Niigata kotsu Co., Ltd.

The balance of interest-bearing debt at the end of the fiscal year under review reached ¥25,530,236 thousand, and in the event of a rapid and significant rise in interest rates, business performance could be adversely affected through increased interest burden. As countermeasures, the Group aims to reduce interest-bearing debt while also utilizing interest rate derivative terms on some borrowings to fix interest rates, thereby striving for stable fundraising.

The core Transportation Business (bus segment) uses large quantities of diesel fuel, and in the event of a surge in crude oil prices caused by geopolitical risk or exchange rate fluctuations, business performance could be affected through increased costs. As countermeasures, the Group closely monitors crude oil market prices and, as necessary, considers introducing crude oil derivative transactions, working to stabilize fuel prices across Group companies.

In the event of a decline in the profitability of held assets or asset groups, or a significant drop in fair value, it may become necessary to write down book value to the recoverable amount and recognize an impairment loss, which could materially affect business performance and financial condition. As a countermeasure, the Group appropriately conducts stable maintenance and management of fixed assets and strives to enhance asset value.

Some loan agreements contain financial covenants, and a breach of these could result in an increase in the borrowing interest rate or loss of the benefit of the term, potentially having a serious impact on business performance and cash flow. The Group seeks to reduce this risk by strengthening its financial position and reliably securing annual cash flow.

As the Group has many labor-intensive businesses, including the Transportation Business, a worsening labor shortage could make it difficult to maintain bus routes, directly affecting business continuity and performance. As countermeasures, the Group is strengthening recruitment through the introduction of a subsidy program for obtaining large Class 2 driver's licenses and a bus driver comeback program, and is improving the workplace environment by establishing new systems that enable diverse working styles.

In the event of a serious accident occurring in the Transportation Business, centered on buses, there is a risk of loss of public trust and administrative sanctions, which could have a material impact on business performance. As a countermeasure, the Group has adopted "Everything Starts with Safety" as its safety policy and reliably implements a PDCA cycle based on transportation safety management, working organization-wide to ensure the safety of transportation.