English translation of the financial reporting parts of the Annual Securities Report for the Fiscal Year Ended March 31, 2025

（Report pursuant to Article 24, Paragraph 1 of the Financial Instruments and Exchange Act） Fiscal Year From April 1, 2024

（Term21） To March 31, 2025

2-2-1, Gakuen-minami, Tsukuba, Ibaraki, Japan

1【Changes in major management indicators】

(1) Consolidated management indicators

Note

1. The Company has prepared the consolidated financial statements under International Accounting Standards.

2. The Company did not state the price-to-earnings ratio because CYBERDYNE recorded a loss attributable to the owners of the parent.

3. The Company did not state the return of equity attributable to the owners of the parent because CYBERDYNE recorded a loss attributable to the owners of the parent.

4. Rounded down to the closest millions of yen (same for the following)

5. In term 19, the Company finalized the provisional accounting treatment for the business combination, and the related key management indices for term 18 are based on the amounts after the significant revision of the initial allocation of acquisition costs due to the finalization of the provisional accounting treatment.

(2) Non-consolidated management indicators

Note

1. The Company did not state diluted net income per share because, while there are diluted shares, CYBERDYNE recorded net loss per share.

2. The Company did not state the return of equity as CYBERDYNE recorded a net loss attributable to owners of the parent.

3. The Company did not state the price-to-earnings ratio, as CYBERDYNE recorded a net loss per share.

4. The highest and lowest share prices are based on the Tokyo Stock Exchange (Growth) price starting from April 4, 2022. Prices before that date are based on the share price at the Tokyo Stock Exchange (Mothers)

1. Basis of preparation of consolidated financial statement and non-consolidated financial statement

   1. The consolidated financial statements of CYBERDYNE, INC. (the "Company") have been prepared by International Accounting Standards (hereafter referred to as "IFRS") under Article 312 of the "Ordinance on Terminology, Forms, and Preparation Methods of Consolidated Financial Statements" (Ordinance of the Ministry of Finance No. 28 of 1976)

   2. The non-consolidated financial statements of the Company have been prepared by "Ordinance on Terminology, Forms, and Preparation Methods of Financial Statements, etc." (Ordinance of the Ministry of Finance No. 59 of 1963. from now on referred to as "Ordinance on Financial Statements").

      The Company is a special company that submits and prepares financial statements under Article 127 of the Ordinance on Financial Statements.

2. Audit Certification

   Under the provisions of Article 193-2 item 1 of the Financial Instruments and Exchange Law, the Company has undergone an audit by Deloitte Touche Tohmatsu LLC of the consolidated financial statements for the consolidated fiscal year (from April 1, 2024, to March 31, 2025) and the non-consolidated financial statements for the business year (from April 1, 2024, to March 31, 2025).

3. Special efforts to ensure the appropriateness of consolidated financial statements, etc., and the establishment of a system that enables the proper preparation of consolidated financial statements, etc. based on IFRS

   The Company makes special efforts to ensure the appropriateness of its consolidated financial statements. It maintains a system that prepares consolidated financial statements appropriately under IFRS. The contents are as follows.

   1. To appropriately understand the content of accounting standards, etc., and to develop a system that can adequately respond to changes in accounting standards, etc., the Company joined the Financial Accounting Standards Foundation and participated in seminars sponsored by the foundation and auditing firms, etc.

   2. In applying IFRS, the Company obtained press releases and statements issued by the International Accounting Standards Board occasionally to keep track of the latest standards. To prepare the appropriate consolidated financial statements by IFRS, the Group has designed its accounting policies and guidelines and applies them to accounts processing.

1. Consolidated financial statements

① Consolidated statement of financial position

Note Previous consolidated fiscal year

(March 31, 2024)

Current consolidated fiscal year (March 31, 2025)

Assets

Current assets

Millions of yen Millions of yen

Note Previous consolidated fiscal year

(March 31, 2024)

Current consolidated fiscal year (March 31, 2025)

Liabilities and equity Liabilities

Current liabilities

Millions of yen Millions of yen

② 【Consolidated statement of profit or loss and consolidated statement of comprehensive income】

【Consolidated statement of profit or loss】

【Consolidated statement of comprehensive income】

Profit (loss)

Other comprehensive income

Items that will not be reclassified to profit or loss Financial assets measured at fair value through other comprehensive income

Total of items that will not be reclassified to profit or loss

Items that may be reclassified to profit or loss Exchange differences on translation of foreign operation

Total of items that may be reclassified to profit or loss

Total other comprehensive income, net of tax Comprehensive income

③ 【Consolidated statement of changes in shareholders' equity】

Equity attributable to owners of parent

Share capital Capital surplus Other components of equity

April 1, 2023 Profit (loss)）

Other comprehensive income Total comprehensive income

Share-based payment

transactions

Acquisition of treasury shares Equity transactions with noncontrolling interests

Increase (decrease) by business combination

Other

Total transaction with owners March 31, 2024

Profit (loss)

Other comprehensive income Total comprehensive income

Share-based payment

transactions

Acquisition of treasury shares Equity transactions with noncontrolling interests

Increase (decrease) by business combination

Other

Total transaction with owners March 31, 2025

Note

Equity attributable to owners of parent

Other components of

Non-controlling

Total equity

equity Retained earnings

Total

interests

April 1, 2023 Profit (loss)

Other comprehensive income Total comprehensive income

Share-based payment transactions

Acquisition of treasury shares

Equity transaction with noncontrolling interest

Increase (decrease) by business combination

Other

Total transactions with owners March 31, 2024

Profit (loss)

Other comprehensive income Total comprehensive income

Share-based payment transaction

Acquisition of treasury shares Equity transaction with noncontrolling interest

Increase (decrease) by business combination

Other

Total transactions with owners March 31, 2025

Total

④ 【Consolidated statement of cash flows】

Note

Previous consolidated fiscal year (From April 2023

to March 31,2024)

Current consolidated fiscal year (From April 1, 2024

to March 31, 2025)

C

Contributions into CEJ Fund from third-party investors

Distributions and redemptions from CEJ Fund into third-party investors

Other -16 -11

Cash flows from financing activities 160 -216

Effect of exchange rate changes on cash and cash equivalents

120 -10

Net increase (decrease) in cash and cash equivalents -2,646 1,669

Cash and cash equivalents at the beginning of the fiscal year

8 7,801 5,155

Cash and cash equivalents at the end of the year 8 5,155 6,824

【Notes to consolidated financial statements】

1. Nature of operations

   CYBERDYNE, INC. (the "Company") is domiciled in Tsukuba, Ibaraki, Japan. The location of the Company's headquarters and its main offices are disclosed on the Company website (https://www.cyberdyne.jp/english). The accompanying consolidated financial statements comprise the Company, its group companies (with the Company collectively referred to as the "Group"), associates, and jointly controlled entities. The fiscal year is from April 1 to March 31.

