Consolidated Financial Report for the First Quarter of
the Fiscal Year Ending March 31, 2020

August 8, 2019DISCLAIMER- BANDAI NAMCO Holdings Inc. provides this translation for your reference and convenience only and without any
warranty as to its accuracy or otherwise. In the event of any discrepancy, the original “Kessan Tanshin” in Japanese
shall prevail.
- This document contains forward-looking statements that are based on management’s estimates, assumptions andprojections at the time of publication. A number of factors could cause actual results to differ materially fromexpectations.

Stock Listing: Tokyo Stock Exchange
Code Number: 7832
(URL: https://www.bandainamco.co.jp/)
August 8, 2019

Consolidated Financial Report for the First Quarter of
the Fiscal Year Ending March 31, 2020 (Japanese GAAP)
Representative:
Mitsuaki Taguchi, President and Representative Director
Contact:
Yuji Asako, Director, Division General Manager of the Corporate Planning Division
Scheduled filing date of the quarterly security report:
August 9, 2019
Scheduled starting date for dividend payments:–
The Financial Highlights of the Financial Results for the Quarter: Yes
The information session of the Financial Results for the Quarter: Yes (for institutional investors and analysts)* Figures are in millions of yen, rounded down
1. Consolidated Results for the First Quarter of the Fiscal Year Ending March 31, 2020
(April 1, 2019 to June 30, 2019)(1) Consolidated Operating Results (For the Three Months Ended June 30, 2019)

First Quarter of the Fiscal YearEnding March 31, 2020
First Quarter of the Fiscal Year
Ended March 31, 2019

Net sales¥ million
159,251%5.5

150,899

4.7

Profit attributable toowners of parent¥ million%
16,924
15.6(Percentages indicate year-on-year changes.)
Operating profit
Recurring profit¥ million%¥ million%
22,83027.6
23,82922.2
17,897

14.6

Basic earnings per share

19,49820.1

Diluted earnings per share¥First Quarter of the Fiscal Year
77.00
Ending March 31, 2020
First Quarter of the Fiscal Year
14,637
8.4
66.61
Ended March 31, 2019
(Note) Comprehensive income: 13,732 million yen [(17.9)%] (FY2020.3 1Q), 16,731 million yen [2.7%] (FY2019.3 1Q)(2) Consolidated Financial Position
Total assets
Net assets
Equity ratio¥ million¥ million%
As of June 30, 2019562,840
416,827
73.9
As of March 31, 2019
612,955
429,644
70.0(Reference) Equity: 416,116 million yen (as of June 30, 2019), 429,031 million yen (as of March 31, 2019)¥––2. Cash Dividends
End offirst quarterEnd ofsecond quarter¥18.00

