Gree Holdings.inc. · TSE:3632
Gree Holdings.inc — Q3 FY2024 Earnings Presentation
58 slides from Gree Holdings.inc's earnings presentation, May 8, 2024
Slide 1: FY2024 Third Quarter Financial Results
GREE, Inc. FY2024 Third Quarter Financial Results May 8, 2024 Copyright © GREE, Inc. All Rights Reserved.
Slide 2: Executive Summary
Executive Summary FY24 3Q Financial Results ◼ Net sales ¥17.2 billion, operating profit ¥2.5 billion, EBITDA ¥2.6 billion Overview ⁃ Achieved QoQ growth in sales and profit and results surpassed expectations (Consolidated) ◼ Successful 2nd anniversary events for Heaven Burns Red, QoQ growth in sales
Slide 3: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 4: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 5: FY24 3Q Financial Results Overview
1. Financial Results Overview (Consolidated) FY24 3Q Financial Results Overview Net sales ¥17.2 billion, operating profit ¥2.5 billion, EBITDA ¥2.6 billion Billions of yen FY24 FY24 FY23 3Q QoQ YoY 2Q 3Q Net sales 17.17 2.93 +21% -4.98 -22% 14.24 22.15 Operating profit 2.52 1.71 +211% -1.70 -40% 0.8
Slide 6: Net Sales and Operating Profit
1. Financial Results Overview (Consolidated) Net Sales and Operating Profit Sales and profit rose QoQ Billions of yen 22.15 20.12 24.6% 17.17 15.79 19.1% 14.24 14.7% 4.96 7.8% 4.22 5.7% 2.52 1.23 0.81 3Q 4Q 1Q 2Q 3Q FY23 FY24 Consolidated net sales Net sales (excluding Investment Business) (Investme
Slide 7: Sales and Operating Profit by Segment
1. Financial Results Overview (Consolidated) Sales and Operating Profit by Segment Billions of yen FY23 FY24 QoQ YoY 3Q 4Q 1Q 2Q 3Q Game and Sales 15.85 12.77 11.72 10.44 12.95 2.51 +24% -2.90 -18% Anime Operating profit 2.06 2.06 1.56 1.35 2.60 1.25 +93% 0.54 +26% Sales 1.52 1.82 1.96 1.79 1.61 -0.
Slide 8: 3Q Operating Profit Analysis
1. Financial Results Overview (Consolidated) 3Q Operating Profit Analysis Profit rose QoQ with operating profit reaching ¥2.5 billion Billions of yen ¥1.71bn increase +2.93 -0.94 -0.29 2.52 Increase in variable costs Increase in fixed costs 0.81 Operating Increase in Operating profit sales profit FY
Slide 9: 3Q Cost Structure
1. Financial Results Overview (Consolidated) 3Q Cost Structure Total costs up ¥1.3 billion QoQ, to ¥14.7 billion Billions of yen FY24 FY24 FY23 Factors in change（QoQ） 3Q QoQ YoY 2Q 3Q Advertising 1.50 0.32 -1.58 Increase on strengthening of promotions for Heaven Burns Red 1.18 3.08 Commission fees,
Slide 10: Revised Dividend Policy and Dividend Forecast
1. Financial Results Overview (Consolidated) Revised Dividend Policy and Dividend Forecast In line with new dividend policy, distributions of ¥16.5 per share Revised Dividend Policy Dividend Forecast Maintain DOE of around 2%, Previous FY24 Forecast FY23 Results consolidated dividend payout ratio of
Slide 11: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 12: Earnings Estimates and Forecast by Segment
2. Operational Overview Earnings Estimates and Forecast by Segment Billions of yen FY23 FY24 4Q FY24 Full-year FY24 3Q Full-year Estimates QoQ Forecast YoY Result Result Game and Sales 9.60-11.30 -3.35 – -1.65 -26% – -13% 41.0-45.0 -13.0 – -9.0 -24% – -17% 12.95 53.7 Anime Operating 1.60-1.90 -1.00
Slide 13: FY24 Full-Year Earnings Forecast Progress (as of 3Q FY24)
2. Operational Overview FY24 Full-Year Earnings Forecast Progress (as of 3Q FY24) 25％ 50％ 75％ Sales 86% ¥35.1bn ¥41.0-45.0bn Game and Anime Operating profit 110% ¥5.5bn ¥5.0-6.0bn Sales 66% ¥5.4bn ¥8.1bn Metaverse Operating profit ¥0.1bn ¥0.1bn -¥0.2bn Sales 73% ¥4.2bn ¥5.7bn DX Operating profit 94%
Slide 14: Game and Anime Business
Game and Anime Business Senior Vice President Yuta Maeda Copyright © GREE, Inc. All Rights Reserved.
