Slide 1: FY2022 Fourth Quarter Financial Results
GREE, Inc. FY2022 Fourth Quarter Financial Results August 4, 2022 Copyright © GREE, Inc. All Rights Reserved.
Slide 2: Executive Summary
Executive Summary ◼ Net sales ¥74.9 billion, operating income ¥11.5 billion, EBITDA ¥12.1 billion ⁃ Achieved YoY growth in sales and income Full- ∙ Produced several hits in the Game Business year ∙ Made aggressive investments in the Metaverse Business and made progress in FY22 developing it into a g
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: FY22 Full-Year and 4Q Financial Results Overview
1. Financial Results Overview (Consolidated) FY22 Full-Year and 4Q Financial Results Overview FY22 net sales ¥74.9 billion, operating income ¥11.5 billion, EBITDA ¥12.1 billion. Ordinary income increased YoY to ¥14.1 billion due to the posting of a forex gain. Net income declined YoY to ¥10.1 billio
Slide 6: Net Sales and Operating Income
1. Financial Results Overview (Consolidated) Net Sales and Operating Income Sales and operating income up QoQ in the Internet and Entertainment Business Internet and Entertainment Investment and Incubation Business Business Billions of yen Billions of yen 79.2% 20.08 20.33 19.14 67.0% 17.8% 56.2% 13
Slide 7: 4Q Operating Income Analysis
1. Financial Results Overview (Consolidated) 4Q Operating Income Analysis Sales growth in the Internet and Entertainment Business on successful operation of new hit titles. Variable costs fell on decline in advertising expenses, resulting in operating income of ¥3.8 billion Billions of yen ¥0.26bn i
Slide 8: FY22 4Q Cost Structure
1. Financial Results Overview (Consolidated) FY22 4Q Cost Structure Total costs down ¥0.2 billion QoQ, to ¥17.0 billion Billions of yen FY22 FY22 FY21 Factors in change（QoQ） 4Q QoQ YoY 3Q 4Q Decrease due to winding down of initial promotion costs for Advertising 1.19 -0.68 0.68 new titles 1.87 0.51
Slide 9: Fiscal Year-End Dividend
1. Financial Results Overview (Consolidated) Fiscal Year-End Dividend Dividend of ¥11 per share Growth in sales and income in the Internet and Entertainment Business, but negative impact from YoY decline in investment-related gains following strong performance in FY2021 Dividend Distribution Policy
Slide 10: 2. Operational Overview
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 11: FY22 Results Summary
2. Operational Overview: FY22 results Summary FY22 Business Plan Summary Continue to strengthen 3 Overall ‒ Aggressively invested in three businesses earnings pillars ‒ Successful implementation of “game engine, IP, and Internet and Entertainment “Game Entertainment engine, IP, global” strategies, c
Slide 12: New Hit Titles
2. Operational Overview: FY22 results Game New Hit Titles Generated multiple hit titles and acquired even more knowhow on how to develop new titles That Time I Got Reincarnated Heaven Burns Red as a Slime: ISEKAI Memories • Reached No. 1 App Store sales ranking • Reached No. 4 App Store sales rankin
Slide 13: Long-term Operation of First-party Titles
2. Operational Overview: FY22 results Game Long-term Operation of First-party Titles Performance of first-party title Another Eden remained strong owing to addition of high-quality content Another Eden Growth focus points Collaboration with Chrono Cross ◼ Continuous release of high-quality new conte
Slide 14: Expansion of Overseas Distribution
2. Operational Overview: FY22 results Game Expansion of Overseas Distribution Continued growth in overseas coin consumption through global releases of new titles Overseas coin consumption (app games) Measures taken in FY22 ◼ Simultaneous global release of That Time I Got Reincarnated as a Slime: ISE
Slide 15: Further Developed Platform
2. Operational Overview: FY22 results Metaverse Further Developed Platform Made progress with REALITY, moving forward with global distribution and adding features Aggressive global distribution Strengthened Functionality ◼ Ratio of overseas users Approximately 80 % ◼ Distribution coverage 63 countri
Slide 16: Strengthened Media Potential
2. Operational Overview: FY22 results Advertising and Media Strengthened Media Potential Made progress strengthening media potential by expanding content, entered SaaS business aumo My Business: number of Entered the SaaS Business participating stores Stores and 30,000 facilities stores Provides one
Slide 17: Stable Profit Contribution
2. Operational Overview: FY22 results Investment and Incubation Stable Profit Contribution Valuation of investments: ¥31.4 billion, stable profit contribution achieved (¥1.8 billion operating income) Operational investment securities Stable Profit Contribution Balance, valuation & translation adjust
Slide 18: Medium-Term Plan for Internet and Entertainment Business
2. Operational Overview: Medium-Term Plan for Internet and Entertainment Business Medium-term Growth Targets Targeting Continuous Growth in Our Three Business Pillars Metaverse Business Strong global growth Game and Anime Business Stable contribution to profit, albeit with some degree of volatility
Slide 19: FY23 Business Plan Summary
2. Operational Overview: FY23 Business Plan Summary Business Plan Summary Continue to ‒ Continue strengthening three earnings pillars to Overall strengthen achieve strong medium-to-long-term growth 3 earnings pillars ‒ Enhance earnings potential of mainstay titles by Internet and Entertainment “Game
