Consolidated Financial Report for the Fiscal Year Ended March 31, 2010
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Consolidated Financial Report for the Fiscal Year Ended March 31, 2010 May 7, 2010 DISCLAIMER - NAMCO BANDAI Holdings Inc. provides this translation for your reference and convenience only and without any warranty as to its accuracy or otherwise. In the event of any discrepancy, the original “Kessan Tanshin” in Japanese shall prevail. - This document contains forward-looking statements that are based on management’s estimates, assumptions and projections at the time of publication. A number of factors could cause actual results to differ materially from expectations. - This document does not include the non-consolidated financial statements of NAMCO BANDAI Holdings Inc. - 1 - Stock Listing: Tokyo Stock Exchange Code Number: 7832 (URL: http://www.bandainamco.co.jp/) May 7, 2010 Consolidated Financial Report for the Fiscal Year Ended March 31, 2010 Representative: Shukuo Ishikawa, President and Representative Director Contact: Yuji Asako, Executive Officer, Corporate Planning Division Date of Ordinary General Meeting of Shareholders: June 21, 2010 Scheduled starting date for dividend payments: June 22, 2010 Scheduled filing date of the annual security report: June 22, 2010 1. Consolidated Results for the Fiscal Year Ended March 31, 2010 (April 1, 2009 to March 31, 2010) (Millions of yen with fractional amounts discarded, unless otherwise noted) (1) Consolidated Operating Results (Percentages indicate year-on-year changes.) Net sales Operating income Recurring income ¥ million % ¥ million % ¥ million % Fiscal Year Ended 378,547 (11.2) 1,883 (91.6) 1,907 (92.2) March 31, 2010 Fiscal Year Ended 426,399 (7.4) 22,348 (33.1) 24,513 (32.3) March 31, 2009 Net income Net income per share Net income per share (diluted) ¥ million %¥ ¥ Fiscal Year Ended (29,928) – (123.98) – March 31, 2010 Fiscal Year Ended 11,830 (63.8) 47.95 47.88 March 31, 2009 ROE ROA Operating margin (Net income / Net assets) (Recurring income / (Operating income / Total assets) Net sales) %% % Fiscal Year Ended (12.4) 0.6 0.5 March 31, 2010 Fiscal Year Ended 4.3 6.3 5.2 March 31, 2009 (Reference) Gain or loss from the equity method: 0 million yen (FY2010.3), 360 million yen (FY2009.3) (2) Consolidated Financial Position Total assets Net assets Equity ratio Net assets per share ¥ million ¥ million % ¥ As of March 31, 2010 325,935 229,012 69.5 938.74 As of March 31, 2009 363,444 260,579 70.9 1,067.71 (Reference) Equity: 226,666 million yen (as of March 31, 2010), 257,645 million yen (as of March 31, 2009) - 2 - (3) Consolidated Statements of Cash Flows Cash flows from Cash flows from Cash flows from Cash and cash operating activities investing activities financing activities equivalents at end of period ¥ million ¥ million ¥ million ¥ million Fiscal Year Ended 10,581 (9,863) (15,276) 97,776 March 31, 2010 Fiscal Year Ended 19,301 (10,327) (16,529) 110,037 March 31, 2009 2. Dividend Dividend per share Total Payout ratio Dividend / Dividend record dates End of End of End of Fiscal Total dividend (Consolidated) Net assets first second third year-end payment (Consolidated) quarter quarter quarter (Full year) ¥ ¥ ¥ ¥ ¥ ¥ million % % Fiscal Year Ended – 12.00 – 12.00 24.00 5,853 50.1 2.2 March 31, 2009 Fiscal Year Ended – 12.00 – 12.00 24.00 5,797 – 2.4 March 31, 2010 (Projection) – 12.00 – 12.00 24.00 – Fiscal Year Ending March 31, 2011 Note: The stable portion of the dividend is given in the projection for the end of second quarter and the fiscal year-end for the Fiscal Year Ending March 31, 2011 based on the Company’s basic policy regarding appropriation of profits. Thus, the actual fiscal year-end dividend will be decided according to the consolidated financial results. 3. Consolidated Projections for the Fiscal Year Ending March 31, 2011 (April 1, 2010 to March 31, 2011) (Percentages indicate year-on-year changes.) Net sales Operating Recurring Net income Net income income income per share ¥ million % ¥ million % ¥ million % ¥ million % ¥ Six Months Ending 175,000 1.3 (1,000) – (1,000) – (3,500) – (14.50) September 30, 2010 Full Year 400,000 5.7 11,000 483.9 10,500 450.4 4,500 – 18.64 4. Other Information (1) Changes in Significant Subsidiaries during the Period (Changes in Specified Subsidiaries Resulting in the Change in Scope of Consolidation): Yes Included: 4 companies (Distribution Partners S.A.S., Atari Asia Holdings Pty.Ltd., Atari Australia Pty.,Ltd., Atari UK Ltd.) Excluded: 1 company (Bandai Networks Co., Ltd.) Note: For more details, please refer to the section of “2. The BANDAI NAMCO Group” on pages 13-20. (2) Changes in Accounting Policies, Procedures, and Methods of Presentation for Preparing the Consolidated Financial Statements a. Changes due to revisions to accounting standards