JMDC Inc.

The Company Group is a business operator that handles large volumes of personal information, including medical claims (receipt) data and health checkup data, and has taken measures such as establishing an information security policy and obtaining Privacy Mark certification. However, if personal information were to be leaked due to human error, natural disaster, unauthorized access, or other causes, this could result in damages payable to customers and deterioration of corporate image, potentially having a material impact on the Group's financial position and business performance. For the Company, whose core business is Health Big Data, the reliability of information management is directly linked to the foundation of the business itself.

If revisions to the Act on the Protection of Personal Information tighten the procedures for the use of anonymously processed information, there is a risk that the cost of acquiring anonymized medical claims (receipt) data and health checkup data will increase. In addition, when specification changes occur for medical claims (receipt) data, modifications to data intake and analysis systems will be required, and the resulting increase in workload may affect operating results. Since an increase in the procurement cost of core data assets directly affects the revenue structure, continuous monitoring of regulatory trends is essential.

The medical claims (receipt) data analysis business is highly dependent on systems, and the Remote Radiology Interpretation Matching Service of subsidiary Doctor Net also relies heavily on computer systems and networks. Although measures such as enhanced security, backup systems, and hardware reinforcement have been implemented, if a system failure occurs due to human error, natural disaster, unauthorized access, or other causes, it could result in direct damages or a decline in service quality, potentially affecting the Group's financial position and business performance.

Competitors may surpass the Company Group in terms of capital strength, technological development capability, price competitiveness, and other factors, and if competitors offer services of equal or higher quality at lower prices, the Group's competitive advantage may decline, making it difficult to retain and acquire customers. If competition intensifies in both the Health Big Data and Telemedicine growth areas, it may become difficult to secure the expected level of revenue and profit, potentially affecting the Group's financial position and business performance.

The Company Group has recorded a substantial amount of goodwill in connection with corporate acquisitions, which it believes appropriately reflects the future earning power and synergy effects of each business. However, if the expected results are not achieved due to changes in the business environment or competitive landscape, impairment losses may occur, affecting business performance. Similarly, for fixed assets in general, there is a risk of impairment if the expected returns are not achieved.

The Company Group has a policy of actively pursuing corporate acquisitions to achieve its growth strategy, and conducts due diligence to identify risks in advance. However, if expected profit growth or synergy effects cannot be realized due to changes in the business environment or competitive landscape, and if unexpected liabilities or the need for additional capital injection arise, this may affect the Group's financial position and business performance.

Subsidiary Doctor Net provides a remote radiology diagnosis service that connects medical institutions with radiology specialists via a digital environment, and the quality of the service depends on the contracted interpreting physicians. Although categorization, matching, and quality control are conducted based on the Company's own criteria, if an unforeseen wrongful act or dispute involving a contracted interpreting physician occurs and material negligence is found on the part of the Company Group, this could result in compensation for losses and deterioration of external reputation, potentially affecting the business and business performance.

Ad hoc sales to pharmaceutical companies, research institutions, and life and non-life insurance companies tend to be concentrated in the second half of the fiscal year, and in FY2026 (ending March 2026) as well, this second-half weighting continues, with revenue of ¥19,893 million in the first half and ¥24,176 million in the second half. Since the cost structure of the data business is centered on fixed costs, seasonal fluctuations occur in which the profit level in the first half tends to be lower, making it difficult to judge full-year performance based solely on first-half results.

The Company Group has subsidiaries engaged in the sale of pharmaceuticals and medical devices, which operate under licenses granted by regulatory authorities. If administrative guidance is issued or licenses are revoked, it may become difficult for the relevant subsidiaries to continue operations, potentially having a significant impact on the Group's operating results and business plans.

The Company recognizes that securing and developing excellent human resources is an important challenge for business expansion, and is working to enhance recruitment activities and prevent the loss of personnel. However, if the Company is unable to secure the necessary personnel or if core personnel leave the Company, this could reduce the driving force behind business development in both the Health Big Data and Telemedicine growth areas, potentially affecting business performance.