Slide 15: Sales and Operating Profit
2. Operational Overview: Game and Anime Business Sales and Operating Profit Sales Operating Profit QoQ +24% YoY -18% QoQ +93% YoY +26% Billions of yen Billions of yen 3.61 17.27 16.28 16.93 3.26 15.85 2.82 13.22 13.06 12.88 12.77 12.95 2.56 2.60 12.98 12.57 2.48 12.54 11.92 12.16 11.38 11.72 11.32 2
Slide 16: Summary of the Game and Anime Business
2. Operational Overview: Game and Anime Business Summary of the Game and Anime Business Sales and Operating Profit Focus Points Sales: QoQ +24% YoY -18% / Operating Profit: QoQ +93% YoY +26% Billions of yen ◼ Successful 2nd anniversary events 15.85 for Heaven Burns Red, QoQ growth in sales and profi
Slide 17: Puella Magi Madoka Magica Magia Exedra
2. Operational Overview: Game and Anime Business Puella Magi Madoka Magica Magia Exedra Developed and operated by Pokelabo, Inc., scheduled for release in 2024 Notes: ● The above English title is tentative. ©2024 Magica Quartet/Aniplex, Magia Exedra Project 17 Copyright © GREE, Inc. All Rights Reser
Slide 18: Live Service Game Business
2. Operational Overview: Game and Anime Business Live Service Game Business Sales and Operating Profit Focus Points Sales: QoQ +34% YoY -21% / Operating Profit: QoQ +286% YoY +100% Billions of yen ◼ Successful 2nd anniversary events 12.46 for Heaven Burns Red, QoQ growth in sales and profit 9.70 9.8
Slide 19: Licensed Game Business
2. Operational Overview: Game and Anime Business Licensed Game Business Sales and Operating Profit Focus Points Sales: QoQ +17% YoY -3% / Operating Profit: QoQ +7% YoY -35% Billions of yen ◼ Strong start from Saint Seiya: 0.56 0.54 Legend of Justice released at the 0.50 beginning of this year, QoQ g
Slide 20: Pipeline
2. Operational Overview: Game and Anime Business Pipeline Make progress on strengthening and rebuilding our pipeline in order to constantly release new titles In-house Regional Joint Licensing to other development expansion development companies 4 8 4 2 Notes: ● Number of titles scheduled for releas
Slide 21: Earnings Estimates (4Q FY24)
2. Operational Overview: Game and Anime Business Earnings Estimates (4Q FY24) Sales and Operating Profit Focus Points Billions of yen Sales: QoQ -26% - -13% / YoY -25% - -11% Operating Profit: QoQ -38% - -27% / YoY -22% - -8% ◼ We expect a reactive decline in 12.77 12.95 sales in 4Q following annive
Slide 22: Earnings Forecast (Full-Year FY24)
2. Operational Overview: Game and Anime Business Earnings Forecast (Full-Year FY24) Sales and Operating Profit Focus Points Billions of yen Sales: YoY -24% - -17% / Operating Profit: YoY -35% - -21% ◼ Sales and operating profit trends 53.7 are strong and we expect to reach 45.0 our full-year targets
Slide 23: Medium-term Targets
2. Operational Overview: Game and Anime Business Medium-term Targets Sales and Operating Profit Focus Points Billions of yen 60.3 ◼ Sales forecasts factor in impact 53.8 from changes in release schedules 53.7 for new titles, contribution from 41.0-45.0 new titles is factored in CAGR conservatively 1
Slide 24: Metaverse Business
Metaverse Business Senior Vice President Eiji Araki Copyright © GREE, Inc. All Rights Reserved.
