August 08, 2008 Press Release Columbia Music Entertainment Issues Notice of Consolidated Business Results for First Quarter of Fiscal Year Ending March 2009 Columbia Music Entertainment Inc. (hereinafter CME; Head Office: Minato-ku, Tokyo; Representative Executive Officer & Chairman: Strauss Zelnick, Chief Executive Officer (CEO): Sadahiko Hirose) today gives notice that it has issued its consolidated business results indicating the Company’s overall performance for the first quarter of the fiscal year ending March 31, 2009 (FY 2008 Q1; April 1 ~ June 30, 2008). During the current first quarter under review, the Company’s consolidated sales totaled 4,505 million yen (an increase of 2.2% compared with the same quarter of the previous fiscal year). The main reasons for this result were that although sales of the Company’s in-house produced titles and sales in the Custom Sales Business both declined, sales in the Digital Business grew by 20% year-on-year, and in addition, sales of the Company’s 100%-owned subsidiary Creative Core Inc. were included in the Q1 figures for the first time. With regard to the profit and loss situation, during the first quarter, sales of titles in the Enka/ Kayokyoku, Animation and Educational Departments all reached their planned targets, but due to slippage of major releases of J-Pop/J-Rock titles., overall sales were lower than planned. In addition, in the Custom Sales Business, in the first quarter of the previous fiscal year, mail order sales of large-scale products made a significant contribution to total sales. However, during the current first quarter under review there were no similar large-scale products, and this resulted in a decline in sales in the Custom Sales Business. As a result of the aforementioned sales performance, the operating loss for the quarter under review was 257 million yen (compared with a loss of 43 million yen for the same quarter of the previous fiscal year) while the ordinary loss was 248 million yen (compared with a loss of 50 million yen for the same quarter of the previous fiscal year). Moreover, the overall net loss for the quarter under review was 258 million yen (compared with a loss of 29 million yen for the same quarter of the previous fiscal year). CME is also making use of its abundant catalogue of sound sources, and as a result is releasing more titles that are designed to appeal to people in their 30s, the middle-aged market beginning with those in their 40s, and the seniors. In addition to sound master production, we are committed to further strengthening our earning capacity by proceeding with the expansion of our Music Entertainment Business including in the fields of concert operation and merchandising in cooperation with music offices and artists. Moreover, we will construct a August 08, 2008 more efficient organization by shifting more resources into growing fields and highly profitable fields, as well as by focusing on more efficient organizational operation. In the Digital Business, which is a growing field, we are presently distributing about 11,000 titles and have 70,000 titles ready for digital distribution.. In future, we will continue to expand the range of titles available for digital distribution. Moreover, on May 29, 2008, we began PC-based distribution of music by the Showa-era diva Hibari Misora in 22 countries via the iTunes music store, and this new venture has been favorably received. With regard to our newly developed single song sales service Customize CD, we have made this service available at the Hibari Misora Theater in Arashiyama, Kyoto, which opened on April 26 this year. Visitors to this theater can create original singles by freely selecting from among all 559 of Hibari Misrora’s recorded songs for burning onto customized CDs, which they can then take home. From now on too, we will proceed to further expand our Music Production Business with a view to expanding profitability. <Artists and Titles Making Major Contributions to Sales (During the Current First Quarter)> < Music Software> Kiyoshi Hikawa— Genkai Funauta/Hokushu, Enka Meikyoku Collection 8 ~ Genkai Funauta Ikuko Harada– Kemono to Mahou Yo Hitoto— BESTYO Bahashishi– Kaleidoscope Chiharu Matsuyama— Kisho Tenketsu 11 Tamurapan— Butabesto Eisaku Okawa— Nagori no Sakura/Soba ni Itene Rudeboy Face— a message to… Kazusa Wakayama— Ajisai no Yado/Onna Hanazakari Takashi Hosokawa— Koi Yadori ~ Ginzan Yakei ~/Omoide Ennichi THE IDOLM@STER Series Enjin Sentai GoOnger Series <Video Software> Wanwan, Kotochan, Uutan— NHK Inai Inai Baa! Series Yo Hitoto— LIVE DVD — Hitoto Yo Shigusauta Clammbon— Tayu Tau — GOOD TIME MUSIC of Clammbon — August 08, 2008 <Mail Order Business> Meiji Daigaku Mandolin Club Dai Zenshu Hibari Misora— Misora Hibari Showa o Utau Joyu Hana no Koibitotachi <PC/Mobile Phone Incoming Call Melodies> Kaela Kimura— Jasper, STARs, Magic Music Yo Hitoto— Hanamizuki, Morainaki, Sayonara Arigato Godaigo— Ginga Tetsudo 999 (The Galaxy Express 999) <P&D (Production & Distribution) Business> ◇ Yoshimoto R & C Ltd. Hitoshi Matsumoto & Mitsuyoshi Takasu— Hoso Shitsu Jealkb— LIVE TOUR 2008 Fuyubara no Chikai at ZEPP TOKYO PaBo— Koi no Hexagon ■ Columbia Music Entertainment Inc. Company Name: Columbia Music Entertainment Inc. Address: Roppongi 21 Mori Bldg., 1-4-33 Roppongi, Minato-ku, Tokyo Representative: Representative Director and CEO Sadahiko Hirose Business contents: Production, advertising and sales of music software, etc., and music artist management Paid-in capital: ¥1,000,000,000 URL: www.columbia.co.jp ■ For further information concerning this subject please contact: Columbia Music Entertainment, Inc. Ms. Tomoko Isawa, Chief Staff, PR/ER Group, Strategic Planning Division Telephone: 03-3588-2250 email: Tomoko Isawa [email protected] .