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Benesse Corporation today announced that it will incur a special loss for the second quarter of the fiscal year ending March 31, 2009. Details are as follows:

1.Details of special loss
Benesse Corporation holds shares totaling a book value of 12.9 billion yen in consolidated subsidiary Tokyo Individualized Educational Institute, Inc. (stock code: 4745; listed on the first section of the Tokyo Stock Exchange). Due to a sharp decline in the market value of these shares, Benesse will apply impairment accounting, recording approximately 7.6 billion yen in valuation loss on investments in subsidiaries and affiliates under special losses in its non-consolidated financial statements. This accounting treatment is in line with the Practical Guidelines for Accounting for Financial Instruments issued by the Japanese Institute of Certified Public Accountants (JICPA).

In conjunction with recording the share value impairment, Benesse will record approximately 7.6 billion yen in goodwill amortization under special losses in its consolidated financial statements, pursuant to paragraph 32 of the Practical Guidelines on Procedures for Consolidating Equity in the Consolidated Financial Statements (JICPA Accounting Committee Report No. 7).

2.Impact on financial results
Benesse plans to record the projected loss described above under special losses in both the consolidated and non-consolidated financial statements for the second quarter of the fiscal year ending March 31, 2009. The Company is currently examining potential revisions to the consolidated and non-consolidated results forecasts for the fiscal year ending March 31, 2009, announced on April 30, 2008, and will publish any revisions promptly once decided.