Notice Regarding Revision of Full-year Forecasts for Consolidated Financial Results for Fiscal Year Ended March 31, 2025, Recording of Operating Loss Associated with Transfer of Shares and Impairment Losses, Partial Reversal of Deferred Tax Assets and Recording of Profit from Discontinued Operations (Progress of Disclosed Matter)

1. Revisions of the consolidated forecasts for the fiscal year ended March 31, 2025

(1) Revised forecasts

*1‘Business contribution profit’ is a profit index calculated by deducting cost of sales and selling, general and administrative expenses from revenue.

*2Because the Precision Medicine Business was classified as discontinued operations, in the consolidated forecasts for the fiscal year ended March 31, 2025, revenue, business contribution profit and operating profit represent the amounts of those for continuing operations and profit attributable to owners of the Company represents the total of continuing and discontinued operations. The consolidated financial results for the previous year are retrospectively adjusted for the classification of discontinued operations.

(2) Reason for the revisions

Revenue is revised downward by 9 billion yen. On the other hand, business contribution profit is revised upward by 1 billion yen, due to the favorable performance of Business Technologies Business.
Under the Medium-term Business Plan (2023-2025), the Company has been pursuing the selection and concentration of businesses as an initiative to strengthen profitability. As part of these efforts, in the current period, the Company entered into share purchase agreements to divest Konica Minolta Marketing Services Holding Company Limited (“Konica Minolta Marketing Services Holding”) and MOBOTIX AG (“MOBOTIX”), respectively and, accordingly, the Company expects to record an operating loss of 20.2 billion yen.^*3
Furthermore, as a result of the impairment testing in accordance with the IFRS, the Company expects to record impairment losses of approximately 22 billion yen in the current period. Consequently, operating profit is revised downward by 39 billion yen.^*4

Regarding profit attributable to the owners of the Company, the Company will record in the current period, as profit from discontinued operations in conjunction with the completion of share transfer for Ambry Genetics Corporation (“Ambry Genetics”), a profit or loss due to the adjustment of exchange differences on translation of foreign operations and a gain from the share transfer due to the fair value evaluation of Tempus AI, Inc.’s (“Tempus”) stocks acquired as part of transfer price. Such profit from discontinued operations was approximately 8 billion yen higher than expected because of changes in the foreign exchange rates and stock price.^*5 However, due to a decline in operating profit and reversal of deferred tax assets of approximately 14 billion yen at overseas subsidiaries^*6, among others, profit attributable to the owners of the Company is revised downward by 38 billion yen.

*3For details, see 2. Recording of operating loss from share transfer (progress of disclosed matters).

*4For details, see 3. Recording of impairment losses.

*5For details, see 4. Recording of profit from discontinued operations due to share transfer (progress of disclosed matter).

*6For details, see 5. Reversal of deferred tax assets.

2. Recording of operating loss from share transfer (progress of disclosure matters)

As announced on March 26, 2025, in "Notice Regarding Change in a Consolidated Subsidiary (Transfer of Share)," the share purchase agreement was executed to transfer all of the shares the Company owns in and loans-receivable against MOBOTIX to Certina Software Investments AG and consequently, in the current period, the Company expects to record an operating loss of 10.4 billion yen. In addition, the share purchase agreement was executed to sell the entire share of Konica Minolta Marketing Services Holding to adm Group LIMITED and consequently the Company expects to record an operating loss of approximately 9.8 billion yen.

3. Recording of impairment losses

As a result of the impairment testing in accordance with the IFRS, as described above, the Company expects to record impairment losses of approximately 22 billion yen in the current period. The details are as follows:

(1) Imaging Solutions Business

In the Healthcare unit, as the decreased demand for radiographic film in China deteriorated operating profit, the Company expects to record impairment losses of approximately 5.5 billion yen, mainly for the Company’s property, plant, and equipment and intangible assets.

(2) Business Technologies Business

In the Industrial Print unit in the Professional Print Business, the Company expects to record impairment losses of approximately 14 billion yen for goodwill, property, plant, and equipment and intangible assets because, as a result of calculating the recoverable amount on the basis of the fair value of MGI Digital Technology, the French-based manufacturer of highly-value-added digital printing and embellishing presses, less costs of disposal, the recoverable amount was less than the carrying amount.
In addition, as a result of impairment testing at three consolidated subsidiaries that belong to the DW-DX unit in the Digital Workplace Business, the Company expects to record impairment losses of approximately 2.5 billion yen for goodwill and property, plant, and equipment, among others, because the recoverable amount was less than the carrying amount, as the economic downturn, intensifying competition and other conditions deteriorated operating profit.

4. Recording of profit from discontinued operations due to share transfer (progress of disclosed matter)

As announced on February 4, 2025, in “Notice of Completion of Change in a Consolidated Subsidiary (Transfer of Share),” the transfer of the share of Ambry Genetics to Tempus was completed. Accordingly, the Company expects to record in the current period, as profit from discontinued operations, a gain of approximately 18 billion yen due to the adjustment of exchange differences on translation of foreign operations and a gain of approximately 8 billion yen from the share transfer due to the fair value evaluation of Tempus’ stocks acquired as part of transfer price.

5. Partial reversal of deferred tax assets

Regarding Konica Minolta Holdings U.S.A., Inc., and its subsidiaries, the Company has carefully assessed the recoverability of their deferred tax assets, as mainly one of their business plans was revised when the impairment loss was recognized in the third quarter of the fiscal year ended March 31, 2025. Consequently, the Company expects to reverse the deferred tax assets and record approximately 14 billion yen as corporate tax adjustments in the current period.

6. Others

The Company expects to record 10.2 billion yen as an extraordinary loss associated with the conclusion of the share purchase agreement to divest MOBOTIX for the Company’s non-consolidated financial results in the current period.

Note regarding the forecasts
The forecasts for the consolidated financial results are based on the assumptions that the Company believes are reasonable at the time of this announcement. It should be noted that actual results may differ from the forecasts due to various factors.