   The Group utilizes Cybernics to work on the entire process, from basic research of innovative technologies to their social implementation, which could contribute to overcoming various problems that modern society faces. At the same time, the Group will continue its endeavors to create new industries and nurture human resources to induce an upward spiral of innovation and shape the future. The Group operates under a single segment of business related to robotics, detailed in "6. Segment information".

2. Basis of presentation

   1. Conformance of consolidated financial statements with IFRS and matters regarding the first-time adoption

      As the Group meets the requirement of "Specified Company Applying Designated International Reporting Standards" under Article 1-2 of the "Ordinance on terminology, forms and preparation methods of consolidated financial statements" (Ordinance of the Ministry of Finance No. 28 of 1976, referred to as the "Ordinance"), the consolidated financial statements of the Group have been prepared by International Financial Reporting Standards ("IFRS") as permitted by the provisions of Article 312 of the Ordinance.

      The consolidated financial statements under review have been approved by Yoshiyuki Sankai, President and CEO of the Company, and Shinji Honda, Director and COO of the Company, on June 24, 2025.

   2. Basis of measurement

      As described in Note "3. Significant accounting policies", consolidated financial statements of the Group have been prepared based on the acquisition cost, except for specific financial instruments measured at fair value.

   3. Functional currency and presentation currency

      The consolidated financial statements of the Group are presented in Japanese yen, which is the Company's functional currency, rounded to the nearest million yen.

3. Significant accounting policies

   1. Basis of consolidation

      ① Subsidiaries

      Subsidiaries are entities controlled by the Group. The Group controls an entity when it has exposure, or rights, to variable returns from involvement with an investee and could affect those returns through its power over the investee.

      The financial statements of subsidiaries are included in the consolidated financial statements of the Group from the date the Group gains control until it loses control of the subsidiary.

      Some of the subsidiaries have a close date of December 31. Due to the relationship with other shareholders and contract agreements, practically unifying these subsidiaries' closing dates is impossible. As such, these subsidiaries are subject to provisional settlements of accounts on March 31, and the Group utilizes these accounts for its consolidated financial statements.

      All intergroup balances, transactions, income and expenses, and unrealized gains and losses arising from intergroup transactions are eliminated when preparing the consolidated financial statements.

      Comprehensive income of subsidiaries is attributed to owners of the parent and the non-controlling interests, even if this results in the non-controlling interests having a deficit balance.

      A change in the Group's ownership interest in a subsidiary, without a loss of control, is accounted for as an equity transaction. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity attributable to the owners of the parent. In case of a change in the Group's ownership interest in a subsidiary, resulting in a loss of control, profit or losses arising from the loss of control are recognized as net loss.

      ② Associates

      An associate is defined as an entity over which the Group significantly influences financial and operating policy decisions but does not have control over the entity.

      The Group is presumed to have significant influence over another entity when it holds at least 20% but at most 50% of the voting rights of that entity.

      Investments in associates are accounted for by the equity method from the date the Group gains significant influence to the date it loses that influence.

      Suppose the Group's share of the associates' loss (amount equivalent to equity interest) exceeds the Group's share of the investment in the associate. In that case, the Group reduces the carrying amount of the investment to zero. It does not recognize any further losses unless the Group incurs or pays obligations (legal or constructive obligations) on behalf of the associate.

      Any excess of the cost of acquisition over identifiable assets, liabilities, and contingent liabilities of the associates at the date of acquisition are recognized as goodwill and shall be included in the carrying value of the investment. The relevant goodwill is not recognized separately, so it shall not be tested for impairment individually.

      However, suppose there is objective evidence on the possibility of impaired investment. In that case, the Group shall test its investment to associates for impairment by recognizing the investment as a single asset in net amounts.

      ③ Jointly controlled company

      A jointly controlled company is an entity jointly controlled by two or more parties, including the Group under the contractually agreed share of control of an arrangement over the economic activity of the jointly controlled company, which exists only when the decision for strategic, financial, and operating decisions related to relevant activities require unanimous consent of the parties sharing control. A jointly controlled company of the Group is accounted for using the equity method.

      Some of the jointly controlled company has a close date of December 31. Due to the relationship with other shareholders and agreements of contract, it is impossible to practically unify the closing date for the said jointly controlled company. As such, the Group adjusts important transactions and events during the period to reflect the impact of changes caused by the difference in close dates.

   2. Business combinations

      Business combinations are accounted for using the acquisition method. The consideration of an acquisition is measured as the aggregate of the acquisition-date fair value of the assets transferred, liabilities assumed, and equity securities issued by the Group to the former owners of the acquiree in exchange for control of the acquiree. Any excess of the consideration over the net fair value of identifiable assets acquired and liabilities assumed at the acquisition date is recognized as goodwill in the consolidated statement of financial position. Conversely, any deficit is immediately recognized as income in the consolidated statement of income.

      Costs associated with business combinations, such as advisory fees, attorney fees, and due diligence costs, are expensed as incurred.

      Suppose the initial accounting for a business combination is incomplete by the end of the fiscal year in which the combination occurs. In that case, provisional amounts of incomplete items are measured and adjusted during the measurement period within one year from the date of acquisition. During the measurement period, the Group shall retrospectively adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. If this new information brings about new recognition of assets and liabilities, it will be recognized as additional assets and liabilities. The measurement period could last up to one year from the date of acquisition.

      The additional acquisition of non-controlling interests is accounted for as an equity transaction; therefore, no goodwill is recognized for such a transaction.

      Identifiable assets and liabilities of the acquiree in business combinations are measured at their acquisition-date fair value, with the following exceptions:

      ・Deferred tax assets and liabilities and assets or liabilities related to employee benefit arrangements

      ・Share-based payment transactions of the acquire

      ・Non-current assets and disposal groups classified as held for sale under IFRS 5 "Non-current assets held for sale and discontinued operations."