Annual cash dividends
End ofFiscalthird quarteryear-end–¥127.00

Total

Fiscal Year Ended March 31, 2019–¥145.00
Fiscal Year Ending March 31, 2020–
Fiscal Year Ending March 31, 2020
¥20.00–¥20.00¥40.00(Projections)(Note) Revision to the projections of cash dividends for the Fiscal Year Ending March 31, 2020: No
Concerning the projected amounts of the end of second quarter and year-end cash dividends for the fiscal year ending March 31,
2020, the base dividend is stated based on the Company’s basic policy on the distribution of profits. The year-end cash dividend
for the fiscal year ending March 31, 2020, will be considered by the Company based on the basic policy on the distribution of
profits.
3. Consolidated Projections for the Fiscal Year Ending March 31, 2020 (April 1, 2019 to March 31, 2020)(Percentages indicate year-on-year changes.)
Basic earnings
Net sales
OperatingRecurring
Profit attributable
per share
profitprofitto ownersof parent¥ million% ¥ million% ¥ million% ¥ million%¥
Six Months Ending
340,000
1.6
40,000(9.0)
41,000(10.5)
29,000(15.2)
131.94September 30, 2019
Full Fiscal Year
720,000(1.7)
70,000(16.7)
71,000(18.3)
50,000(21.1)
227.49(Note) Revision to the projections: Yes
Consolidated projections for the six months ending September 30, 2019 (announced on May 9, 2019) are revised in thisdocument.
For details of the revisions to the consolidated projections, please refer to “Notice Regarding Revisions to Consolidated
Projections” announced today (August 8, 2019).
* Notes(1) Changes in Significant Subsidiaries during the Period(Changes in Specified Subsidiaries Resulting in the Change in Scope of Consolidation): No(2) Application of Special Accounting for Preparing the Quarterly Consolidated Financial Statements: Yes(Note) For more details, please refer to the section of “(3) Notes to Consolidated Financial Statements, (Application of Special
Accounting for Preparing the Quarterly Consolidated Financial Statements)” of “2. Consolidated Financial Statements andSignificant Notes” on page 9 of the attached material.
(3) Changes in Accounting Policies, Changes in Accounting Estimation and Restatementa) Changes in accounting policies due to revisions to accounting standards and other regulations: Yesb) Changes in accounting policies due to revisions to other reasons: Noc) Changes in accounting estimation: Nod) Restatement: No(Note) For more details, please refer to the section of “(3) Notes to Consolidated Financial Statements, (Changes in Accounting
Policies)” of “2. Consolidated Financial Statements and Significant Notes” on page 9 of the attached material.
(4) Number of Issued Shares (Common Stock)a) Total number of issued shares at the end of the period (including treasury stock)
222,000,000 shares
As of June 30, 2019
As of March 31, 2019
222,000,000 sharesb) Number of shares of treasury stock at the end of the period
2,209,688 shares
As of June 30, 2019
As of March 31, 2019
2,209,402 sharesc) Average number of shares during the period (cumulative from the beginning of the fiscal year)
219,790,383 shares
For the First Quarter of the Fiscal Year Ending March 31, 2020
For the First Quarter of the Fiscal Year Ended March 31, 2019219,759,866 shares* Quarterly Consolidated Financial Reports are not required to be subjected to quarterly reviews conducted by certified public accountants
or an audit firm.
* Explanation on appropriate use of the projections of business results, etc.
- Forward-Looking Statements:
This document contains forward-looking statements that are based on management’s estimates, assumptions and projections at the timeof publication and those forward-looking statements do not purport to be a promise by the Company to achieve such results. A number

of factors could cause actual results to differ materially from expectations. Please refer to the section of “(3) Explanation Regarding
Consolidated Projections and Other Forward-Looking Statements” of “1. Qualitative Information Regarding Consolidated Results for
the First Quarter” on page 3 of the attached material for matters pertaining to the earnings projections.
- To obtain Financial Highlights:
The Financial Highlights will be posted on the Company’s website on August 8, 2019.

Attached Material
Index
1. Qualitative Information Regarding Consolidated Results for the First Quarter ........................... 2(1) Explanation Regarding Operating Results ......................................................................................................................... 2(2) Explanation Regarding Financial Position ......................................................................................................................... 3(3) Explanation Regarding Consolidated Projections and Other Forward-Looking Statements .............................................. 3

2. Consolidated Financial Statements and Significant Notes ................................................................ 5(1) Consolidated Balance Sheets.............................................................................................................................................. 5(2) Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income ................................... 7(Consolidated Statements of Operations) ........................................................................................................................... 7(Consolidated Statements of Comprehensive Income)....................................................................................................... 8(3) Notes to Consolidated Financial Statements ...................................................................................................................... 9(Notes on Premise of Going Concern) ............................................................................................................................... 9(Notes on Significant Changes in the Amount of Stockholders’ Equity) ........................................................................... 9(Application of Special Accounting for Preparing the Quarterly Consolidated Financial Statements) .............................. 9(Changes in Accounting Policies) ...................................................................................................................................... 9(Segment Information) ..................................................................................................................................................... 10-1-

