FIELDS DIGITAL ANNUAL REPORT 2017

COMPANY INFO / STOCK INFO

About FIELDS

Company Information (As of March 31, 2017)

Company name FIELDS CORPORATION
Corporate philosophy The Greatest Leisure for All People
Established June 1988
Head office address Shibuya Garden Tower, 16-17 Nampeidai-cho, Shibuya-ku, Tokyo 150-0036, Japan
Main business activities
  1. Development, planning and sales of characters and contents
  2. Development, planning and sales of animation soft works
  3. Development and planning of pachinko and pachislot machines
  4. Purchase and sales of pachinko and pachislot machines
Common stock ¥7,948 million
Number of employees 1,713 (Consolidated); 784 (Non-consolidated)
Consolidated Subsidiaries Lucent Pictures Entertainment, Inc.
Digital Frontier Inc.
Tsuburaya Productions Co., Ltd.
BOOOM Corporation
K.K. CROSSALPHA
And others totaling 14 companies
Equity-Method Affiliates HERO’S INC.
Kadokawa Haruki Corporation
And others totaling 8 companies

Regional and Branch Offices throughout Japan (As of March 31, 2017)

Figure: Regional and Branch Offices throughout Japan

Organization (As of May 15, 2017)

Figure: Organization

Main Group Companies

Company name Paid-in capital
(Million yen)
Holding Ratio of Voting Rights
(%)
Main Business activities
Pachinko/Pachislot Fields Jr. Corporation 10 100.0 Pachinko/pachislot machine maintenance, etc.
Shinnichi Technology Co., Ltd. 10 100.0 Development of pachinko/pachislot machines
MICROCABIN CORP. 10 100.0 Planning and development of software for pachinko and pachislot machines
K.K. CROSSALPHA 10 100.0 Development and production of pachinko/pachislot machines
Spiky Corporation 100 100.0
(100.0)
Development and production of pachinko/pachislot machines
BOOOM Corporation 10 51.0 Planning and development of pachinko/pachislot machines
Mizuho Corp. 10 49.7 Planning, development, manufacturing and sales of pachinko/pachislot machines
NANASHOW Corporation 40 38.9 Planning, development, manufacturing and sales of pachinko/pachislot machines
SOUGOU MEDIA INC. 10 35.0 Planning and production related to sales promotions
Comics HERO’S INC. 10 49.0 Planning, operation and production of comic magazine and character contents
Animation Lucent Pictures Entertainment, Inc. 10 100.0 Planning, production and producing of animations
Digital Frontier Inc. 31 86.9 Planning and production of CG, etc.
Movies/TV SPO Entertainment Inc. 371 31.8 Planning, production and distribution of movie, etc.
Interactive Media FutureScope Corp. 60 94.4 Service provider and mail order of mobile contents
Consumer Products Total Workout premium management Inc. 5 95.0 Running fitness gym
Tsuburaya Productions Co., Ltd. 310 51.0 Planning and production of movie and TV program
Planning, production and sales of character goods

The percentage of indirect ownership is indicated in parenthesis after the Company's voting rights ratio.

FIELDS’ Advances

From 1988 Seeking to Create New Entertainment That Enriches People’s Live

As entertainment in Japan entered a new era in the 1980s, we saw a business opportunity in the growing leisure time available to people. This marked the beginning of our move to create entertainment that would enrich people’s lives.
In 1988, FIELDS’ forerunner, Toyo Shoji Co., Ltd. was established. The company focused first on revitalizing the pachinko industry and making it sounder, with the aim of making it easier for many more people to enjoy the inherent entertainment value of pachinko machines as an ordinary part of life.
After that, the scale of Japan’s pachinko/pachislot market expanded to ¥30 trillion. We also grew into the industry’s largest distributor with a nationwide sales network, as we continued to anticipate and meet the diverse needs of pachinko halls and fans.

