Notice Regarding Recording of Extraordinary Gains and Losses

Regarding the Recording of Extraordinary Gains and Losses

Sakura Internet Inc. plans to record up to 9,619 million yen in government subsidy income (extraordinary gains) and an equal amount of fixed asset impairment loss (extraordinary losses) in the fourth quarter of the fiscal year ending March 2026, following the decision on the grant award based on the Ministry of Economy, Trade and Industry's Cloud Program Supply Assurance Plan certification. The total subsidy amounts to 10,539 million yen, of which the portion allocated to fixed assets acquired during the period will be recorded as extraordinary gains and losses. The remaining amount is expected to be recorded as subsidy income under non-operating income.

Impact on Business Performance and Future Outlook

The impact of this matter on the consolidated earnings for the fiscal year ending March 2026 is considered minor. Furthermore, the portion of subsidies applied to fixed assets acquired from the fiscal year ending March 2027 onwards will be recorded as extraordinary gains and losses in subsequent periods. The consolidated earnings forecast for the fiscal year ending March 2026 is net sales of 36,500 million yen, operating income of 350 million yen, and net income attributable to owners of parent of 200 million yen.