True Data Inc.

The Company relies on the provision of ID-POS data and POS data from major domestic retailers, with a high degree of concentration among a small number of leading providers. If contract terminations or changes in transaction terms occur in the future, this could directly affect business operations and financial results. While favorable business relationships are currently maintained, no specific measures to reduce this dependence have been disclosed.

The Company holds a vast amount of consumer personal information, and there is a risk of information leakage or tampering due to unauthorized access or cyberattacks. If such an event occurs, there are concerns of significant impact on business results, including loss of social credibility, incurrence of damages liability, and disruption of business activities. As countermeasures, the Company has obtained the Privacy Mark, established various internal regulations, and conducts employee training, but states that complete elimination of the risk is difficult.

In the retail industry, including drugstores and supermarkets which are the Company's main customer base, industry restructuring through management integration is progressing, and consolidation and collaboration among major common point program operators is also accelerating. If data providers change their business strategies as a result of such restructuring, this could lead to termination of transactions or changes in terms, affecting business operations and financial results. The Company is responding by expanding data utilization into multiple areas, but its dependence on changes in the external environment remains high.

Competition may intensify due to new entrants by major companies with substantial financial resources and brand strength, or the emergence of competitors with innovative technologies. If the Company's competitive advantage declines due to changes in the competitive environment, this could affect business operations and financial results. The Company states that it strives to accurately grasp changes in customer needs and market conditions in order to maintain and enhance its competitiveness.

The Company continuously undertakes technology development and capital investment to maintain its competitiveness, but these require considerable time and substantial funding. If plans are delayed or expected results are not achieved, it may become difficult to recover the invested capital, potentially affecting financial results. No specific disclosure has been made regarding countermeasures for unforeseen circumstances.

The Company is subject to legal regulations such as the Act on the Protection of Personal Information and the Act against Unjustifiable Premiums and Misleading Representations. Amendments to laws or the introduction of new regulations could restrict business activities or increase costs. If a legal violation occurs, administrative sanctions, loss of social trust, and liability for damages could arise, affecting financial results. While the Company's policy is to thoroughly ensure compliance, the risk of changes in the regulatory environment continues to exist.

The labor market for IT and marketing specialists such as engineers, data scientists, and data marketers continues to be tight, and competition for talent is expected to intensify. If recruitment and training do not proceed as planned, or if talented personnel leave for other companies, this could lead to a decline in competitiveness, constraints on business expansion, and deterioration in service quality, thereby affecting financial results. The Company recognizes securing and developing personnel as an essential management issue, but details of specific measures have not been disclosed.

Representative Director and President Hiroyuki Yonekura plays a critical role in formulating management policy and business strategy, and dependence on him is expected to remain high for the time being. If he becomes unable to continue his involvement in the business, this could affect business operations and financial results. As a countermeasure, the Company is pursuing organizational reforms, including delegation of authority to on-site leaders and consideration of introducing an internal company system.

The Company may pursue M&A, business alliances, joint ventures, and other initiatives aimed at agile business expansion. If changes in the market environment after an investment or delays in the integration process prevent the Company from achieving the expected synergies or earnings, this could affect its financial results and financial position. The Company states that it will conduct due diligence and economic value assessments and make careful decisions when implementing such initiatives.

As of the end of FY2026 (ending March 2026), the Company holds tax loss carryforwards. If business performance progresses favorably and these carryforwards are utilized, corporate tax, resident tax, and enterprise tax based on the standard tax rate will be incurred, increasing the tax burden. This could affect financial results, financial position, and cash flows. This is recognized as a structural risk of increased tax burden accompanying the recovery in business performance.