Regarding our company information provided by MSCI, while some descriptions have been corrected to 0.17% to better reflect our actual gambling-related revenue ratio, an incorrect figure of 5 to 9.9% still remains. We have received confirmation from MSCI that this information is scheduled to be corrected around March 2026.

The timeline is as follows.

October 31: GENDA formally requested MSCI for correction on the same day we disclosed the “Frequently Asked Questions and Answers.”

November 3: MSCI contacted us, stating the information provided lacked sufficient detail.

November 5: GENDA submitted monthly sales data for the amusement poker business to MSCI.

November 21: The amusement poker revenue data we had submitted was added to our company’s page on MSCI. However, the gambling revenue ratio remains listed as 5 to 9.9%.

November 21: GENDA requested MSCI to correct the erroneous gambling revenue ratio once again.

From November 25 to December 9: GENDA conducted four rounds of continuous follow-up with MSCI.

December 16: Due to the lack of response from MSCI, GENDA escalated the matter by reaching out through a different channel than before.

December 24: Due to the lack of response from MSCI, GENDA followed up again through multiple channels, including email and direct phone calls.

             MSCI updated certain pages regarding our company and notified GENDA of the change.

             GENDA requested MSCI to ensure accurate information is reflected across all relevant pages.

             MSCI responded that they will correct the information on all pages as soon as possible. December 26: GENDA has strongly requested MSCI to promptly correct the pages that remain inaccurate.

In addition to the aforementioned situation, we have taken the following actions.

January 6: Again, GENDA requested MSCI to correct the information.

January 8: MSCI acknowledged our request for correction and confirmed that the figures will be updated in their next scheduled cycle.

GENDA inquired with MSCI about the specific timing for the correction.

January 13: GENDA requested a response as none had been received from MSCI.

January 14: MSCI responded that the next update is scheduled for around March.

January 15: GENDA strongly urged MSCI to expedite the correction process.

January 19: MSCI reaffirmed the correction is scheduled for the next update in March.

January 20: GENDA requested a more explicit and definitive response from MSCI.

January 23: MSCI stated the correction would occur during the next annual review (without specifying a month).

GENDA identified the specific pages containing incorrect information and submitted a formal request for correction and a confirmed timeline.

As of today: Awaiting for MSCI’s response.

1. Revising our M&A strategy to align with the capital markets

Through the following three policy shifts, we will revise our M&A strategy to align with the capital markets by utilizing Free Cash Flow (FCF) and debt, thereby alleviating concerns regarding future equity financing. Meanwhile, by being more selective with the number of deals while increasing the transaction value per deal, we aim to achieve transformational growth without compromising our growth rate.

• Leveraging our debt capacity by being highly selective with M&A opportunities
• Strictly prioritizing growth investments for our existing businesses and aiming to generate 5.0 billion yen in FCF next fiscal year (The difference compared to this fiscal year is a plus of 15.0 billion yen)
• Implementing a 36-month freeze on public offerings intended for M&A standby funds

For more detail, please refer to Q2 of “Frequently Asked Questions and Answers (December 2025)” and page 9 of “FY2026/1 3Q Earnings Presentation.”

2. Transition to IFRS (International Financial Reporting Standards)

We will adopt International Financial Reporting Standards (IFRS) starting from the fourth quarter of the fiscal year ending on January 31, 2027. Consequently, we expect all income levels from operating income downward to increase compared to current levels – primarily due to the non-amortization of goodwill. As a result, we anticipate that our valuation metrics, such as P/E multiple on various financial databases, will decrease.

3. Full-year forecast: Switched to adjusted metrics only

Until the fiscal year ending on January 31, 2026, “our full-year earnings forecasts included M&A-related expenses, etc. (statutory figures).” Under this conventional method, forecasting M&A-related expenses – which can occur toward the end of the fiscal year – was difficult. This presented a challenge in making agile upward or downward revisions to our guidance that reflected new M&A activity mid-term.

To resolve this, starting from the fiscal year ending on January 31, 2027, we will transition to using only “Adjusted” metrics – which exclude M&A-related expenses – to more accurately reflect the actual state of our operations. Specifically, we will streamline our official earnings guidance to the following three items: (1) Revenue, (2) Adjusted EBITDA, and (3) Adjusted Net Income.

This will enable us to promptly reflect the impact of new consolidations from M&A into our earnings forecasts during the term. We are committed to providing all our investors with higher transparency and more agile information disclosure.

For more detail, please refer to page 26 of “FY2026/1 3Q Earnings Presentation.”

4. Towards inclusion in the new TOPIX (effective October 2026)

The Tokyo Stock Exchange is currently revising the TOPIX (Tokyo Stock Price Index) framework with the aim of enhancing its market representativeness and investment functionality. We are highly mindful of these new TOPIX selection criteria, particularly regarding liquidity.

Inclusion in such an index serves as a testament to the market’s trust in our company, while simultaneously providing a significant opportunity to increase our visibility among a broader range of investors. We will continue to build a solid track record, step by step, as we strive to meet the expectations of all our shareholders.

In addition to our ongoing efforts to improve prize-restocking operations, we have begun developing the following DX (Digital Transformation) initiatives to establish a more robust, long-term operational foundation.

1. Promotion of Data-Driven Management (Establishment of a Unified Data Infrastructure)

We are building a unified data infrastructure to centrally manage business data across all of North America. By strengthening data governance and developing dashboards that visualize management indicators in real-time, we will establish a system that allows frontline conditions to be reflected in management decisions immediately.

2. Digitization of Field Operations (Implementation of a Unified Operational App)

Leveraging the expertise gained from our proven business management systems in Japan (such as GiGO NAVI), we are currently developing a unified operational app optimized for the North American market. This initiative will streamline workflows for frontline staff and ensure data accuracy, simultaneously reducing human error and containing operational costs.

3. Optimizing collection routes through AI integration

We are utilizing AI to optimize the service routes of our rounders, who handle cash collection and prize restocking for over 12,000 locations. By leveraging the AI expertise proven in our domestic business (such as our currency exchange machine operations), we aim to reduce travel costs and maximize machine uptime.

4. Refining prize ordering and store allocation processes

We will optimize the end-to-end process, from prize selection and ordering to logistics, store allocation, and machine placement. By transplanting our Japanese expertise in prize management, we aim to optimize inventory levels and reduce dead stock, thereby ensuring improved cash flow and the prevention of lost sales opportunities.

  All of the aforementioned measures represent best practices based on our success in domestic operations. These are highly reproducible PMI initiatives designed to deploy the same proven model within our North American business.

Furthermore, beyond mere cost-cutting, these initiatives represent a shift away from person-dependent management toward a “scalable business model driven by data and AI” in the North American market. By establishing this DX foundation, we will enable efficient operations with low marginal costs even as we further expand our footprint in the future.

  We will steadily execute these initiatives to ensure that our North American business serves as a powerful growth engine for the company and solidifies its position as a premier platform for distributing Japanese IP throughout the region.