      In a business combination achieved in stages, the Group re-measures its previously held equity interest at its acquisition-date fair value. It recognizes the resulting gain or loss, if any, in net profit or loss.

   3. Foreign currency transaction

      ① Foreign currency transactions

      Foreign currency transactions are translated into the functional currency of each company of the Group at the spot exchange rate at the date of the transaction or an exchange rate that approximates the spot rate.

      Foreign currency monetary items are translated into functional currency using the rates at the end of the reporting period.

      Non-monetary items measured at fair value in foreign currencies are translated into the functional currency using the exchange rates when the fair value was measured.

      Exchange differences from such translations and settlements are recognized in profit or loss. However, exchange differences arising from financial assets measured at fair value through other comprehensive income are recognized in other comprehensive income.

      ② Financial statements of foreign operations

      Assets and liabilities of foreign operations are translated at the rate at the end of each reporting period. Income and expenses are translated at the average exchange rates for the period, provided there were no significant fluctuations in the exchange rates. Exchange differences arising from the translation of the financial statements of foreign operations are recognized in other comprehensive income. On the disposal of a foreign operation, the cumulative amount of exchange differences relating to that foreign operation is reclassified from equity to profit or loss when the gain or loss on disposal is recognized.

   4. Financial instruments

      ① Financial assets

      1. Initial recognition and measurement

         The Group classifies its financial assets as financial assets measured at fair value through profit or loss, financial assets measured at fair value through other comprehensive income, or financial assets measured at amortized cost. The classification of measurements is conducted at initial recognition.

         The Group recognizes and derecognizes all financial assets on trade date where the purchase or sale of a financial asset under a contract whose terms require delivery of the financial asset within the timeframe established by the market concerned, and are initially measured at fair value, plus transaction costs except for those financial assets classified at fair value through profit or loss, which are initially measured at fair value.

         Financial assets held by the Group are measured at amortized cost if both conditions are met.

         ・The financial asset is held in a business model whose objective is to hold financial assets to collect contractual cash flows

         ・The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

         Equity instruments not measured through amortized cost are classified as equity instruments measured at fair value.

         Excluding equity instruments measured at fair value through profit or loss that is held for trading, for each equity item, the Group designates whether it shall be measured at fair value through profit and loss or whether it shall be measured at fair value through comprehensive income. This designation is continuously used after the initial designation.

      2. Subsequent measurement

         Measurement of financial assets after initial recognition is performed according to the classification of financial assets as follows:

         1. Financial assets measured at amortized cost

            The effective interest method recognizes the carrying amounts of financial assets measured at amortized cost.

         2. Financial assets measured at fair value

            These financial assets are measured at fair value after initial recognition, and changes in their fair value are recognized in profit or loss.

            However, for financial assets designated as financial assets measured at fair value through comprehensive profit, the Group recognizes changes in their fair value as other comprehensive income. Dividends from equity instruments measured at fair value through other comprehensive income are recognized as financial income in profit or loss.

      3. Derecognition of financial assets

         The Group derecognizes financial assets only when the contractual rights to the cash flows from the financial assets expire, or when the Group transfers financial assets. In cases where the Group continues to possess ownership over the transferred asset, it shall be recognized as liability related to the asset within the range of ownership held, so long as this ownership continues to remain in effect.

      4. Impairment of financial assets

         For impairment of financial assets measured at amortized cost, the Group recognizes an allowance for doubtful accounts for expected credit losses on such financial assets.

         At each reporting date, the Group assesses whether the credit risks on the financial assets have increased significantly since initial recognition.

         Suppose credit risk on a financial instrument has not increased significantly since initial recognition. In that case, the allowance for doubtful accounts for that financial instrument equals the 12-month expected credit losses. If credit risk in a financial instrument has increased significantly since initial recognition, the allowance for doubtful accounts equals the lifetime expected credit losses.

         The Group determines if credit risk has increased significantly by evaluating changes in default risk concerning factors such as downgrading internal credit ratings, declining counterparty results, and delinquency information. Furthermore, suppose the credit risk is determined to be low as of the closing date. In that case, the Group shall assess that credit risk on a financial instrument has not increased significantly since the initial recognition.

         However, the allowance for doubtful accounts on trade receivables and others always equals the lifetime expected credit losses.

         The expected credit losses of financial assets are estimated in a way that reflects the following:

         ・An unbiased and probability-weighted amount determined by evaluating a range of possible outcomes ・The time value of money

         ・Reasonable and supportable information about past events, current conditions, and forecasts of economic conditions that is available without undue cost or effort at the reporting date The amounts of these measurements are recognized in profit or loss.

         If an event that reduces an impairment loss occurs after the impairment loss has been recognized, the impairment loss will be reversed to the extent of the decrease and credit to profit or loss.

         ② Financial liabilities

         1. Initial recognition and measurement

            The Group classifies financial liabilities as financial liabilities measured at fair value through profit or loss or at amortized cost. This classification is conducted upon initial recognition.

            All financial liabilities are measured at fair value. However, financial liabilities measured at amortized cost are measured in the total amount after deducting directly attributable transaction costs from the fair value.

         2. Subsequent measurement

            Financial liabilities are measured according to the classification of the financial liabilities after initial recognition. Financial liabilities measured at amortized cost are subsequently measured at amortized cost using the effective interest method.

            Amortization using the effective interest method and gains and losses on derecognition are recognized in profit or loss for the period.

         3. Derecognition of financial liabilities

         The Group derecognizes financial liabilities when they are extinguished (i.e. when the obligation specified in the contract is discharged, canceled, or expires).

         ③ Offsetting of financial assets and financial liabilities

         Financial assets and financial liabilities are offset, and the net amount is presented in the consolidated statement of financial position only when the Group currently has a legally enforceable right to set off the recognized amount and intends to settle on a net basis or realize the assets and settle the liabilities simultaneously.

         ④ Fair value of financial instruments

         For financial instruments measured at fair value, their fair value is classified into Level 1 through Level 3 based on the observability of inputs used for the measurement and their materiality.

