Statements of Cash Flow

(Millions of yen)

	For the fiscal year ended May 31, 2025	For the fiscal year ended May 31, 2026
Cash flows from operating activities
Profit (loss) before income taxes	(5,826)	(1,006)
Depreciation	2,756	2,731
Impairment losses	237	498
Amortization of goodwill	336	207
Increase (decrease) in allowance for doubtful accounts	(14)	(7)
Increase (decrease) in provision for bonuses	3	(110)
Increase (decrease) in retirement benefit liability	(24)	(6)
Decrease (increase) in retirement benefit asset	(939)	(427)
Increase (decrease) in provision for share awards for directors (and other officers)	(165)	-
Increase (decrease) in provision for employee stock ownership plan trust	8	0
Interest and dividend income	(173)	(421)
Interest expenses	331	420
Subsidy income	(198)	(179)
Sponsorship income	(234)	(542)
Share of loss (profit) of entities accounted for using equity method	(134)	(210)
Loss (gain) on sale and retirement of non-current assets	93	318
Loss (gain) on sale of investment securities	(76)	(181)
Loss (gain) on valuation of investment securities	50	168
Decrease (increase) in accounts receivable - trade, and contract assets	2,244	4,175
Decrease (increase) in inventories	(552)	28
Decrease (increase) in other assets	1,190	915
Increase (decrease) in trade payables	763	(1,104)
Increase (decrease) in accrued consumption taxes	371	1,123
Increase (decrease) in deposits received	2,094	(246)
Increase (decrease) in accounts payable - other	425	(1,160)
Increase (decrease) in contract liabilities	976	164
Increase (decrease) in other liabilities	902	(1,294)
Other, net	(6)	100
Subtotal	4,439	3,951
Interest and dividends received	112	439
Interest paid	(335)	(393)
Subsidies received	198	179
Support money received	234	542
Income taxes paid	(322)	(1,822)
Net cash provided by (used in) operating activities	4,327	2,897
Cash flows from investing activities
Decrease (increase) in time deposits	(10,536)	(2,468)
Purchase of securities	(14,500)	(24,000)
Proceeds from redemption of securities	-	22,500
Purchase of property, plant and equipment	(14,909)	(18,071)
Proceeds from sale of property, plant and equipment	197	4
Purchase of intangible assets	(3,421)	(3,697)
Purchase of investment securities	(4,454)	(713)
Proceeds from sale of investment securities	245	305
Purchase of shares of subsidiaries resulting in change in scope of consolidation	-	(1,307)
Loan advances	(7)	(7)
Proceeds from collection of loans receivable	6	20
Payments of leasehold and guarantee deposits	(660)	(597)
Proceeds from refund of leasehold and guarantee deposits	1,108	898
Payments for asset retirement obligations	(127)	(133)
Payments for acquisition of businesses	(491)	-
Other, net	(50)	(18)
Net cash provided by (used in) investing activities	(47,600)	(27,285)
Cash flows from financing activities
Net increase (decrease) in short-term borrowings	120	86
Proceeds from long-term borrowings	-	12,300
Repayments of long-term borrowings	(9,099)	(5,728)
Repayments of finance lease liabilities	(345)	(312)
Redemption of bonds	(594)	(530)
Proceeds from share issuance to non-controlling shareholders	45	274
Purchase of treasury shares	(1,731)	(2,467)
Purchase of treasury shares of subsidiaries	(0)	-
Purchase of shares of subsidiaries not resulting in change in scope of consolidation	(34)	(5)
Dividends paid	(3,016)	(2,955)
Dividends paid to non-controlling interests	(400)	(559)
Net cash provided by (used in) financing activities	(15,055)	101
Effect of exchange rate change on cash and cash equivalents	(55)	198
Net increase (decrease) in cash and cash equivalents	(58,384)	(24,087)
Cash and cash equivalents at beginning of period	137,047	78,664
Increase in cash and cash equivalents resulting from inclusion of subsidiaries in consolidation	2	-
Cash and cash equivalents at end of period	78,664	54,577