Sankyo Co., Ltd. · TSE:6417

Sankyo — 9M FY3/2021 Earnings Presentation

30 slides from Sankyo's earnings presentation, Feb 8, 2021

  1. Slide 1: Presentation on Business Results for the First Nine Months of FY 3/2021

    Presentation on Business Results for the First Nine Months of FY 3/2021 (April 1, 2020 to December 31, 2020) February 8, 2021 SANKYO CO., LTD. 1st Sec. of the TSE #6417

  2. Slide 2: Contents

    Contents  Overview of Financial Results ・・・・・・・・・・・・・・・・・・・・ P3 Overview and Forecasts of Business ・ ・・・ ・・・ ・・・ ・・・・ P11 ・ Initiatives of Pachinko and Pachislot Industry・ ・・・ ・・ P19 Appendix ・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・ P23 © 2021 SANKYO CO., LTD. 2

  3. Slide 3: Financial Highlights

    Financial Highlights  Both net sales and profits decreased from the same period of the previous fiscal year because of a decrease in the number of pachinko/pachislot titles sold in the first six months of FY 3/2021.  The Group has been accelerating introduction of new titles since the third quarte

  4. Slide 4: Summary of Financial Results: Pachinko Pachislot Market

    Summary of Financial Results  Whereas machine utilization at pachinko parlors, having hit bottom in May, the month in which the first state of emergency was lifted, is on a recovery trend, it has not returned Pachinko to the level prior to the COVID-19 pandemic. Pachislot  Pachinko parlor operator

  5. Slide 5: Summary of Financial Results

    Summary of Financial Results million yen FY 3/2020 3Q FY 3/2021 3Q YoY FY 3/2021 Forecast Net Sales 61,738 41,000 -20,738 -33.6% 73,500 Pachinko Machines Business 47,525 37,052 -10,473 -22.0% 57,000 Pachislot Machines Business 9,545 1,698 -7,847 -82.2% 10,000 Cost of Sales 28,409 19,428 -8,981 -31.6

  6. Slide 6: Factors of Change in Consolidated Net Sales

    Factors of Change in Consolidated Net Sales Million yen Pachinko Machines Business Pachislot 61,738 ‐10,473 Machines Business Ball Bearing Supply Business Other ‐7,847 Business ‐2,137 ‐279 41,000 FY3/2020 3Q FY3/2021 3Q -20,738 million yen（-33.6%） © 2021 SANKYO CO., LTD. 6

  7. Slide 7: Factors of Change in Consolidated Operating Income

    Factors of Change in Consolidated Operating Income Million yen The gross profit of the pachinko machine sales decreases 10,548 R&D expenses The gross profit decreases of the pachislot machine sales Sales Other factors +1,745 decreases commission decreases ‐5,107 Advertising expenses +1,840 decreases

  8. Slide 8: Costs and Expenses

    Costs and Expenses million yen FY 3/2020 3Q FY 3/2021 3Q YoY FY 3/2021 Forecast SG & A Expenses 22,780 17,319 -5,461 -24.0% 27,500 Advertising Expenses 1,696 511 -1,185 -69.9% 1,233 Sales Commission 3,034 1,194 -1,840 -60.6% 2,579 R&D Expenses 10,532 8,787 -1,745 -16.6% 13,380 Salaries & Wages 2,379

  9. Slide 9: Summary of Balance Sheet

    Summary of Balance Sheet million yen As of 31-Mar-20 As of 30-Dec-20 YoY Factors of Change Total current assets 276,041 243,098 ‐32,943 Decrease in cash and deposits, marketable securities Quick assets 259,589 230,683 ‐28,906 and notes and accounts receivable‐trade Total fixed assets 49,190 48,587 ‐

  10. Slide 10: Contents

    Contents Overview of Financial Results ・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・ P3  Overview and Forecasts of Business ・・・・・・・・・・・・・ P11 Initiatives of Pachinko and Pachislot Industry・ ・・・ ・・ P19 Appendix ・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・ P23 © 2021 SANKYO CO., LTD. 10