1. Qualitative Information Regarding Consolidated Results for the First Quarter(1) Explanation Regarding Operating Results
During the first quarter (three months) of the fiscal year ending March 31, 2020, the economy continued to moderately
recover both in Japan and overseas. However, the outlook for the overall economy and personal consumption remained
uncertain.
In this environment, the BANDAI NAMCO Group (“the Group”) started a three-year Mid-term Plan in April 2018, under
the Mid-term Vision of “CHANGE for the NEXT: Empower, Gain Momentum, and Accelerate Evolution,” which reflects
our aspiration to achieve changes in all aspects to progress to a next stage without being bound by previous business models
and established ideas. Aiming for medium- and long-term growth, the Group has been promoting a range of measures. As
one of these initiatives, we have been taking advantage of the worldview and unique characteristics of IP (Intellectual
Property: meaning characters and other intellectual property) to further evolve the “IP Axis Strategy” that aims to maximize
IP value through the provision of the optimal products and services at the optimal possible times. The measures also include
an initiative to strengthen development in regions and businesses with high growth potential and an initiative to realize thetotal capabilities of the Group in regions around the world under the ALL BANDAI NAMCO concept.
During the first quarter (three months), the Toys and Hobby Business performed strongly atop favorable performance inproducts for the mature fan base in Japan and overseas, as did the Network Entertainment Business, which saw favorable
performance in network content in Japan and overseas along with repeat sales of home video game software overseas.
Consequently, the Group’s consolidated results for the first quarter (three months) were net sales of 159,251 million yen(year-on-year increase of 5.5%), operating profit of 22,830 million yen (year-on-year increase of 27.6%), recurring profit of
23,829 million yen (year-on-year increase of 22.2%), and profit attributable to owners of parent of 16,924 million yen (yearon- year increase of 15.6%).
Operating results by segment are as follows.
Toys and Hobby Business
As for the Toys and Hobby Business, in Japan and overseas, products for the mature fan base such as plastic models of
the Mobile Suit Gundam series and collectible figures and card related products for DRAGON BALL series gained in
popularity. In Japan, products for the mature fan base performed strongly along with long-established IP toys and peripheralproducts, such as the DRAGON BALL series, the KAMEN RIDER series, and the Super Sentai series. Overseas, in the Asian
region, products for the mature fan base and products such as ULTRAMAN series gained in popularity. In the Americas andEurope, the Group promoted efforts to strengthen sales and marketing of products for both children and the mature fan base.
As a result, net sales in the Toys and Hobby Business were 56,842 million yen (year-on-year increase of 12.5%), andsegment profit was 6,807 million yen (year-on-year increase of 28.5%).
Network Entertainment Business
As for the Network Entertainment Business, in network content, key titles being distributed worldwide such as the
DRAGON BALL series and ONE PIECE, and key titles in Japan such as The iDOLM@STER series, continued to perform
favorably due to ongoing measures targeting users. In home video games, there were no new major title launches, but repeat
sales of existing titles such as JUMP FORCE and ACE COMBAT 7: SKIES UNKNOWN, and DRAGONBALL FighterZ
enjoyed strong popularity, primarily overseas, due to continuous measures for users.
As a result, net sales in the Network Entertainment Business were 71,222 million yen (year-on-year increase of 1.8%),
and segment profit was 14,431 million yen (year-on-year increase of 41.4%).
Real Entertainment Business
As for the Real Entertainment Business, in amusement facilities, net sales in existing facilities in Japan was up year on
year, and we strengthened the development of new business formats that provide venue where customers are able to enjoy
experiences that only BANDAI NAMCO can offer. In regard to arcade games, we promoted the development of new products
to be introduced going forward.
As a result, net sales in the Real Entertainment Business were 21,613 million yen (year-on-year increase of 7.6%), andsegment loss was 36 million yen (compared with segment loss of 473 million yen for the same period of the previous fiscal
year).
Visual and Music Production Business
As for the Visual and Music Production Business, we stirred up public attention through the development of IP
productions, such as the cinematic release of a new GIRLS und PANZER movie, sales of visual and music package software-2-

