Sankyo Co., Ltd. · TSE:6417
Sankyo — Q3 FY3/2024 Earnings Presentation
31 slides from Sankyo's earnings presentation, Feb 7, 2024
Slide 1: Presentation on Business Results for the First Nine Months of FY 3/2024
Presentation on Business Results for the First Nine Months of FY 3/2024 (April 1, 2023 to December 31, 2023) February 7, 2024 SANKYO CO., LTD. Prime Market of the TSE #6417
Slide 2: Contents
Contents Overview of Financial Results P3 Overview of Business P14 Surroundings of Pachinko and Pachislot Industry, P19 And Initiatives of SANKYO Appendix P24 © 2024 SANKYO CO., LTD. 2
Slide 3: Financial Highlights
Financial Highlights Substantial increases in both net sales and profits compared with the same period of the previous year due to increases in sales volumes of Pachinko and Pachislot machines. Substantial increase in income of pachislot machines business compared with the previous fiscal year a
Slide 4: Summary of Financial Results
Summary of Financial Results The overall pachinko market, comprising conventional pachinko machines and Smart Pachinko machines, has remained somewhat sluggish compared to the Pachinko pachislot market because of a lack of new titles capable of raising machine utilization, as the shift to Smart Pa
Slide 5: Revision of the Forecast of the Financial Results for the Year Ending March 31, 2024
Revision of the Forecast of the Financial Results for the Year Ending March 31, 2024 (Disclosed in February 7, 2024) Buoyed by increased production, re-release models, and mainstay series machines, the sales unit prices remained firm. Results of the Ball Bearing Supply Business are also expected
Slide 6: Revision of Dividend Forecast and Share Split
Revision of Dividend Forecast and Share Split（announced Feb. 7, 2024） In line with the revision of the business results forecast, revised the amount of the year-end dividend based on the dividend policy of paying dividends with a consolidated dividend payout ratio of 40% as a benchmark As the Compan
Slide 7: Repurchase of the Company's Own Shares and the Cancellation of Treasury Stock
Repurchase of the Companyʼs Own Shares and the Cancellation of Treasury Stock （announced Feb. 7, 2024） １. In line with the share split, a partial change to the matters related to repurchase of the Companyʼs own shares will be carried out. 【Before Change】 【After Change】 （Details of the resolution of
Slide 8: Summary of Financial Results
Summary of Financial Results million yen FY 3/2023 3Q FY 3/2024 3Q YoY FY 3/2024 Forecast Net Sales 128,065 170,588 +42,523 +33.2% 197,000 Pachinko Machines Business 103,570 129,840 +26,270 +25.4% 146,200 Pachislot Machines Business 14,176 23,176 +9,000 +63.5% 32,100 Cost of Sales 55,374 76,102 +20,
Slide 9: Factors of Change in Consolidated Net Sales
Factors of Change in Consolidated Net Sales Million yen Ball Bearing Pachislot Supply Other Pachinko Machines Business Business Machines Business +7,119 +133 Business +9,000 +26,270 170,588 128,065 FY3/2023 3Q FY3/2024 3Q +42,523 million yen（+33.2%） © 2024 SANKYO CO., LTD. 9
Slide 10: Factors of Change in Consolidated Operating Income
Factors of Change in Consolidated Operating Income Million yen Pachislot Ball Bearing Machines Supply Advertising Sales Pachinko Business Business expenses commission R&D Machines +5,923 +1,006 increases increases expenses Business increases Other factors +14,758 ‐710 ‐2,467 ‐915 ‐370 65,264 48,039
Slide 11: Costs and Expenses
Costs and Expenses million yen FY 3/2023 3Q FY 3/2024 3Q YoY FY 3/2024 Forecast SG & A Expenses 24,651 29,221 +4,570 +18.5% 38,500 Advertising Expenses 1,211 1,921 +710 +58.6% 2,444 Sales Commission 5,589 8,056 +2,467 +44.1% 9,344 R&D Expenses 10,201 11,116 +915 +9.0% 15,477 Salaries & Wages 2,350 2
Slide 12: Summary of Balance Sheet
Summary of Balance Sheet million yen As of 31-Mar-23 As of 31-Dec-23 YoY Main Factors of Change Total current assets 321,797 279,101 ‐42,696 Quick assets 295,715 252,098 ‐43,617 Decrease due to the repurchase of treasury stock Total fixed assets 44,153 39,796 ‐4,357 Investment securities 11,436 6,06
