Consolidated Financial Results
for the Nine-Month Period Ended December 31, 2022 (Japan GAAP)
February 3, 2023
Company name: | SQUARE ENIX HOLDINGS CO., LTD. |
Shares traded: | Tokyo Stock Exchange, Prime Market |
Company code: | 9684 |
Company URL: | https://www.hd.square-enix.com/eng |
Representative: | Yosuke Matsuda, President and Representative Director |
Contact: | Atsushi Matsuda, Chief Accounting Officer |
Tel: | (03) 5292-8000 |
Financial report submission: | February 8, 2023 (planned) |
Cash dividend payment commencement: | - |
Supplementary quarterly materials prepared: Yes | |
Quarterly results presentation held: | Yes (for institutional investors and analysts) |
(Amounts under one million yen are rounded down)
1. Consolidated Financial Results (April 1, 2022 through December 31, 2022)
(1) Consolidated Financial Results | (Millions of yen and year-on-year changes in percents) | ||||||||||||||
Net sales | Operating income | Ordinary income | Profit attributable to | ||||||||||||
owners of parent | |||||||||||||||
Nine months ended | % | % | % | % | |||||||||||
December 31, 2022 | 255,616 | (6.6) | 41,315 | (17.6) | 50,805 | (6.7) | 46,397 | 16.4 | |||||||
December 31, 2021 | 273,627 | 7.9 | 50,138 | 22.2 | 54,441 | 40.7 | 39,844 | 116.9 | |||||||
Note: Nine months ended December 31, 2022 Comprehensive income: 44,847 million yen [12.7%] | |||||||||||||||
Nine months ended December 31, 2021 Comprehensive income: 39,794 million yen [112.0%] | |||||||||||||||
Earnings per | Earnings per | ||||||||||||||
share, basic | share, diluted | ||||||||||||||
Nine months ended | yen | yen | |||||||||||||
December 31, 2022 | 387.71 | 387.05 | |||||||||||||
December 31, 2021 | 333.44 | 332.73 | |||||||||||||
(2) Consolidated Financial Position | (Millions of yen, ratios in percents and per share data) | ||||||||||||||
Total assets | Net assets | Equity ratio | |||||||||||||
As of | % | ||||||||||||||
December 31, 2022 | 399,847 | 314,404 | 78.4 | ||||||||||||
March 31, 2022 | 380,902 | 284,429 | 74.4 | ||||||||||||
Note: Total equity As of December 31, 2022: | 313,435 million yen | ||||||||||||||
As of March 31, 2022: | 283,519 million yen |
2. Dividends
Dividends per share | |||||||
1Q | 2Q | 3Q | 4Q | Total | |||
yen | yen | yen | yen | yen | |||
Fiscal year ended | - | 10.00 | - | 119.00 | 129.00 | ||
March 31, 2022 | |||||||
Fiscal year ending | - | 10.00 | - | ||||
March 31, 2023 | |||||||
Fiscal year ending | |||||||
March 31, 2023 | - | - | |||||
(projection) | |||||||
Note: No change in Dividends projection from the previous announcement.
3. Consolidated Forecasts (April 1, 2022 to March 31, 2023)
The Company refrains at this time from disclosing consolidated financial forecasts for the fiscal year through March 31, 2023. For details, please refer to page 4 "1. Consolidated Results for the Nine-Month Period Ended December 31, 2022 (3) Qualitative information on consolidated business forecasts."
Notes
- Significant changes among major subsidiaries during the period: Yes Eliminated: CRYSTAL DYNAMICS, INC.
