ICHIKURA CO., LTD.

As of the end of March 2026, the market capitalization of tradable shares on the Tokyo Stock Exchange Standard Market fell below the listing maintenance criteria, and the company entered an improvement period starting April 1, 2026. If the criteria are not met by March 31, 2027, the company will be designated as a securities under supervision and then as securities to be delisted, resulting in delisting on October 1, 2027. Details of initiatives to meet the criteria are scheduled to be announced in late June 2026, and this is the most critical matter for investors to monitor.

The primary customers of the Furisode business are limited to women prior to their Coming-of-Age Ceremony, and if the population below the target age declines due to the declining birthrate, there is a risk of structural contraction in demand. According to the Statistics Bureau of the Ministry of Internal Affairs and Communications, the number of newly adult women has remained at around 530,000, but a long-term declining trend is inevitable. In the Wedding Business as well, the number of marriages in 2024 was approximately 480,000, a decrease of about 30,000 from the previous year, indicating that the impact of the declining birthrate is becoming apparent in both businesses.

In the kimono industry, the market is on a downward trend due to the aging of craftsmen and changes in consumer lifestyles, while in the wedding industry, the spread of

The Group has funded capital expenditures such as new store openings through borrowings from financial institutions, and as a result, the balance of interest-bearing debt as of March 31, 2026 reached ¥4,537,547 thousand, with an interest-bearing debt ratio of 25.8% and interest expenses of ¥51,101 thousand. In a future rising interest rate environment, there is a risk that the burden of interest payments will increase and put pressure on the financial condition. The company's policy is to reduce interest-bearing debt through the expansion of operating cash flow, but improvement may be delayed if new investments continue.

The Group holds a large volume of customer personal information through both the Japanese Apparel Business and the Wedding Business, and if information leakage occurs due to unauthorized external access or deficiencies in internal management systems, there is a risk of claims for damages and loss of social credibility. Although the company has established personal information protection regulations and information system management regulations and conducts training for all employees, complete elimination of this risk is difficult.

If core systems such as sales management systems are infected with ransomware or subject to unauthorized access, or if systems experience prolonged outages due to natural disasters or power outages, there is a risk of delays in business processes, increased recovery costs, and loss of social credibility. The company is working to strengthen security measures, store backup data at remote locations, and develop business continuity plans, but it is explicitly stated that these measures cannot completely eliminate the risk.

In the Japanese Apparel Business, outsourced processing costs account for a high proportion of cost of sales, and further increases in overseas processing costs are expected due to rising crude oil prices and rising labor costs in Vietnam. If increases in processing costs cannot be passed on to product prices in the short term, gross profit margin may decline, adversely affecting business performance. The company addresses this through risk diversification across multiple business partners and ongoing price negotiations.

In the Japanese Apparel Business, there is a risk that differentiation will become difficult as competitors imitate and follow the company's services, while in the Wedding Business, competition may intensify due to entry by competitors into the same trading area or new entrants from other industries. Both could affect the financial condition and business performance through intensified price competition and increased customer acquisition costs.

President and Representative Director Yoshihiko Kawabata, as the founder, plays a central role ranging from determining management policy and business strategy to developing new businesses, and if he becomes unable to perform his duties, there would be a significant impact on management. The company is working to reduce this dependence through delegation of authority, personnel development, and information sharing at board meetings, but the establishment of a substitute system is still a work in progress.

Although the age of adulthood was lowered to 18 under the April 2022 revision of the Civil Code, local governments continue to hold ceremonies targeting 20-year-olds. If significant changes occur in the future regarding the format of Coming-of-Age Ceremonies, such as changes in the timing of events to avoid conflicts with entrance exam season or changes in organizers, the order pattern for Furisode sales and rentals could fundamentally change, potentially affecting the financial condition and business performance.