  11. Slide 11: Pachinko Machines Business

    Pachinko Machines Business Factors of Change in Net sales Data Million yen million yen FY 3/2020 3Q FY 3/2021 3Q YoY FY 3/2020 1st Nine Months (Apr‐Dec) 47,525 Net Sales 47,525 37,052 -10,473 Sales volume of SANKYO-brand Operating Income 11,738 9,799 -1,939 and JB-brand pachinko machines +218 increa

  12. Slide 12: Pachinko Machines Business

    Pachinko Machines Business New Title x8→9 Reused Models 1Q 1Q 2Q 3Q 4Q Fever Symphogear 2 Fever BIOHAZARD REVELATIONS 2 Fever Queen Ⅱ CODE GEASS Lelouch of Fever Shinkagetsu 2 Yozakura ver. Light / Light middle ver. the Rebellion Light Ver. Fever Aquarion ALL STARS NEON GENESIS EVANGELION Fever Shin

  13. Slide 13: Pachislot Machines Business

    Pachislot Machines Business Factors of Change in Net sales Data Million yen million yen FY 3/2020 3Q FY 3/2021 3Q YoY FY 3/2020 1st Nine Months (Apr‐Dec) 9,545 Net Sales 9,545 1,698 -7,847 Sales volume of SANKYO-brand Operating Income 2,401 (2,157) -4,558 ‐6,022 pachislot machines decreases. Percent

  14. Slide 14: Pachislot Machines Business

    Pachislot Machines Business ©窪岡俊之 ©BANDAI NAMCO Entertainment Inc. ©創通・サンライズ ©BNEI／PROJECT iM＠S ©BANDAI NAMCO Sevens Inc. 1Q 1Q 2Q 3Q 4Q Pachislot for CHAR AZNABLE Pachislot THE iDOLM@STERx4 -RED COMET's Counterattack- MILLION LIVE! New Title x3→2 Sales of 300 units - units 314 units 3,531 units Uni

  15. Slide 15: Pachinko Market

    Pachinko Market Sales Volume Sales volume forecast FY2021： 800 thousand units Thousand units (April 1, 2020 to March 31,2021) Total number 2,100 of units sold Approx. 600 thousand units YoY Approx.-32％ （5 titles sold 30,000 units or more. (April to December, 2020) 1,800 (April to December)） 1,590 1,

  16. Slide 16: Pachislot Market

    Pachislot Market Sales Volume Sales volume forecast FY2021： 370 thousand units Thousand units (April 1, 2020 to March 31,2021) Total number 1,400 of units sold Approx. 280 thousand units YoY Approx.-38％ （4 titles sold 20,000 units or more. (April to December, 2020) 1,200 (April to December)）  Total

  17. Slide 17: Initiatives of SANKYO in The Pachinko and Pachislot Machine Markets

    Initiatives of SANKYO in The Pachinko and Pachislot Machine Markets  The Group has been accelerating introduction of new titles since the third quarter in expectation of a recovery in pachinko parlor operatorsʼ willingness to purchase new models  Capture pachinko parlor operatorsʼ replacement dema

  18. Slide 18: Contents

    Contents Overview of Financial Results ・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・ P3 Overview and Forecasts of Business ・ ・・・ ・・・ ・・・ ・・・・ P11 ・  Initiatives of Pachinko and Pachislot Industry・・・ P19 Appendix ・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・ P23 © 2021 SANKYO CO., LTD. 18

  19. Slide 19: Status of the Influence to Parlors Under Another State of Emergency in January 2021

    Status of the Influence to Parlors Under Another State of Emergency in January 2021 Influence to the Operation of Parlors  Requested by the government and municipalities to cooperate by introducing shorter business hours (to close by 20:00). • The influence is smaller than that under the state of e

  20. Slide 20: Status of Install of the Machines with the former regulations

    Status of Install of the Machines with the former regulations Schedule of Removal of the Machines with the former regulations  Parlors are going to remove all the machines with the former regulations by November, 2021 in stages Target： Pachinko：About 1,040 thousand units Pachislot： About 910 thousa

