Asahi Concrete Works Co., Ltd.

A significant portion of the Concrete-Related Business's sales is heavily dependent on public works projects undertaken by national and local government agencies. Deterioration in the fiscal condition of such agencies or reductions in public investment could have a direct adverse effect on business performance. Although the Company is working to expand sales channels to the private sector, the high degree of dependence remains a structural risk.

Increases in the prices of key raw materials used in the Concrete-Related Business could lead to higher manufacturing costs, potentially adversely affecting business performance. While the Company seeks to mitigate procurement risk by diversifying its suppliers, it is difficult to completely avoid price fluctuations driven by market conditions.

Deterioration in the business performance of business partners could result in delayed collection of trade receivables or bad debts, adversely affecting business performance. Although the Company addresses this through thorough credit management, there remains a risk of losses arising from changes in the business environment of its counterparties.

If the value of held fixed assets declines or profitability decreases, impairment losses may need to be recognized, potentially affecting business performance. Given the business characteristic of significant earnings volatility due to dependence on public works, the risk of declining profitability of fixed assets exists as a latent factor.