Consolidated Financial Report for the Fiscal Year Ended
March 31, 2018

May 9, 2018DISCLAIMER- 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: http://www.bandainamco.co.jp/)
May 9, 2018

Consolidated Financial Report for the Fiscal Year Ended March 31, 2018 (Japanese GAAP)
Representative:
Mitsuaki Taguchi, President and Representative Director
Contact:
Yuji Asako, Director, Division General Manager of the Corporate Planning Division
Date of Ordinary General Meeting of Shareholders:June 18, 2018
Scheduled starting date for dividend payments:
June 19, 2018
Scheduled filing date of the annual security report:
June 18, 2018
The Financial Highlights of the Financial Results:
Yes
The information session of the Financial Results:
Yes (for institutional investors and analysts)* Figures are in millions of yen, rounded down
1. Consolidated Results for the Fiscal Year Ended March 31, 2018 (April 1, 2017 to March 31, 2018)(1) Consolidated Operating Results

Fiscal Year Ended
March 31, 2018
Fiscal Year Ended
March 31, 2017

Net sales¥ million
678,312%9.4

620,061

7.7

Profit attributable toowners of parent¥ million%
54,10922.5(Percentages indicate year-on-year changes.)
Operating profit
Recurring profit¥ million%¥ million%
75,02418.6
75,38019.1
63,238

27.4

Basic earnings per share

63,29024.7

Diluted earnings per share¥
Fiscal Year Ended
246.29March 31, 2018
Fiscal Year Ended
44,15927.7
201.03
March 31, 2017
(Note) Comprehensive income: 56,024 million yen [30.0%] (FY2018.3), 43,104 million yen [57.4%] (FY2017.3)
ROE(Profit attributable toowners of parent / Net
assets)ROA(Recurring profit /Total assets)¥
246.23200.97

Operating margin(Operating profit /Net sales)%%%
Fiscal Year Ended
14.7
14.7
11.1
March 31, 2018
Fiscal Year Ended
13.3
13.5
10.2
March 31, 2017
(Reference) Gain or loss from application of equity method: 930 million yen (FY2018.3), 556 million yen (FY2017.3)(2) Consolidated Financial Position
Total assets

Net assets

Equity ratio¥ million¥ million%
As of March 31, 2018
540,490387,354
71.5
As of March 31, 2017
488,032
348,784
71.3(Reference) Equity: 386,556 million yen (as of March 31, 2018), 348,106 million yen (as of March 31, 2017)

Net assets
per share¥
1,758.99
1,584.71

(3) Consolidated Statements of Cash Flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities¥ million
55,138¥ million(63,338)¥ million(17,086)

Cash and cash
equivalents at endof period¥ million
180,83164,136(13,016)(13,171)

205,667

Fiscal Year Ended
March 31, 2018
Fiscal Year Ended
March 31, 2017
2. Cash Dividends

Fiscal Year Ended
March 31, 2017
Fiscal Year Ended
March 31, 2018

End offirstquarter¥––

Annual cash dividends
End of
End ofFiscalsecondthird
year-endquarterquarter
¥
¥
¥
12.00
–
70.00
12.00

–

111.00

Total

¥
82.00
123.00Total
Payout ratio
Dividend /dividend(Consolidated) Net assets
payment(Consolidated)(Full year)¥ million%%
18,02340.8
5.4
27,045

49.9

7.4

Fiscal Year Ending
–
18.00
–
18.00
36.00
18.4
March 31, 2019
(Projections)(Note) The year-end cash dividend per share for the fiscal year ended March 31, 2018 consists of:
Ordinary cash dividend per share: 86.00 yen and Special dividend per share: 25.00 yen.
Concerning the projected amounts of the end of second quarter and year-end cash dividends for the fiscal year ending
March 31, 2019, 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, 2019, 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, 2019 (April 1, 2018 to March 31, 2019)(Percentages indicate year-on-year changes.)
Net sales
OperatingRecurring
Profit attributable
Basic earnings
profitprofitto owners
per shareof parent¥ million% ¥ million% ¥ million% ¥ million%¥
Six Months Ending
306,000(0.9)
29,000 (17.0)
29,500 (17.3)
22,000 (22.0)
100.11
September 30, 2018
Full Fiscal Year
650,000(4.2)
60,000 (20.0)
61,000 (19.1)
43,000 (20.5)
195.67* Notes(1) Changes in Significant Subsidiaries during the Period(Changes in Specified Subsidiaries Resulting in the Change in Scope of Consolidation): Yes
Included: 1 company (BANDAI NAMCO Holdings CHINA CO., LTD.) Excluded: 1 company (Anime Consortium Japan Inc.)(2) Changes in Accounting Policies, Changes in Accounting Estimation and Restatementa) Changes in accounting policies due to revisions to accounting standards and other regulations: Nob) Changes in accounting policies due to revisions to other reasons: Noc) Changes in accounting estimation: Nod) Restatement: No(3) 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 March 31, 2018
As of March 31, 2017
222,000,000 sharesb) Number of shares of treasury stock at the end of the period
2,239,901 shares
As of March 31, 2018
As of March 31, 2017
2,334,579 sharesc) Average number of shares during the period
219,698,981 shares
For the Fiscal Year Ended March 31, 2018
For the Fiscal Year Ended March 31, 2017219,672,077 shares

