Newsletter No.76 June 2024

Bandai Namco miraikenkyusho
5-37-8, Shiba, Minato-ku, Tokyo, 108-0014, Japan
Management

Interview with the President

Masaru Kawaguchi
President and Representative Director, Group CEO
Bandai Namco Holdings Inc.

Net sales surpassed ¥1 trillion,
and net profit surpassed ¥100 billion,
for the first time in FY2024.3
Bandai Namco Holdings Inc. has announced its results for FY2024.3 and its
future forecasts. In this issue of the newsletter, President Masaru Kawaguchi
discusses the results, the trends in each business, and other matters.
The results For FY2024.3 have beenannounced.
Kawaguchi: Looking at our results in FY2024.3,
net sales were exceeded ¥1.05 trillion, operating
profit was ¥90.6 billion, recurring profit was¥104.1 billion, and profit attributable to ownersof parent was ¥101.4 billion. This marks thefirst time net sales surpassed ¥1 trillion andnet profit exceeded ¥100 billion, due in partto profit on the sale of investment securities.
Would you review the circumstances for
FY2024.3?
Kawaguchi: This achievement of surpassing¥1 trillion in net sales is the result of the Groupbeing able to leverage its presence under theALL BANDAI NAMCO concept, centered on IP*,and strongly developing business with­established IP products and services worldwide, such as Gundam, DRAGON BALL, andONE PIECE.
By business, the Toys and Hobby andAmusement businesses achieved record-highresults. The Toys and Hobby business benefited from the continued popularity ofproducts for the mature fan base, card
­products, and capsule toys, which contributedto results. The Amusement business saw
strong sales of new releases and updates in
popular series of amusement machines, aswell as favorable results at amusement­facilities worldwide that are linked to theGroup’s products and services.
In the Digital business, results wereimpacted by differences in the product mix forhome console games compared to the previous fiscal year. In addition to valuation losses
related to new online game title, a loss on
disposal was recorded due to changes in the* IP: Characters and other intellectual property

composition of titles with a view to the next
Mid-term Plan.
The IP Production business saw thedevelopment of several visual works for­the Gundam series lead to expansion of thefan base and brisk sales of Group products.
The return of fans to in-person entertainment
resulted in firm demand for live events. The
Group’s portfolio effect of having diverse IPs
and a wide range of categories led to strong-­
performing businesses helping to offset
struggling businesses.
Please discuss the dividend for FY2024.3?
Kawaguchi: Our basic policy is to provide areturn to shareholders that targets a total
return ratio of 50% or more based on stabledividend payments of 2% of DOE (dividendson equity). In accordance with this policy,
the year-end dividend will be ¥50, comprising
the base dividend of ¥10 per share and aperformance-based dividend of ¥40 pershare. Including the interim dividend, theannual dividend will be ¥60 per share.
­Additionally, in the fourth quarter of FY2024.3,
Bandai Namco purchased treasury shares inorder to improve capital efficiency throughthe effective use of assets held and to­implement a flexible capital policy, including
a return to shareholders. As a result, the total
return ratio, including dividends and purchase of treasury shares, was 55.7%.
Would you discuss the results forecast
for FY2025.3?
Kawaguchi: We are forecasting net sales of¥1.08 trillion and operating profit of ¥115.0billion. We aim to surpass ¥1 trillion in net sales
again. Regarding operating profit, we initially

set a target of ¥125.0 billion for the final fiscal
year of the current Mid-term Plan, which is
FY2025.3. While keeping this target in mind,
we set our forecast below this, consideringchanging trends in the market and fans, aswell as the sales plans for products and­services in each business segment.
Looking at average operating profit for eachMid-term Plan period (see the consolidated
operating profit chart on the next page), wecan see that the level of operating profit has
steadily risen a notch with each Mid-term Plan,
strengthening the earnings base. In the current
Mid-term Plan, operating profit has reached¥100 billion, underscoring stable growth evenin an industry with rapidly changing conditions. This achievement can be attributed tothe strengths of our diversified and self-­
reinforcing portfolio, which allows different
business segments and categories to alternate
roles in driving earnings growth, as well as ourwillingness to take on challenges from a stablefoundation. We will continue to strengthen
this earnings base going forward.

(Continued on next page)

June 2024 No.76

1

(Information in this section is as of the end of May 2024.)

