The Takigami Steel Construction Co.,Ltd.

The Steel Structure Manufacturing Business is largely dependent on public works centered on bridge construction and maintenance, while the steel frame business depends on capital investment trends such as private-sector urban redevelopment. If order volumes decline far more than expected due to soaring raw material and labor costs or unforeseen events such as infectious disease outbreaks, this could have a material impact on business performance. The securities report does not describe specific countermeasures.

The Group holds a large amount of fixed assets, mainly in the Steel Structure Manufacturing Business and the Real Estate Leasing Business, and there is a risk that impairment losses may arise due to business downturns or other factors. Given the scale of fixed assets held, the financial impact of any impairment could be correspondingly significant. The securities report does not describe specific countermeasures.

In the Steel Structure Manufacturing Business, securing engineers is a key challenge for business continuity, and the shortage of construction industry personnel has become more severe against the backdrop of a declining working population in recent years. If the necessary technical personnel cannot be secured, this could hinder production capacity and quality maintenance, potentially affecting business performance. The securities report does not describe specific recruitment or training measures.

The Steel Structure Manufacturing Business primarily uses steel plates and shaped steel from steel manufacturers as raw materials, and is constantly exposed to the risk of surging raw material market prices. If prices surge due to unforeseen circumstances and it is difficult to pass on the cost increase to selling prices, profitability could deteriorate significantly. The securities report does not describe specific hedging or other countermeasures.

If liability for defects or damages arising from accidents or disasters occurs after product delivery, this could affect business performance. Given the nature of the business, which handles social infrastructure such as bridges, there is a risk that the social impact and scale of compensation could be substantial in the event of a quality defect. The securities report does not describe specific quality control systems or insurance arrangements.

Losses arising from credit concerns regarding business partners could affect business performance. While dependence on public works is high, there are also private-sector business partners, and in a downturn, the risk of uncollectible accounts receivable due to deteriorating financial conditions of business partners increases. The securities report does not describe specific credit management systems.

Fluctuations in the fair value of held assets could affect business performance. In addition to operating the Real Estate Leasing Business, the company appears to hold assets such as investment securities, and there is a risk that a decline in fair value due to changes in market conditions could impact the financial statements. The securities report does not provide details on the assets held or specific risk management policies.

The company strives to comply with laws and regulations in its business activities and to establish social norms and corporate ethics, but failure to comply could affect business performance and corporate trust. As a construction and manufacturing company, it is subject to a wide range of regulations, including the Construction Business Act and the Industrial Safety and Health Act, and the risk of violations extends broadly. The securities report does not describe a specific compliance system.

The Group's production sites are concentrated on the Chita Peninsula in Aichi Prefecture, and if a large-scale disaster such as the Nankai Trough earthquake occurs, production functions could be halted temporarily or for an extended period, potentially causing a severe impact on business performance. The geographic concentration of production sites indicates a lack of risk diversification, and the securities report does not describe the status of business continuity plan (BCP) preparations.