         Level 1: Quoted prices in active markets for identical assets or liabilities (unadjusted)

         Level 2: Fair value determined using observable prices other than Level 1 for the asset or liability directly or indirectly

         Level 3: Fair value determined using the valuation technique, including unobservable inputs for the asset or liability

   5. Cash and cash equivalents

      Cash and cash equivalents consist of cash on hand, demand deposits, and short-term investments that are highly liquid and readily convertible to known amounts of cash subject to an insignificant risk of changes in value and that mature or become due within three months from the date of acquisition.

      Cash and cash equivalents include certificates of deposit and joint-managed money trusts.

   6. Inventories

      Inventories are measured at the lower value between cost and net realizable value. The cost of finished goods and work in process are calculated using specific identification methods and purchase costs. Merchandise and raw materials are calculated using the moving average method. These include processing costs and all other costs incurred in bringing the inventories to their existing location. Net realize value is the estimated selling price in the ordinary course of business minus the estimated completion costs and the costs necessary to make the sale.

   7. Property, plant and equipment

      Property, plant and equipment are presented at a cost calculated by deducting accumulated depreciation and impairment losses from the purchase cost.

      The cost of an item of property, plant and equipment comprises any costs directly attributable to the acquisition of the asset and the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

      Depreciation of assets other than land and construction in progress is calculated straight-line over the assets' estimated useful lives. The estimated useful lives of major asset items are as follows:

      Buildings and structures: 3 to 50 years

      Operating lease assets 5 years Tools, furniture and fixtures: 2 to 20 years

      The estimated useful lives, residual value, and depreciation method are reviewed at each fiscal year-end, and any revisions are applied prospectively as changes in accounting estimates.

   8. Intangible assets

      ① Goodwill

      The measurement of Goodwill arising from business combination at the time of initial recognition is stated in "2. Business combinations."

      Goodwill is not amortized but is tested for impairment annually or whenever there is an indication of impairment. The goodwill impairment test and measurement of impairment loss are described in "10. Impairment of nonfinancial assets."

      Goodwill is presented in the consolidated statement of financial position as the amount obtained by deducting accumulated impairment loss from the acquisition cost.

      ② Intangible assets

      Intangible assets acquired separately are measured using acquisition cost at the initial recognition.

      After initial recognition, except for intangible assets with an indefinite useful life, intangible assets are amortized on a straight basis over their estimated useful lives. After deducting the accumulated depreciation and impairment loss, they are presented at acquisition cost.

      Expenditures related to internally generated intangible assets are recognized as expenses when incurred, except development expenses that meet the criteria for capitalization.

      The Group has no intangible assets with indefinite useful lives. The estimated useful lives of major intangible assets are as follows:

      Software 5 years

      Patents 8 years

      Customer-related assets 3 years

      The estimated useful lives, residual values, and amortization method are reviewed at each fiscal year-end, and any revisions are applied prospectively as changes in accounting estimates.

      ③ Research and development expenses

      Research expenditures are expensed as incurred. Development expenditures are capitalized if they can be measured reliably, future economic benefits are probably, and the Group intends to, and has sufficient resources to, complete development and to use or sell assets.

   9. Leases

      The Group determines whether a contract is a lease or includes a lease at the time the contract is entered into. If the contract conveys the right to control the use of the identified asset for a period of time in exchange for consideration, the contract is considered to be a lease or to contain a lease.

      Leases as lessee

      Right-of-use assets and lease liabilities are recognized at the start date of the lease.

      Right-of-use assets are initially measured at acquisition cost, which is obtained by adjusting the amount of the initial measurement of the lease liability according to any lease payments made at or before the commencement date, any initial direct costs that were incurred, etc.

      After initial recognition, right-of-use assets are depreciated using the straight-line method over the shorter period of the following useful lives or lease terms. The lease term is measured as the period that includes the non-cancelable period of the lease, the extended option period if it is reasonably certain that the lease will be exercised, and the cancellation option period if it is not reasonably certain that the lease will be exercised.

      Lease liabilities are initially measured at the present value, which is the total amount of lease payments payable discounted at the rate of interest on the lease or the rate of interest on additional borrowings of the lessee.

      Lease payments are allocated to finance costs and the repayment of lease liabilities using the interest method, with finance costs recognized in the consolidated statement of profit or loss.

      For short-term leases with 12 months or less or leases with small underlying assets, right-of-use assets and lease liabilities are not recognized. In these cases, lease payments are amortized over the lease term by the straight-line or other regular methods.

      Leases as lessor

      Leases for which the Group is the lessor are classified as finance or operating leases when the lease contract becomes effective.

      When the Group classifies leases, the Group conducts comprehensive evaluations of whether all of the risks and economic values associated with ownership of the underlying asset are substantially transferred. If they are transferred, the lease is classified as a finance lease; if not, it is classified as an operating lease. As part of this evaluation, the Group considers specific indicators, such as whether the lease period based on the non-cancelable period accounts for the majority of the economic useful life of the underlying asset.

      Lease payments under operating leases are recognized as revenue in the consolidated statement of profit or loss on a straight-line basis over the lease term. Units such as HAL that are leased as operating leases are presented as operating lease assets in the consolidated statement of financial position. Please refer to Note "3. Significant accounting policies, 7. Property, plant and equipment" for further details.

      In finance lease transactions, when the Group becomes a lessor who is a manufacturer or a seller, the Group recognizes income, cost of sales, and gains or losses on sales under its policy for outright sales to which IFRS 15 applies, on the commencement date. Please refer to Note "25. Revenue".

      Leases are classified as finance leases when substantially all the risks and rewards incidental to ownership of assets are contractually transferred to the Group. All the other leases are classified as operating leases.

   10. Impairment of non-financial assets

       Non-financial assets, excluding inventories, are assessed at the end of each reporting period to determine whether there is any indication of impairment. If impairment is indicated, the asset's recoverable amount is estimated.

       A cash-generating unit, which is a unit for conducting impairment testing, is the smallest group of assets that generates cash inflows, which are generally independent of cash flows of other assets or groups of assets.

       Recoverability is measured using the higher of the following: fair value after deducting disposal costs or value in use as recoverable amount. If the recoverable amount is less than the carrying amount, the carrying amount is reduced to the recoverable amount and recognized as an impairment loss in profit or loss. When testing goodwill for impairment, the cash-generating units to which goodwill is allocated are consolidated so that impairment is tested to reflect the smallest unit to which goodwill relates. Goodwill acquired through a business combination is allocated to cash-generating units expected to generate synergies from the combination. An impairment loss recognized in connection with a cashgenerating unit is allocated first to reduce the carrying amount of goodwill allocated to that unit and then to reduce the carrying amount of other assets in the cash-generating unit proportionally. Value in use is the present value of future cash flows expected to accrue from the asset or cash-generating unit.