FIELDS’ Transitions

1983
Toyo Shoji founded
1987
Construction of the Head Office building completed; Embarked on surveys and research into entertainment in general and computer management systems for pachinko and pachislot halls
1988
Toyo Shoji Co., Ltd. (currently FIELDS CORPORATION) established, marking full-scale launch of the pachinko/pachislot machines sales business
1992
Information service launched
1992
Leisure Nippon News Company acquired; Formulation of a vision for the pachinko industry began
Launched Hall TV, a pachinko hall management support system
1994
Launched Pachinko Information Station, a direct-to-hall communications satellite broadcast for the pachinko industry
Regional and branch offices were expanded throughout Japan to establish our foundation as a distributor
1992
Businesses in Tokyo and Kyushu region were expanded
1995
Businesses in Tohoku, Chugoku and Kansai regions were expanded
2000
Nationwide sales network was established

Entertainment & Pachinko/Pachislot history

1983
Opened Tokyo Disneyland
Released the home video game console Family Computer System
1984
Launched JUNET, Japan’s first Internet service
1985
Launched Shoulder Phone, Japan’s first mobile phone
1985
Enforcement of New Amusement Businesses Law (started the model certification test of pachinko and pachislot machines by Security Communications Association)
1987
Started Japan’s first direct-to-home Broadcasting Satellite (BS) service
1988
Opened Tokyo Dome
1989
Launched Japan’s first direct-to-home Communications Satellite (CS) broadcasting service
1990
Revised Pachinko and pachislot machines regulations (launch of CR pachinko machine)
1991
Launched Pachinko machines mounted with color LCD screens
1993
Opened First cinema complex in Japan
1994
The pachinko and pachislot market expands to a ¥30 trillion
1995
Strengthening of regulations for restricting the gambling aspect of pachinko machines
1996
Number of pachinko machines installed reaches a record high 3.9 million

From 1998 Focusing on Developing Machines That Provide Greater Entertainment Value

In the 1990s pachinko and pachislot machines mounted with LCD screens brought the same appeal to these machines as media such as movies and television. The advent of larger LCD screens with higher quality, meanwhile, led to the emergence of a host of original intellectual property (IP) unique to the industry.
Viewing pachinko and pachislot machines as media, we moved to create more fans of the genre. To this end, we used our nationwide sales network to identify needs, and began taking steps to create pachinko and pachislot machines that utilize outstanding IP known widely throughout the public domain.
Together with building a structure for acquiring IP and relationships with talented creators and planners, we entered a business alliance with machine manufacturer Sammy Corporation. These and other efforts formed our single-minded focus on measures to enhance both the gaming and entertainment value of pachinko and pachislot machines.
In 1998, the number of pachislot machines installed, which had stalled in the several hundred thousands, broke the 1 million machine mark. We recognized this milestone would change pachinko and pachislot, and transform entertainment in Japan. This was the start of our full-scale shift toward IP.

FIELDS’ Transitions

1999
Obtained ISO 9002 certification (Sales Division) to provide superior operational quality to customers (migrating ISO 9001 in 2002)
2000
Company name changed from Toyo Shoji Co., Ltd. to FIELDS CORPORATION
Forms alliance with leading manufacturers to develop pachinko and pachislot machines that leverage IP
2001
Alliance with Sammy Corporation formed; Exclusive sales of Rodeo brand machines began
2003
Alliance with SANKYO CO., LTD. formed; Exclusive sales of Bisty brand machines began
2008
Alliance with KYORAKU SANGYO formed; Exclusive sales of OK!! Brand machines began
2009
Alliance with Enterrise co., Ltd (CAPCOM CO., LTD. subsidiary) formed; Exclusive sales of Enterrise brand machines began
2012
Formed alliance with Universal Entertainment Corporation
2013
Formed alliance with D-light Co., Ltd.
2014
Formed alliance with NANASHOW Corporation
2015
Aristocrat Technologies (now CROSSALPHA) became a subsidiary
Spiky Corporation became a subsidiary (100% wholly owned subsidiary of Aristocrat Technologies (now CROSSALPHA))
Formed alliance with Daiichi Shokai Co., Ltd.
2017
Formed Basic Sale and Purchase Agreement with Sammy Corporation
2001
Entered sports entertainment field
2001
Starting up professional Management Co., Ltd.; Entertainment production began
Established Total Workout Corporation to provide high-quality sports gyms
2005
Three sports-related subsidiaries merged and renamed Japan Sports Marketing Inc. (JSM Inc.)
2007
EXPRESS Inc. made a subsidiary
2011
Established Total Workout premium management Inc.
2012
Absorption of JSM Inc.’s fitness club business considering future growth and synergistic effects
2013
Absorption-type merger of EXPRESS Inc. aiming at improving management efficiency

