Slide 1: FY2019 First Quarter Financial Results
GREE, Inc. FY2019 First Quarter Financial Results October 26, 2018 Copyright © GREE, Inc. All Rights Reserved.
Slide 2: Executive Summary
Executive Summary Net Sales ¥18.2 billion, Operating Income ¥1.6 billion, EBITDA ¥1.9 Financial Results billion Overview ⁃ Operating income surpassed forecast Expanded overseas and multiplatform distribution ⁃ After releasing Danmachi in North America, expanded distribution to South Korea and Ta
Slide 3: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 4: 1. Financial Results Overview
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 5: FY19 1Q Financial Results Overview
1. Financial Results Overview (Consolidated) FY19 1Q Financial Results Overview Net Sales ¥18.2 billion, operating income ¥1.6 billion and EBITDA ¥1.9 billion Billions of yen FY19 FY18 FY18 1Q QoQ YoY 4Q 1Q Net sales 18.16 -0.82 -3.46 18.98 21.61 Operating income 1.62 0.01 -1.08 1.61 2.69 Ordinary i
Slide 6: Net Sales, EBITDA, and Operating Income
1. Financial Results Overview (Consolidated) Net Sales, EBITDA, and Operating Income Operating income margin up 0.4 percentage points QoQ, to 8.9% Billions of yen 21.61 22.0 25.0% 19.46 18.98 17.87 18.16 15.6% 12.5% 12.0% 11.0 12.5% 8.5% 8.9% 2.69 3.06 2.78 3.15 2.34 2.71 1.61 1.88 1.62 1.85 0.0 0.0
Slide 7: Operating Income Analysis
1. Financial Results Overview (Consolidated) Operating Income Analysis Offset decline in net sales with reduction in variable costs to keep operating income basically steady at ¥1.6 billion Billions of yen ¥0.01bn increase +1.17 -0.34 1.61 -0.82 1.62 Operating Decrease in Decrease in Increase in Ope
Slide 8: FY19 1Q Cost Structure
1. Financial Results Overview (Consolidated) FY19 1Q Cost Structure Total costs down ¥800 million QoQ, to ¥16.5 billion Billions of yen FY19 FY18 FY18 Factors in change(QoQ) 1Q QoQ YoY 4Q 1Q Advertising 1.28 -0.36 -1.05 Decrease from efficient investment (4Q: 8.6% → 1Q: 7.0%) 1.64 2.33 Commission 5.
Slide 9: 2Q FY19 Earnings Forecast
1. Financial Results Overview (Consolidated) 2Q FY19 Earnings Forecast Plan：Net Sales ¥17.0 billion~¥18.0 billion, Operating income ¥1.0 billion ~ ¥1.5billion Billions of yen 1Q 2Q Results Forecast Net sales 18.2 17.0~18.0 Operating income 1.6 1.0~1.5 Ordinary income 2.2 1.0~1.5 Net income 2.1 0.5~1
Slide 10: 2. Operational Overview
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 11: Review and Summary of 1Q FY19 Business Plan
2. Operational Overview: Summary Review and Summary of 1Q FY19 Business Plan Review Strengthen 3 Overall - Made progress on measures to grow our businesses earnings pillars - Began distribution of Wild Arms: Million Memories “Game engine, - Secured new user base by running our first TV ad for Game/e
Slide 12: Development pipeline
2. Operational Overview: Game/entertainment business - Consoles, etc. Development pipeline One title already released; total of five titles in development FY20 and FY19 onward Already In released development First-party IP Co-developed IP 0 1 1 （1） （0） （1） Third-party IP 1 （0） 0 （1） 3 （2） Notes: • A
Slide 13: Progress Made
2. Operational Overview: Game/entertainment business - Consoles, etc. Progress Made Coin Consumption Topics Billions of coins 15.0 Existing titles - Reactive decline following four-year 12.6 anniversary event 11.4 10.8 10.4 Aired TV ad for SINoALICE 9.0 - Aired nationwide July 20 - August 19 7.5
Slide 14: Development/improvement of game engines
2. Operational Overview: Game/entertainment business - Consoles, etc. New title Development/improvement of game engines Released Wild Arms: Million Memories a masterpiece RPG for the PlayStation® on September 26 - Newest title in the Wild Arms series, featuring main characters from past titles and n
Slide 15: Nurturing first-party IP over long term
2. Operational Overview: Game/entertainment business - Consoles, etc. Nurturing first-party IP over long term Developing in-game universes through multichannel distribution, thereby creating more fan contact points Shoumetsu Toshi Another Eden Created anime for TV Developed Colabo-café event, game g
Slide 16: Expanding fan communities ①
2. Operational Overview: Game/entertainment business - Consoles, etc. Expanding fan communities ① Expanding fan communities through promotions and IP collaborations SINoALICE Shoumetsu Toshi 2 Aired TV ad Collaboration • Secured new fan base by running our first • Secured new fan base through TV ad
Slide 17: Expanding fan communities ②