       Impairment losses related to goodwill have not been reversed. As for the reversal of impairment losses on the other assets or cash-generating units, if there is an indication at the end of each reporting period that an asset or cashgenerating unit that has incurred an impairment loss in a prior period may have either disappeared or decreased, the recoverability of the asset or cash-generating unit is assessed. In cases where the recoverable amount exceeds the carrying amount of assets or cash-generating units, the Group shall reverse the impairment loss at the maximum of the amount calculated by deducting the depreciation and amortization necessary from the carrying amount that would have been determined if no impairment loss had previously been recognized in the prior year.

   11. Employee benefits

       Short-term employee benefit obligations are measured on an undiscounted basis and are recognized as expenses when related services are rendered. For bonuses, when there is a legal or constructive obligation to make payments of bonuses, and a reliable estimate of the obligation can be made, the estimated amount to be paid is accounted for as a liability.

       Paid leave expenses are recognized when labor that grants an employee additional rights to paid leave is incurred.

   12. Share-based payment

       ① Stock options

       The Company has a stock option scheme accounted for as an equity-settled share-based payment scheme. The equity settled share-based payment scheme is estimated at the fair value of the date of allotment, taking the estimated number of subscription rights to share that are likely to be vested into the account. It is recognized as an expense in the consolidated statement of profit or loss from the date of allotment through the vesting period and the same amount as an increase in asset in the consolidated statement of profit and loss. The fair value of the allotted option is calculated mainly by the Black-Scholes Model, considering the conditions of the option. Furthermore, the conditions of stock options are reviewed regularly, and estimates of subscription rights to share are adjusted where necessary.

       ② Shares with transfer restriction

       The Group has adopted shares with transfer restrictions as a compensation plan for its employees.

       Consideration received for services is recognized as an expense by a straight-line method over a certain period from the day of allotment. An equal amount is recognized as an increase in capital.

   13. Provisions

       Provisions are recognized when the Group has a present legal or constructive obligation due to a past event, an outflow of resources embodying economic benefits will probably be required to settle the obligation, and a reliable estimate can be made of the obligation amount. Where the time value of money is material, a provision is measured by its present value, to which estimated future cash flows are discounted using a pre-tax discount rate that reflects the risks specific to the provision. Interest costs associated over time are recognized as finance costs.

   14. Revenue

       The Group recognizes revenue based on the following five-step model, excluding revenue from dividend and interest income based on IFRS 9 "Financial Instruments." Step 1: Identify the contract with a customer

       Step 2: Identify the performance obligations in the contract Step 3: Determine the transaction price

       Step 4: Allocate the transaction price to the performance obligations in the contract Step 5: Recognize revenue when the entity satisfies a performance obligation

       Details on revenue recognition are stated in Note "25. Revenue".

   15. Government grants

       Government grants are measured and recognized at fair value when there is reasonable assurance that the Group will comply with the conditions attached to them and that the grants will be received. The Group fulfills the incidental condition for grants and receives reasonable assurance that the grants are scheduled for delivery.

       For government grants related to expense items, related costs that grants will compensate are regularly recognized over the recognized term as revenue. Grants related to assets are calculated by deducting the amount of relevant grants from the acquisition cost of assets.

   16. Income taxes

       Income taxes consist of current income taxes and deferred income taxes. Income taxes are recognized as income or expenses and included in profit or loss, except for taxes related to business combinations and taxes related to items recognized directly in equity or other comprehensive income.

       Current income taxes are recognized in the amount of the expected taxes payable to or receivable from the taxation authorities. Calculation of the amount of tax is based on the tax rates and laws enacted or substantively enacted by the end of the reporting period in countries.

       Deferred tax assets and liabilities are recognized for temporary differences between the carrying amounts of assets or liabilities at the end of the reporting period and its tax base, as well as for tax loss carryforwards and tax credits. Deferred tax assets and liabilities are recognized for the following temporary differences:

       ・Taxable temporary differences arising from initial recognition of goodwill

       ・Temporary differences arising from the initial recognition of assets and liabilities from transactions that are not business combination transactions, that do not affect accounting profit or taxable income (loss) at the time of the transaction, and that do not give rise to an equal amount of future additional temporary differences and future subtractive temporary differences at the time of the transaction

       ・Taxable temporary differences associated with investments in subsidiaries and associates where the timing of the reversal of the temporary differences will not reverse in the foreseeable future or where it is no longer probable that sufficient tax profit subject to taxable temporary difference will be available.

       ・Taxable temporary differences associated with investments in subsidiaries and associates where the timing of the reversal of the temporary differences can be controlled and, probably, the temporary differences will not reverse in the foreseeable future.

       The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the assets to be recovered. Unrecognized deferred tax assets are reassessed at each reporting period. They are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax assets to be recovered.

       Deferred tax assets and liabilities are measured at the tax rate expected to apply when the assets are realized, or the liabilities are settled based on the tax rates and laws enacted or substantively enacted by the end of the reporting period.

       Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when it meets any of the following conditions: If it relates to income taxes levied by the same tax authority, if different taxable entities intend to settle current tax assets and liabilities on a net basis, or if the realization of assets and settlement of liabilities are done simultaneously.

   17. Earnings per share

       Basic earnings per share are calculated by dividing profit (loss) attributable to owners of the parent by the weighted average number of ordinary shares outstanding during the period, adjusted for treasury shares held. Diluted earnings per share are calculated by adjusting the effects of all dilutive potential ordinary shares.

   18. Equity and other capital

       ① Common shares

       Common shares issued by the Company are recognized in share capital and capital surplus at their issue price. Share issuance costs are deducted from the issue price.

       ② Treasury shares

       When a treasury share is acquired, consideration received (including direct transaction cost) is recognized as deducted items from equity. When a treasury share is sold or re-issued, consideration received is recognized as an increase in capital. The surplus and deficit generated by this transaction are presented as capital surplus.

   19. Significant accounting policy related to Cybernic Excellence Japan Fund 1 Investment Limited Partnership

       ① Consolidation of Cybernic Excellence Japan Fund 1 Investment Limited Partnership by the Company

       The Company is consolidating Cybernic Excellence Japan Fund 1 Investment Limited Partnership ("CEJ Fund") for the following reasons.