- Adoption of special accounting treatment for quarterly consolidated financial statements: No
- Changes in accounting policies, procedures, and methods of presentation for consolidated financial statements
- Changes in accounting policies due to revisions to accounting standards: Yes
- Changes other than 1. : No
- Changes in accounting estimates: No
- Retrospective restatement: No
- Outstanding shares (common stock)
- Number of shares issued and outstanding (including treasury stock):
As of December 31, 2022 | 122,531,596 | |
As of March 31, 2022 | 122,531,596 | |
2. | Number of treasury stock: | |
As of December 31, 2022 | 2,814,988 | |
As of March 31, 2022 | 2,927,230 | |
3. | Average number of shares during the period (cumulative): | |
Nine-Month period ended December 31, 2022 | 119,671,206 | |
Nine-Month period ended December 31, 2021 | 119,493,845 |
Disclaimer: (1) This document is a translation of the Japanese language "Kessan Tanshin" prepared in accordance with the guidelines of the Tokyo Stock Exchange. The Japanese language document shall prevail in the event any differences or discrepancies exist between this English translation and the original. (2) This earnings release is not subject to review procedures for quarterly financial statements. (3) The forward-looking statements in this document are based upon the information currently available and necessarily include elements that are not entirely predictable. The achievement is not promised. Actual results may differ from the forward-looking statements in this document. (4) For additional information about forecasts, please refer to "1. Consolidated Results for the Nine-Month Period Ended December 31, 2022 (3) Qualitative information on consolidated business forecasts" section on page 4 of Supplemental Information.
Supplemental Information - Index
Page | ||
1. Consolidated Results for the Nine-Month Period Ended December 31, 2022 | 2 | |
(1) | Analysis of consolidated business results | 2 |
(2) | Analysis of consolidated financial position | 3 |
(3) | Qualitative information on consolidated business forecasts | 4 |
2. Consolidated Financial Statements for the Nine-Month Period Ended December 31, 2022 | 5 | |
(1) | Consolidated Balance Sheets | 5 |
(2) | Consolidated Income Statement and Consolidated Statement of Comprehensive Income | 7 |
Consolidated Income Statement | 7 | |
Consolidated Statement of Comprehensive Income | 8 | |
(3) | Notes to Consolidated Financial Statements | 9 |
(Note regarding going concern assumptions) | 9 | |
(Material changes in shareholders' equity) | 9 | |
(Changes in accounting policies) | 9 | |
(Additional information) | 9 | |
(Segment information) | 10 |
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1. Consolidated Results for the Nine-Month Period Ended December 31, 2022
(1) Analysis of consolidated business results
The Square Enix group (the "Group") is continuing determined efforts to strengthen the competitiveness and profitability of its business segments of Digital Entertainment, Amusement, Publication and Merchandising. Net sales for the Nine-Month period ended December 31, 2022 totaled ¥255,616 million (a decrease of 6.6% from the same period of the prior fiscal year), operating income amounted to ¥41,315 million (a decrease of 17.6% from the same period of the prior fiscal year). In foreign exchange rates, the weakness of Japanese yen compared to rates as of the end of the prior fiscal year resulted in the booking of a foreign exchange gain amounting to ¥10,087 million, which contributed to ordinary income of ¥50,805 million (a decrease of 6.7% from the same period of the prior fiscal year). In addition, the Group concluded a contract to divest select overseas studios and intellectual property through the transfer of shares, producing a gain of ¥9,500 million on the gain on sale of shares of subsidiaries and associates. This contributed to a profit attributable to owners of parent amounted to ¥46,397 million (an increase of 16.4% from the same period of the prior fiscal year).
A discussion of results by segment for the Nine-Month period ended December 31, 2022 follows.
●Digital Entertainment
The Digital Entertainment segment consists of planning, development, distribution, and operation of digital entertainment content primarily in the form of game. Digital entertainment content is offered to meet customer lifestyles across a variety of usage environments such as consumer game consoles (including handheld game machines), personal computers and smart devices.
At the HD (High-Definition) Game sub-segment, the nine-month period ended December 31, 2022 saw the release of such titles as "CRISIS CORE -FINAL FANTASY VII- REUNION," "DRAGON QUEST TREASURES," and "Dragon Quest X." However, because new titles generated fewer earnings than in the previous year, which had seen the launch of "OUTRIDERS," "NieR Replicant ver. 1.22474487139...," and "Marvel's Guardians of the Galaxy," the sub-segment's net sales declined versus the same period of the previous fiscal year.