2. Operational Overview: Game/entertainment business - Consoles, etc. Expanding fan communities ② Expanding fan communities by integrating real-world events with anniversary celebrations Senki Zesshou SYMPHOGEAR XD In Love with NEWS Special performance at Tokyo Game Show 2018 Celebration of NEWS’ 15
Slide 18: Full-scale overseas development
2. Operational Overview: Game/entertainment business - Consoles, etc. Full-scale overseas development Continuing to release existing titles overseas DanMachi - MEMORIA FREESE SINoALICE October 25 release Over 100,000 pre-registered • Following North American release (in March), • To be released in H
Slide 19: Overseas development plans
2. Operational Overview: Game/entertainment business - Consoles, etc. Overseas development plans Continuing to work toward global releases Distribution region North Partnership America/ South Korea, agreement Japan Europe Taiwan, etc. China status Already Already Released Preparing for released rele
Slide 20: Multiplatform development
2. Operational Overview: Game/entertainment business - Consoles, etc. Multiplatform development Developed titles based on first-party IP for LINE QUICK GAME platform Developing Fishing Star and Another Eden for Nintendo Switch™ platform Fishing Star QUICK Driland Brave Hunters Began distribution on
Slide 21: Started distribution of REALITY
2. Operational Overview: Game/entertainment business - Live, etc. Started distribution of REALITY Livestreaming platform for VTubers launched August 7 Many popular VTubers streaming daily Anyone can stream as a VTuber using a smartphone Real-time communication using gifts 21 Copyright © GREE, Inc. A
Slide 22: Vtuber Fund Project
2. Operational Overview: Game/entertainment business - Live, etc. Vtuber Fund Project Moving forward on cooperation with multiple strong partners Established RK music, a joint venture music label specializing in VTuber music - Joint production with VTubers with popular IP - Working together to produ
Slide 23: Strengthened media potential
2. Operational Overview: Advertising and media business Strengthened media potential Strengthened media potential by energizing fan communities and expanding content LIMIA MINE Expanded content with Measures to energize fan community topic-focused special editions 23 Copyright © GREE, Inc. All Right
Slide 24: 3. Appendix
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 25: Coin Consumption (1)
3. Appendix Coin Consumption (1) Overall coin consumption (1) Overall coin consumption (2) Billions of coins Billions of coins 25.0 25.0 22.9 22.9 1.9 20.0 20.0 19.1 5.3 19.1 1.7 17.6 18.1 18.1 1.3 17.6 7.1 1.1 5.0 1.5 4.4 4.5 5.0 6.8 5.7 5.5 12.5 6.2 12.5 17.7 15.0 14.8 13.9 13.1 13.0 11.5 12.2 11.
Slide 26: Coin Consumption (2)
3. Appendix Coin Consumption (2) Mobile games Web games Billions of coins Billions of coins 15.0 13.9 15.0 1.3 12.2 11.5 11.4 0.8 1.1 0.7 9.8 9.0 0.8 8.5 7.7 7.5 7.5 7.0 6.6 4.7 12.6 4.5 11.4 3.8 10.4 10.8 3.4 3.4 9.0 4.3 4.0 3.9 3.5 3.2 0.0 0.0 1Q 2Q 3Q 4Q 1Q 1Q 2Q 3Q 4Q 1Q FY18 FY19 FY18 FY19 ■ De
Slide 27: 1Q FY19 Cost Structure
3. Appendix 1Q FY19 Cost Structure Millions of yen FY19 FY18 FY18 1Q 4Q 1Q QoQ YoY Rental charges 691 △2 △272 693 963 Labor costs 2,304 205 222 2,099 2,082 Others 4,868 △288 △177 5,156 5,045 Cost of sales 7,863 △85 △228 7,948 8,090 Advertising 1,278 △363 △1,050 1,641 2,328 Commission fees 3,773 △450
Slide 28: 1Q FY19 Balance Sheet
3. Appendix 1Q FY19 Balance Sheet Billions of yen FY19 FY18 FY18 1Q QoQ YoY 4Q 1Q Current assets 95.87 -4.46 0.21 100.33 95.66 Fixed assets 28.83 3.80 1.79 25.03 27.04 Total assets 124.70 -0.66 2.01 125.36 122.69 Current liabilities 11.71 0.11 -1.32 11.60 13.03 Fixed liabilities 0.97 0.25 0.42 0.72
Slide 29: Breakdown of Group Headcount
3. Appendix Breakdown of Group Headcount Number of employees Headcount at Group companies end-1Q Game/Entertainment funplex, Pokelabo, WFS, Wright Flyer Live Entertainment, etc. 1,048 Business Advertising and Media Glossom, Limia, 3 Minutes, aumo, QUANT, etc. 388 Business Other businesses Includes G
Slide 30: ■ This document includes some forecasts, which are based on currently available information. Actual
■ This document includes some forecasts, which are based on currently available information. Actual performance may differ due to various factors. ■ When producing this document, we were careful to avoid errors or omissions, but the accuracy and completeness of the provided information is not guaran