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Business report for FY ended March 2011

04/26/2011

Outline of Business Results

  Business year ending in March 2011
(yen in million)
Business year ending in March 2010
(yen in million)
Operating revenues 3,943 (24.9%) 3,157 (57.1%)
Operating income 415 (5.8%) 393 (383.6%)
Ordinary profit 425 (2.9%) 413 (315.6%)
Net income after income taxes for the (current) quarter period 146 (△47.4) 279 (-)

Business Results

The Company recorded operating revenues of 3,943,691,000 yen, which was up 24.9% compared to the last year, and for the operating profit, it was 415,930,000 yen, which was up 5.8% compared to the last year. This is because the promotion fee and depreciation cost and such other costs were 27.6%, which was higher than operating revenue of 24.9%. The Company recorded current profit of 425,903,000 yen, which was up 2.9% compared to the last year, yet loss on revaluation of investments in securities, loss on intangible fixed asset (software) and other extraordinary loss were 175,950,000 yen, and current net income before-tax was 253,082,000 yen, which was down 36.9% compared to the last year.
As a result, current net income for the year after tax adjustment was 146,871,000 yen, which was down 47.4% compared to the last year.

Online Game Business

The online game business, which the Company focuses on as a new management pillar, increased sales to 2,657,989,000 yen for the year, up 75.6% from the last year.
The online game business comprises 3 fields, traditional online games (those downloading client software onto your computer) browser games (online games running on browsers and not necessary to download) and mobile games (a type of browser game that can be played on a cell phone without an application).
As for the traditional online games (those downloading client software onto your computer) accounts over 40% of the online game business, nine titles are offered including “Sangoku Heroes” operated since April 2009, “Angelic Crest” operated since May 2010, and “SOULALIVE ONLINE” operated since September 2010. As for the browser games (online games running on browsers and not necessary to download), ten titles are operated including Dragon Crusade II. For mobile games (a type of browser game that can be played on a cell phone without an application), which started in August 2009, ten titles are operated, yet receiving influence of the high market competition.
As a result, the online game business accounted for as much as 67.4% of operating revenues. In terms of profits, a large sales increase absorbing an increase in the allocated portion of fixed costs largely contributed to the enhancement in earning capacity.

Software Sales Business

The name of “Internet Sales Business” has changed to “Software Sales Business” for more conclude segmentation. Sales from the software sales business of this year were 1,120,651,000 yen. Among these, those from the Pro Regi service were 955,090,000 yen and those from the Share Regi service were 23,378,000 yen. In the software download sales business, although there is still strong demand for anti-virus software, interest in computer software in general is low; therefore, the effect of the sales-promotion campaign was limited. Additionally, sales from the download-sales total support service were 113,116,000 yen, which continued to be stagnating due to the difficulty in acquiring new customers.
* Note: the calculation of software download sales multiples the service charge from users and author of the software (users are charged from each download, and authors are charged by the percentage of sales price as the service fee), and Pro Regi service calculates sales price of products as the sales.

Website Advertisement Business

Sales from the website advertisement business were 160,432,000 yen. Among them, those from keyword advertisements (listing advertisement) accounted for almost 39.1% and led the website advertisement sales business. However, the business category in general is stagnated due to delayed economic recovery.

Other Businesses

Sales from other businesses totaled 4,618,000 yen. 40.7% of the sales were from the membership-based blog service for individuals, which includes the entrusted operation service of other companies’ servers as well, showing a transition at low levels.

Disclaimer: This summarized translation is provided for convenience only. In the event of any discrepancy with the Japanese original, the original shall prevail.

Press Releases » 2011

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