Notice of Dissolution of Consolidated Subsidiary and Recording of Special Loss

Performance Overview

Osaka Steel has decided to dissolve its consolidated subsidiary, PT KRAKATAU OSAKA STEEL, and plans to record a special loss of 20 billion yen in the fiscal year ending March 2026. The dissolution of KOS is scheduled for a resolution in December 2026, with procedures to be carried out in accordance with local laws. As a result, consolidated net assets are expected to decline significantly, impacting the company's financial position. Sales are expected to remain roughly unchanged YoY, but substantial reduction in net assets is anticipated.

Future Outlook and Impact on Shareholders

The recording of the loss associated with the subsidiary's dissolution is expected to have a major impact on performance in the fiscal year ending March 2026. This may lead to a decrease in shareholders’ equity and raise concerns about financial soundness. The dissolution procedures are scheduled for completion in December 2026, and the final liquidation date is yet to be decided. Investors should monitor the trend of the company's financial condition as the decision could influence future business strategies and capital policies.