KONAMI GROUP CORPORATION

Due to multiple factors including production resource and capacity constraints and adaptation to new technologies/platforms, there is a possibility that products and services cannot be released in a timely manner with sufficient quality. If timely delivery becomes difficult, this will directly impact sales and profit plans. The Company is working to strengthen its production framework and technological response capabilities.

In the entertainment and sports-related markets, competitors continue to launch new products and services one after another, while new forms of entertainment and leisure businesses also keep emerging, further intensifying the competitive environment. This may make it difficult to sustain the Company's competitive advantage in the market. Continuous differentiation of products and services is required.

The entertainment and sports-related markets have a characteristic of rapidly changing trends driven by technological evolution, with consumer preferences also shifting significantly in short periods. If the Company fails to continuously provide products and services that respond to such changes, its business performance may be affected. Responding to this requires technological innovation and product renewal to be executed with speed.

If legal regulations change in any of the countries where the Company operates, changes may be required not only to products and services but also to the business model and strategy, potentially affecting business operations in that country. Insufficient compliance with consumer protection, personal information protection, online service regulations, and similar rules could also expose the Company to administrative sanctions or litigation. Regulations and licensing related to gaming (casinos) are also recognized as a significant regulatory risk.

Some of the Company's products and services use intellectual property such as copyrighted works of third parties, and if licenses cannot be obtained, this may hinder the provision of the related products and services. Additionally, if disputes arise over intellectual property infringement due to differences in interpretation or other reasons, expenses such as settlement payments or the inability to use the relevant intellectual property could affect business performance. The Company exercises considerable care to avoid infringement, but it is difficult to completely eliminate this risk.

The Company's growth is heavily dependent on the continued contributions of management executives and employees as well as the recruitment of talented personnel. In particular, competition for digital talent has intensified globally, making it extremely difficult to secure such personnel. As overseas business expansion grows, securing global talent has also become an urgent priority, and difficulties in recruiting and retaining personnel could affect business performance.

If information systems experience failures due to external cyberattacks, natural disasters, accidents, or outages of power and communication infrastructure, services provided to customers may be suspended, potentially affecting business performance. The Company has implemented various measures to improve availability and security, but it is difficult to eliminate all risks.

If customers' personal information is leaked due to improper handling by officers and employees or unauthorized external access, this could significantly impact the Company's brand image and business performance. In addition to establishing strict information management regulations, thoroughly educating officers and employees, and implementing robust security measures for information systems, the Company has established a system to comply with personal information protection regulations worldwide, including the GDPR.

The Company seeks opportunities such as mergers and acquisitions with the aim of achieving sustainable growth and enhancing corporate value; however, this involves various risks, including failure of post-acquisition integration efforts and the recognition of impairment losses if the originally planned performance cannot be achieved. The Company's policy is to proceed carefully with such initiatives after conducting thorough due diligence.

In conducting business overseas, various risks exist, including social disruption from terrorism or conflicts, unforeseen political factors, business customs unique to each country, and fluctuations in tariffs and foreign exchange rates. Failure to appropriately address all of these could affect business performance, and this risk requires ongoing management by the Company as it continues to expand its business globally.