Sega Sammy Holdings Inc. · TSE:6460

Sega Sammy — FY2015 Earnings Presentation

52 slides from Sega Sammy's earnings presentation, May 12, 2015

  1. Slide 1: FY Ended March 2015 Full Year Results Presentation

    FY Ended March 2015 Full Year Results Presentation May 12th, 2015 SEGA SAMMY HOLDINGS INC. [Disclaimer] The contents of this material and comments made during the questions and answers etc of this briefing session are the judgment and projections of the Company’s management based on currently availa

  2. Slide 2: Contents

    目次 【FY Ended March 2015 Full Year Results】 【FY Ending March 2016 Full Year Forecasts】 Consolidated Income Statements Changes to Business Segment and 4 28 (Summary)/Results Highlights Accounting Policy Major Business Measures 5 Consolidated Income Statements (Summary) 29 Operating Income Primary Fact

  3. Slide 3: FY Ended March 2015 Full Year Results

    FY Ended March 2015 Full Year Results © SEGA SAMMY HOLDINGS INC. All Rights Reserved.

  4. Slide 4: Consolidated Income Statements (Summary)

    Consolidated Income Statements (Summary) (JPY Billion) FY Ended March 2014 FY Ended March 2015 Results Results Revised Full ・Sales and profits decreased year-on year mainly due to the Full Year YoY Year Full Year YoY Through Results Through Change Forecasts Results Change decrease in the unit sales

  5. Slide 5: Major Business Measures

    Major Business Measures ■Announced various measures of structure reform *Please refer Page 23, review of group structure reform <SEGA SAMMY HOLDINGS INC. Third Unsecured Straight Bond (announced on June 11, 2014 ） (with inter-bond pari passu clause)> ■ Issuance of Straight Total value of bond 10 bil

  6. Slide 6: Major Business Measures

    Major Business Measures (announced on November 21, 2014） <PARADISE CITY: Facility Overview> ■Construction Start on Facility name PARADISE CITY PARADISE CITY Operating company PARADISE SEGASAMMY Co.,Ltd. Facility address IBC-1 2nd Phase District, Woonseo-dong, Jung-gu, Incheon, Republic of Korea Site

  7. Slide 7: Operating Income – Primary Factors Behind Fluctuations

    Operating Income – Primary Factors Behind Fluctuations (Major Causes) （JPY Billion) Pachislot Operating AM Machine AM Center Consumer Other Pachinko Income Operating Income ・Decrease in unit sales due to the ・Due to the ・Preliminary expenses in the decreased number sluggish sales of ・Due to the ・Ear

  8. Slide 8: Costs and Expenses Results

    Costs and Expenses Results (JPY Billion) FY Ended March 2014 FY Ended March 2015 Results Full Year Results YoY Revised Full Year Full Year YoY Through 2Q Results Through 2Q Change Forecasts Results Change (announced on Feb 12) R&D Expense / Content Production Expense 25.1 59.2 28.4 +13% 64.0 67.6 +1

  9. Slide 9: Consolidated Balance Sheet (Summary)

    Consolidated Balance Sheet (Summary) (JPY billion) 【 Assets 】 【 Liabilities and Net Assets 】 As of end of March As of end of March As of end of March As of end of March Account 2014 2015 Change Account 2014 2015 Change Cash and Deposits 101.2 102.2 +1.0 Accounts Payable 37.2 26.9 -10.3 Accounts Rece

  10. Slide 10: Consolidated Cash Flows

    Consolidated Cash Flows （JPY Billion) End of Cash Flows from Cash Flows from Cash Flows from End of FY 2014 Operating Activities Investing Activities Financing Activities FY 2015 ＋37.0 billion yen －37.7 billion yen －15.0 billion yen - 10 - © SEGA SAMMY HOLDINGS INC. All Rights Reserved.

  11. Slide 11: Results: Pachislot and Pachinko Machines

    Segment Results: Pachislot and Pachinko Machines (JPY Billion) FY Ended March 2014 FY Ended March 2015 Revised Full Year Results Full Year Results YoY Full Year YoY Forecasts Through 2Q Results Through 2Q Change Results Change (announced on Feb 12) Net Sales 71.2 181.8 60.6 -15% 149.0 149.1 -18% Pac

  12. Slide 12: Results: Pachislot

    Segment Results: Pachislot Shipment Data: Pachislot ＊Number of titles reflects products which begin sales in the period FY Ended March 2014 FY Ended March 2015 Pachislot Revised Full Year Results Full Year Results Full Year Forecasts Through 2Q Results Through 2Q Results (announced on Feb 12) 1 titl

  13. Slide 13: Results: Pachinko

    Segment Results: Pachinko Shipment Data: Pachinko ＊Number of titles reflects products which begin sales in the periodc FY Ended March 2014 FY Ended March 2015 Pachinko Revised Full Year Results Full Year Results Full Year Forecasts Through 2Q Results Through 2Q Results (announced on Feb 12) 2 titles