of The iDOLM@STER series and LoveLive! Sunshine!! and the holding of live events, leading to those series gaining
popularity. However, overall sales of package software did not reach the level seen in the same period of the previous fiscal
year, when the Company launched several high-added-value products, due to differences in the product mix.
As a result, net sales in the Visual and Music Production Business were 9,191 million yen (year-on-year decrease of
4.1%), and segment profit was 1,323 million yen (year-on-year decrease of 50.6%).
IP Creation Business
As for the IP Creation Business, in visual production, we stirred up public attention around IP by disseminating
information on the production of a new movie marking the 40th anniversary of the Mobile Suit Gundam series, which isplanned for release in the second quarter or afterward and various other topic. We also took steps to strengthen our Groupwide initiatives and animation production structure, and so forth, with a view to enhancing IP creation. License revenue
maintained the same level as the same period of the previous fiscal year when it performed favorably.
As a result, net sales in the IP Creation Business were 3,263 million yen (year-on-year decrease of 10.7%), and segment
profit was 1,141 million yen (year-on-year decrease of 4.9%).
Other Businesses
Other Businesses consist of companies that conduct businesses such as logistics support, printing, and other kinds ofadministration and operational support for each of the Group companies. We are making efforts to manage such operations
related to group support in an efficient manner.
Net sales in the Other Businesses were 7,301 million yen (year-on-year increase of 5.8%), and segment profit was 307
million yen (year-on-year increase of 159.0%).
(2) Explanation Regarding Financial Position
At the end of the first quarter of the fiscal year ending March 31, 2020, total assets stood at 562,840 million yen, adecrease of 50,114 million yen from the end of the previous fiscal year. The main factor was a decrease of 42,502 million
yen in cash and time deposits mainly due to cash dividends paid.
Total liabilities amounted to 146,013 million yen, a decrease of 37,298 million yen from the end of the previous fiscal
year. The main factor was a decrease of 14,128 million yen in trade payables.
Total net assets stood at 416,827 million yen, a decrease of 12,816 million yen from the end of the previous fiscal year.
The main factor was a decrease of 9,623 million yen in retained earnings mainly due to cash dividends paid.
As a result, the equity ratio became 73.9% compared with 70.0% at the end of the previous fiscal year.
(3) Explanation Regarding Consolidated Projections and Other Forward-Looking Statements
Looking ahead, under our three-year Mid-term Plan, which started in April 2018, we will move ahead with measures
under our main strategies—the IP axis strategy, business strategy, region strategy, and personnel strategy. By implementing
these main strategies, we aim to further strengthen the Group’s business foundation and achieve growth in global markets.
For the consolidated projections for the second quarter (six months) of the fiscal year ending March 31, 2020, theconsolidated projections announced on May 9, 2019 have been revised as stated in the table below in light of the actual
results for the first quarter (three months) of the fiscal year ending March 31, 2020, the lineup and marketing plans of the
products and services scheduled in the second quarter, etc.
The consolidated projections for the full fiscal year are not revised in light of factors that include the continuation ofdramatic changes in the market environment both in Japan and overseas and the coming Christmas and New Year sellingseason.

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Revisions to consolidated projections for the second quarter (six months) of the fiscal year ending March 31, 2020
(April 1, 2019 to September 30, 2019)
Operating profit

Recurring profit(¥ million)
340,000
340,0000
0.0(¥ million)
31,00040,0009,000
29.0(¥ million)
31,50041,0009,500
30.2

Profitattributable toowners of parent(¥ million)
23,00029,0006,000
26.1

334,665

43,93545,802

34,188Net sales

Previous projections (A)Revised projections (B)Change in amount (B-A)
Change (%)(Reference)
Results for the second
quarter of the previous fiscal
year (The second quarter ofthe fiscal year ended March
31, 2019)-4-

Basic earnings
per share¥
104.65131.94––155.56

2. Consolidated Financial Statements and Significant Notes(1) Consolidated Balance Sheets(¥ million)
Prior Fiscal Year(As of March 31, 2019)

Current 1st quarter(As of June 30, 2019)

AssetsCurrent assets
Cash and time deposits

213,851

171,349

Trade receivables

93,08372,525

Finished goods and merchandise

19,062

21,849Work in process

42,42847,995

Raw materials and supplies

3,580

4,163

Other current assets

26,83625,763

(890)

(867)

397,951

342,779

Allowance for doubtful receivables
Total current assets
Fixed assets
Property, plant and equipment

87,59392,317

Intangible assets

11,845

12,121

Investment securities

74,02372,791Other investments and assets

41,90743,196

Allowance for doubtful receivables

(366)

(364)

Total investments and other assets

115,564

115,622

Investments and other assets

Total fixed assets
Total assets-5-215,003

220,061

612,955

562,840(¥ million)
Prior Fiscal Year(As of March 31, 2019)

Current 1st quarter(As of June 30, 2019)

Liabilities
Current liabilities
Trade payables

74,80460,676

Provision

3,505

1,693

Other current liabilities

85,58361,650Total current liabilities

163,893

124,020

Net defined benefit liability

10,383

10,576

Other long-term liabilities

9,034

11,416

Total long-term liabilities

19,41721,992

183,311

146,013

10,00010,000Long-term liabilities

Total liabilities
Net assets
Stockholders’ equity
Common stock
Capital surplus

52,30852,308Retained earnings

369,315359,692

Treasury stock(2,298)(2,300)Total stockholders’ equity

429,326

419,700

20,19019,407

5(373)

