UORIKI CO.,LTD.

The Company sells fresh fish and shellfish under regulations based on the Food Sanitation Act, the Food Labeling Act, and the Measurement Act. If a serious food-related accident or labeling violation occurs, it could have a material impact on business performance through business suspension, damages, or other consequences. In addition, if reports of incidents concerning food safety heighten consumer reluctance to purchase raw fish, this could lead to a decline in sales. As countermeasures, the Company has implemented ozone disinfection facilities, hygiene inspections by a dedicated in-house department, regular cleaning and equipment inspections by specialized contractors, and the establishment of a proper labeling system.

Global demand for fish consumption is expanding while natural fish resources are depleting, leading to stricter catch restrictions and a progressive contraction in supply. Significant changes in the supply-demand balance and price fluctuations may affect business performance. In addition, supply chain disruptions (supply stoppages, reductions, or delays) caused by overseas conflicts and wars are an additional risk factor. As countermeasures, the Company is strengthening its network and diversifying procurement methods through a capital and business alliance with Yonkyu Co., Ltd., a major aquaculture operator, and a business alliance with Toto Suisan Co., Ltd., a major wholesale operator at the Toyosu Market.

According to the Family Income and Expenditure Survey Annual Report, the proportion of spending on fish and shellfish as raw ingredients has been on a declining trend, with a continuing shift toward prepared foods and dining out. In addition, as consumers increasingly favor one-stop shopping, there is a risk that the opening of large-scale competing facilities in the vicinity could directly pressure sales at existing stores. As countermeasures, the Company is expanding its lineup of sushi, simmered fish, and grilled fish to meet convenience needs, and is developing the Food Service Business "Kaisen Shokudo Toto Ichiba."

As new store openings are a pillar of the growth strategy, securing capable personnel to operate stores is essential. However, the recruitment environment remains challenging due to an improving employment situation and rising hourly wages for partner employees. If the Company is unable to sufficiently secure and develop human resources, this could affect business performance through delays in new store opening plans or a decline in the operational quality of existing stores. As countermeasures, the Company actively hires experienced mid-career employees and provides various training programs for new employees to enable them to become productive quickly.

Rising costs of construction materials have led to a decline in the construction of new commercial facilities, shrinking opportunities for new store openings. In addition, requests to revise leasing terms for existing tenants or to switch to fixed-term lease contracts are increasing, weakening the foundation for continuing store operations over the medium to long term. The Company Group is responding by emphasizing its operating track record and financial creditworthiness, but if business suspensions occur due to the expiration of contract terms, this could affect business performance.

The Company operates stores primarily in the Greater Tokyo area, the Chukyo area, and Kyushu. If natural disasters such as earthquakes, typhoons, or floods, or unforeseen accidents occur, damage to store facilities or human injury could disrupt operations. In addition, abnormal weather such as extreme heat, cool summers, or warm winters could cause significant declines in catch volumes or changes in consumer purchasing trends, leading to lower sales. The concentration of stores in specific regions is a structural factor that heightens this risk.

In connection with the discharge of treated water into the ocean from Tokyo Electric Power Company's Fukushima Daiichi Nuclear Power Station, there is a risk that reputational damage may occur regarding fish and shellfish from Fukushima Prefecture and other areas, even if scientifically and technically safe. Regardless of whether actual contamination exists, consumer purchasing behavior may be affected, potentially leading to a decline in sales for the Company Group, which procures products from across the country mainly through the Toyosu Market. Reputational risk may manifest in ways that diverge from actual circumstances, and is recognized as a risk that is difficult to address.

As the Company Group operates face-to-face retail and food service businesses, in the event of an outbreak of an infectious disease such as COVID-19, there is a risk that sales will directly decline due to store closures or shortened business hours mandated by government requests. Even after the disease has subsided, if consumer purchasing trends have changed, the recovery of sales may be delayed. Based on the experience of the recent COVID-19 pandemic, the impact of infectious disease outbreaks on business performance is recognized as a significant risk.

Uoriki Shoji Co., Ltd. has been exporting seafood since 2024 to a major food import wholesale and retail company in Dubai (United Arab Emirates), and in February 2026 entered into an investment and business alliance agreement with the company, investing 10 million US dollars (a 17.5% equity stake) through a limited partnership. The impact of the armed conflict between the United States and Iran has extended to Dubai, and export volumes have declined due to reduced flight frequency and suspended container ship port calls. If the conflict is prolonged or expands and the investee company's business performance deteriorates further, this could have an additional impact on the Company Group's business performance. Although overseas business currently remains relatively small in scale, the Company is closely monitoring the heightening of geopolitical risk.

The Company sells imported products and processed goods made using imported raw materials, and procurement prices may be affected by fluctuations in foreign exchange rates. In addition, there is a risk that expense burdens may increase or decrease due to changes in the discount rate for retirement benefit obligations resulting from interest rate fluctuations. Furthermore, if the market prices of held securities decline significantly, impairment accounting may require the recognition of valuation losses on investment securities, which could affect business performance.