       The Company practically decides on the investment of CEJ Fund through its consolidated subsidiary CEJ Capital, Inc. (general partner "GP" of CEJ Fund), which gives the Company control. As a GP, CEJ Capital, Inc. receives the performance fee, and the Company gets returns based on the performance according to its contribution as a Limited Partner ("LP") of CEJ Fund. As the Company has the power over the CEJ Fund to influence the return, the Company has the control based on IFRS 10 "Consolidated Financial Statements."

       Inter-company transactions such as management and performance fees to CEJ Capital, Inc., GP of CEJ Fund, to be paid from CEJ Fund are eliminated in consolidation.

       ② Investment by CEJ Fund

       For financial instruments measured at fair value, except financial assets that are held for trading purposes that must be measured at fair value through profit or loss, for each financial instruments, the Group classifies each capital-based financial asset to either financial assets measured at fair value through profit or loss or financial assets measured at fair value through other comprehensive income. The same classification is applied continuously.

       ③ Contribution from Limited Partners ("LP") to CEJ Fund

       CEJ Fund will issue capital calls for its respective LP ("Capital Call")

       1. Contribution from LP other than the Company

          The term of existence (up to 12 years from the effective date) is prescribed in the investment limited partnership agreement of the CEJ Fund. This agreement states that equity interests in the CEJ Fund held by LPs other than the Company (from now on, "Third-Party Investors") that invest in CEJ Fund shall be distributed and refunded. As such, it is recorded as a liability under "Third-party interests in CEJ Fund" in the consolidated statement of financial position and classified as "financial liabilities measured at amortized cost." The carrying amounts of the liabilities is the amount of equity vested in Third-Party Investors under the limited partnership agreement for investment, assuming that the Fund was liquidated at the end of each quarter.

          "Third-party interests in CEJ Fund" are subject to change depending on payments from Third-Party Investors based on Capital Calls, distributions, and refunds to Third-Party Investors and the performance of the CEJ Fund. Changes in the performance of the CEJ Fund are included in "Gains (losses) related to CEJ Fund" in the consolidated statement of profit or loss. "Gains (losses) related to CEJ Fund" includes the costs of establishing and managing the CEJ Fund.

          Contributions from Third-Party Investors are presented as "Contribution into CEJ Fund from third-party investors" under cash flows from financing activities in the consolidated statement of cash flow. Distribution and refunds to third-party investors are presented as "Distributions and redemptions from CEJ Fund into third-party investors" under cash flow from financing activities.

       2. Contribution from the Company

       Contribution from the Company to CEJ Fund as an LP is eliminated in consolidation.

4. Significant accounting estimates and judgments

   Preparing the consolidated financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income, expenses, and related disclosures. Due to the uncertain nature of estimates, in some cases, actual results may vary from initial estimates.

   Management reviews the estimates and their underlying assumptions continuously. The effects of revisions to accounting estimates and assumptions are recognized from the accounting period when the estimates are revised and all accounting periods after that point.

   Estimates and assumptions that significantly affect the amounts recognized in the Group's consolidated financial statements are as follows:

   • Matters concerning financial instruments (Notes "3. Significant accounting policies, (4) Financial instruments", Notes "3. Significant accounting policies, (19) Significant accounting policy related to Cybernic Excellence Japan Fund 1 Investment Limited Partnership", Notes "10. Other financial assets", "33. Financial instruments" as well as "34. CEJ Fund"

   • Impairment of non-financial assets ("Note 3. Significant accounting policies, (10) Impairment of non-financial assets)", "13. Property, plant and equipment", "14. Goodwill and intangible assets", "15. Investments accounted for using equity method")

   • Useful lives of property, plant, and equipment, estimation of residual value (Note "3. Significant accounting policies,

     (7) Property, plant and equipment" as well as Note "13. Property, plant and equipment")

   • Collectability of deferred tax assets (Note "16. Income taxes")

   ・Recognition of revenue (Note "3. Significant accounting policies, (14) Revenue", Note "25. Revenue")

   ・Measurement of share-based payments (Note "32. Share-based payment")

   ・Estimates of measurement of equity from Third-Party in CEJ Funds (Note "3. Significant accounting policies, (19) Significant accounting policy related to Cybernic Excellence Japan Fund 1 Investment Limited Partnership")

5. New standards and interpretations not yet adopted

   The following are the standards and interpretations issued before the approval date for the consolidated financial statements but have not yet been adopted by the Group.

   The impact of the application of these accounting standards is still being calculated.

   IFRS		Mandatory effective date （start date）	Effective date for the Group	Outline of the establishment and revision
   IFRS９ IFRS７	Modifications to the classification and measurement of financial instruments	January 1, 2026	Fiscal year ending March 31, 2027	Clarification of the classification of financial assets, addition of derecognition requirements for financial liabilities, and revision of disclosure requirements for financial assets measured at fair value through other comprehensive income
   IFRS 18	Presentation and disclosure in Financial Statements	January 1, 2027	Fiscal year ending March 31, 2028	A new standard that will replace the current standard IAS 1 about presentation and disclosure in financial statements

6. Segment information

   1. Summary of reportable segments

      The Group's reportable segments are the components of the Group for which discrete financial information is available and which are regularly reviewed by the Board of Directors in deciding how to allocate resources and assess their performance.

      Since the Group operates under a single segment of business related to robotics, segment information is omitted.

   2. Revenue and results of reportable segments

      Since the Group operates under a single segment, segment information is omitted.

   3. Information about Products and Services

      Please refer to Note "25. Revenue" on information related to products and services.

   4. Geographical information

      Revenue to customers and non-current assets by region consists of the following: Revenue to customers

      Previous consolidated fiscal year (From April 1,2023

      to March 31,2024)

      Current consolidated fiscal year (From April 1,2024

      to March 31,2025)

      	Millions of yen			Millions of yen
      Japan		1,457			1,319
      Americas		1,521			1,565
      EMEA (Europe, Middle East, Africa）		908			939
      APAC		468			562
      Total		4,354			4,384

      (Note) Revenue is classified by country or region based on the location of customers.

      Non-current assets

      Since most non-current assets are in Japan, the amount of non-current assets in the consolidated financial position and information on non-current assets by geographical area are omitted.