Slide 20: Game and Anime Business
2. Operational Overview: FY23 Business Plan: Internet and Entertainment Game and Anime Business Execute “Game engine, IP, and global” strategies Create IP and strengthen growth potential to increase earnings potential over the medium-to-long term Game Anime Integration Game engine, IP, IP creation a
Slide 21: Pipeline
2. Operational Overview: FY23 Business Plan: Internet and Entertainment Pipeline Leveraging knowhow gained from producing hit titles in FY22 to plan and develop strong titles ◼ Planning and developing multiple titles New Titles based on first-party and third-party IP ◼ Aggressively distributing exis
Slide 22: Metaverse Business
2. Operational Overview: FY23 Business Plan: Internet and Entertainment Metaverse Business Strengthen REALITY functions, targeting expansion of global user base to hundreds of millions of users Strengthen 5 Core Experiences to Achieve Global Growth Livestreaming Communication Avatars Games World 22
Slide 23: Commerce and DX Business
2. Operational Overview: FY23 Business Plan: Internet and Entertainment Commerce and DX Business Expand commerce business by integrating media and SaaS businesses, provide comprehensive support for corporate DX, mainly through advertising and marketing Commerce DX Integrate media and SaaS, expand bu
Slide 24: Investment and Incubation Business
2. Operational Overview: FY23 Business Plan: Investment and Incubation Investment and Incubation Business Investment in VC Funds and Startups Business operation system Expect stable profit ◼ Investing in startups and in major ◼ We expect stable profit over the medium to Japanese and overseas VC that
Slide 25: Earnings Outlook
2. Operational Overview: Earnings Outlook Earnings Outlook ◼ Leveraging discontinuous growth of the Metaverse to drive growth in corporate value ⁃ Internet and Entertainment Business ∙ In the Metaverse Business, we expect expansion of our global operations to shift from continuous growth to disconti
Slide 26: 3. Appendix
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 27: Expanding and Energizing Fan Communities
3. Appendix: 4Q Overview Game Expanding and Energizing Fan Communities Energized users by conducting anniversary events, etc. Heaven Burns Red Another Eden 100-day anniversary campaign Marked five-year anniversary • Held campaign including 100-day • Released additional content and held user annivers
Slide 28: Further Developed Platform
3. Appendix: 4Q Overview Metaverse Further Developed Platform Strengthened functionality and added content for REALITY Building Metaverse Solutions Added Functions for Corporate Clients Avatar stamp function REALITY World • Added avatar stamp function to promote • Launched a new service providing RE
Slide 29: Strengthened Media Potential
3. Appendix: 4Q Overview Advertising and Media Strengthened Media Potential aumo My Business marketing service for physical stores: steady growth in number of participating stores, progress made in expanding functionality aumo My Business: number of participating stores Expanded functionality • Numb
Slide 30: Overview of Total Assets Under Management (AUM)
3. Appendix: 4Q Overview Investment and Incubation Overview of Total Assets Under Management (AUM) Total AUM: 71.6 billion yen Up 0.2 billion yen QoQ Total AUM Main investments Based on investee valuation Billions of yen +3.6 -1.0 -2.5 71.4 71.6 FoF Increase by capital call Decrease by distributions
Slide 31: Strengthening Investment
3. Appendix: 4Q Overview Investment and Incubation Strengthening Investment Operational investment securities investment valuation of ¥31.4 billion, unrealized value remains high Quarterly change in operational investment securities investment valuation Investment status in 4Q Based on investee valu
Slide 32: Status of FoF and CVC Investment Results
3. Appendix: 4Q Overview Investment and Incubation Status of FoF and CVC Investment Results Achieved high long-term returns on FoF and CVC investments Valuation of investments by investment period Net multiples, IRR Performance Benchmarking of Domestic VC Billions of yen 20% 20% IRR 18% 12.7 8% 14%
Slide 33: 4Q FY22 Cost Structure
3. Appendix 4Q FY22 Cost Structure Billions of yen FY22 FY22 FY21 4Q QoQ YoY 3Q 4Q Rental charges 0.63 0.08 0.10 0.55 0.53 Labor costs 2.41 0.01 0.21 2.40 2.20 Others 5.01 0.30 1.80 4.71 3.21 Cost of sales 8.04 0.39 2.11 7.65 5.93 Advertising 1.19 -0.68 0.67 1.87 0.52 Commission fees 4.68 0.13 1.93
Slide 34: 4Q FY22 Balance Sheet
3. Appendix 4Q FY22 Balance Sheet Billions of yen FY22 FY22 FY21 4Q QoQ YoY 3Q 4Q Current assets 100.2 3.1 -30.8 97.1 131.0 Fixed assets 16.5 -0.1 6.2 16.6 10.4 Total assets 116.7 3.0 -24.7 113.7 141.4 Current liabilities 16.0 0.6 4.3 15.4 11.6 Fixed liabilities 9.8 0.5 0.3 9.3 9.5 Total liabilities
Slide 35: Group Headcount
3. Appendix Group Headcount Number of employees 1,603 1,604 1,595 1,596 1,616 4Q 1Q 2Q 3Q 4Q FY21 FY22 Notes: ● Includes non-consolidated group companies; as of the end of each quarter. 35 Copyright © GREE, Inc. All Rights Reserved.
Slide 36: ■ This document includes forecasts, which are based on currently available information. Actual performance
■ This document includes 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 guaranteed.