TV Asahi Holdings Corporation

Television Broadcasting Business revenue, which accounts for a large portion of net sales, depends on corporate advertising expenditure. An economic downturn or weakening consumer sentiment could directly affect operating results through reduced advertising placements. Intensifying competition from diverse media, including internet advertising, is also placing downward pressure on conventional television advertising revenue. As a countermeasure, the Group is promoting multimedia content deployment and diversification of revenue opportunities.

The spread of smartphones and tablets and the rise of video streaming platforms are diversifying television viewing formats, creating a risk that the relative standing of terrestrial broadcasting will decline. Falling viewership ratings directly lead to reduced advertising revenue, while content production and distribution costs may rise, potentially worsening profitability. The Business Solutions Division is leading efforts to leverage data and technology and strengthen information dissemination.

Should compliance issues such as improper accounting, information leakage, or harassment, or deficiencies in internal controls occur, this could lead to significant damage to corporate image, contract cancellations by advertisers, litigation, or regulatory sanctions, potentially having a material adverse effect on operating results. Because the Group's business model relies heavily on the trust and confidence of viewers and advertisers, the impact of any loss of credibility would be especially significant. In response, the Group is thoroughly disseminating compliance awareness among officers and employees, strengthening internal audit functions, and plans to establish an integrated management structure through a Risk Management Committee to be set up in July 2026.

TV Asahi Corporation, BS Asahi Corporation, and CS One Ten are subject to legal and regulatory requirements under the Radio Law, Broadcast Law, and other laws. If a broadcasting license is revoked due to a legal violation, this could have a material effect on the Group's operating results. There is also a risk that certification as a certified broadcasting holding company could be revoked if the company fails to meet asset requirements or other criteria. As a countermeasure, the Group has established a check system involving multiple departments, including the Legal Department and the Compliance Supervision Division, and is promoting compliance training and awareness activities overseen by top management.

Under provisions of the Broadcast Law, there is a risk that certification as a certified broadcasting holding company could be revoked if the proportion of voting rights held by foreign nationals and others reaches 20% or more. In FY2026 (ending March 2026), the Company appropriately addressed this by refusing to register name transfers for the portion exceeding 20%, and plans to continue measures restricting the exercise of voting rights by foreign nationals and others. This restriction represents a structural risk affecting the acquisition of shares and exercise of voting rights by foreign investors.

The Group holds personal information of program appearers, viewers, Internet Business members, Shopping Business customers, and others. If unauthorized access or misuse results in the external leakage of information, this could lead to a decline in credibility, business disruption, and an impact on earnings. As the Group is also engaged in utilizing a wide variety of data, information management risk is on an expanding trend. The Digital Governance Promotion Department of the Compliance Supervision Division is leading efforts in technical measures, development of internal rules, and staff training.

There is no guarantee that capital expenditures and investments aimed at maintaining technological standards and strengthening content production capabilities will generate the expected returns. If returns fall below expectations, this could adversely affect the Group's financial position and operating results. While the Group has established an internal system to assess risk according to the scale, nature, and form of investments and loans, investment effectiveness remains uncertain amid rapid changes in the business environment. The Group is continuing strategic investments while working to minimize impact through the development of its risk assessment framework.

In the event of a large-scale disaster, there is a risk of difficulty continuing broadcasts, the need to broadcast commercial-free disaster information programs, or shortened broadcasting hours. Damage to facilities, employee casualties, or broadcasting equipment failures could affect the continuity of normal business operations. Responses to power shortages could also lead to shortened broadcasting hours. Although the Group has implemented measures such as an emergency disaster response manual, business continuity simulations, an employee safety confirmation system, disaster drills, and strengthened backup systems, it remains difficult to completely eliminate the impact or damage.

During the spread of COVID-19, the Group experienced a decline in advertising volume, postponement or cancellation of events and invested films, and suspension of drama filming, leading to a decrease in revenue from the Television Broadcasting Business and Other Businesses. Should an unknown infectious disease with even greater infectivity or fatality rate emerge in the future, the impact on the business could exceed that of COVID-19. The Group is sharing and passing on the know-how gained from its COVID-19 response within the Group, while focusing on strengthening its ability to provide content and continue business operations under a variety of circumstances.

If climate change risks progress at a greater scale or speed than anticipated, this could affect the Group's financial position and operating results. There is also a risk that securing and developing appropriate human resources as planned may not proceed smoothly amid intensifying competition for talent due to a declining working population resulting from the falling birthrate and aging population. In addition, insufficient efforts regarding human rights due diligence could affect the business through a loss of stakeholder trust and other effects. The Group is strengthening its response through endorsing the TCFD recommendations and conducting related analysis, launching a Climate Change Response Team and Human Capital Team (September 2025), publishing a Human Rights Policy (February 2024), and continuing to implement human rights due diligence.