Accumulated other comprehensive income
Valuation difference on available-for-sale securities, net oftax
Deferred gains or losses on hedges, net of tax
Revaluation reserve for land, net of tax(5,920)(5,920)Foreign currency translation adjustments(8,864)(11,034)

Remeasurements of defined benefit plans, net of tax(5,705)(5,663)(294)(3,584)612

711

429,644416,827

612,955

562,840

Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets-6-

(2) Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income(Consolidated Statements of Operations)(¥ million)
Prior 1st quarter(From April 1, 2018
to June 30, 2018)

Current 1st quarter(From April 1, 2019
to June 30, 2019)

Net sales

150,899

159,251

Cost of sales

95,204

96,053Gross profit

55,69563,198Selling, general and administrative expenses

37,79740,367

Operating profit

17,897

22,830

Dividend income

452

540

Equity in gain of affiliated companies

339

412

Non-operating income

Other non-operating income

1,068

433

Total non-operating income

1,859

1,387

–

350

257

37

Non-operating expenses
Foreign exchange losses
Other non-operating expenses
Total non-operating expenses

257

388

19,49823,829Gain on sales of fixed assets

148Gain on sales of investment securities

Recurring profit
Extraordinary income

231–

Reversal of provision for loss on liquidation of affiliatedcompanies–

21

Other extraordinary income–

0

Total extraordinary income

246

30

Loss on impairment of fixed assets

27–

Loss on disposal of fixed assets

15

26

Loss on valuation of stocks of affiliated companies

33

63

Other extraordinary loss

40

1

Extraordinary loss

Total extraordinary loss

117

91

Profit before income taxes

19,627

23,767

Income taxes

5,293

6,727

Profit14,334

17,040(303)

115

14,637

16,924

Profit (loss) attributable to non-controlling interests
Profit attributable to owners of parent-7-

(Consolidated Statements of Comprehensive Income)(¥ million)
Prior 1st quarter(From April 1, 2018
to June 30, 2018)
ProfitCurrent 1st quarter(From April 1, 2019
to June 30, 2019)14,334

17,040

1,654

(792)

Other comprehensive income
Valuation difference on available-for-sale securities, net oftax
Deferred gains or losses on hedges, net of tax

445

(378)

Foreign currency translation adjustments

247(2,186)

Remeasurements of defined benefit plans, net of tax

124

41

Share of other comprehensive income of associates
accounted for using equity method

(75)

9

Total other comprehensive income
Comprehensive income

2,397(3,307)

16,731

13,732

17,035

13,634(303)

98

Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to non-controllinginterests-8-

(3) Notes to Consolidated Financial Statements(Notes on Premise of Going Concern)
Not applicable.
(Notes on Significant Changes in the Amount of Stockholders’ Equity)
Not applicable.
(Application of Special Accounting for Preparing the Quarterly Consolidated Financial Statements)(Calculation of taxes)
Taxes are calculated first by reasonably estimating the effective tax rate after applying tax effect accounting against
profit before income taxes for the fiscal year including the current first quarter, and next by multiplying the profit before
income taxes by such estimated effective tax rate.
(Changes in Accounting Policies)(Application of US accounting standard ASU 2014-09 “Revenue from contracts with customers”)
Effective from the first quarter ended June 30, 2019, the Company’s consolidated subsidiaries in the United States haveapplied the US accounting standard ASU 2014-09 “Revenue from contracts with customers.”
With the application of ASU 2014-09, revenue is required to be recognized at the time of transfer of promised goods orservices to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange
for those goods or services. In applying this ASU, the Company used the method to recognize the cumulative effect ofretrospective adjustments at the date of initial application.
As a result of this change, for the first quarter (three months), net sales decreased by 2,414 million yen, cost of sales
decreased by 1,244 million yen, while operating profit, recurring profit, and profit before income taxes each decreased by
1,170 million yen. In addition, the opening balance of retained earnings increased by 936 million yen.
(Application of IFRS 16 “Leases”)
Effective from the first quarter ended June 30, 2019, some overseas consolidated subsidiaries applied IFRS 16 “Leases.”
IFRS 16 requires the recognition by the lessee for all leases in principle of right-of-use assets, being the right to use theunderlying asset, and lease liabilities, being the obligation to make lease payments. In applying the standard, the Company
used the method to recognize the cumulative effect of retrospective adjustments at the date of initial application.
As a result, the opening balance of assets, liabilities, and retained earnings increased by 3,509 million yen, 3,497 million
yen, and 12 million yen, respectively. The effect of this change on operating profit, recurring profit, and profit before income
taxes for the first quarter (three months) is immaterial.