Slide 25: Sales and Operating Profit
2. Operational Overview: Metaverse Business Sales and Operating Profit Sales Operating Profit QoQ -10% YoY +6% QoQ +¥0.20bn YoY +¥0.32bn Billions of yen 1.96 Billions of yen 1.82 1.79 1.69 0.130.13 1.64 1.61 0.10 0.12 1.48 1.52 0.08 0.06 1.34 0.01 1.23 1.13 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
Slide 26: Summary of the Metaverse Business
2. Operational Overview: Metaverse Business Summary of the Metaverse Business Sales and Operating Profit Focus Points Sales: QoQ -10% YoY +6% / Operating Profit: QoQ +¥0.20bn YoY +¥0.32bn Billions of yen ◼ Sales declined QoQ due to the 1.96 1.82 transfer of part of the B2B 1.79 Metaverse Business 1.
Slide 27: Platform Business (REALITY, Inc.)
2. Operational Overview: Metaverse Business Platform Business (REALITY, Inc.) Sales and Operating Profit Focus Points Sales: QoQ -4% YoY +13% / Operating Profit: QoQ +39% YoY +¥0.40bn Billions of yen 1.79 ◼ Although sales fell QoQ on a reactive decline from year-end 1.58 24.4% 1.55 seasonal factors,
Slide 28: VTuber Business (REALITY Studios, inc.)
2. Operational Overview: Metaverse Business VTuber Business (REALITY Studios, inc.) Sales and Operating Profit Focus Points Sales: QoQ +0% YoY +284% / Operating Profit: QoQ +¥0.07bn YoY -¥0.10bn Billions of yen ◼ We are steadily growing our talent 0.08 0.09 0.09 pool (increased by 23 QoQ) and 0.05 s
Slide 29: Earnings Estimates (4Q FY24)
2. Operational Overview: Metaverse Business Earnings Estimates (4Q FY24) Sales and Operating Profit Focus Points Sales: QoQ +8% YoY -4% / Operating Profit: QoQ -88% YoY +¥0.25bn Billions of yen ◼ We expect continued strong growth 1.96 in the Platform Business and the 1.82 1.79 1.74 VTuber Business 6
Slide 30: Earnings Estimates and Forecast (Full-Year FY24)
2. Operational Overview: Metaverse Business Earnings Estimates and Forecast (Full-Year FY24) Sales and Operating Profit Focus Points Billions of yen Sales: YoY +6% Operating Profit: YoY +¥0.43bn ◼ We expect strong performance in 8.1 the Platform Business and, in the 7.1 VTuber Business, we will cont
Slide 31: Medium-term Targets
2. Operational Overview: Metaverse Business Medium-term Targets Sales and Operating Profit Focus Points Billions of yen 15.2 ◼ We expect steady profit growth in the Platform Business as we continue to invest in the VTuber CAGR Business, resulting in FY2026 46％ operating profit of ¥1.9bn 6.7 7.1 5.2
Slide 32: DX Business
DX Business Vice President Kazuhisa Adachi Copyright © GREE, Inc. All Rights Reserved.
