Fields Corporation held a financial presentation on the third quarter of the fiscal year ending March 31, 2014 in OTEMACHI 1st SQUARE CONFERENCE (Chiyoda-ku, Tokyo) on February 5, 2014 (Wednesday) at 11:30 am.
This page provides an overview of our explanation (summary) at the financial presentation.
1. Summary of Results for the Third Quarter of the Fiscal Year Ending March 31, 2014 (Consolidated)
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In the third quarter, consolidated net sales totaled ¥54.2 billion, operating income was ¥2.0 billion and net income was ¥1.2 billion. Operating income was up ¥3.1 billion compared to the same period in the previous year.
The main factor behind the fluctuation in earnings was the approximately 60,000 unit increase in the number of pachinko machines sold compared to the same period in the previous year. In addition, consolidated subsidiary Tsuburaya Productions’ earnings increased.
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4 pachinko titles were launched, including “CR EVANGELION 8” (about 75,000 machines sold), for which Fields was the general sales agency, and about 139,000 machines were sold overall.
We launched 3 pachislot titles as the general sales agency, and sold about 92,000 machines.
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The table shows the consolidated balance sheet.
There are no points particularly worthy of note.
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The table shows the consolidated cash flow.
There are no points particularly worthy of note.
2. Key IP Initiatives
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The table provides examples of IP development.
As previously with “Evangelion,” we primarily built on the IP we acquired in the pachinko/pachislot field.
Currently, we are working to raise IP value while attracting fans across a wide range of fields, as with “HERO’S” IP, “Majestic Prince” and “Ultraman” series.
Regarding earnings on IP, we are currently making upfront investments, and plan on generating earnings with developments in the interactive media, consumer products and pachinko/pachislot fields.
3-1. <Merchandising field> Pachinko/Pachislot Business
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The table here shows fluctuations in the number of machines sold and titles sold in the pachinko market.
Both the number of machines sold and titles sold have decreased in 2013 compared to the previous year. We see a general trend in buying in which customers limit their initial introduction of a machine, and place additional orders of popular machines after they have introduced them.
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The table shows fluctuations in the number of machines sold and titles sold in the pachislot market.
The number of machines sold was flat and the number of titles sold increased in 2013 compared to the previous year. The solid performance of the pachislot market has resulted in many manufacturers launching pachislot machines.
Average utilization of pachinko machines has been on the decline since 2009, but recently some machines have continued to be highly utilized with signs that the decline is coming to a halt. We expect utilization to remain at this level going forward.
Average utilization of pachislot machines has been on the rise since 2009. We expect it to trend around 10,000 medal tokens going forward (utilization per machine per day).
The average gross margin per pachinko machine has declined as utilization has fallen.
The average gross margin per pachislot machine increased as utilization has increased, but is currently decreasing slightly.
The average utilization and average gross margin per machine during the New Year’s holidays were in line with the previous year’s levels for both pachinko and pachislot machines.
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The table shows trends in pachinko hall installation share by pachinko machine specification.
The share of “middle-high-type” and “middle-low-type” machines, preferred by those who enjoy pachinko, has declined, while the share is increasing for the “MAX type” (High Spec), and the “Amadigi type” (Low Spec) which has a jackpot probability of about 1/100.
We will continue to focus on planning, developing and offering pachinko machines with high entertainment value that pachinko fans can enjoy without requiring high-stakes gambling.
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The table shows trends in pachislot hall installation share by pachislot machine specification.
Recently, the share of high-stakes gambling “AT type” (New Middle-high Spec) is increasing in a shift away from the two-way structure consisting of the “Normal type” (Low Spec) and the “ART type” (Middle Spec).
We will launch “Evangelion—Ketsui no Toki” in February, a very user-friendly normal type. After its launch, we will strive to bring in additional orders to encourage utilization.
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The pachinko and pachislot lineup that we sell as the general sales agency in the fourth quarter is shown in the handout.
Currently, we are marketing “Monster Hunter” and “Onimusha,” which we plan to launch in March. These titles have attracted considerable praise at exhibitions.
(Reference) Press release
“Pachislot Monster Hunter: Gekka Raimei”
“Pachinko Onimusha: Dawn of Dreams”
3-2. <Merchandising Field> Interactive media business
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We expect to launch 8 key new game titles in the fiscal year ending in March 2014, based on our assessment of the market environment going forward and our careful focus of resources on core titles.
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We had issued 9 social game titles as of December 2013, including ongoing titles for this period such as “AKB48 Stage Fighter.”
We plan to launch 3 titles in the fourth quarter, and distributed the social game “Beyond the Heavens” in January, a joint development and joint operation with DeNA Co., Ltd.
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The table shows the main developments with consumer products.
Currently, consumer products do not make a substantial contribution to profits, but we plan to expand IP earnings in the future, including tie-ups with pachinko/pachislot and interactive media.
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In April 2010, we made Tsuburaya Productions, which owns the “Ultraman” series, a Group subsidiary. We took steps to improve management and initiatives to revitalize and rejuvenate the Tsuburaya universe, and succeeded in bringing the company to solvency as of December 31, 2013. Going forward, we will pursue developments with BANDAI Co., Ltd. and expand overseas, particularly in Southeast Asia.
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The IP relationship diagram is shown below. The red lines in the diagram indicate our initiatives in this fiscal year.
Several projects to bring “HERO’S” IP to movie are underway, including live action films, and in the future we will expand IP in merchandising field.