and other regulations: Yes b. Changes due to other reasons: Yes Note: For more details, please refer to the section of “Changes in the Important Information Constituting the Basis for Preparation of Consolidated Financial Statements” on page 43. (3) Number of Issued Shares (Common Stock) a. Total number of issued shares at the end of the period (including treasury stock) As of March 31, 2010 250,000,000 shares As of March 31, 2009 250,000,000 shares b. Number of shares of treasury stock at the end of the period As of March 31, 2010 8,540,776 shares As of March 31, 2009 8,694,796 shares Note: Please refer to the section of “Per Share Data” on page 65 for the number of shares used to calculate “Net income per share”. - 3 - (Reference) Non-consolidated Financial Statements 1. Non-consolidated Results for the Fiscal Year Ended March 31, 2010 (April 1, 2009 to March 31, 2010) (1) Non-consolidated Operating Results (Percentages indicate year-on-year changes.) Net sales Operating income Recurring income ¥ million % ¥ million % ¥ million % Fiscal Year Ended 9,608 (59.5) 6,976 (66.6) 6,465 (68.9) March 31, 2010 Fiscal Year Ended 23,754 98.7 20,869 146.5 20,773 144.7 March 31, 2009 Net income Net income per share Net income per share (diluted) ¥ million %¥ ¥ Fiscal Year Ended 7,296 (63.4) 30.21 30.20 March 31, 2010 Fiscal Year Ended 19,936 161.5 80.72 80.62 March 31, 2009 (2) Non-consolidated Financial Position Total assets Net assets Equity ratio Net assets per share ¥ million ¥ million % ¥ As of March 31, 2010 329,222 255,757 77.4 1,055.39 As of March 31, 2009 306,579 252,893 82.0 1,041.48 (Reference) Equity: 254,947 million yen (as of March 31, 2010), 251,425 million yen (as of March 31, 2009) *Proper use of earnings projections, and other special matters The above projections are based on information available to the Company as of the date of the announcement of these materials and on assumptions pertaining to uncertain factors, which may affect future operating results, as of the date of the announcement of these materials. Actual business results may differ from the projections due to a number of factors in the future. Please refer to the section of “(1) Analysis on Results of Operations” of “1. Results of Operations” on pages 5-9 for matters pertaining to the earnings projections. - 4 - 1. Results of Operations (1) Analysis on Results of Operations a. Summary for the Period (April 1, 2009 to March 31, 2010) In this fiscal year, during the global economic recession, there were visible signs of a partial recovery in the economy in the context of government deployment of emergency economic stimulus measures and other factors. However, economic conditions remained harsh due to, among other things, weakness in the self-sustainability of the recovery and high unemployment rates. Reduced consumption had a substantial impact on the entertainment industry, causing continued uncertainty in the industry as a whole. In this environment, the Group has worked to put in place the global management foundation adopted in the three-year Mid-term Business Plan that has been implemented since April 2009. Moreover, prior to launching the “BANDAI NAMCO Group Restart Plan” in April 2010, for the purpose of a more assured implementation of the global management foundation, the Group carried out steps, including a review of its personnel structure, to improve profitability. On the business front, although long-established character toys in the Toys and Hobby Business posted strong performance figures in Japan, amidst weak individual consumption world-wide, overall results for the Group were harsh, especially in the Game Contents Business. Consequently, the Group’s consolidated results at fiscal year-end were net sales of 378,547 million yen (year-on-year decrease of 11.2%), operating income of 1,883 million yen (year-on-year decrease of 91.6%), and recurring income of 1,907 million yen (year-on-year decrease of 92.2%). Moreover, the Group recorded losses on, among other things, the amusement facilities scheduled to be closed in the following fiscal year and recorded expenses related to the review of its personnel structure. Further, as a result of strict examination of the future business plans of certain subsidiaries, an impairment loss on goodwill was recognized, and there was a withdrawal of a fixed amount from deferred tax assets. As a result, the Group recorded a net loss of 29,928 million yen (compared with a net income of 11,830 million yen in the previous fiscal year). An overview of each business is presented as follows. Operating Results by Business Segment (¥ million) Net Sales Operating Income Year Ended Year Ended Year Ended Year Ended March 31, March 31, Change March 31, March 31, Change 2010 2009 2010 2009 Decrease of Decrease of Toys and Hobby 148,843 165,725 16,881 10,786 11,533 746