(Reference) Non-consolidated Information
1. Non-consolidated Results for the Fiscal Year Ended March 31, 2018 (April 1, 2017 to March 31, 2018)(1) Non-consolidated Operating Results

Fiscal Year Ended
March 31, 2018
Fiscal Year Ended
March 31, 2017

Fiscal Year Ended
March 31, 2018
Fiscal Year Ended
March 31, 2017

Operating revenue¥ million%
21,075(13.3)(Percentages indicate year-on-year changes.)
Operating profit
Recurring profit¥ million%¥ million%
15,855(17.0)
16,230(15.6)

24,309(16.9)

19,103(25.7)

Profit¥ million
16,204

%
30.7

¥
73.72

Diluted earnings per share¥
73.70

12,399(52.2)

56.41

56.40

Basic earnings per share

19,233(26.1)(2) Non-consolidated Financial Position
Total assets

Net assets

Equity ratio¥ million¥ million%
368,497
253,175
68.7
As of March 31, 2017354,697
251,257
70.8(Reference) Equity: 253,175 million yen (as of March 31, 2018), 251,158 million yen (as of March 31, 2017)
As of March 31, 2018

Net assets
per share¥
1,151.38
1,142.70

2. Non-consolidated Projections for the Fiscal Year Ending March 31, 2019 (April 1, 2018 to March 31, 2019)(Percentages indicate year-on-year changes.)
ProfitOperating revenue
Recurring profit
Basic earnings
per share¥ million% ¥ million% ¥ million%¥
Full Fiscal Year
25,00018.6
20,00023.2
20,00023.4
90.96* Consolidated Financial Reports are not required to be audited 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 numberof factors could cause actual results to differ materially from expectations. Please refer to the section of “(4) Future Outlook” of “1.
Overview of Operating Results and Others” on page 4 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 May 9, 2018.

Attached Material
Index
1. Overview of Operating Results and Others ....................................................................................... 2(1) Overview of Operating Results for the Period (April 1, 2017 to March 31, 2018) ............................................................ 2(2) Overview of Financial Position for the Period ................................................................................................................... 3(3) Overview of Cash Flows for the Period ............................................................................................................................. 3(4) Future Outlook ................................................................................................................................................................... 4(5) Basic Policy on the Distribution of Profits ......................................................................................................................... 5

2. Basic Concept Regarding Selection of Accounting Standards .......................................................... 5
3. Consolidated Financial Statements and Significant Notes ................................................................ 6(1) Consolidated Balance Sheets.............................................................................................................................................. 6(2) Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income.................................... 8(Consolidated Statements of Operations) ........................................................................................................................... 8(Consolidated Statements of Comprehensive Income) ....................................................................................................... 9(3) Consolidated Statements of Changes in Net Assets ......................................................................................................... 10(4) Consolidated Statements of Cash Flows .......................................................................................................................... 14(5) Notes to Consolidated Financial Statements .................................................................................................................... 16(Notes on Premise of Going Concern) ............................................................................................................................. 16(Segment Information) ..................................................................................................................................................... 16(Per-Share Data) ............................................................................................................................................................... 22(Significant Subsequent Events) ...................................................................................................................................... 23

4. Other .................................................................................................................................................... 27
Changes in Directors and Audit & Supervisory Board Members ........................................................................................... 27-1-

