Kadokawa Corporation Notice Regarding the Expected Recognition of Non-Operating Expenses

Kadokawa Corporation has officially canceled its planned donations to the Bunri Sato Gakuen Educational Institution, effectively terminating a project intended to support the establishment of a new school. This initiative, which involved subsidiaries Vantan Inc. and Dwango Co., Ltd., was originally designed to leverage educational synergies and expand the company’s student outreach. The decision follows the identification of significant procedural and scheduling risks that rendered the original timeline for regulatory approval and operational commencement unfeasible.

The cancellation results in the removal of substantial non-operating expenses from the company’s financial outlook. Specifically, projected donations of approximately 200 million yen for the fiscal year ending March 2027 and 3.584 billion yen for the fiscal year ending March 2028 will no longer be recorded. While these expenses were previously integrated into the company’s Mid-term Management Plan, the impact on financial performance for the fiscal year ending March 2029 and beyond is expected to be minimal.

Management is currently evaluating the necessity of revising full-year earnings forecasts for the fiscal year ending March 2027 in light of this development. Any adjustments to these forecasts or the previously established management targets, such as return on equity and earnings per share, will be disclosed as further information becomes available. This strategic pivot reflects a commitment to fiscal discipline following the determination that the partnership could not proceed as originally envisioned.