The following are the main risks that could affect the Group’s operating results, financial position, cash flows, and other aspects of its performance.
Forward-looking statements contained in this section is based on the Group’s judgments as of June 30, 2025, the end of the consolidated fiscal year under review. This section is not intended to provide an exhaustive list of all risks related to the Group.
The Group operates three businesses: the Packaging Plant Business, the Mechatronics Systems Business, and the Agricultural Equipment Business. All three businesses are affected by trends in capital investment by customers. Some of the Group’s customers also operate in industries that are subject to laws and regulations, including the pharmaceutical and medical device industries.
Although the factors that cause fluctuations in performance differ by business, unexpected changes in the external environment—including sudden changes in economic or market conditions, or changes in laws and regulations in each industry—could affect the Group’s operating results. The specific risks associated with each business are as follows.
Within the Packaging Plant Business, the Group’s core business, sales to the soft drink industry account for approximately 20% to 30% of consolidated net sales. Capital investment in filling equipment in the soft drink industry may be affected by changes in consumer preferences, weather conditions, changes in container types, and other factors.
The Group closely monitors trends in the soft drink industry and will further strengthen its technological development capabilities. Through innovative technology development, the Group will proactively respond to changes in the business environment.
Medical equipment, the first pillar of this business, is supplied largely on an OEM basis, and may be affected by the business performance of OEM customers and changes in their management policies.
The Group works to maintain and strengthen these business relationships by jointly developing products with OEM customers and holding regular liaison meetings on technical and sales matters.
In its Agricultural Equipment Business, the Group mainly manufactures and sells agricultural grading and sorting systems to agricultural cooperatives. When introducing such equipment, agricultural cooperatives often use subsidies from the national and local governments, and their equipment investment plans may be affected by changes in national and other agricultural policies.
The Group closely monitors market trends and will work to expand sales globally.
The Group manufactures a range of products with the utmost attention to quality and performance. To prevent product liability (PL) issues, the Group reviews PL risks in advance and conducts inspections at the time of product shipment and equipment handover to confirm that its quality standards have been met. The Group also maintains appropriate product liability insurance to prepare for unforeseen accidents. However, if a PL incident occurs that cannot be fully covered by these measures, it could affect the Group’s operating results.
The Group has established the PL Committee, a risk management committee for product and technology information. In the event of an accident, the Committee will take the lead in responding promptly.
The Group protects the products and technologies it develops through patents and other intellectual property rights, and works to ensure that its products do not infringe the intellectual property rights of third parties. However, if third parties infringe patents related to the Group’s products, or if lawsuits or other disputes arise alleging that the Group’s products infringe third-party intellectual property rights, the Group’s operating results could be affected by loss of business opportunities, litigation expenses, damages, and other factors.
The Group has established a specialized department responsible for managing intellectual property rights. This department conducts thorough reviews of third-party intellectual property rights and, as necessary, investigates potential infringement by third parties of patents related to the Group’s products.
In the event of a large-scale natural disaster or the spread of a new infectious disease, the Group may be forced to reduce or suspend production and sales activities, which could affect its operating results.
In the event of a disaster or similar emergency, the Group will respond promptly under the leadership of the Emergency Response Headquarters, headed by the President and CEO.