  14. Slide 14: Results: Amusement Machine Sales

    Segment Results: Amusement Machine Sales (JPY Billion) FY Ended March 2014 FY Ended March 2015 Revised Full Year Results Full Year Results YoY Full Year YoY Forecasts Through 2Q Results Through 2Q Change Results Change (announce d on Fe b 12) Net Sales 18.0 38.6 18.0 - 39.0 39.6 +3% Domestic 15.5 32

  15. Slide 15: Results: Amusement Machine Sales - Major Titles

    Segment Results: Amusement Machine Sales Major Titles (Results) Title Game Type Sales WORLD CLUB Champion Football Series Trading Card Game 2.7 billion yen StarHorse3 Series Medal Game 1.8 billion yen SENGOKU-TAISEN Trading Card Game 1.3 billion yen BORDER BREAK Series Video Game 1.2 billion yen Won

  16. Slide 16: Results: Amusement Center Operations

    Segment Results: Amusement Center Operations (JPY Billion) FY Ended March 2014 FY Ended March 2015 Results Full Year Results YoY Revised Full Year Full Year YoY Through 2Q Results Through 2Q Change Forecasts Results Change (announced on Feb 12) Net Sales 21.9 43.2 20.8 -5% 41.0 41.4 -4% Operating In

  17. Slide 17: Results: Amusement Center Operations

    Segment Results : Amusement Center Operations Domestic Facilities Same Store Sales Comps / Domestic Facilities Number Transition - 17 - © SEGA SAMMY HOLDINGS INC. All Rights Reserved.

  18. Slide 18: Results: Consumer Business

    Segment Results: Consumer Business (JPY Billion) FY Ended March 2014 FY Ended March 2015 Results Full Year Results YoY Revised Full Year Full Year YoY Through 2Q Results Through 2Q Change Forecasts Results Change (announced on Feb 12) Net Sales 43.8 99.8 48.2 +10% 110.0 111.0 +11% Packaged Games 16.

  19. Slide 19: Results: Consumer Business - Packaged Games Sales

    Segment Results：Consumer Business Sales Results (Packaged Games) *Number of titles reflects products which begin sales in the period FY Ended March 2014 FY Ended March 2015 Breakdown Revised Full Year by Region Results Full Year Results Full Year Forecasts Through 2Q Results Through 2Q Results (anno

  20. Slide 20: Results: Consumer Business - Major Titles

    Segment Results : Consumer Business Major Titles (Results) / Packaged Games Sales Unit Title (Region） Platform (Thousands) Launch Alien: Isolation（Europe, US） PS3, PS4, Xbox360, XboxOne, PC 2,110 October Football Manager 2015（Europe, US） PC 810 November Sonic Boom Rise of Lyric（Japan, Europe, US） Wi

  21. Slide 21: Results: Consumer Business - Digital Title Indices

    Segment Results: Consumer Business ■Major Index for Digital Titles (for the entire digital games) FY Ended March 2015 1Q Results 2Q Results 3Q Results 4Q Results Average MAU（ Thousands, 3 months average） *1 6,690 5,750 5,510 5,430 Domestic ARPMAU (JPY) *2 1,225 1,928 1,757 1,761 Share of sales for t

  22. Slide 22: Review of Structure Reform

    Review of Structure Reform © SEGA SAMMY HOLDINGS INC. All Rights Reserved.

  23. Slide 23: Review of Structure Reform: Major Measures

    Review of Structure Reform Major Measures of Group Structure Reform in the fiscal year ended March 2015 1. Established Group Structure Reform Division (on May 9, 2014) ・Chairman: Hajime Satomi, President & CEO 2. Announcement of Group Structure Reform Policy（on October 31, 2014） ・Restructuring into

  24. Slide 24: Implementation Status of Structure Reform

    Review of Structure Reform Implementation Status of Structure Reform (Fiscal year ended March 2015）  Restructuring into three business groups Pachislot and Pachinko Pachislot and Pachinko Machines Machines Clarification of core Amusement Machine Sales Entertainment Contents businesses Amusement Cen

  25. Slide 25: Future Activities

    Review of Structure Reform Future Activities（Fiscal year ending March 2016 ~）  Bolster operation of business portfolio ⇒Consider business replacements ⇒Consider investments in new businesses Structure Reform  Thorough cost management of each business  Consider rules for starting or exiting from b

  26. Slide 26: Impact of Structure Reform on Operating Results

    Review of Structure Reform Impact of structure reform implementation on operating results ＜Breakdown of extraordinary loss in actual results for FY ended March 2015＞ Account Amount (JPY Billion) Impairment loss 7.8 Provision for dismantling of 2.7 ＜Effect of reduction of fixed expense in fixed asset

  27. Slide 27: FY Ending March 2016 Full Year Forecasts

    FY Ending March 2016 Full Year Forecasts © SEGA SAMMY HOLDINGS INC. All Rights Reserved.