   5. Information about major customers

      (Unit: Millions of yen)

      Name of customer	Previous consolidated fiscal year (From April 1, 2023 to March 31, 2024)	Current consolidated fiscal year (From April 1, 2024 to March 31, 2025)	Related segments
      Pertubuhan Kaselamatan Social	308	475	Business related to robots
      Petroliam Nasional Berhad	440	336	Business related to robots

7. Business combination

   Previous fiscal year (from April 1, 2023 to March 31, 2024) No applicable item

   Current fiscal year (from April 1, 2024 to March 31, 2025) No applicable item

8. Cash and cash equivalents

   The breakdown of Cash and cash equivalents is as follows

   Previous fiscal year (March 31, 2024)

   Current fiscal year (March 31, 2025)

   Millions of yen Millions of yen

   Cash and cash equivalents

   Cash and deposits 5,155 6,824

   Total 5,155 6,824

   The balances of "Cash and cash equivalents" presented in the consolidated statements of financial position for the previous and current consolidated fiscal years are consistent with those presented in the consolidated statements of cash flows.

9. Trade and other receivables

   Trade and other receivables consist of the following:

   Previous fiscal year (March 31, 2024)

   Current fiscal year (March 31, 2025)

   Millions of yen Millions of yen

   Accounts receivable-trade 663 622

   Accounts receivable-other 34 196

   Allowance for doubtful accounts -23 -18

   Total 674 800

   Trade and other receivables are classified into the financial assets measured at amortized cost.

10. Other financial assets

    1. Other financial assets

       Breakdown of other financial assets are as follows:

       Previous fiscal year (March 31, 2024)

       Current fiscal year (March 31, 2025)

       Other financial assets

       Financial assets measured at amortized cost：

       Millions of yen Millions of yen

       Bonds	11,500	7,984
       Leasehold and guarantee deposits	89	89
       Other	22	266

       Equity securities	9,276		11,999
       Convertible bonds	4,266		1,853
       Other	11		11
       Financial assets measured at fa Equity securities	r value through other comprehensive income：	1,154		1,164
       	Total	26,318		23,366
       Current assets		11,504		8,033
       Non-current assets		14,814		15,333
       	Total	26,318		23,366

       Financial assets measured at fair value through profit or loss：

       i

    2. Financial assets measured at fair value through other comprehensive income

    Names and fair values of major financial assets measured at fair value through other comprehensive income are as follows:

    Previous fiscal year (March 31, 2024)

    Current fiscal year (March 31, 2025)

    Trading name Millions of yen Millions of yen

    Listed

    Kringle Pharma, Inc. 105 175

    Cyfuse Biomedical K.K. 69 －

    Total 174 175

    Non-listed

    WHILL, Inc.	626		626
    Materials Innovation Tsukuba Co, Ltd.	100		100
    Other	254		263
    Total	980		990

    As equity securities are held mainly to strengthen relationships with investees, the shares are considered financial assets measured at fair value through other comprehensive income.

    No dividend income was recognized from financial assets measured at fair value through other comprehensive income in the previous or current consolidated fiscal year.

11. Inventories

    Breakdown of Inventories are as follows:

    Previous fiscal year (March 31, 2024)

    Current fiscal year (March 31, 2025)

    Millions of yen Millions of yen

    Merchandise and finished goods 259 264

    Work in process 75 31

    Raw materials 663 628

    Total 997 923

    The inventories recognized as expenses and included in the cost of sales for the previous consolidated fiscal year and the current consolidated fiscal year were ¥377 million and ¥401 million, respectively.

    Loss on devaluation of inventory recognized as expenses and included in the cost of sales for the previous consolidated fiscal year and current consolidated fiscal year were ¥7 million and ¥12 million, respectively.

12. Other assets

Breakdown of Other assets are as follows:

Previous fiscal year (March 31, 2024)

Current fiscal year (March 31, 2025)

Millions of yen Millions of yen

Other current assets

1. Property, plant and equipment

   1. Change in property, plant and equipment

      The following tables present changes in acquisition costs, accumulated depreciation, impairment losses, and carrying amounts of property, plant and equipment.

      Property plant and equipment

      Acquisition costs	Operating lease assets		Land		Buildings and structures		Tools, furniture and fixtures		Other		Construction in progress		Subtotal		Total
      	Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen
      April 1, 2023	1,384		9,872		4,083		1,583		276		461		16,276		17,660
      Acquisition	117		-		3		83		7		9		103		220
      Sales and disposals	-22		-		-		-6		-		-		-6		-28
      Exchange differences
      on translation of	-		-		4		23		1		-		28		28
      foreign operations
      Other	-		-		-		-		-		-4		-4		-4
      March 31, 2024	1,479		9,872		4,090		1,683		285		467		16,397		17,877
      Acquisition	168		-		118		173		7		1		299		467
      Sales and disposals	-109		-		-5		-23		-1		-		-29		-139
      Exchange differences on translation of	-		-		-3		27		-0		-		24		24
      foreign operations
      Other	-		-		-		-2		-4		-4		-10		-10
      March 31, 2025	1,538		9,872		4,200		1,857		286		465		16,681		18,220

      Property plant and equipment

      Accumulated depreciation and impairment losses	Operating lease assets		Land		Buildings and structures		Tools furniture and fixtures		Other		Construction in progress		Subtotal		Total
      	Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen
      April 1, 2023	-954		-		-1,279		-1,325		-266		-		-2,870		-3,823
      Depreciation	-168		-		-167		-104		-5		-		-276		-444
      Sales and disposals	2		-		-		5		-		-		5		7
      Exchange differences on translation of	-		-		-3		-17		-0		-		-20		-20
      foreign operations
      March 31, 2024	-1,120		-		-1,449		-1,440		-271		-		-3,161		-4,280
      Depreciation	-145		-		-169		-172		-5		-		-346		-491
      Sales and disposals	79		-		0		7		1		-		8		87
      Exchange differences
      on translation of	-		-		1		-		0		-		1		1
      foreign operations
      Other	-		-		-		2		0		-		2		2
      March 31, 2025	-1,186		-		-1,617		-1,604		-274		-		-3,495		-4,681

      (Note) Depreciation of property, plant and equipment is included in the cost of sales, research and development expenses and other selling, general and administrative expenses in the consolidated statement of income.

