Sankyo Co., Ltd. · TSE:6417

Sankyo — H1 FY3/2023 Earnings Presentation

30 slides from Sankyo's earnings presentation, Nov 7, 2022

  1. Slide 1: Presentation on Business Results for the First Half of FY 3/2023

    Presentation on Business Results for the First Half of FY 3/2023 (April 1, 2022 to September 30, 2022) November 7, 2022 SANKYO CO., LTD. Prime Market of the TSE #6417

  2. 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 P23 © 2022 SANKYO CO., LTD. 2

  3. 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 substantial increases in the sales volume of both pachinko machines and pachislot machines.  Recording of extraordinary gains amounting to 3.3 billion yen , partly ow

  4. Slide 4: Summary of Financial Results

    Summary of Financial Results  The continuing difficulty in procuring electronic components and other parts has been a drag on pachinko and pachislot machine manufacturers, affecting the total number of pachinko and pachislot machines sold. Pachinko Pachislot  Despite stable demand in the pachinko

  5. Slide 5: Revision of the Forecast of the Financial Results for the Year Ending March 31, 2023

    Revision of the Forecast of the Financial Results for the Year Ending March 31, 2023 (Disclosed in October 17, 2022) FY 3/2022 FY 3/2023 FY 3/2023 Variance from Variance from million yen Results Forecast Revised Forecast FY 3/2022 Previous Forecast +50,143 +25,000 Net Sales 84,857 110,000 135,000 (+

  6. Slide 6: Factors of Change in Consolidated Net Sales (Variance from Previous Forecast)

    Factors of Change in Consolidated Net Sales (Variance from Previous Forecast) Million yen Pachinko Pachislot Machines Machines Ball Bearing Business Supply Other Business Business +6,000 Business +19,000 +0 +0 135,000 110,000 FY3/2023 FY3/2023 Previous Forecast Revised Forecast +25,000 million yen（+

  7. Slide 7: Factors of Change in Consolidated Operating Income (Variance from Previous Forecast)

    Factors of Change in Consolidated Operating Income(Variance from Previous Forecast) Million yen The gross profit of the pachislot The gross profit machine sales of the pachinko increases machine sales increases +5,018 +307 +16,197 ‐715 ‐27 Advertising expenses Sales R&D ‐4,780 45,000 decreases commi

  8. Slide 8: Summary of Financial Results

    Summary of Financial Results million yen FY 3/2022 2Q FY 3/2023 2Q YoY FY 3/2023 Forecast Net Sales 28,061 69,963 +41,902 +149.3% 135,000 Pachinko Machines Business 25,670 63,021 +37,351 +145.5% 112,400 Pachislot Machines Business 1,131 4,751 +3,620 +320.1% 17,300 Cost of Sales 13,132 29,238 +16,106

  9. Slide 9: Factors of Change in Consolidated Net Sales

    Factors of Change in Consolidated Net Sales Million yen +3,620 +936 ‐4 +37,351 Pachislot Ball Bearing Other 69,963 Machines Supply Business Pachinko Business Business Machines Business 28,061 FY3/2022 2Q FY3/2023 2Q +41,902 million yen（+149.3%） © 2022 SANKYO CO., LTD. 9

  10. Slide 10: Factors of Change in Consolidated Operating Income

    Factors of Change in Consolidated Operating Income Million yen Advertising expenses Sales decreases commission R&D increases expenses +2,454 +293 increases Other factors +24,345 ‐798 ‐801 The gross profit ‐1,992 26,415 of the pachislot machine sales increases The gross profit of the pachinko machine

  11. Slide 11: Costs and Expenses

    Costs and Expenses million yen FY 3/2022 2Q FY 3/2023 2Q YoY FY 3/2023 Forecast SG & A Expenses 12,014 14,308 +2,294 +19.1% 34,000 Advertising Expenses 1,204 911 -293 -24.3% 1,999 Sales Commission 949 1,747 +798 +84.1% 5,953 R&D Expenses 5,647 6,448 +801 +14.2% 14,997 Salaries & Wages 1,139 1,265 +1

  12. Slide 12: Summary of Balance Sheet

    Summary of Balance Sheet million yen As of 31-Mar-22 As of 30-Sep-22 YoY Factors of Change Total current assets 264,859 276,779 +11,920 Increases in cash and deposits and notes and accounts Quick assets 250,242 262,558 +12,316 receivable‐trade, and contract assets Total fixed assets 44,353 42,499 ‐1

  13. Slide 13: Contents: 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 P23 © 2022 SANKYO CO., LTD. 13

  14. Slide 14: Pachinko Machines Business

    Pachinko Machines Business Factors of Change in Net sales Data Million yen million yen FY 3/2022 2Q FY 3/2023 2Q YoY FY 3/2023 2nd Quarter (Apr‐Sep) 25,670 Net Sales 25,670 63,021 +37,351 Sales volume of SANKYO-brand Operating Income 6,501 28,275 +21,774 and JB-brand pachinko machines +31,096 increa

  15. Slide 15: Pachinko Machines Business

    Pachinko Machines Business 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）/ ©カラー TM & © TOHO CO., LTD. ©⼤森藤ノ・SBクリエイティブ/ダンまち2製作委員会 ©藤⽥和⽇郎・⼩学館／ツインエンジン Licensed by Sony Music Labels Inc. ©Project シンフォギアＧＸ ©Project シンフォギアAXZ 1Q 1Q 2Q 3Q 4Q New Title Fever Danmachi Fever Star Blazers: Space Battleship Yamato 2202 -O