Slide 33: Sales and Operating Profit
2. Operational Overview: DX Business Sales and Operating Profit Sales Operating Profit QoQ +14% YoY +6% QoQ +27% YoY -13% Billions of yen Billions of yen 1.54 0.32 1.46 1.44 1.35 0.28 0.28 1.29 1.32 1.30 1.27 1.29 1.25 1.20 1.20 1.21 1.22 0.25 1.16 0.23 0.22 0.18 0.18 0.18 0.17 0.17 0.14 0.10 0.08 0
Slide 34: Summary of the DX Business
2. Operational Overview: DX Business Summary of the DX Business Sales and Operating Profit Focus Points Sales: QoQ +14% YoY +6% / Operating Profit: QoQ +27% YoY -13% Billions of yen 1.54 ◼ Sales and profit increased QoQ on 1.44 contribution from growth in the 22.3% 1.35 1.25 1.30 Advertising Busines
Slide 35: Marketing DX Business
2. Operational Overview: DX Business Marketing DX Business Sales and Operating Profit Focus Points Sales: QoQ +27% YoY +23% / Operating Profit: QoQ +25% YoY -19% Billions of yen 0.89 ◼ Sales and profit increased QoQ on growth in the Advertising Business 0.72 and the transfer of part of the B2B 0.70
Slide 36: Social DX Business
2. Operational Overview: DX Business Social DX Business Sales and Operating Profit Focus Points Sales: QoQ +4% YoY +25% / Operating Profit: QoQ +54% YoY +131% Billions of yen 0.44 ◼ Established and began cooperation 0.40 with ADK Social Media Marketing 0.37 0.38 Inc., a joint venture with ADK Creati
Slide 37: Earnings Estimates (4Q FY24)
2. Operational Overview: DX Business Earnings Estimates (4Q FY24) Sales and Operating Profit Focus Points Sales: QoQ -9% YoY +12% / Operating Profit: QoQ -23% YoY +19% Billions of yen ◼ While we expect a decline from the 1.54 peak in 3Q, we expect to continue 1.40 to accumulate a backlog of support
Slide 38: Earnings Estimates and Forecast (Full-Year FY24)
2. Operational Overview: DX Business Earnings Estimates and Forecast (Full-Year FY24) Sales and Operating Profit Focus Points Sales: YoY +3% Billions of yen Operating Profit: YoY -13% 5.7 ◼ While we expect operating profit to trend in line with our initial forecast, 5.4 5.6 we think sales will fall
Slide 39: Medium-term Targets
2. Operational Overview: DX Business Medium-term Targets Sales and Operating Profit Focus Points Billions of yen 7.9 ◼ We aim to accelerate growth CAGR through restructuring 19％ 5.4 5.6 5.0 CAGR 1.0 1.2 0.7 0.9 16％ Full-year results Full-year results Full-year estimates Med-term Targets (announced o
Slide 40: Commerce Business
Commerce Business Vice President Yosuke Nakamura Copyright © GREE, Inc. All Rights Reserved.
Slide 41: Sales and Operating Profit
2. Operational Overview: Commerce Business Sales and Operating Profit Sales Operating Profit QoQ -6% YoY +4% QoQ -14% YoY +¥0.02bn Billions of yen Billions of yen 0.36 0.36 0.35 0.34 0.03 0.33 0.32 0.31 0.31 0.29 0.02 0.01 0.01 0.01 0.01 0.00 -0.00 -0.01 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 3Q 4Q 1Q 2Q 3Q 4Q
Slide 42: Summary of the Commerce Business
2. Operational Overview: Commerce Business Summary of the Commerce Business Sales and Operating Profit Focus Points Sales: QoQ -6% YoY +4% / Operating Profit: QoQ -14% YoY +¥0.02bn Billions of yen ◼ Sales and profit declined QoQ as we 0.34 were unable to offset the impact of 0.31 0.32 declines resul
Slide 43: aumo, Inc.
2. Operational Overview: Commerce Business aumo, Inc. Sales and Operating Profit Focus Points Sales: QoQ -11% YoY +2% / Operating Profit: QoQ -47% YoY -17% Billions of yen ◼ Sales and profit were weak as the 0.30 Media Business was strongly 0.28 9.7% 0.27 0.27 impacted by the algorithm update 0.26 7
Slide 44: jobda, Inc. etc.
