Notice Regarding Recognition of Impairment Loss (Consolidated) by Philippine Consolidated Subsidiary and Equity Method Investment Loss (Individual), and Revision of Full-Year Earnings Forecast for the Fiscal Year Ending March 2026

Regarding Recognition of Impairment Loss and Equity Method Investment Loss

At the Philippine consolidated subsidiary, Taiheiyo Cement Philippines Inc., following a review of the business plan considering post-COVID-19 interest rate hikes and demand stagnation, an impairment test was conducted. As a result, an impairment loss of 24.4 billion yen was recorded as an extraordinary loss in the consolidated results for the third quarter of the fiscal year ending March 2026. Additionally, in the individual financial statements, an equity method investment loss of 37.8 billion yen was recognized as an extraordinary loss. Since the equity method investment loss is eliminated in consolidation, it has no impact on consolidated earnings.

Revision of Earnings Forecast for the Fiscal Year Ending March 2026 and Future Outlook

The consolidated earnings forecast remains unchanged with net sales of 906,000 million yen and operating income of 70,000 million yen; ordinary income has been revised upward to 69,000 million yen (+1.5% from the previous forecast). However, due to the recording of the impairment loss, the forecast for net income attributable to owners of the parent has been revised downward by 62.2%, from 45,000 million yen to 17,000 million yen. The individual earnings forecast has been revised to net sales of 342,000 million yen (-3.7% from the previous forecast) and net income of 1,000 million yen (-97.5%). The dividend forecast remains unchanged. The outlook for the Philippines business remains positive for medium- to long-term demand growth, and efforts toward profit improvement will continue through cost reductions and expansion of sales volume.