Management

Interview with the President(billion yen)

Consolidated Operating Profit
Previous
Mid-term Plan
Annual average 82.4

Previous previous
Mid-term Plan

0

Annual average 62.6

20172017 75.0
75.0
2016
2016 63.2
63.2

4

2015
2015 49.6
49.6

Current
Mid-term Plan
Annual average 107.3
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2020
2020 84.6
84.6

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2019
2019 78.7
78.7

��������
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20182018 84.0
84.0

Previous previous
Mid-term Plan

Previous
Mid-term Plan

2

BANDAI NAMCO NEWS115.0

2023
Results

90.6

2022

116.4

2021

Preparation
periodThe Toys and Hobby business led the groupin FY2024.3.
In FY2025.3, we will promote a Bandai Namco
IP axis strategy with unique ideas and speed.
Could you provide a summary of howeach business performed in FY2024.3,and trends so far in FY2025.3, startingwith the Digital business?
Kawaguchi: In FY2024.3, while the core app
titles in network content did well, new online
game fell significantly short of its targets. In
home console games, new titles like ARMORED
CORE VI FIRES OF RUBICON and TEKKEN 8 wereglobal hits. However, the sales volume of
repeat titles decreased compared to the­previous fiscal year, influenced by differencesin the overall title lineup and product mix ofhome console games.
In FY2025.3, we aim to rebuild our development system with an eye on growth overthe medium to long term, and establish awell-balanced portfolio of game titles. Froma broad business perspective, with a strategic
portfolio in place, we will allocate resources
appropriately and manage schedules toensure steady progress on development. Wewill take the lead in consolidating the knowhow of multiple studios within the group at
Bandai Namco Studio. Furthermore, toensure long-term sales growth, we will coordinate marketing efforts globally, particularly
between Japan and North America, andstrategically decide on the measures andresource allocation for each region.
In network content, core apps have recently
been doing well. We will continue high-level

2024
Forecast

development of these apps through media
collaboration and events while focusing on
launching carefully selected new titles andimproving operational efficiency. In homeconsole games, we plan to release major
downloadable content, ELDEN RING SHADOW
OF THE ERDTREE, in June, along with several
new titles, such as GUNDAM BREAKER 4. For
repeat titles, sales of ELDEN RING and DRAGONBALL have been strong lately, and we expect
annual sales volume to reflect growing­interest in real entertainment among fans.
Additionally, under a new structure wheremarketing is coordinated between Japan andthe US, we will implement measures to growsales over the long term, such as marketingstrategies with a global perspective. ForTEKKEN 8, we have launched our own esports
world tour, and TEKKEN 8 will be featured in
the Esports World Cup in Saudi Arabia.

Current
Mid-term Plan

What are the circumstances in the Toysand Hobby business?
Kawaguchi: In FY2024.3, the Toys andHobby business saw continued success in
categories of products targeting the mature
fan base, such as Gundam model kits, cardproducts, capsule toys, and confectioneries. In addition to strengthening these
popular categories in Japan, we expanded
our global presence, particularly in thepriority markets of North America andinland China, resulting in higher sales.
Thanks to these initiatives, the Toys andHobby business significantly contributed
to the overall earnings of the Group.
In FY2025.3, we aim for record-breaking
earnings for a seventh consecutive year byfurther strengthening the deployment of­successful categories in the global market. We
will leverage our fast-cycling business model
to swiftly take on challenges.
Regarding Gundam model kits, this year
marks the 45th anniversary of Gundam,
and we have a wealth of buzz being­generated by events, such as the overseas
release of the theatrical work Mobile Suit
Gundam SEED FREEDOM. Next year, when

2017

75.0

2016

63.2

2015

49.6

Gundam model kits reach their 45th
­a nniversary, we will closely collaborate
to augment product offerings, aiming toestablish these model kits as a popular
category, especially overseas.
In card products, the new trading card
game DRAGON BALL SUPER CARD GAMEFUSIONWORLD,
which can be played both2020
84.6
digitally and physically, got off to a great start.
It is currently
being sold in 54 countries
2019
78.7
and regions. The ONE PIECE trading cardgame2018
will celebrate
84.0 its second anniversary
this summer. In addition to anniversary­promotions, we will host events targeting
casual players to attract new users.
In capsule toys, we are actively exploring
new genres and IPs. We have opened over 260
specialty stores around the world, and arefocusing on expanding business overseas.
Overall, the Toys and Hobby business istargeting medium- to long-term growthby advancing various initiatives to support
growth. These include marketing and­promotions in global markets, creating newIPs, enhancing production systems, ensuring
global quality standards, and expanding
e-commerce ­capabilities. Additionally, fostering a mature fan base for the future is a crucial
long-term challenge. We will continue to focus
on p­ roduct development and marketing foryounger age groups.
What is the situation in the IP Production
business?
Kawaguchi: In FY2024.3, we engaged in thecreation and production of various works.
In the Gundam series, multiple titles, includ­ing Mobile Suit Gundam THE WITCH FROM­MERCURY, helped to expand the fan base andboost sales of Group products. Additionally,video streaming and licensing sales of theseworks were favorable, and a resurgence in fansattending live entertainment events and venturing out to Gundam Factory Yokohama led

Theatrical version BLUELOCK -EPISODE NAGIesports “TEKKEN WORLD TOUR”©TEKKEN™ 8 & ©Bandai Namco Entertainment Inc.