Entertainment & Pachinko/Pachislot history

1998
Released Windows 98
1998
Opening of large-scale halls by leading pachinko hall operators accelerate
Number of pachislot machines installed exceeds one million
1999
Launched i-mode proprietary internet service for mobile phones
1999
Launched pachislot machines mounted with color LCD screens
Major pachinko and pachislot machines manufacturers launched a number of titles featuring original IP
2001
Opened Universal Studios Japan
Opened Tokyo DisneySea
Released feature-length animation film Spirited Away (Sen to Chihiro no Kamikakushi)
2002
Held a 2002 FIFA World Cup

From 2003  Toward the Multifaceted Development of IP

Amid diversifying media formats and growth in individual preferences, we strove to establish IP-driven business models to realize “The Greatest Leisure for All People.”
Utilizing funds from our public offering and other opportunities afforded by our 2003 stock market listing, we focused on obtaining many merchandising rights to develop high-quality IP into products from companies that possess such IP in areas such as comics, animes, movies, TV dramas, music, games, and sports.
In addition, we formed alliances with outstanding creative production companies and companies with the talented human resources and cutting-edge technology, taking new steps to develop the merchandising rights we obtained in pachinko and pachislot and other media as well.
The start of the 21st century saw the use of characters and other IP across the full spectrum of media formats. For pachinko machines, roughly 70 percent featured IP of some kind. Recognizing that this trend could lead to IP exhaustion in the future, we made it our mission to eliminate this looming concern.

FIELDS’ Transitions

2003
Shares listed on the JASDAQ market; New IP-driven business model announced
2004
Entered game field as part of multifaceted IP development
2004
Invested in D3 Publisher Inc.; Launched pachinko and pachislot machine simulator software
2009
Sold D3 Inc. shares to NAMCO BANDAI Games Inc.; Strengthened relationship with NAMCO BANDAI Games
2005
Entered movie field to acquire IP and promote multifaceted IP development
2005
Invested in Kadokawa Haruki Corporation; Planning and production of many movies for the theater began
2008
Invested in SPO Entertainment Inc. (management of movie theaters); Promotion of trend-setting cinema complexes for independent films began
2006
Entered online services field including mobile service for the acquisition, creation and multifaceted development of IP
2006
Invested in FutureScope Corporation; Developed mobile site, Fields Mobile
2010
Established IP Bros. by joint capital investment with NHN Japan Corporation; Developed pachinko and pachislot- related site Nanapachi
2015
IP Bros. Inc. absorbed into FutureScope Corp.
Distributed smartphone app THE TOWER OF PRINCESS and other five works
2007
Entered visual field to acquire and cultivate IP
2007
Starting up Lucent Pictures Entertainment, Inc.; Planning and producing movie animation BERSERK THE GOLDEN AGE ARC trilogy
2010
Digital Frontier Inc. made a subsidiary; Providing high-quality video technology
2011
Digital Frontier (Taiwan) and Fly Studio SDN. BHD. (Malaysia) made a subsidiary to expand the visual production line overseas
2012
Starting up cross-media development of HERO’S work MAJESTIC PRINCE with SOTSU CO., LTD. and Toho Co., Ltd.
2013
Broadcasting TV anime MAJESTIC PRINCE
2014
Released APPLESEED ALPHA
2016
APPLESEED ALPHA received first prize by category for the VFX-JAPAN Awards 2016
Broadcasting TV anime BERSERK (first series) on MBS etc., Animeism, wowow
Released Full-3DCG animation movie GANTZ:O
Released MAJESTIC PRINCE THE MOVIE
Full-3DCG animation movie GANTZ:O received Best Picture in CG Animation category for the 2nd CGWORLD AWARDS
Sold all shares of Fly Studio SDN. BHD.(Malaysia)
2017
Broadcasting TV anime BERSERK (second series) on MBS etc., Animeism, wowow
Broadcasting TV anime ATOM THE BIGINNING on NHK

