Kanagawa Chuo Kotsu Co., Ltd.

At the Company Group, which has many labor-intensive businesses including the Passenger Motor Vehicle Business, labor shortages could make it difficult to maintain Fixed-Route Bus Business routes and reduce taxi utilization rates, thereby affecting business performance and financial condition. The Securities Report explicitly states that "the recent labor shortage is having a negative impact on business performance," indicating that this risk has already materialized. As countermeasures, the Company is strengthening recruitment through diverse advertising media, providing support for obtaining driver's licenses, and implementing retention promotion programs utilizing its own training courses.

For the Company Group, which has the Passenger Motor Vehicle Business as its core, frequent traffic accidents or the occurrence of serious accidents could lead to a decline in public trust, and in addition, receiving administrative penalties could directly hinder business operations, potentially having a material impact on business performance and financial condition. As countermeasures, the Company is implementing a PDCA cycle under the transportation safety management system, providing education utilizing drive recorders, improving the effectiveness of face-to-face roll calls using digital technology, and promoting the introduction of vehicles equipped with EDSS.

The spread and prolongation of various infectious diseases could reduce demand in many businesses, including the Passenger Motor Vehicle Business, and could also make business continuity difficult due to infection among employees, potentially affecting business performance and financial condition. During the COVID-19 pandemic, actual changes in customer behavior occurred, and in response, the Company has been striving to secure revenue by implementing infection prevention and spread control measures in accordance with the guidelines of relevant authorities and by deploying sales measures that respond to changes in behavior.

If confidential information, including personal information, is leaked due to cyberattacks, computer virus infections, human error, or other causes, it could damage the Company Group's credibility and affect business performance and financial condition. As countermeasures, the Company has established an information management system based on its personal information protection and information security regulations, restricted user access, regularly updates security equipment, has introduced multiple security software programs, and provides regular alerts and reminders to employees.

In the event of an earthquake, tsunami, or large-scale natural disaster, in addition to facility damage, a decline in social infrastructure functions such as roads, electricity, and water supply, as well as fuel supply shortages, could hinder business operations and affect business performance and financial condition. As countermeasures, the Company has formulated business continuity plans (BCPs) for each business area and is working to improve their effectiveness by conducting regular disaster response drills for all group companies.

If the Company's efforts toward carbon neutrality are evaluated as insufficient, it could lead to a loss of trust from stakeholders, resulting in a decline in corporate value and, through difficulties in raising funds, a negative impact on business performance and financial condition. As countermeasures, the Company has formulated CO2 emission reduction targets and a roadmap for achieving carbon neutrality by fiscal 2050, and is promoting the introduction of environmentally friendly vehicles and solar power generation facilities, as well as energy-saving initiatives, across the entire group.