Our group's sales are heavily concentrated in the automotive parts manufacturing industry, resulting in a high dependency on the automotive sector. Consequently, fluctuations in automobile production trends may materially affect our group's revenues.

Our company holds foreign currency-denominated assets and liabilities. As a result, exchange rate differences at the end of the fiscal year may lead to foreign exchange gains or losses, which could have a material impact on ordinary profit. Additionally, in the import and export of manufactured goods and commodities, foreign exchange rates may influence both sales and purchase prices, thereby affecting the profitability of our group's business segments.

Approximately 60% of our group's raw material procurement—primarily rubber, resin, and textiles—is sensitive to fluctuations in crude oil prices. Volatility in crude oil prices may lead to fluctuations in material costs, which could have a material impact on operating profit.

Our group operates production facilities in China, the United States, Vietnam, and other overseas markets, and continues to actively expand its global footprint. However, unique local circumstances, changes in regimes or legal frameworks, and other factors may affect the execution of our business strategies. Furthermore, natural disasters, epidemics, terrorism, strikes, and other disruptions in these countries may hinder purchases, production, and sales of products.

In Japan, we have plants in Iwatsuki Ward (Saitama City), Kazo City (Saitama Prefecture), and Minamisoma City (Fukushima Prefecture), with affiliated production subsidiaries located nearby. In the event of a large-scale disaster (earthquake, tornado, etc.) in these locations, in the worst case, simultaneous suspension of operations across multiple sites could occur, potentially resulting in a substantial adverse impact on business performance.

Our group manufactures a range of products in strict accordance with globally recognized quality control standards. However, product defects and future quality claims cannot be ruled out entirely. Although we are covered by product liability insurance, the insurance coverage may not fully compensate for all potential liabilities. In the event of serious product defects, our group may incur substantial costs and suffer reputational damage, which could have a material adverse impact on the sales across our business divisions and our group's financial condition.

Under the company's Basic Policy on Information Security, our group strives to systematically and continuously improve and enhance information security. However, in the event of a major system failure caused by a computer virus or cyberattack, resulting in lost business opportunities due to compensation claims for information leakage or temporary operational shutdown, such an incident could have a material adverse impact on the company's sales and our group's financial condition.

We recognize human resource development as a critical priority and are actively increasing investment in human capital. However, securing talent in a timely manner is becoming increasingly challenging due to the shortage of the working population driven by the declining birthrate, an aging population, and a shortage of highly specialized personnel in specific fields. Such a talent shortfall may hinder the transfer of skills and know-how and diminish the company's growth potential, especially if younger mid-tier employees retire.

FUJIKURA COMPOSITES Inc. and its group companies (hereinafter referred to as "the Company") are committed to disclosing corporate information, including management and financial conditions, to its shareholders and investors in a manner that upholds timeliness, fairness, accuracy, and continuity, under the FUJIKURA COMPOSITES Code of Conduct. By doing so, we aim to enhance management transparency and earn the trust and appropriate evaluation of the Company by shareholders and investors.

We will comply with the Financial Instruments and Exchange Act and other relevant laws and regulations, as well as the Rules on Timely Disclosure of Corporate Information by Issuers of Listed Securities ("Timely Disclosure Rules") stipulated by the Tokyo Stock Exchange, where the Company is listed, and disclose IR information accordingly. Even when not required by these regulations, the Company will disclose information it considers necessary to foster a deeper understanding of the Company among shareholders and investors.
In disclosing information, the Company will adhere to the fair disclosure rules set forth in the Financial Instruments and Exchange Act, exercise caution to prevent selective disclosure to specific parties, and strive to ensure that all disclosures are made in a fair manner.

In addition to the earnings forecasts submitted to the Tokyo Stock Exchange, the Company may, in written form or via its website, provide materials outlining its plans, strategies, targets, and forecasts.These are intended to assist shareholders and investors in making their own independent assessment of the Company's future value.

Such information, excluding historical facts, constitutes our projections. It is based on information currently available to us and may reflect assumptions and beliefs derived from information, which inherently involves risks and uncertainties. We kindly ask for your understanding that actual results may differ from current projections due to various factors.

Factors affecting actual results include, but are not limited to, economic conditions, trends in customer needs, fluctuations in exchange rates, volatility in raw material prices, and rapid technological innovation.

In addition, the Company is not in a position to comment on any information disclosed by third parties, including earnings forecasts related to the Company. However, if the Company determines that such information contains a clear factual error that could materially affect the judgment of shareholders and investors, the Company will request the disclosing party to correct the error while issuing accurate information.

To prevent the leakage of financial results information and to ensure fair access for all shareholders and investors, the Company designates a quiet period from the day following the quarterly earnings closing date until the completion of disclosure on the Tokyo Stock Exchange. During this period, we will refrain from answering any questions related to the financial results.

In addition, even outside the quiet period, the Company may be unable to respond to certain inquiries due to factors such as the risk of incurring a competitive disadvantage relative to industry peers or obligations under confidentiality agreements.