QUICK CO.,LTD.

Business performance may be affected by changes in economic conditions, employment trends, and corporate hiring and training trends. In the promotion support-related business, since client companies' advertising expenditure fluctuates in line with economic conditions and consumer trends, a decline in domestic economic conditions is likely to lead to a decrease in demand for promotional services. The Company addresses this through regular information sharing on market trends at Board of Directors meetings and other venues, as well as by selecting focus areas and developing new products.

In the Human Resources Services Business (Recruitment Placement), the Company focuses on placement services for nurses, and business performance may be affected by a decline in personnel needs due to deregulation in the medical field and by intensifying competition with other companies for job seekers. In addition, the seasonal fluctuation in which profits are concentrated in the first quarter is attributable to the timing of new hires in the nursing field. The Company is working to reduce this dependence by strengthening sales in fields other than nursing and developing new markets.

In the Recruiting Business, many of the job advertisement placement slots handled are on Indeed Japan's media, resulting in a high level of dependence on that company. If Indeed Japan changes its sales strategy or promotional measures, or if the competitiveness of its job advertisement media declines, this could have a material impact on business activities and performance. The Company is working to reduce this dependence by building a diverse service provision system encompassing recruitment consulting, recruitment tool production, recruitment outsourcing, and employee training.

The Group's websites rely heavily on traffic drawn from search engines, and there is a risk that inflow to each website will decrease due to changes in search engine operators' ranking policies or the spread of AI-generated overview displays. If AI overview displays alone are sufficient to fulfill users' objectives, the effectiveness of attracting visitors may decline, potentially affecting business performance. The Company is addressing this by actively hiring specialized personnel in content production, system development, and promotion.

With the rapid technological innovation of generative AI, automation and efficiency improvements in matching are progressing, particularly in the mass-recruitment job advertising field, raising the possibility that part of the recruitment placement business may be replaced. The Group is strengthening areas that are difficult for AI to directly replace by focusing on highly specialized fields and services that emphasize individual career context. At the same time, the Company is promoting the use of AI to improve operational efficiency and service quality, striving to maintain its competitiveness.

The Human Resources Services Business is subject to regulations such as the Employment Security Act and the Worker Dispatching Act, and paid employment placement services and worker dispatching require licenses from the Minister of Health, Labour and Welfare. There is a risk that business activities could be hindered in the event of a violation of legal regulations or a significant legal amendment. Business regulations also exist in each country overseas. The Company monitors developments in relevant legislation and works to build systems and measures to mitigate the impact of legal amendments.

The Human Resources Services Business holds large volumes of personal information belonging to job seekers, temporary staffing registrants, and others. In the event of an information leak, this could result in administrative sanctions such as business suspension or revocation of licenses, claims for damages, and loss of public trust, potentially having a material impact on business performance and financial condition. The Company has established a certain level of management framework through the introduction of the Privacy Mark certification system, strengthening security for websites and systems, and enhancing management systems at business locations.

Recruiting and developing excellent personnel is essential for business expansion, strengthening profitability, and differentiation from competitors. However, if recruitment and development do not proceed as planned, or if skilled personnel leave the Company, business activities may be hindered or constrained. The Company is working to retain personnel and improve their capabilities by focusing on enhancing employee engagement, improving the work environment, improving treatment, and providing employee training.

If large-scale natural disasters, wars, terrorism, or infectious disease outbreaks cause direct damage to business locations or human resources at the Group's numerous sites in Japan and overseas, or if such events disrupt the business activities of business partners, this could affect business performance and financial condition. In addition, system failures caused by computer viruses or hacker intrusions also pose a risk to business activities. The Company addresses this through the formulation and enhancement of Business Continuity Plans (BCPs) and by building a system for operational support from other locations.

The Company operates recruitment placement, staffing, and HR and labor consulting businesses across 14 locations in the United States, the United Kingdom, Vietnam, Thailand, Mexico, the Netherlands, and Germany, and various risks are inherent, including exchange rate fluctuations, changes in local laws and regulations or administrative policies, fluctuations in labor costs, and economic disruption due to war, terrorism, natural disasters, or infectious diseases. These developments could affect business expansion, performance, and financial condition, requiring continuous monitoring of the business environment in each country.