MORIO DENKI CO., LTD.

The Group's core business is concentrated in the railway vehicle industry, which is maturing. Its performance structure is heavily affected by fluctuations in demand such as replacement demand for railway vehicles both domestically and overseas and new line construction. Overseas subsidiaries also have orders limited to railway-related business, so trends in the industry as a whole may have a direct and wide-ranging impact on consolidated results.

Depending on the scale of replacement demand for railway vehicles and the timing of overseas vehicle projects, orders and delivery schedules may become concentrated in specific periods. If the production and shipment system cannot respond nimbly to concentrated demand, there is a risk of a significant impact on business results and financial condition. The ability to respond to the temporal skew of demand is key to stabilizing performance.