Net sales declined versus the same period of the previous fiscal year in the MMO (Massively Multiplayer Online) Game sub-segment as no expansion pack was launched for "FINAL FANTASY XIV."
The Games for Smart Devices/PC Browser sub-segment saw a decline in net sales versus the same period of the previous fiscal year because of weak performances by existing titles.
Net sales and operating income in the Digital Entertainment segment totaled ¥184,380 million (a decrease of 12.9% from the same period of the prior fiscal year), and ¥38,735 million (a decrease of 21.6% from the same period of the prior fiscal year), respectively.
●Amusement
The Amusement segment consists of the operation of amusement facilities and planning, development, and distribution of arcade game machines and related products for amusement facilities.
Same-store sales were up sharply from the previous year, resulting in year-on-year growth in both net sales and operating income for the nine-month period ended December 31, 2022.
Net sales and operating income in the Amusement segment totaled ¥40,883 million (an increase of 23.3% from the same period of the prior fiscal year), and ¥4,100 million (an increase of 206.5% from the same period of the prior fiscal year), respectively.
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●Publication
The Publication segment consists of publication and licensing of comic magazines, comic books, and game- related books.
Sales of both digital and print media were solid in the nine-month period ended December 31, 2022, but higher prices on printing paper on other inputs led to higher costs. This, combined with other factors such as increased advertising expenses, led to a year-on-year decline in operating income.
Net sales and operating income in the Publication segment totaled ¥21,071 million (an increase of 0.0% from the same period of the prior fiscal year) and ¥8,360 million (a decrease of 6.1% from the same period of the prior fiscal year), respectively.
●Merchandising
The Merchandising segment consists of planning, production, distribution, and licensing of derivative products of IPs owned by the Group.
The nine-month period ended December 31, 2022 saw brisk sales of products including new character merchandise based on major intellectual properties. However, while net sales rose versus the same period of the previous fiscal year, operating income declined, because of changes in the sales mix by product.
Net sales and operating income in the Merchandising segment totaled ¥11,905 million (an increase of 13.8% from the same period of the prior fiscal year), and ¥2,899 million (a decrease of 8.5% from the same period of the prior fiscal year), respectively.
-
Analysis of consolidated financial position
●Assets
As of December 31, 2022, total current assets were ¥346,111 million, an increase of ¥23,656 million compared to March 31, 2022. This was mainly due to increases in cash and deposits of ¥12,913 million, content production account of ¥4,526 million and the other on current assets of ¥2,744 million. As of December 31, 2022, total non-current assets were ¥53,735 million, a decrease of ¥4,711 million compared to March 31, 2022.
As a result, total assets were ¥399,847 million, an increase of ¥18,944 million compared to March 31, 2022.
●Liabilities
As of December 31, 2022, total current liabilities were ¥75,082 million, a decrease of ¥8,717 million compared to March 31, 2022. This was mainly due to decreases in income taxes payable of ¥3,965 million and provision for bonuses of ¥3,513 million. As of December 31, 2022, total non-current liabilities were ¥10,359 million, a decrease of ¥2,312 million compared to March 31, 2022.
As a result, total liabilities were ¥85,442 million, a decrease of ¥11,030 million compared to March 31, 2022.
●Net assets
As of December 31, 2022, net assets were ¥314,404 million, an increase of ¥29,974 million compared to March 31, 2022. This was mainly due to profit attributable to owners of parent of ¥46,397 million and dividend payments of ¥15,430 million.
As a result, the consolidated equity ratio stood at 78.4% (74.4% as of March 31, 2022).
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Square Enix Holdings Co. Ltd. published this content on 03 February 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 03 February 2023 06:57:06 UTC.