Slide 13: Overview of Business
Contents Overview of Financial Results P3 Overview of Business P14 Surroundings of Pachinko and Pachislot Industry, P19 And Initiatives of SANKYO Appendix P24 © 2024 SANKYO CO., LTD. 13
Slide 14: Pachinko Machines Business
Pachinko Machines Business Factors of Change in Net sales Data Million yen million yen FY 3/2023 3Q FY 3/2024 3Q YoY FY 3/2023 1st Nine Months (Apr‐Dec) 103,570 103,570 129,840 +26,270 Net Sales Sales volume of SANKYO-brand Operating Income 45,164 56,700 +11,536 and JB-brand pachinko machines ‐2,727
Slide 15: Pachinko Machines Business
Pachinko Machines Business ©⼤久保篤／講談社 ©⼤久保篤・講談社／特殊消防隊動画広報課 ©創通・サンライズ ©カラー ©SUNRISE/VVV Committee 1Q 2Q 3Q 4Q Fever QueenⅡ Fever ENN ENN NO SHOUBOUTAI 30th ANNIVERSARY EDITION Fever Kaguya-sama: Love Is War Fever Valvrave the Liberator 3 New Title CODE GEASS Lelouch of the Rebellion -Rebellion to Re;
Slide 16: Pachislot Machines Business
Pachislot Machines Business Factors of Change in Net sales Data Million yen million yen FY 3/2023 3Q FY 3/2024 3Q YoY FY 3/2023 1st Nine Months 14,176 (Apr‐Dec) Net Sales 14,176 23,176 +9,000 Operating Income 6,338 11,075 +4,737 Sales volume of SANKYO-brand+1,371 Percentage 44.7% 47.8% pachislot mac
Slide 17: Pachislot Machines Business
Pachislot Machines Business ©⼤久保篤／講談社 原作／藤⽥和⽇郎「からくりサーカス」（⼩学館少年サンデーコミックス刊）/ ©2009,2011 BIGWEST/MACROSS F PROJECT ©カラー TM & © TOHO CO., LTD. ©⼤久保篤・講談社／特殊消防隊動画広報課 ©藤⽥和⽇郎・⼩学館／ツインエンジン Licensed by Sony Music Labels Inc. 1Q 2Q 3Q 4Q New Title Pachislot ENN ENN NO x4 x 44 L Pachislot Karakuri Circus x5 SHOU
Slide 18: Surroundings of Pachinko and Pachislot Industry, and Initiatives of SANKYO
Contents Overview of Financial Results P3 Overview of Business P14 Surroundings of Pachinko and Pachislot Industry, And Initiatives of SANKYO P19 Appendix P24 © 2024 SANKYO CO., LTD. 18
Slide 19: Pachinko Market
Pachinko Market 1,000 thousand units Sales volume forecast FY2024： Sales Volume 850 thousand units Thousand units (April 1, 2023 to March 31, 2024) Total number 1,800 of units sold Approx. 700 thousand units YoY Approx. -8％ （4 titles sold 30,000 units or more. (April to December, 2023) (April to Dec
Slide 20: Pachislot Market
Pachislot Market Sales Volume Sales volume forecast FY2024： 800 thousand units Thousand units (April 1, 2023 to March 31, 2024) Total number 1,000 of units sold Approx. 640 thousand units YoY Approx. +25％ （7 titles sold 20,000 units or more. (April to December, 2023) 800 (April to December)） 800 698
Slide 21: Initiatives of SANKYO in the Pachinko and Pachislot Machine Markets
Initiatives of SANKYO in The Pachinko and Pachislot Machine Markets Aim to maintain and enhance brand power and share of sales in the pachinko market. Aim to ensure the Group forges ahead in the pachislot market. Q1-Q3 Q4 Launch of mainstay pachinko machine title and Launch of series titles
Slide 22: Enhancement of the corporate governance system
Enhancement of the corporate governance system The Company resolved to transition to a company with an audit and supervisory committee. (announced January 18, 2024) The Company also resolved to establish a Nomination and Remuneration Committee and a Sustainability Committee, which are voluntary comm
Slide 23: Appendix
Contents Overview of Financial Results P3 Overview of Business P14 Surroundings of Pachinko and Pachislot Industry, P19 And Initiatives of SANKYO Appendix P24 © 2024 SANKYO CO., LTD. 23
Slide 24: Business Results for the First Nine Months of FY 3/2024
Business Results for the First Nine Months of FY 3/2024 FY 3/2023 FY 3/2024 Forecast FY 3/2023 FY 3/2024 Consolidated:milion yen 9 Months 9 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Net Sales 128,065 170,588 +42,523 197,000 27,763 42,200 58,102 29,231 157,296 50,777 65,413 54,398 Pachinko 103,570
Slide 25: Margin / Expenses etc.