  21. Slide 21: Format Inspection

    Format Inspection  Pachinko：The pass rate in format inspection has improved, and manufacturers have been able to secure a definite number of pachinko titles for launch.  Pachislot：Despite indications of an improvement in the format inspection pass rate, the supply of new models remains tight. Numb

  22. Slide 22: Contents

    Contents Overview of Financial Results ・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・ P3 Overview and Forecasts of Business ・ ・・・ ・・・ ・・・ ・・・・ P11 ・ Initiatives of Pachinko and Pachislot Industry・ ・・・ ・・ P19  Appendix ・・・・・・・・・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・・・ ・ P23 © 2021 SANKYO CO., LTD. 22

  23. Slide 23: Business Results for the First Nine Months of FY 3/2021

    Business Results for the First Nine Months of FY 3/2021 FY 3/2020 FY 3/2021 Forecast FY 3/2020 FY 3/2021 Consolidated:milion yen 9 Months 9 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Net Sales 61,738 41,000 -20,738 73,500 11,351 22,142 28,245 16,678 78,416 17,960 7,372 15,668 Pachinko 47,525 37,05

  24. Slide 24: Margin / Expenses etc.

    Margin / Expenses etc. GP Margin/OP Margin FY 3/2020 FY 3/2021 Forecast FY 3/2020 FY 3/2021 Consolidated 9 Months 9 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 GP Margin 54.0% 52.6% -1.4pt 48.3% 53.5% 52.6% 55.3% 50.5% 53.2% 51.0% 46.0% 57.6% OP Margin 17.1% 10.4% -6.7pt 10.9% (5.3%) 16.6% 26.5% 12

  25. Slide 25: Pachinko Machines Business

    Pachinko Machines Business FY 3/2020 FY 3/2021 Forecast FY 3/2020 FY 3/2021 Consolidated:milion yen 9 Months 9 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Net Sales 47,525 37,052 -10,473 57,000 7,064 20,214 20,247 12,989 60,514 16,952 5,432 14,668 Operating Income 11,738 9,799 -1,939 13,500 (238) 5

  26. Slide 26: Pachislot Machines Business

    Pachislot Machines Business FY 3/2020 FY 3/2021 Forecast FY 3/2020 FY 3/2021 Consolidated:milion yen 9 Months 9 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Net Sales 9,545 1,698 -7,847 10,000 2,635 394 6,516 1,896 11,441 210 1,303 185 Operating Income 2,401 (2,157) -4,558 (700) 718 (711) 2,394 48 2

  27. Slide 27: Financial Indicates

    Financial Indicates million yen FY 3/2014 FY 3/2015 FY 3/2016 FY 3/2017 FY 3/2018 FY 3/2019 FY 3/2020 FY 3/2021E Net Sales 158,453 146,579 137,130 81,455 86,220 88,558 78,416 73,500 Operating Income 28,023 13,233 18,826 5,059 10,181 21,286 12,551 8,000 Recurring Income 30,144 14,870 19,965 3,832 11,

  28. Slide 28: Pachinko/Pachislot Machine Market

    Pachinko/Pachislot Machine Market Market size Situation of Parlors that Are Members of Zennichiyuren for recent a year 3,500 3,500 12,000 2,918 11,000 3,000 3,000 2,833 2,749 2,637 2,557 10,000 2,500 2,500 2,339 2,329 2,350 2,288 2,273 2,266 2,261 2,254 2,246 2,244 2,244 8,802 8,763 8,710 2,050 9,00

  29. Slide 29: Others

    Others Number of Titles Sold (All Manufacturers) Compliance with Format Inspection Pachinko machines 2015 2016 2017 2018 2019 2020J‐D FY2016 18,401 Sales per title (Left) 104 Number of titles Applicant 731 864 875 711 945 912 FY2017 17,046 93 Pass 519 396 361 336 430 295 Fail 172 458 463 333 560 498

  30. Slide 30: 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

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