Slide 1: FY2020 Fourth Quarter Financial Results
GREE, Inc. FY2020 Fourth Quarter Financial Results August 20, 2020 Copyright © GREE, Inc. All Rights Reserved.
Slide 2: Executive Summary
Executive Summary ◼ Net sales ¥62.7 billion, operating income ¥3.2 billion, EBITDA ¥3.9 billion ⁃ In the game business, increased earnings potential of titles by strengthening operations Full- systems and expanding overseas distribution year ⁃ In the live entertainment business, strengthened platfor
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: FY20 Full-Year and 4Q Financial Results Overview
1. Financial Results Overview (Consolidated) FY20 Full-Year and 4Q Financial Results Overview FY20 net sales ¥62.7 billion , operating income ¥3.2 billion , EBITDA ¥3.9 billion Billions of yen FY20 FY20 4Q FY19 FY20 3Q YoY QoQ Net sales 62.67 -8.27 14.99 -0.44 70.94 15.44 Operating income 3.16 -2.31
Slide 6: Net Sales, EBITDA, and Operating Income
1. Financial Results Overview (Consolidated) Net Sales, EBITDA, and Operating Income Profit decline on posting of one -time costs Billions of yen 20.0 25.0％ 17.4 16.4 15.8 15.4 15.0 10.0 12.5％ 8.0% 7.7% 7.4% 5.0% 1.3 1.5 1.2 1.3 1.2 1.4 0.8 1.1 0.1 -0.1 0.0 0.0％ -0.4％ 4Q 1Q 2Q 3Q 4Q FY19 FY20 Net Sa
Slide 7: 4Q Operating Income Analysis
1. Financial Results Overview (Consolidated) 4Q Operating Income Analysis Profit decline owing to posting of one -time costs resulted in operating income of -¥0.1 billion Billions of yen 11.6億円 減少 1.24 -0.44 +0.05 -0.91 Operating income -0.07 FY20 3Q Decrease in Decrease in Increase in FY20 4Q net s
Slide 8: 4Q Operating Income Analysis (adjusted for one-time costs)
1. Financial Results Overview (Consolidated) 4Q Operating Income Analysis（adjusted for one-time costs ） Operating income adjusted for one-time costs of ¥0.8 billion; profit-generation base remains firm Billions of yen ¥0.47bn decrease 1.24 -0.44 +0.05 -0.08 0.76 Operating income FY20 3Q Decrease in
Slide 9: FY20 4Q Cost Structure
1. Financial Results Overview (Consolidated) FY20 4Q Cost Structure Total costs up ¥0.9 billion QoQ, to ¥15.1 billion Billions of yen FY20 FY20 FY19 Factors in change（QoQ） 4Q QoQ YoY 3Q 4Q Advertising 0.62 0.22 -0.56 Increase due to app games anniversary campaigns 0.40 1.18 Commission 4.98 0.11 -0.4
Slide 10: Stock Repurchase
1. Financial Results Overview (Consolidated) Stock Repurchase Implemented the stock repurchase to increase shareholder returns and to implement a flexible capital policy Cumulative repurchases(as of end July 30, 2020) Total number of shares repurchased Roughly 4.14 million shares Total repurchased p
Slide 11: Fiscal Year-End Dividend
1. Financial Results Overview (Consolidated) Fiscal Year-End Dividend Plan to pay dividend of ¥10 per share Maintaining a dividend on DOE of 2.0%, consolidated dividend payout ratio of 20% or higher FY20 Forecast FY19 Actual Record date June 30, 2020 June 30, 2019 Dividend per share ¥10 ¥10 Total am
Slide 12: FY21 Outlook
1. Financial Results Overview (Consolidated) FY21 Outlook Overall - We expect firm profit based on global operations of games Game/entertainment - Global operations of existing title are stable Game - We expect upside from new game titles and overseas distribution, especially in China Live - Maintai
Slide 13: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 14: FY20 Review and Summary
2. Operational Overview: FY20 results Review and Summary FY20 Business Plan Review Continue to strengthen 3 Overall - Aggressively invested in three businesses earnings pillars - Successfully strengthened operations from a Game/entertainment “Game long-term perspective, maintained strong operation e