Entertainment & Pachinko/Pachislot history

2004
Started social networking service Facebook
2004
Revised pachinko and pachislot machines regulations
Relaxed pachinko machine regulations
Strengthened regulations to restrict the gambling aspect of pachislot machines
Launched pachinko machine CR Neon Genesis Evangelion based on new regulations
Release a host of machines featuring IP by major machine manufacturers
2006
Started information service Twitter
Launched 1seg mobile digital terrestrial broadcasting
2006
Number of pachislot machines installed exceeds two million
2007
Launched Kindle e-reader equipped with communication functions
2007
Transferred completely to new regulation machine in pachislot machine

From 2008 Eyeing the Continuous Acquisition, Creation and Cultivation of IP

From our beginnings as an independent distributor of pachinko and pachislot machines, we have now achieved substantial growth in the pachinko and pachislot field driven by IP.
Along the way, we have brought companies with high-quality IP rights like Tsuburaya Productions Co., Ltd. under our umbrella, and sought out higher-added value for our IP by building a more robust network of prominent companies and talented partners in every field. In parallel, the FIELDS CORPORATION Group has also welcomed companies skilled in comics, animation, visual and other specialized field.
During this time, the exhaustion of characters and other high-quality IP in the pachinko and pachislot industry worsened. In light of the situation, we opted to make a strategic shift to a business model centered on IP which continuously acquire, creation and cultivation of IP.

FIELDS’ Transitions

2008
Announced Medium-Term Management Plan for 5 years, eyeing the Continuous Acquisition, Creation and Cultivation of IP
Entered video development field to enhance the entertainment of pachinko and pachislot
2008
Established Shin-Nichi Technology Co., Ltd.
2009
Established F Corporation (currently BOOOM Corporation)
2011
MICROCABIN CORP. made a subsidiary
2011
NEX ENTERTAINMENT CO., LTD. made a subsidiary
2013
Established F Corporation (now XAAX Inc.)
Entered digital comics field as part of multifaceted IP development efforts
2008
Invested in Bbmf Magazine, Inc.; Digital comics distribution began
2010
Established publishing company HERO’S Inc. by joint capital investment with Shogakukan Creative Inc.
2011
Publishing of HERO’S Monthly magazine began
2012
Launched HERO’S Comics
Sold shares of Bbmf Magazine, Inc.
2016
Distributed official comic app Comic HERO’S
2010
Tsuburaya Productions Co., Ltd., owner of the Ultraman series and other high-quality IP, made a subsidiary
2011
Broadcasting TV series Ultraman Retsuden (Ultra Zero Fight)
2013
Broadcasting TV series New Ultraman Retsuden (Ultraman Giga, Ultraman Ginga S, ULTRA FIGHT VICTORY, Ultraman X)
2016
Broadcasting ULTRAMAN ORB
2017
Broadcasting ULTRAMAN ZERO THE CHRONICLE
Broadcasting ULTRAMAN GEED

Entertainment & Pachinko/Pachislot history

2008
Launched iPhone 3G in Japan
2008
Expanded operating at low playing cost in pachinko and pachislot market, to diversifying needs of fans
Pachislot machines utilizing high-quality IP revitalize the pachinko and pachislot market
Launched pachinko machines linked with other media, including movies, TV, mobile and live theater
2010
Box-office earnings in Japan reach record levels due to the rising popularity of 3D in movie field
Conversion of Mobage and GREE to open platform
Established Cool Japan Office in Manufacturing Industries Bureau, Ministry of Economy, Trade and Industry
2011
Analog terrestrial broadcasting discontinued and transferred completely to digital terrestrial broadcasting (excluding three prefectures affected by the Great East Japan Earthquake)
2012
Launched iPhone 5 and 4G LTE service commences
Achievement of record-breaking hit by Pazdra (PUZZLE & DRAGONS)
2012
Shares of major pachinko hall operator listed on the Hong Kong Exchanges and Clearing

From 2012 Toward the Maximization of IP Value

Since 2012, the spread of smartphones, tablets and other digital devices, along with high-speed internet and devices with greater storage capacity have enabled the casual enjoyment of comic, visual and game without dependence on a specific platform, leading to diversification in the way people spend their leisure time.
Also, with the enhance of internet environment, we have entered an age in which contents are in demand on a global basis. In anticipation of these trends, FIELDS announced the “Development Business Model” based on IP in May 2012. Then, FIELDS has promoted the cross-media development of IP through the acquisition, creation and cultivation of IP focused on the Japanese and global markets without reliance on specific media.

