seasonality concentrated in the fourth quarter (the March-May moving season), if external factors such as economic conditions or natural disasters disrupt deliveries in the fourth quarter, sales for that period could decline significantly, potentially affecting business performance and financial condition. As a countermeasure, the Company is promoting the leveling of construction start timing to suppress seasonal fluctuations in the number of units delivered and to diversify risk across quarters.

Because the primary customers are individual first-time buyers, the Company is susceptible to changes in personal consumption trends caused by economic and interest rate fluctuations, consumption tax rate revisions, and changes in tax systems such as housing loan tax deductions. If unfavorable changes occur in the housing industry, orders and sales could decline, potentially affecting business performance and financial condition. As a countermeasure, the Company accurately captures changes in the market environment and swiftly develops products responsive to demand to reduce the impact of order declines.

Compliance with a wide range of laws and regulations is required, particularly in the housing construction business. If the construction business license under the Construction Business Act were to be revoked or become unrenewable, this could significantly impede business activities. There is also a risk that revisions or abolition of existing regulations, or the introduction of new legal regulations, could affect business performance. As a countermeasure, the Company continuously provides compliance education to employees and maintains a structure to ensure that license renewals proceed without disruption.

Since the Company's main business is the construction contracting of wooden custom-built houses, there is a risk that a sharp rise in the prices of major materials such as lumber could increase procurement costs. Additionally, if labor shortages among subcontractors and other partners expand beyond expectations, construction costs could rise, potentially affecting business performance. As a countermeasure, the Company has established a monitoring system for cost fluctuations and implements advance procurement measures and alternative strategies to minimize adverse effects.

In the event of a large-scale natural disaster such as an earthquake or typhoon, substantial costs may arise from repair of owned facilities and construction sites, as well as from initial response activities such as building inspections and emergency measures. Furthermore, business interruption and delivery delays due to supply chain disruption or damage to social infrastructure could affect business performance and financial condition. As a countermeasure, the Company maintains casualty insurance on owned assets and managed properties, and has established a system for personnel support and switching to alternative procurement routes.

If a sharp change in real estate prices leads to price reductions, delays in nearby development plans, or discovery of defects such as soil contamination or buried structures resulting in the suspension or postponement of projects, impairment losses on real estate for sale may occur. There is also a risk that impairment processing may become necessary for other tangible fixed assets and investment securities due to changes in the market and business environment. The Company addresses this by conducting thorough investigations at the time of acquisition regarding location conditions, competing property trends, the presence of buried structures, and price fluctuations.

The Company holds a large amount of customers' personal information, and if a security incident such as a cyberattack were to occur, the leakage of personal information could result in a loss of social trust and affect business performance. Although the Company has established the "Personal Information Protection Regulations" and continuously implements company-wide countermeasures, risks associated with the increasing sophistication and diversification of cyberattacks continue to exist.

As the Company operates overseas businesses with subsidiaries established in Singapore, Vietnam, and elsewhere, the occurrence of terrorism, military coups, large-scale civil unrest, or major changes in legal systems could stagnate business activities, potentially affecting business performance and financial condition. The Company has established an Overseas Business Office at its head office to collect information and oversee responses regarding the economic, social, and political situations, as well as legal and regulatory trends, in each country.

Lawsuits and claims may arise from nonconformity with contracts (defects) in sold houses and real estate, or from complaints by neighboring residents during construction periods. If a significant lawsuit were to occur, it could result in substantial costs and a major loss of social trust, potentially affecting business performance and financial condition. At present, no lawsuits with a material impact on business performance have been filed, but the Company strives to reduce this risk through thorough quality control.

If an infectious disease causing health damage to employees and business partners were to spread, business activities could be restricted through office closures and supply chain disruptions, potentially affecting business performance. As a countermeasure, the Company has established a response headquarters at its head office to gather information on infectious diseases and to build a system to minimize the impact of the spread of infection.