TOKYO TEKKO CO., LTD.

The sales prices of the company's mainstay bar steel products (Neji Tekkon, etc.) and the price of steel scrap, the main raw material, fluctuate depending on market conditions and may have a material impact on business performance. There is a risk that if these price fluctuations move in opposite directions simultaneously, profitability could be significantly squeezed. As a countermeasure, the company is working to reduce market fluctuation risk by increasing the sales ratio of value-added products such as Neji Tekkon joints and precast concrete joints, which are less susceptible to market conditions.

Against a backdrop of a maturing economic structure, shrinking public investment, and changes in demographic structure, domestic construction demand is expected to continue trending downward, which could affect business performance through a decline in demand for bar steel products. Reduced investment by the construction industry, the company's key customer base, poses a risk of downward pressure on both sales volume and prices. As a countermeasure, the company intends to mitigate the impact of declining demand by expanding sales of value-added products (such as Neji Tekkon) that meet the needs of the construction industry.

If a large-scale earthquake, typhoon, or other natural disaster, or a serious equipment accident or industrial accident occurs, it may have a material impact on business performance through the suspension of plant operations, among other effects. A suspension of operations at manufacturing sites could not only result in lost sales opportunities but also affect the company's ability to fulfill its supply responsibilities to customers. As a countermeasure, the company has established a BCP Committee, which meets regularly to continuously discuss and develop business continuity measures in response to internal and external conditions.