FIELDS’ Transitions

2012
Announced “Developing Business Model” based on characters and other IP with the aim of maximizing IP value
Strengthened Group structure and network with external partners to raise IP value
2014
Formed alliance with DLE Inc. to begin cross-media development of HERO’S work SWORD GAI
2015
Collaborative development of conceptual licensing of A MAN of ULTRA with various companies and brands
2016
Broadcasting TV anime ACTIVERAID: Special Public Security Fifth Division Third Mobile Assault Eighth Unit (first series)
Broadcasting TV anime ACTIVERAID: Special Public Security Fifth Division Third Mobile Assault Eighth Unit (second series)
A MAN of ULTRA recieved Japan Brand and Licensing Grand Prize for Character & Brand of the Year 2016
2014
Accelerated global development of IP
2014
Created animation version of APPLESEED ALPHA in conjunction with Sony Pictures Entertainment (U.S.) released in the United States and Japan
2015
Global distribution of NINJA SLAYER FROM ANIMATION
Ultra heroes live shows held in China, Hong Kong, Thailand and Malaysia, etc.
Accelerate global distribution of visual works through collaboration with Crunchy Roll (U.S), Tencent (China) and other SVOD operators.
2016
Expanded distribution of e-books HERO’S works collaboration with China Mobile and Kidstone in China, and developed to North and South America, Europe and Korea
Developed comics of HERO’S works in North and South America, Europe and Asia

Entertainment & Pachinko/Pachislot history

2013
Tokyo is selected as host city for the 2020 Olympic and Paralympic Games
2014
Implementation of voluntary regulations by industry bodies for both pachinko and pachislot machines
2015
Scale of market for theme parks and amusement parks grows to largest ever
Started video streaming service by Netflix
Started video streaming service by Amazon Prime
Released animation film Your Name. (Kimi no Na wa.)
2016
National Police Agency announces list of machines to be recalled related with possible performance variance from test machine and demands for removal within the current year
Publication of IR promotion law

From 2017 Toward the Growth for Next 30 years

FIELDS will mark its 30th anniversary in Jun 2018. Toward the growth for next 30 years, we announced the Medium-Term Management Plan in May 2017.
We will contribute to the joy and happiness of people across Japan by returning to “planning and production capabilities” with an eye to the past/future of the market, the DNA of FIELDS since its founding, and providing hero’s IP through various points of customer contact (business platform), and will further extend those IP and platforms (PF) throughout the world.
We will attempt to plan, develop and provide the products and services that enrich people’s spirit and will continue striving toward the realization of its corporate philosophy “The Greatest Leisure for All People.”

FIELDS’ Transitions

2017
Announced Medium-Term Management Plan for 3 years
Acquisition of shares in No9 Inc. in the digital book platform

Entertainment & Pachinko/Pachislot history

2017
Revisions to Regulations etc. for Enforcement of Act on Control and Improvement of Amusement Business

Stock Information

Stock Information

Total authorized shares 138,800,000
Total outstanding shares 34,700,000
Treasury stock 1,516,300
Number of shareholders 7,745

By type of shareholder

Graph: By type of shareholder

Principal Shareholders

Name of Shareholders Number of Shareholding shares held Ratio
Hidetoshi Yamamoto 8,875,000 25.58%
SANKYO CO., LTD. 5,205,000 15.00%
Takashi Yamamoto 3,612,800 10.41%
NORTHERN TRUST CO. (AVFC) RE NVI01 1,835,100 5.29%
Mint Co. 1,600,000 4.61%
Treasury stock 1,516,300 4.37%
GOLDMAN, SACHS & CO. REG 1,089,200 3.14%
STATE STREET BANK AND TRUST COMPANY 505019 593,600 1.71%
NORTHERN TRUST CO. (AVFC) RE IEDU UCITS CLIENTS NON LENDING 15 PCT TREATY ACCOUNT 573,600 1.65%
NORTHERN TRUST CO. (AVFC) SUB A/C NON TREATY 476,200 1.37%
Japan Trustee Services Bank, Ltd. (Trust Account 9) 427,400 1.23%