  28. Slide 28: Changes to Business Segment and Accounting Policy

    Changes to Business Segment and Accounting Policy (1) Change to Business segment FY ended March 2015 FY FYending March 2016 ending March 2016 Pachislot and Pachinko Machines Pachislot Pachislotand and Pachinko Machines Pachinko Machines Entertainment EntertainmentContents Business Contents Business

  29. Slide 29: Consolidated Income Statements (Summary)

    Consolidated Income Statements (Summary) (JPY Billion) FY Ended March 2015 FY Ending March 2016 Results Full Year Forecasts YoY Full Year YoY Through 2Q Results Through 2Q Change Forecasts Change Sales 160.1 367.2 200.0 +25% 420.0 +14% Pachislot and Pachinko Machines 62.3 152.6 94.5 +52% 167.0 +9% E

  30. Slide 30: Costs and Expenses Results/Forecast

    Costs and Expenses Results/Forecast (JPY Billion) FY Ended March 2015 FY Ending March 2016 Results Full Year Forecasts YoY Full Year YoY Through 2Q Results Through 2Q Change Forecasts Change R&D Expense / Content Production Expense 28.4 67.6 30.0 +6% 69.4 +3% Pachislot and Pachinko Machines 10.5 22.

  31. Slide 31: Operating Income – Primary Factors Behind Fluctuations

    Operating Income – Primary Factors Behind Fluctuations (Major Causes) （JPY Billion) Pachislot Entertainment Contents Resort Pachinko Operating Income ・Plans to continue making up-front investment such as accumulation of know-how Operating Income ・Profit ratio is expected ・Due to an increase to go te

  32. Slide 32: Forecasts: Pachislot and Pachinko Machines Business

    Segment Forecasts: Pachislot and Pachinko Machines Business Positioning, Direction of Business Strategy, Our Strength Positioning within the group Main pillar of the group’s revenue ■ Responding to the market environment and regulatory environment Direction of ■ Developing products for broad user ba

  33. Slide 33: Pachislot and Pachinko Market Forecasts

    Segment Forecasts: Pachislot and Pachinko Machines Business (Market Forecasts) Pachislot Machine Pachinko Machine 12/03 13/03 14/03 15/03 16/03 12/03 13/03 14/03 15/03 16/03 Pachislot Results Results Results Estimate Forecasts Pachinko Results Results Results Estimate Forecasts Market Unit Sales Mar

  34. Slide 34: Forecasts: Pachislot and Pachinko Machines Business

    Segment Forecasts: Pachislot and Pachinko Machines Business (JPY Billion) FY Ended March 2015 FY Ending March 2016 Results Full Year Forecasts YoY Full Year YoY Through 2Q Results Through 2Q Change Forecasts Change Sales 62.3 152.6 94.5 +52% 167.0 +9% Pachislot 34.6 74.0 61.3 +77% 97.0 +31% Pachinko

  35. Slide 35: Forecasts: Pachislot

    Segment Forecasts: Pachislot Shipment Data: Pachislot ※Number of titles reflects products launched in this fiscal year. FY Ended March 2015 FY Ending March 2016 Pachislot Results Full Year Forecasts Full Year Through 2Q Results Through 2Q Forecasts 2 titles 3 titles 3 titles 7 titles 83,468 units 15

  36. Slide 36: Forecasts: Pachinko

    Segment Forecasts: Pachinko Shipment Data: Pachinko ※Number of titles reflects products launched in this fiscal year. FY Ended March 2015 FY Ending March 2016 Pachinko Results Full Year Forecasts Full Year Through 2Q Results Through 2Q Forecasts 3 titles 5 titles 3 titles 5 titles 62,938 units 206,7

  37. Slide 37: Forecasts: Entertainment Contents Business

    Segment Forecasts: Entertainment Contents Business Positioning, Direction of Business Strategy, Our strength Positioning within the group Short- to medium-term growth area ■ Further enhancing profitability in the digital game field Direction of business ■ Solving unprofitable businesses by structure

  38. Slide 38: Forecasts: Entertainment Contents Business

    Segment Forecasts: Entertainment Contents Business (JPY Billion) FY Ended March 2015 FY Ending March 2016 Results Full Year Forecasts YoY Full Year YoY Through 2Q Results Through 2Q Change Forecasts Change Sales 91.0 199.6 98.5 +8% 235.0 +18% Digital Games 26.9 54.3 34.0 +26% 87.0 +60% Packaged Game

