CaSy Co.,Ltd.

Given the nature of the business, in which Casts provide housework support services at customers' homes, there is a risk of property damage, key loss, personal information leakage, health hazards such as food poisoning, and other incidents. If such issues materialize, they may lead to claims for damages or a decline in credibility, potentially affecting business results. As countermeasures, the Company strives to improve and standardize service quality through clarifying hiring standards, conducting training, and implementing engagement measures.

Given the business model in which Casts enter customers' residences and provide face-to-face services in the absence of any third party, there is a possibility of physical or psychological harm to both customers and Casts due to sexual crimes, violence, verbal abuse, and the like. If an incident, accident, or crime occurs and is not handled appropriately, it could significantly affect business results, such as through a substantial decline in service demand or a sharp drop in new customer registrations. As countermeasures, the Company has established a system for prior criminal background checks on Casts, notification of termination of outsourcing contracts upon negative evaluations, and immediate escalation to management.

The Company holds personal information of both customers and Casts, and if an unexpected leak occurs due to a system attack by a third party or other cause, there is a risk that business operations could become difficult, including loss of social trust, difficulty acquiring new customers, cancellation of recurring services, and revocation of Cast registrations. As a countermeasure, the Company has obtained ISO/IEC 27001 certification and strives for the continuous operation and improvement of its information security management system based on third-party certification standards.

The Company depends on IT systems for all business processes, including customer acquisition, matching, billing, compensation payments, and Cast training. If a system malfunction, cyberattack, natural disaster, communication failure, or similar event renders the Company unable to provide services or delays recovery, it could impair revenue and significantly affect business results. As countermeasures, the Company uses cloud databases with low vulnerability, has established a backup system, and has strengthened its internal operational structure.

If major telecommunications companies, internet companies, retailers, or others enter the housework support service market, or if competitors form partnerships utilizing point services, there is a risk that customer attrition could relatively weaken the Company's competitiveness. In addition, the rapid spread of alternative services such as takeout services and online retail could relatively diminish the usefulness of the Company's services. The Company has led industry innovation through its proprietary matching technology and IT-driven low-price realization, but how it responds to changes in the competitive environment could significantly affect business results.

Outsourced Casts are subject to the Act on Improving Transactions with Specified Freelance Business Operators, as well as numerous other laws and regulations, including the Consumer Contract Act, the Labor Standards Act, the Employment Security Act, and the Food Sanitation Act. If unforeseen circumstances, such as legal amendments, enactment of new laws, or changes in the views of regulatory authorities, cause the business to fall out of compliance, it could affect the business and business results. As countermeasures, the Company consults with external experts such as retained attorneys, gathers information on legal amendments, thoroughly educates employees, and works to build and strengthen its compliance system.

There is a risk that the intensifying future shortage of workers could make it difficult to stably secure the Casts necessary for providing services. As countermeasures, the Company is promoting measures to maintain contract continuation rates, marketing to acquire new Casts, hiring full-time employee Casts, and accepting foreign human resources through the Tokyo Metropolitan Government's National Strategic Special Zone program for accepting foreign nationals in housework support services. However, if the Company fails to appropriately address these changes, it could affect business results.

Representative Director, CEO and CFO Yuichi Kamo and Representative Director Yuki Ikeda have played important roles since the Company's founding in management policy, strategic decision-making, business development, and customer acquisition. At the current stage, if a situation were to arise in which either of them were to step down as Representative Director, it could affect the business and business results. The Company is working to secure and develop human resources and to build and strengthen its management structure in order to reduce this dependence, but at present the degree of dependence remains high.

The Company has undertaken M&A and business alliances aimed at strengthening and expanding its business foundation; however, significant changes in the market or competitive environment after an acquisition, integration costs exceeding expectations, or failure to achieve anticipated synergies may result in the expected investment returns not being realized. If such issues materialize, they could affect the Company's financial position and business results. The Company's policy is to proceed after considering market trends, the target company's business performance, financial condition, and risk analysis in advance, but unforeseen risks after an acquisition cannot be completely eliminated.

The Company has adopted a stock option plan for directors and employees. As of the end of the fiscal year under review, the number of potential shares was 93,300, representing 4.70% of the total of 1,985,300 shares, combining the total number of issued shares and potential shares. If the stock acquisition rights are exercised, the value of shares held by existing shareholders may be diluted. In addition, whether and when dividends will be paid remains undecided at this time, as the Company's policy is to prioritize retaining internal reserves for growth investment.