ARIAKE JAPAN Co.,Ltd.

The Group's net sales are largely dependent on the Japanese domestic market, and changes in economic conditions and consumer spending trends have a direct impact on business results. Although there are signs of economic recovery against the backdrop of monetary easing, a shift to full-fledged economic growth remains uncertain, and should demand decline or unforeseen circumstances occur, this could adversely affect business results and financial condition. No specific countermeasures are explicitly stated in the securities report.

A significant portion of net sales derives from the supply of raw materials to customers such as food manufacturers, and these customers themselves are exposed to intense competition in responding to rapidly shifting consumer preferences. If the Group fails to adequately anticipate market changes and cannot provide appropriate products and services, this may lead to sluggish sales and reduced profitability. The Company has stated a policy of addressing this through the continued provision of products that are "safe and reliable" and "delicious, healthy, and easy to use."

Toward future growth, the Company has made approximately ¥20 billion in capital investment worldwide over the past several years, establishing and expanding plants. Should unforeseen circumstances prevent these business operations from proceeding as planned, there is a risk that growth targets will not be achieved. In addition, unexpected obstacles in M&A undertaken as part of business strategy could result in unanticipated time and costs.

The Company may undertake corporate acquisitions as part of its business strategy, and if unexpected integration obstacles arise after an acquisition, there is a risk of requiring unanticipated costs and time. Such situations could adversely affect the Group's business results and financial condition. The securities report does not include specific descriptions of due diligence processes or post-merger integration management systems.

The Group conducts business in multiple countries and is inherently exposed to country risks such as unexpected changes in laws and regulations, political and economic turmoil, and social disruption caused by terrorism or war. Should these factors materialize, they could adversely affect business results and financial condition through a decline in local business operations. No specific countermeasures are explicitly stated in the securities report.

The Company imports raw materials from overseas subsidiaries, and sharp fluctuations in exchange rates directly affect procurement costs. In a yen depreciation scenario, profitability may decline due to rising import costs, affecting business results and financial condition. The securities report does not describe specific foreign exchange risk management measures such as hedging instruments.

The Group is subject to various public regulations, including food-related laws and regulations, in each country where it conducts business. Failure to comply with these regulations could restrict business activities and increase costs, adversely affecting business results and financial condition. The Company has stated a policy of striving to comply with regulations in each country, but specific details of its management framework are not disclosed in the securities report.

The Company has established and strives to comply with a framework in line with the intent of the Personal Information Protection Act; however, should personal information be leaked and cause significant loss to customers or others, this could severely damage social trust and affect business results. Against the backdrop of digitalization, risks such as cyberattacks also exist, but specific descriptions of security measures in the securities report are limited.

Damage to production facilities caused by natural disasters such as earthquakes or floods could interrupt production lines, leading to lower sales and increased costs. The Company conducts regular disaster prevention inspections and equipment checks, but explicitly states that there is no guarantee that natural disasters can be fully prevented. Details regarding the concentration of production sites or business continuity planning (BCP) are not disclosed in the securities report.