2. Operational Overview: Commerce Business jobda, Inc. etc. Sales and Operating Profit Focus Points Sales: QoQ +25% YoY +25% / Operating Profit: QoQ +¥0.01bn YoY +¥0.02bn Billions of yen 0.06 ◼ jobda’s media potential is growing steadily and tie ups with recruiting 0.05 0.05 media have accelerated t
Slide 45: Earnings Estimates (4Q FY24)
2. Operational Overview: Commerce Business Earnings Estimates (4Q FY24) Sales and Operating Profit Focus Points Sales: QoQ +15% YoY +28% / Operating Profit: QoQ +94% YoY +¥0.04bn Billions of yen ◼ We expect the decline in aumo’s 0.37 Media Business to wind down and 0.34 other business are also perfo
Slide 46: Earnings Estimates and Forecast (Full-Year FY24)
2. Operational Overview: Commerce Business Earnings Estimates and Forecast (Full-Year FY24) Sales and Operating Profit Focus Points Sales: YoY +5% Billions of yen Operating Profit: YoY +¥0.07bn 1.5 ◼ Although sales increased YoY, owing to weak sales in 3Q, we 1.3 1.3 expect to fall short of our full
Slide 47: Medium-term Targets
2. Operational Overview: Commerce Business Medium-term Targets Sales and Operating Profit Focus Points Billions of yen 3.3 ◼ Sales are expected to reach ¥3.3 billion on growth at aumo, jobda, and LIMIA CAGR 57％ ◼ Operating profit is expected to be ¥0.4 billion as investment in jobda is offset by gro
Slide 48: Investment Business
Investment Business Senior Vice President, Chief Financial Officer Toshiki Oya Copyright © GREE, Inc. All Rights Reserved.
Slide 49: Summary of the Investment Business
2. Operational Overview: Investment Business Summary of the Investment Business Sales and Operating Profit Focus Points Sales: QoQ +92% YoY -73% / Operating Profit: QoQ +¥0.12bn YoY -99% Billions of yen ◼ Based on dividend distributions 4.09 from investment funds in which we have made investments, w
Slide 50: Overview of Total Assets Under Management (AUM)
2. Operational Overview: Investment Business Overview of Total Assets Under Management (AUM) Total AUM: 80.9 billion, down ¥2.2 billion QoQ on revaluation etc. Total AUM Main investments Billions of yen Based on investee valuation Fund Investments 83.1 +0.8 -0.4 -2.6 80.9 Fund Increase by Decrease b
Slide 51: Rise in unrealized value
2. Operational Overview: Investment Business Strengthening Investment Operational investment securities investment valuation of ¥33.0 billion, unrealized value remains high Quarterly change in operational investment securities investment valuation Investment status in 3Q Billions of yen Book value V
Slide 52: Status of Investment Results
2. Operational Overview: Investment Business Status of Investment Results Achieved high long-term returns on fund investments and startup investments Valuation of investments by investment period Net multiples, IRR Billions of yen Investment Results of GREE 13.5 Performance Benchmarking of Domestic
Slide 53: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 54: 3Q FY24 Cost Structure
3. Appendix 3Q FY24 Cost Structure Billions of yen FY24 FY24 FY23 3Q QoQ YoY 2Q 3Q Rental charges 0.54 -0.02 -0.03 0.57 0.57 Labor costs 2.35 -0.02 0.05 2.37 2.30 Others 4.09 0.47 -0.65 3.62 4.74 Cost of sales 6.99 0.43 -0.63 6.56 7.61 Advertising 1.50 0.32 -1.58 1.18 3.08 Commission fees 3.07 0.49
Slide 55: 3Q FY24 Balance Sheet
3. Appendix 3Q FY24 Balance Sheet Billions of yen FY24 FY24 FY23 3Q QoQ YoY 2Q 3Q Current assets 110.6 1.7 8.2 109.0 102.4 Non-current assets 16.5 -0.4 -1.1 16.9 17.6 Total assets 127.1 1.3 7.1 125.8 120.0 Current liabilities 14.8 -0.8 -1.1 15.7 16.0 Non-current liabilities 18.2 -0.1 1.3 18.3 16.9 T
Slide 56: Group Headcount
3. Appendix Group Headcount Number of employees 1,670 1,667 1,640 1,593 1,610 804 806 784 786 771 174 176 176 145 140 338 354 352 353 369 66 62 60 60 60 13 13 15 17 18 141 154 157 154 154 109 109 101 96 93 3Q 4Q 1Q 2Q 3Q FY23 FY24 Game and Anime Metaverse DX Commerce Investment Common Others Notes:
Slide 57: Sustainability
3. Appendix Sustainability GREE Group is continuously working to develop the Internet industry and solve various social issues. Please see our corporate website for more information. Solving social Helping to create Building a safe issues through a diverse society and secure the Internet Internet so
Slide 58: This document includes forecasts, which are based on currently available information. Actual performance may
◼ 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.