      Property plant and equipment

      Carrying amounts	Operating lease assets		Land		Buildings and structures		Tools furniture and fixtures		Other		Construction in progress		Subtotal		Total
      	Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen		Millions of yen
      April 1, 2023	430		9,872		2,804		258		11		461		13,406		13,837
      March 31, 2024	359		9,872		2,640		243		14		467		13,237		13,596
      March 31, 2025	353		9,872		2,583		253		12		464		13,186		13,539

   2. Impairment loss

      As the Company has continued to record negative operating results, indications of impairment have been identified for the cash-generating unit to which the head office group (comprising the head office, production facilities, and research and development facilities) belongs. This unit includes operating lease assets of ¥353 million, property, plant and equipment of ¥4,200 million, right-of-use assets of ¥96 million, and intangible assets of ¥18 million. In conducting the impairment test, the recoverable amount has been measured based on value in use. The value in use is calculated as the present value of estimated future cash flows. These future cash flows are based on business plans approved by management, and for periods beyond the scope of those plans, a growth rate is estimated taking into account future uncertainties. The discount rate (8.9% in the previous fiscal year and 11.9% in the current fiscal year) is determined based on the weighted average cost of capital.

      The key assumption in estimating value in use is the projection of future cash flows. These future cash flows are primarily influenced by factors such as the timing and likelihood of obtaining regulatory approval and insurance reimbursement for medical devices, the projected number of adopting facilities, and expected selling prices.

      These projections involve a high degree of uncertainty and may have a significant impact on the estimation of value in use.

      No impairment losses were recognized in either the previous or the current consolidated fiscal year.

2. Goodwill and intangible assets

   1. The following tables present changes in acquisition costs, accumulated amortization and impairment losses, and carrying amounts of intangible assets.

      Goodwill

      Customer-related

      Intangible assets

      Acquisition cost

      April 1, 2023 Acquisition

      Acquisition through business combination

      Sales and disposals Exchange difference on

      translation of foreign operations

      Other

      March 31, 2024 Acquisition

      Acquisition through business combination

      Sales and disposals Exchange difference on

      translation of foreign operations

      Other

      March 31, 2025

      assets Software Patents Other Total Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen

      2,531		77		173		20		19		289
      -		-		-		-		0		0
      -		-		-		-		-		-
      -		-		-		-		-		-
      250		3		0		-		2		5
      -		-		-		-		-		-
      2,781		81		173		20		21		294
      -		-		16		-		2		18
      -		-		-		-		-		-
      -		-		-7		-		-1		-8
      -23		-0		-		-		-0		-0
      -345		-		-		-		-		-
      2,413		81		182		20		22		303

      Accumulated amortization and impairment losses

      Goodwill

      Customer-related assets

      Intangible assets

      Software Patents Other Total

      Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen

      April 1, 2023	-	-27		-156		-19		-6		-209
      Amortization	-	-11		-6		-0		-3		-20
      Impairment losses	-643	-17		-		-		-		-17
      Sales and disposals	-	-		-		-		-		-
      Exchange difference on	-	-0		-		-		-0		-1
      translation of foreign operations
      Other	-4		-		-		-		-		-
      March 31, 2024	-647		-55		-162		-20		-9		-247
      Amortization	-		-5		-6		-		-3		-14
      Impairment losses	-175		-		-		-		-		-
      Sales and disposals	-		-		-		-		-		-
      Exchange difference on translation of foreign operations	-		3		-		-		-0		2
      Other	175		-		-		-		-		-
      March 31, 2025	-647		-58		-168		-20		-13		-259

      (Note) Amortization of intangible assets is included in the cost of sales, research and development expenses and other selling, general and administrative expenses in the consolidated statement of income.

      Goodwill

      Carrying amount Customer-related

      assets

      Intangible assets

      Software Patents Other Total

      Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen

      April 1, 2023	2,531	50	17	0	13	80
      March 31, 2024	2,134	26	10	-	12	48
      March 31, 2025	1,766	22	14	-	9	45

   2. Significant goodwill

      The carrying amounts of goodwill recognized in the Group's consolidated statement of financial position for the previous and current fiscal years are as follows. Goodwill from business combinations is allocated to the cash generating units that will benefit from the business combination at the acquisition date.

      	Previous fiscal year		Current fiscal year
      	(March 31, 2024)		(March 31, 2025)
      	Millions of yen		Millions of yen
      RISE Healthcare Group,Inc.	1,731		1,709
      LeyLine GmbH	347		-
      Other	57		57
      Total	2,134		1,766

   3. Impairment test of goodwill

The Group tests goodwill for impairment each period and whenever there is an indication of impairment. The recoverable amount of the impairment test is based on a value in use. Value in use is calculated as the discounted present value of estimated future cash flows based on business plans and growth rates for the next five years, reflecting past performance and future projections.

The discount rates used to calculate the value in use of the cash-generating units to which significant goodwill was allocated for RISE Healthcare Group, Inc. in the current consolidated fiscal year and the previous consolidated fiscal year were 9.8% and 12.3% respectively. The growth rate is determined by considering the average long-term growth rate in the market or the country to which the cash generating unit belongs.

These projections are subject to a high degree of uncertainty and can significantly impact value-in-use estimates. No impairment loss on goodwill was recognized in the previous fiscal year.

In the previous fiscal year, based on a review of the future recoverability of fixed assets such as goodwill and other assets of the Group's consolidated subsidiaries, such as C2, Inc. an impairment loss of ¥660 million (including ¥643 million for goodwill and ¥17 million for intangible assets) was recorded under "Other expenses" in the consolidated statements of profit or loss.

In the current consolidated fiscal year, the recoverability of goodwill related to the consolidated subsidiary LeyLine GmbH ("LeyLine") was assessed, and an impairment loss of ¥175 million was recognized under "Other expenses" in the consolidated statement of profit or loss.

This impairment loss was recorded as the expected profitability initially anticipated at the time of acquisition was no longer achievable, resulting in a write-down of the carrying amount of goodwill and related assets to their recoverable amount.

In other cases, although there is a risk of impairment if the assumptions used in the impairment testing were to change, the value in use is well over the carrying amount of the cash-generating unit group concerned. It is considered unlikely that the value in use would be less than the carrying amount, even if the assumptions used in the impairment testing changed within a reasonably foreseeable range.