DRAGON BALL SUPER CARD GAME FUSION WORLD©バードスタジオ／集英社・東映アニメーション©金城宗幸・三宮宏太・ノ村優介・講談社／「劇場版ブルーロック」製作委員会to favorable outcomes. In the fourth quarter,
the theatrical release of Mobile Suit Gundam
SEED FREEDOM had a strong start.
For FY2025.3, we have an exciting lineupof theatrical releases, TV animations, andstreaming works. We plan to expand businessbroadly around these works, including video
streaming, overseas markets, licensing, live
events and merchandise.
For the theatrical release of Mobile Suit
Gundam SEED FREEDOM in FY2024.3, box officerevenue will be recorded in FY2025.3, and weplan to release it in more than 80 countries
and regions. Additionally, we are launchingmeasures for the 45th anniversary of Gundam.
We also intend to generate buzz with mainly
video content ahead of Gundam’s 50th and60th anniversaries, so please look forward tothese events. Moreover, to meet growing
demand for live events, we are constructing
our own 2,000-seat concert hall in Shibuya,
Tokyo. This concert hall will not only hostevents but also serve as a venue for IP andartist development.
Furthermore, to strengthen IP creation,
which is the core mission of the IP Production business, we are enhancing talent­development, improving the work environment, and strengthening external partnerships.
In FY2024.3, Echoes Inc., which produces­vertical scroll comics, joined the Group, andin April this year, Eight Bit Inc. an a­ nimation
studio known for high-quality works like­BLUELOCK, also joined us. We will work on
creating high-quality content by sharing knowhow and talent with these new partners while
managing schedules and costs effectively.
What are the circumstances in theAmusement business?
Kawaguchi: In FY2024.3, the Amusementbusiness saw strong sales of new and updated
arcade titles in popular series, such as theMobile Suit Gundam Extreme Vs. series.
Additionally, facilities unique to Bandai­Namco, like the Bandai Namco Cross Store,
a collaboration of the Group’s products andservices, p­ erformed well.
In FY2025.3, we will maintain stable­operations by balancing amusement machines
and facilities. We will strengthen the operationsof successful models around the world. In
amusement machines, we plan to release thenew WANGAN MIDNIGHT MAXIMUM TUNE
6RR PLUS in the first half, and several othernew products in the second half of the year.

WANGAN MIDNIGHT MAXIMUM TUNE 6RR PLUS

©Michiharu Kusunoki/Kodansha Ltd. All rights reserved.
GAME ©Bandai Namco Amusement Inc.
All trademarks and copyrights associated withthe manufacturers, vehicles, models, trade names, brands
and visual images depicted in this game are the property of
their respective owners, and used with such permissions.

We are expanding the reach of Taiko no
Tatsujin in inland China, managing directlyowned retail stores for capsule toys and­trading card games in various regions, andincreasing sales of amusement machines andstore locations overseas.
Although there are still challenges, such as
rising depreciation and personnel expenses
associated with sales of amusement machines
and location openings, we aim to continue
playing a vital role as an outlet for IP, products
and services. Furthermore, in a time when realcommunication is increasingly valued, wewant to serve as real entertainment venues
and touchpoints for fans.
Finally, do you have a message for thereaders?
Kawaguchi: Internally, we are currently
discussing the long-term vision for the­next Mid-term Plan, which will begin in
April 2025. I believe that Bandai Namco’s
strengths lie in its unique ideas and speed.
By unique ideas, I mean our differentiatedstrategies as exemplified by our IP axis
­strategy, and the pursuit of various productand service i­nnovations. We aim to fully
embody the uniqueness of Bandai Namcoin these ideas. Additionally, speed is crucial
to promoting our IP axis strategy. We strive
to be a nimble and flexible Bandai Namco,
capable of responding to situations andenvironments with agility, without beingbound by past successes or preconceived
notions.

June 2024 No.76

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