  16. Slide 16: Pachislot Machines Business

    Pachislot Machines Business Factors of Change in Net sales Data Million yen million yen FY 3/2022 2Q FY 3/2023 2Q YoY FY 3/2022 2nd Quarter (Apr‐Sep) 1,131 Net Sales 1,131 4,751 +3,620 Operating Income (1,469) 1,039 +2,508 Sales volume of SANKYO-brand +3,267 Percentage (129.9%) 21.9% pachislot machi

  17. Slide 17: Pachislot Machines Business

    Pachislot Machines Business 1Q 1Q 2Q 3Q 4Q Pachislot Aquarion ALL STARS x4 L Pachislot Valvrave the Liberator x1 New Title x3 Sales of 1,254 units 8,836 units - units - units Unit FY 3/2023 Forecast Progress 10,090 units（25.2 %） 40,000 units © 2022 SANKYO CO., LTD. ※ Introduction of titles is in lin

  18. Slide 18: Contents: Surroundings of Pachinko and Pachislot Industry

    Contents Overview of Financial Results P3 Overview of Business P14  Surroundings of Pachinko and Pachislot Industry, And Initiatives of SANKYO P19 Appendix P23 © 2022 SANKYO CO., LTD. 18

  19. Slide 19: Pachinko Market

    Pachinko Market Sales Volume Sales volume forecast FY2023： 1,000 thousand units Thousand units (April 1, 2022 to March 31, 2023) Total number 2,100 of units sold Approx. 530 thousand units YoY Approx. -13％ （1 titles sold 30,000 units or more. (April to September, 2022) (April to September)） 1,800 

  20. Slide 20: Pachislot Market

    Pachislot Market Sales Volume Sales volume forecast FY2023： 600 thousand units Thousand units (April 1, 2022 to March 31, 2023) Total number 1,000 of units sold Approx. 240 thousand units YoY Approx. +9％ （0 titles sold 20,000 units or more. (April to September, 2022) (April to September)） 800  Tota

  21. Slide 21: Initiatives of SANKYO in The Pachinko and Pachislot Machine Markets

    Initiatives of SANKYO in The Pachinko and Pachislot Machine Markets  Aim to increase the Groupʼs share of sales in the pachinko market and improve the Groupʼs presence in the pachislot market  Implement all possible measures to deal with the shortage of electronic components and achieve business p

  22. Slide 22: Contents: Appendix

    Contents Overview of Financial Results P3 Overview of Business P14 Surroundings of Pachinko and Pachislot Industry, P19 And Initiatives of SANKYO  Appendix P23 © 2022 SANKYO CO., LTD. 22

  23. Slide 23: Business Results for the Second Quarter of FY 3/2023

    Business Results for the Second Quarter of FY 3/2023 FY 3/2022 FY 3/2023 Forecast FY 3/2022 FY 3/2023 Consolidated:milion yen 6 Months 6 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Net Sales 28,061 69,963 +41,902 135,000 10,932 17,129 42,283 14,513 84,857 27,763 42,200 Pachinko 25,670 63,021 +37,351 1

  24. Slide 24: Margin / Expenses etc.

    Margin / Expenses etc. GP Margin/OP Margin FY 3/2022 FY 3/2023 Forecast FY 3/2022 FY 3/2023 Consolidated 6 Months 6 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 GP Margin 53.2% 58.2% +5.0pt 58.5% 56.3% 51.2% 59.0% 54.8% 56.4% 56.0% 59.7% OP Margin 10.4% 37.8% +27.4pt 33.3% 7.0% 12.5% 40.5% 9.1% 25.2% 3

  25. Slide 25: Pachinko Machines Business

    Pachinko Machines Business FY 3/2022 FY 3/2023 Forecast FY 3/2022 FY 3/2023 Consolidated:milion yen 6 Months 6 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Net Sales 25,670 63,021 +37,351 112,400 9,189 16,481 36,107 10,083 71,860 26,431 36,590 Operating Income 6,501 28,275 +21,774 43,700 1,981 4,520 15

  26. Slide 26: Pachislot Machines Business

    Pachislot Machines Business FY 3/2022 FY 3/2023 Forecast FY 3/2022 FY 3/2023 Consolidated:milion yen 6 Months 6 Months YoY Full Year Q1 Q2 Q3 Q4 FY Q1 Q2 Net Sales 1,131 4,751 +3,620 17,300 1,029 102 4,504 3,256 8,891 628 4,123 Operating Income (1,469) 1,039 +2,508 6,200 (338) (1,131) 2,008 646 1,18

  27. Slide 27: Financial Indicates

    Financial Indicates million yen FY 3/2016 FY 3/2017 FY 3/2018 FY 3/2019 FY 3/2020 FY 3/2021 FY 3/2022 FY 3/2023E Net Sales 137,130 81,455 86,220 88,558 78,416 58,129 84,857 135,000 Operating Income 18,826 5,059 10,181 21,286 12,551 6,587 21,357 45,000 Recurring Income 19,965 3,832 11,319 22,300 13,4

  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 3,000 3,500 12,000 2,749 2,637 2,557 11,000 3,000 2,500 2,432 2,338 10,000 2,500 2,000 9,000 1,687 1,665 1,637 2,000 2,137 2,134 2,127 2,130 2,110 1,572 2,080 2,065 2,059 2,050 2,04

  29. Slide 29: Others

    Others Number of Titles Sold (All Manufacturers) Compliance with Format Inspection Pachinko machines 2017 2018 2019 2020 2021 2022J‐S 2017 90 Applicant 875 711 945 912 990 686 2018 116 Pass 361 336 430 295 313 180 2019 Fail 463 333 560 499 598 487 97 2020 63 SANKYO Group (Number of Pa s s ) SANKYO+J

  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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