Slide 15: Coin Consumption
2. Operational Overview: FY20 results Game Coin Consumption Maintained stable coin consumption by strengthening global operations and expanding distribution to new regions Coin consumption (app games) Topic Billions of coins 10.9 10.3 ◼ Coin consumption has stabilized at 10.0 9.7 9.7 100 10.0 around
Slide 16: Strengthening of long-term Operations system
2. Operational Overview: FY20 results Game Strengthening of long-term Operations system Major titles achieved YoY growth through successful global distribution and IP collaboration Another Eden SYMPHOGEAR Released Q4 FY17 Released Q4 FY17 +25％ +20％ FY19 FY20 FY19 FY20 Notes: • Comparison of coin con
Slide 17: Overseas Distribution: Strengthening earning potential
2. Operational Overview: FY20 results Game Overseas Distribution: Strengthening earning potential Increased overseas coin consumption by expanding overseas distribution and strengthening operations Overseas coin consumption Measures taken in FY20 (app games) ◼ Global simultaneous release of +25％ thi
Slide 18: Overseas Distribution: Strengthening earning potential
2. Operational Overview: FY20 results Game Overseas Distribution: Strengthening earning potential Growth in overseas coin consumption of first-party title Another Eden Another Eden: overseas coin consumption Measures taken in FY20 ◼ Strengthened global marketing ◼ Acquired new user base through IP +
Slide 19: Overseas Distribution: Expanding regionally/Accumulating knowhow
2. Operational Overview: FY20 results Game Overseas Distribution: Expanding regionally/Accumulating knowhow Expansion into new regions and progress in preparing for distribution in China Distribution regions North Hong Kong, Mainland Japan America Europe Taiwan, etc. China Released Agreement Release
Slide 20: Further develop platform
2. Operational Overview: FY20 results Live Entertainment Further develop platform Strengthened functionality and expanded contents for our REALITY, Virtual live distribution app Strengthened functionalities Expanded contents Launched low-latency mode Original Programs Avatar sharing with other compa
Slide 21: Expanded User Base
2. Operational Overview: FY20 results Advertising and Media Expanded User Base Strengthened vertical media potential by expanding contents Strengthened media potential Measures to meet users’ needs Posted info on restaurants offering takeout/delivery Housing & lifestyles Outing & travel Held photo c
Slide 22: Targeting Medium-Term Growth
2. Operational Overview: Medium-Term Plan Targeting Medium-Term Growth Targeting sustainable growth from three earnings pillars Scale Third pillar: Live entertainment business Sowing the seeds of new businesses Second pillar: Advertising and media business Expanding scale of operations to create the
Slide 23: FY21 Business Strategy Summary
2. Operational Overview: FY21 Business Strategy Summary Business Plan Summary Continue to strengthen 3 - Continue aggressive investment aimed at Overall earnings strengthening three earnings pillars pillars - Continue to invest in engine development and Game/entertainment “Game improvement, and IP a
Slide 24: Development pipeline
2. Operational Overview: FY21 Business Strategy - Game Development pipeline Plan to release 2-3 new titles per year; aiming to generate hits Assault Lily: Last Bullet Scheduled Heaven Burns Red Scheduled release this release in winter 2021 KNIGHT OF SIDONIA Scheduled game project release in 2021 Mul
Slide 25: Overseas Distribution Plans