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(Segment Information)
I. Prior 1st quarter (From April 1, 2018 to June 30, 2018)
1. Information regarding the amounts of net sales and profit/loss by reportable segment(¥ million)
Reportable segments
Visual andRealNetwork
IP
Toys andEntertain- Entertain- Music
Creation
Hobby
ment Production
mentBusiness
Business
Business Business Business

Subtotal

Other(Note 1)

Total

Adjustments(Note 2)

Consolidated
Total(Note 3)

Net sales
To externalcustomers

48,786

68,67919,986

8,527

2,487

148,467

2,432

150,899–

150,899

Inter-segment sales
and transfers

1,749

1,303

94

1,054

1,168

5,369

4,468

9,838

(9,838)–

Total

50,53669,982

20,081

9,581

3,655

153,837

6,900

160,738(9,838) 150,899

Segment profit (loss)

5,296

10,207

(473)

2,679

1,200

18,910118

19,029(1,131)

Notes: 1.
2.

3.

17,897The “Other” category is a business segment not included in reportable segments under which operations such as
logistics services and printing for each of the Group companies are classified.
Included in the 1,131 million yen deducted from segment profit (loss) as adjustment are an addition of 184 million
yen in inter-segment eliminations, and a deduction of 1,316 million yen in corporate expenses that cannot beallocated to any reportable segment. The corporate expenses are mainly costs related to the administration divisionthat has not been attributed to a reportable segment.
Segment profit (loss) is adjusted with operating profit in the consolidated statements of operations.

2. Information regarding loss on impairment of fixed assets and goodwill by reportable segment(Material loss on impairment of fixed assets)
Not applicable.
(Material changes in the amount of goodwill)
Not applicable.
(Material gains on negative goodwill)
Not applicable.

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II. Current 1st quarter (From April 1, 2019 to June 30, 2019)
1. Information regarding the amounts of net sales and profit/loss by reportable segment(¥ million)
Reportable segments
Visual andRealNetwork
IP
Toys andEntertain- Entertain- Music
Creation
Hobby
ment Production
mentBusiness
Business
Business Business Business

Subtotal

Other(Note 1)

Total

Adjustments(Note 2)

Consolidated
Total(Note 3)

Net sales
To externalcustomers

55,081

70,137

21,339

8,222

2,204

156,984

2,266

159,251–

159,251

Inter-segment sales
and transfers

1,761

1,084

273

969

1,058

5,148

5,034

10,182(10,182)–

Total

56,842

71,222

21,613

9,191

3,263

162,133

7,301

169,434(10,182) 159,251

Segment profit (loss)

6,807

14,431

(36)

1,323

1,141

23,666307

23,973(1,143)

Notes: 1.
2.

3.

22,830The “Other” category is a business segment not included in reportable segments under which operations such as
logistics services and printing for each of the Group companies are classified.
Included in the 1,143 million yen deducted from segment profit (loss) as adjustment are an addition of 150 million
yen in inter-segment eliminations, and a deduction of 1,293 million yen in corporate expenses that cannot beallocated to any reportable segment. The corporate expenses are mainly costs related to the administration divisionthat has not been attributed to a reportable segment.
Segment profit (loss) is adjusted with operating profit in the consolidated statements of operations.

2. Information regarding loss on impairment of fixed assets and goodwill by reportable segment(Material loss on impairment of fixed assets)
Not applicable.
(Material changes in the amount of goodwill)
Not applicable.
(Material gains on negative goodwill)
Not applicable.
3. Information regarding changes to reportable segments, etc.
(Application of US accounting standard ASU 2014-09 “Revenue from contracts with customers”)
As described under “Changes in Accounting Policies,” the Company’s consolidated subsidiaries in the United States
have applied US accounting standard ASU 2014-09 “Revenue from contracts with customers” effective from the firstquarter ended June 30, 2019. Consequently, they changed their method of revenue recognition to the method in whichrevenue is recognized at the time of transfer of promised goods or services to customers in an amount that reflects theconsideration to which they expect to be entitled in exchange for those goods or services.
In accordance with this change, compared to the previous method of revenue recognition, for the first quarter (threemonths) in the Network Entertainment Business, the amount of net sales recorded decreased by 2,414 million yen andthe amount of segment profit decreased by 1,170 million yen.

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