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Earnings Results Briefing for the Third Quarter Ended December 31, 2010


Outline of Business Results

Business year ending in March 2011
3rd quarter
Business year ending in March 2010
3rd quarter
Operating revenues 3,064,000,000 yen
Operating income 395,000,000 yen
Ordinary profit 402,000,000 yen
Net income after income taxes for the (current) quarter period 232,000,000 yen

Note: The details for the third quarter of the business year ending March 2010 are not listed because the consolidated financial statement has been prepared.

Business Results

For the current third quarter account period, the Company recorded operating revenues of 3,064,689,000 yen, and for profits, the Company earned operating income of 395,008,000 yen, ordinary profit of 402,547,000 yen, and net income before income taxes of 398,871,000 yen.
As a result, net income after income taxes was 232,933,000 yen for the current third quarter account period.

Online Game Business

The online game business, which the Company focuses on as a new management pillar, increased sales to 2,081,118,000 yen for the current third quarter account period, up 105.9% from the same quarter period of the previous 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, six titles were offered during the previous period including Sangoku Heroes. At the end of current third quarter, eight titles are offered; SOULALIVE ONLINE and four other new titles have opened, in contrast, two aging titles were closed.
As for browser games, seven titles are offered at the end of current third quarter; there were three titles from previous quarter, and from this quarter, Dragon Crusade 2 and other new titles were added.
For mobile games, which started in August of 2009, three titles including Kiss to My Prince were offered in privious quarter. In current third quarter, Enmusu! and three other new titles have added, and as a result, at the end of current third quarter, eight titles are offered. The operation of these games is mainly through the special website of the mobile game, which is operated by the mobile SNS operation companies.
As a result, the online game business accounted for as much as 67.9% 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

Sales from the software sales business during the current third quarter were 858,893,000 yen. Among these, those from the Pro Regi service were 734,794,000 yen and those from the Share Regi service were 17,307,000 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 83,334,000 yen, which continued to be stagnate due to the difficulty in acquiring new customers.

Website Advertisement Business

Sales from the website advertisement business were 121,159,000 yen. Among them, those from keyword advertisements (listing advertisement) accounted for almost 37.5% 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 3,518,000 yen. More than half were sales 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.

Press Releases » 2011

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