  39. Slide 39: Forecasts: Entertainment Contents Business Overview

    Segment Forecasts: Entertainment Contents Business Full Year Forecast of FY Ending March 2016 ・ Significant increase in sales and profits is forecasted year-on-year due to an increase in profits in the digital game field and an Overall improvement in profitability by streamlining ・ Increase in sales

  40. Slide 40: Sales Forecasts (Packaged Games)

    Segment Forecasts: Entertainment Contents Business Sales Forecasts (Packaged Games) *Number of titles reflects products which begin sales in the period FY Ended March 2015 FY Ending March 2016 Breakdown by Region Results Full Year Forecasts Full Year Through 2Q Results Through 2Q Forecasts # of titl

  41. Slide 41: Forecasts: Resort Business

    Segment Forecasts: Resort Business Positioning, Direction of Business Strategy, Our Strength Positioning within the group Medium- to long-term growth area ■ Up-front investment to prepare for entry to domestic IR business ■ Accumulating know-how through Direction of Business Strategy development and

  42. Slide 42: Major Initiatives in the Resort Business

    Segment Forecasts: Resort Business Major initiatives taken in the Resort Business  Facility name: Phoenix Seagaia Resort  Location: Miyazaki prefecture (Miyazaki City)  Operating company: PHOENIX RESORT CO.,LTD.  Overview: Resort facility which holds accommodation facilities such as “Sheraton Gr

  43. Slide 43: Forecasts: Resort Business

    Segment Forecasts: Resort Business (JPY Billion) FY Ended March 2015 FY Ending March 2016 Results Full Year Forecasts YoY Full Year YoY Through 2Q Results Through 2Q Change Forecasts Change Sales 6.6 14.9 7.0 +6% 18.0 +21% Operating Income -1.4 -2.3 -2.0 - -3.5 - Operating Income Margin - - - - - -

  44. Slide 44: Appendix

    Appendix © SEGA SAMMY HOLDINGS INC. All Rights Reserved.

  45. Slide 45: Pachinko and Pachislot Machine Markets

    Pachinko and Pachislot Machine Markets Number of pachinko hall and number of machines installed per hall (halls) (units) 20,000 17,773 17,426 500.0 17,173 16,988 16,801 16,504 16,076 15,617 14,674 371.9 377.2 387.8 15,165 349.8 356.2 365.0 13,585 400.0 15,000 294.7 12,323 268.0 270.3 274.3 279.9 284

  46. Slide 46: Pachinko and Pachislot Machine Markets

    Pachinko and Pachislot Machine Markets Sources:Yano research Institute Ltd. Sources : White Paper on Leisure Industry, Japan Productivity Center - 46 - © SEGA SAMMY HOLDINGS INC. All Rights Reserved.

  47. Slide 47: Pachinko and Pachislot Machine Markets

    Pachinko and Pachislot Machine Markets Sources:Security Communications Association - 47 - © SEGA SAMMY HOLDINGS INC. All Rights Reserved.

  48. Slide 48: Pachislot / Pachinko Sales Share

    Pachislot / Pachinko Sales Share Share of Annual Pachislot Machine Sales 2009 2010 2011 2012 2013 Rank Manufacturer Units sold Share Manufacturer Units sold Share Manufacturer Units sold Share Manufacturer Units sold Share Manufacturer Units sold Share 1 Sammy 162,932 21.3% Sammy 302,270 30.9% Sammy

  49. Slide 49: Amusement Market Data

    Amusement Market Data Amusement Machine and Amusement Center Operations Markets Scale Number of Amusement Facilities (Facilities) Amusement Machine / Facilities sales (JPY billion） Number of Amusement Machine units installed (Units) 600,000 10,000 1,000 474,808 486,582 484,804 473,601 461,465 446,22

  50. Slide 50: Packaged and Digital Game Market Data

    Packaged and Digital Game Market Data Home Video Game and Online Game Markets Scale Japan's Market for Game Content with Network Connectivity (JPY billion) 836.2 862.5 800.0 735.8 600.0 528.5 393.3 713.1 745.8 400.0 606.9 318.1 385.6 193.7 233.2 224.9 118.7 200.0 5.5 29.0 89.0 92.0 85.4 51.2 19.2 5.

  51. Slide 51: Past Operating Results

    Past Operating Results From FY Ended March 2005 to FY Ended March 2015 *The data in this page can be downloaded from following URL. (http://www.segasammy.co.jp/english/ir/library/pdf/settlement/2015/e_201503_4q_transition.xls) ※The counting rules for the number of facilities have been changed from f

  52. Slide 52: Disclaimer

    http://www.segasammy.com/ ［Disclaimer］ The contents in this material and comments made during the questions and answers etc. of this briefing session are the judgment and forecasts of the Company’s management based on the currently available information. These contents involve risk and uncertainty,

Sega Sammy Holdings — FY2015 Earnings Presentation on 6ix