GLORY LTD.

If rapid cashless adoption progresses globally and in a short period due to digital currency issuance and other factors, it could have a material impact on the performance of the Company Group, which has a high dependence on cash handling machines. The transition period until the new business domain (software platform, DMP business, etc.) grows is particularly vulnerable. As a countermeasure, the Group is promoting business transformation into the DX field through the advancement of total store solutions.

In addition to geopolitical risks arising from changes in the international situation, such as the occurrence of wars, conflicts, or high additional tariffs, unexpected fluctuations in exchange rates and interest rates and infringement of intellectual property may affect overseas operations. As the Company Group is actively expanding into overseas markets, the materialization of these risks could directly damage business performance. As countermeasures, the Group is promoting the formulation of medium- to long-term business and production strategies that take geopolitical risks into account, exchange hedging measures, and the strengthening of intellectual property activities.

If technology-related laws and regulations, including business licensing, import/export regulations, environmental regulations, security regulations, and digital regulations, are revised, abolished, or newly established in the various countries where the Company Group operates, delays in response could affect business performance. In particular, as the Group expands globally, it is required to respond simultaneously to regulatory changes across multiple jurisdictions. As countermeasures, the Group continuously conducts research on regulatory trends in each country, implements risk assessments and countermeasures, and provides employee training.

As of the end of FY2026 (ending March 2026), goodwill arising from corporate acquisitions accounts for 17.4% (¥78,656 million) of consolidated total assets, and customer relationship assets account for 7.0% (¥31,771 million). If expected results are not achieved due to changes in the business environment, impairment losses may occur, materially affecting business performance. There is also a risk that investment losses under the equity method may arise if equity-method affiliates fail to achieve their business plans. As a countermeasure, the Group has established a system for regular evaluation of investees based on the Strategic Investment Committee regulations and reporting to the Board of Directors.

Suspension of suppliers' production due to natural disasters, wars, conflicts, etc., or delivery delays caused by the collapse of the global supply-demand balance for specific parts and raw materials, may affect production activities. In addition, soaring prices of parts and raw materials due to inflation could lead to increased costs, and there is also a risk that securing materials for BCP purposes could result in excess inventory. As countermeasures, the Group is working to secure procurement sources considering economic security, switch to more readily available parts, and improve the accuracy of appropriate inventory management in emergencies.

The medium- to long-term growth of the Company Group depends heavily on personnel with diverse expertise, and if the securing and development of DX talent, etc., necessary for expanding the new business domain does not proceed as planned, it could affect business performance. Intensifying global competition for talent raises concerns about the loss of, and difficulty in hiring, excellent personnel. As countermeasures, the Group is focused on improving employee engagement, and is working on talent development, health management, diversity promotion, and respect for human rights, while focusing on securing and developing DX talent.

The risk of business activity suspension due to leakage of personal information and confidential information of customers, etc., or unauthorized access, is increasing, and if an information leak occurs, it could lead to loss of credibility and liability for damages. As dependence on information systems increases, there is also a risk that existing countermeasures could become obsolete due to the sophistication of cyberattacks. As countermeasures, the Group has established an information security governance framework centered on the Group CISO, thoroughly implements employee training, and continues and strengthens system renewal and operational monitoring.

In providing stable cash handling solutions for financial institutions, retail, and restaurant stores, unforeseen quality issues may arise due to uncertainties associated with the use of digital and network technologies and the advancement of solutions. The occurrence of quality issues is directly linked to the risk of loss of customer trust and liability for damages. As countermeasures, the Group has established thorough design and verification based on a quality management system, prevention through remote monitoring and regular inspections, and a system for promptly conveying information to the officer in charge of quality management.

If policy interest rates are raised in Japan, the Americas, and Europe, or if credit ratings are downgraded by rating agencies, the cost of raising funds through bank borrowings, corporate bond issuance, etc., may increase, affecting business performance. As the Company Group relies on external fundraising in addition to internal funds, changes in the financial environment pose a risk of increasing the financial burden. As a countermeasure, the Group aims to reduce liquidity risk through timely updates of cash flow plans and diversification of fundraising through bank borrowings, corporate bond issuance, and other means.

Both transition risks arising from the strengthening of laws, regulations, and social demands in various countries (additional investment in energy-saving and renewable energy equipment, increased energy procurement costs due to carbon taxes and emissions trading, loss of sales opportunities, and brand damage) and physical risks arising from the intensification of natural disasters such as typhoons and heavy rains (damage to the Company's own factories and employees, and suspension of operations at parts suppliers) may affect business performance and corporate value. As countermeasures, the Group is setting and promoting greenhouse gas reduction targets based on SBT (net-zero CO2 emissions by FY2050) and enhancing information disclosure in line with the TCFD recommendations.