Margin / Expenses etc. GP Margin/OP Margin FY 3/2023 FY 3/2024 Forecast FY 3/2023 FY 3/2024 Consolidated 9 Months 9 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 GP Margin 56.8% 55.4% -1.4pt 55.6% 56.0% 59.7% 55.0% 62.4% 57.8% 55.8% 55.3% 55.1% OP Margin 37.5% 38.3% +0.7pt 36.0% 34.1% 40.2% 37.2% 35.
Slide 26: Pachinko Machines Business
Pachinko Machines Business FY 3/2023 FY 3/2024 Forecast FY 3/2023 FY 3/2024 Consolidated:milion yen 9 Months 9 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Net Sales 103,570 129,840 +26,270 146,200 26,431 36,590 40,549 19,006 122,576 34,887 47,220 47,733 Operating Income 45,164 56,700 +11,536 59,200
Slide 27: Pachislot Machines Business
Pachislot Machines Business FY 3/2023 FY 3/2024 Forecast FY 3/2023 FY 3/2024 Consolidated:milion yen 9 Months 9 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Net Sales 14,176 23,176 +9,000 32,100 628 4,123 9,425 8,375 22,551 9,056 12,630 1,490 Operating Income 6,338 11,075 +4,737 15,600 (289) 1,328 5
Slide 28: Financial Indicates
Financial Indicates million yen FY 3/2017 FY 3/2018 FY 3/2019 FY 3/2020 FY 3/2021 FY 3/2022 FY 3/2023 FY 3/2024E Net Sales 81,455 86,220 88,558 78,416 58,129 84,857 157,296 197,000 Operating Income 5,059 10,181 21,286 12,551 6,587 21,357 58,532 71,000 Recurring Income 3,832 11,319 22,300 13,476 7,48
Slide 29: Pachinko/Pachislot Machine Market
Pachinko/Pachislot Machine Market Market size Situation of Parlors that Are Members of Zennichiyuren for recent a year 3,000 3,500 2,637 12,000 2,557 2,432 3,000 2,500 2,338 2,190 10,000 2,500 2,000 2,001 1,978 1,966 1,969 1,957 8,000 1,665 1,637 1,952 1,947 1,931 1,920 1,909 2,000 1,901 1,897 1,572
Slide 30: Others
Others Number of Titles Sold (All Manufacturers) Compliance with Format Inspection Pachinko machines 2018 2019 2020 2021 2022 2023J‐D 2018 116 Applicant 711 945 912 990 910 912 2019 97 Pass 336 430 295 313 230 186 2020 63 Fail 333 560 499 598 669 666 2021 87 SANKYO Group (Number of Pa s s ) SANKYO+J
Slide 31: Contact Us
Contact Us Investor Relations Office 【Notes of forecasts】 The Company's plans, strategies and forecasts, except historical facts, contained in this document may be subject Corporate Planning Division to change due to factors of risk and uncertainty. Therefore, the Company does not guarantee their at