Atlas Technologies Corporation

In FY2025 (ended December 2025), the ratio of sales to NTT DOCOMO, INC. was 51.6%, which, while on a declining trend from 93.2% in FY2020 (ended December 2020), remains at a high level. Should material changes to contractual terms with this company or a significant decline in transaction value occur, this could have a material impact on operating results and financial condition. As a countermeasure, the Group is promoting diversification of its customer portfolio, and the number of customers receiving project orders in FY2025 (ended December 2025) reached 37.

Securing and retaining consultants with advanced expertise in the Fintech domain is fundamental to business continuity, and the Group has positioned talent acquisition and development as its highest priority issue. If the Group is unable to secure personnel at appropriate times or develop human resources according to plan, this could impede business expansion and new business promotion, potentially affecting operating results and financial condition. The Group is continuously working to secure, develop, and retain talented personnel through various recruitment methods.

Koji Yamamoto, Representative Director and President, is the founder and a major shareholder (holding a 66.7% stake) and plays a central role in overall business activities, including determining management policy and business strategy. Should he become unable to perform his duties for any reason, this could have a material impact on operating results and financial condition. The Group is working to strengthen its management team and delegate authority in order to build a system that reduces excessive dependence on a specific individual.

If material contracts important to the Group's management are terminated or amended due to expiration, cancellation, unfavorable revision, or deterioration in the counterparty's business condition or policy changes, this could have a significant impact on operating results and financial condition. This risk is linked to the risk of dependence on a specific customer, as contract stability is directly tied to maintaining the business foundation. The Group aims to mitigate this risk through the continuous building of favorable relationships with business partners.

As of the end of the fiscal year under review, the Group has tax loss carryforwards, and corporate taxes based on the standard tax rate are not currently being levied. Once the tax loss carryforwards are used up or expire, the Group will bear normal corporate tax burdens, which could affect operating results and financial condition. In addition, changes in future forecasts of taxable income or tax reform may require a write-down of deferred tax assets.

The Representative Director and President holds a high shareholding ratio of 66.7%, and the tradable share ratio as of the end of the fiscal year under review stood at only 32.7% under the standards set by the Tokyo Stock Exchange. Should liquidity decline, trading in the market could stagnate, adversely affecting the supply-demand balance of the shares. Going forward, the Group intends to gradually reduce the shareholding ratio to around a majority level through phased secondary offerings, thereby improving liquidity.

While the Group currently recognizes few direct competitors, if companies with abundant knowledge and experience in the Fintech field emerge in the future and competition intensifies, this could affect operating results and financial condition. The Group seeks to differentiate itself by providing high-value-added consulting services and by building an integrated system covering everything from upstream to downstream.

The Group conducts overseas business primarily through its consolidated subsidiary Kapronasia Singapore Pte. Ltd. and its Singapore branch, and is exposed to potential risks such as civil unrest, political developments, country-specific business customs, legal regulations, and foreign exchange risk. Should these risks materialize, they could affect business activities as well as operating results and financial condition. The Group has established a system for early identification of local risks and, as a policy, will respond swiftly, including through business withdrawal if necessary.

The Group is a small-scale organization, and its current organizational and management structure remains commensurate with that scale. If organizational development and enhancement of the internal control system accompanying business expansion do not proceed smoothly, this could affect operating results and financial condition. The Group plans to continue timely and appropriate hiring of personnel and to enhance its organizational and internal control systems.

When utilizing business partners in the Digital Solutions business, appropriate compliance is required with the revised Subcontracting Act (Act on Proper Transactions Involving Specified Entrusted Businesses) taking effect on January 1, 2026, as well as with the Worker Dispatch Act. Should the Group be deemed in violation of laws or regulations due to interpretation of the law or determinations by authorities, this could result in a loss of credibility, claims for damages, and other consequences, potentially affecting operating results and financial condition. The Group seeks to mitigate this risk through continuous monitoring of legal and regulatory developments and ongoing scrutiny of actual transaction practices.