2. Operational Overview: FY21 Business Strategy - Game Overseas Distribution Plans Aiming to further strengthen earning potential through expansion of overseas distribution, especially in China Distribution of major titles Global distribution of in China SINoALICE Chinese distribution partners ■ bil
Slide 26: Live Entertainment business
2. Operational Overview: FY21 Business Strategy – Live Entertainment business Live Entertainment business Further develop platform and entry into XR entertainment businesses Platform business XR Entertainment business B-to-C B-to-B Example of event • Continue to strengthen functionality and • Full-s
Slide 27: Expansion of Vertical Media Portfolio
2. Operational Overview: FY21 Business Strategy – Advertising and media Expansion of Vertical Media Portfolio Continued investment aimed at increasing media capabilities Scaling up our vertical media portfolio Housing & lifestyles Outing & travel Beauty Fashion 27 Copyright © GREE, Inc. All Rights R
Slide 28: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 29: Expanding and Energizing Fan Communities (1)
3. Appendix: 4Q Overview – Game Expanding and Energizing Fan Communities (1) Energized users by adding contents and conducting anniversary campaigns Another Eden SINoALICE Marked three-year anniversary Marked three-year anniversary • Added long-form contents and aired • Conducted major campaign and
Slide 30: Expanding and Energizing Fan Communities (2)
3. Appendix: 4Q Overview – Game Expanding and Energizing Fan Communities (2) Energized users by adding new game scenarios and IP collaboration Senki Zesshou SYMPHOGEAR XD DanMachi UNLIMITED Marked three-year anniversary Marked three-year anniversary • Added new major storyline drafted by • Added new
Slide 31: Growing Platform
3. Appendix: 4Q Overview – Live Entertainment Growing Platform Expanded contents on REALITY by adding original programs and new avatars Original Program Avatar gacha TOKYO IDOL STADIUM 2020 on .LIVE Alice in Wonderland • Original program featuring popular virtual • Added new avatar variations talent
Slide 32: Strengthened Media Potential
3. Appendix: 4Q Overview – Advertising and media Strengthened Media Potential Energized user communities through campaigns, etc. LIMIA aumo Held Posting contest Reached over 150 media affiliates キャンペーン アグリゲーション • Energized user community through photo • Strengthened local information contest distrib
Slide 33: Coin Consumption
3. Appendix Coin Consumption Billions of coins 16.4 0.7 14.8 14.7 14.0 14.0 0.6 0.5 0.5 0.4 4.5 4.3 3.9 3.8 3.9 11.2 10.0 10.3 9.7 9.7 4Q 1Q 2Q 3Q 4Q FY19 FY20 ■ Game apps ■ Browser games (smartphones) ■ Browser games (feature phones) 33 Copyright © GREE, Inc. All Rights Reserved.
Slide 34: 4Q FY20 Cost Structure
3. Appendix 4Q FY20 Cost Structure Billions of yen FY20 FY20 FY19 4Q QoQ YoY 3Q 4Q Rental charges 0.55 -0.02 -0.03 0.56 0.58 Labor costs 2.38 0.17 0.11 2.21 2.27 Others 3.92 -0.38 -0.50 4.30 4.43 Cost of sales 6.85 -0.23 -0.42 7.08 7.27 Advertising 0.62 0.22 -0.56 0.40 1.18 Commission 3.12 0.06 -0.4
Slide 35: 4Q FY20 Balance Sheet
3. Appendix 4Q FY20 Balance Sheet Billions of yen FY20 FY20 FY19 4Q QoQ YoY 3Q 4Q Current assets 99.0 0.3 4.5 98.7 94.5 Fixed assets 27.5 -2.4 -0.5 29.9 28.0 Total assets 126.5 -2.2 4.0 128.6 122.5 Current liabilities 12.1 0.5 1.2 11.6 10.9 Fixed liabilities 1.0 0.1 0.1 0.9 0.9 Total liabilities 13.
Slide 36: Group Headcount
3. Appendix Group Headcount Number of employees 1,746 1,729 1,712 1,702 1,710 4Q 1Q 2Q 3Q 4Q FY19 FY20 Note: • Includes non-consolidated group companies; as of the end of each quarter 36 Copyright © GREE, Inc. All Rights Reserved.
Slide 37: 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.