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We would now like to begin the Financial Results Briefing session of SQUARE ENIX HOLDINGS (the “Company”) for the first quarter of the fiscal year ending March 31, 2021 (“1Q FY2021/3”).
Today’s presenters are:Yosuke Matsuda, President and Representative Director, andAtsushi Matsuda, General Manager of Finance and Accounting Division.
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First, Mr. Matsuda, General Manager of Finance and Accounting Division, will give an overview of the Company’s financial results for 1Q FY2021/3, and then our president Mr. Matsuda will discuss the progress made by each of the Company’s business segments.
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Good afternoon. I am Atsushi Matsuda.In 1Q FY2021/3, the Company booked net sales of ¥87.0 billion (up ¥33.7 billion YoY), operating income of ¥24.5 billion (up ¥17.4 billion), ordinary income of ¥24.1billion (up ¥17.9 billion), and net income attributable to parent company shareholders of ¥14.3 billion (up ¥10.2 billion).In addition, the Company booked ¥2.226 billion in losses resulting from temporary closures of amusement facilities etc.
prompted by the COVID-19 pandemic as extraordinary losses.
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I will next break down our results by segment.The Digital Entertainment segment posted net sales of ¥74.3 billion (up ¥37.2 billion YoY) and operating income of ¥26.0 billion (up ¥18.4 billion).
The HD Game sub-segment saw both sales and profits rise YoY thanks not only to the release of the console titles “FINAL FANTASY VII REMAKE” and “TRIALS OF MANA,” but also to a higher percentage of digital sales and to licensing income.
The MMO sub-segment likewise saw sales and profits rise, thanks to growth in paying subscriber numbers for “FINAL FANTASY XIV.”
The Games for Smart Devices/PC Browser sub-segment also saw YoY growth in both sales and profits due to strong performances from titles such as “DRAGON QUEST WALK,” “WAR OF THE VISIONS: FINAL FANTASY BRAVE EXVIUS,” and “Romancing SaGA Re;univerSe.”
The Amusement segment generated net sales of ¥4.6 billion (down ¥6.2 billion YoY) and an operating loss of ¥1.5 billion (vs. operating income of ¥680 million a year earlier). The Company temporarily closed its amusement facilities in Japan in response to the state of emergency declaration issued under Japan’s Act on Special Measures for Pandemic Influenza and New Infectious Diseases Preparedness and Response, related to COVID-19. This resulted in a sharp YoY sales decline and an operating loss.
The Publication segment booked net sales of ¥5.4 billion (up ¥1.6 billion YoY) and operating income of ¥2.3 billion (up ¥1.1 billion). Sales in digital formats, such as from “MANGA UP!” manga application and e-books, grew substantially. Sales in printed formats were also brisk, resulting in YoY growth in net sales and operating income.
The Merchandising segment posted net sales of ¥3.1 billion (up ¥1.2 billion YoY) and operating income of ¥1.2 billion (up ¥1.1 billion). The YoY growth in sales and profits is owed to brisk sales of character goods and soundtracks based on the Company’s IP.
This concludes my overview on our 1Q FY2021/3 financial results.
The information on the future forecasts described in this material is current as of August 6, 2020. The company is not obliged to update or correct forecasts concerning the Company’s future results, including forecasts or outlook, if new information becomes available and/or events occur after August 6, 2020