1. Overview of Operating Results and Others(1) Overview of Operating Results for the Period (April 1, 2017 to March 31, 2018)
During the fiscal year ended March 31, 2018, the Japanese economy continued to moderately recover, supported
mainly by a recovery in personal consumption and improved corporate profitability. However, the outlook for the overall
economy remained uncertain. Overseas, personal consumption was impacted by uncertainty in social conditions and otherfactors.
In this environment, the BANDAI NAMCO Group (“the Group”) has pushed ahead with the three-year Mid-term Plan
that started in April 2015. Under the Vision of “NEXT STAGE: Empower, Gain Momentum and Accelerate Evolution,”
the Group is targeting medium- and long-term growth and has focused on creating and cultivating new IP (Intellectual
Property: meaning characters and other intellectual property), expanding target markets, and growing new businesses aspart of efforts to strengthen the “IP Axis Strategy” that aims to maximize IP value through the provision of the bestproducts and services at the best possible times. The Group also worked to expand its IP lineup, business fields and areas inoverseas markets.
During this fiscal year, we pushed ahead with key measures of the Mid-term Plan, where network content such as gameapplications for smartphones and home video games performed well in Japan and overseas. In addition, key IP products
and services in each business segment also performed favorably. Accordingly, we were able to achieve our record-high net
sales and operating profit.
Consequently, the Group’s consolidated results for the fiscal year ended March 31, 2018 were net sales of 678,312
million yen (year-on-year increase of 9.4%), operating profit of 75,024 million yen (year-on-year increase of 18.6%),
recurring profit of 75,380 million yen (year-on-year increase of 19.1%), and profit attributable to owners of parent of
54,109 million yen (year-on-year increase of 22.5%).
<Operating Results by Segment>
Operating results by segment are as follows.
Effective from the fiscal year ended March 31, 2018, the Group changed the classification of part of its reportablesegments. Consequently, in year-on-year comparisons the figures for the previous fiscal year have been restated into thefigures for the classifications after the change.
Toys and Hobby Business
As for Toys and Hobby Business, in Japan, long-established IP products such as the KAMEN RIDER series, the
PRETTY CURE! series, and the Dragon Ball series continued to perform well, while products of the Mobile Suit Gundam
series performed steadily, mainly in plastic models. In addition, the Group enhanced efforts to expand its target markets formature fans and implemented measures to strengthen the IP axis strategy by taking steps to expand IP lineup and the like.
Overseas, in the Asian region, products of the Mobile Suit Gundam series and collectable toys for mature fans continued
gaining in popularity. In Americas and Europe, we continued with the roll-out of products for the mature fan base, such ascard products.
As a result, net sales in the Toys and Hobby Business were 222,417 million yen (year-on-year increase of 2.0%), andsegment profit was 14,476 million yen (year-on-year increase of 8.6%).
Network Entertainment Business
As for the Network Entertainment Business, in network content such as game applications for smartphones, key titles
being distributed worldwide such as DRAGON BALL Z DOKKAN BATTLE and ONE PIECE Treasure Cruise, and, inJapan, key titles such as The iDOLM@STER series continued to perform well and contributed to earnings. In home video
games, the new title TEKKEN 7 and DRAGONBALL FighterZ became popular mainly in Americas and Europe, and repeat
sales of existing titles were favorable. In the amusement business, the Group’s existing amusement facilities in Japan
performed favorably, and the Group proactively developed machines and opened new facilities utilizing virtual reality(VR) as a fresh initiative combining new technologies.
As a result, net sales in the Network Entertainment Business were 405,986 million yen (year-on-year increase of
14.2%), and segment profit was 52,374 million yen (year-on-year increase of 24.6%).
Visual and Music Production BusinessIn the Visual and Music Production Business, the Company rolled out videos and products linked to new and existing
key IP products, such as the Mobile Suit Gundam series, the LoveLive! series, and the GIRLS und PANZER series, and these
became popular. Although earnings also made a contribution from license revenue related to products such as the LoveLive!
-2-

series, differences mainly in the launch timing for key products resulted in a year-on-year decline in earnings for thebusiness overall.
As a result, net sales in the Visual and Music Production Business were 56,058 million yen (year-on-year decrease of0.4%), and segment profit was 12,508 million yen (year-on-year decrease of 6.9%).
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’s strategic business units: Toys and Hobby SBU, Network
Entertainment SBU, and Visual and Music Production SBU. We are making efforts to manage such operations related togroup support in an efficient manner.
As a result, net sales in the Other Businesses were 27,640 million yen (year-on-year increase of 3.1%), and segment
profit was 767 million yen (year-on-year increase of 9.3%).
(2) Overview of Financial Position for the Period
At the end of the fiscal year ended March 31, 2018, total assets stood at 540,490 million yen, an increase of 52,457
million yen from the end of the previous fiscal year. The main factors were increases of 12,542 million yen in tradereceivables, 8,861 million yen in work in process, 33,919 million yen in property, plant and equipment mainly due to theacquisition of land, and 17,293 million yen in investment securities, despite a decrease of 19,999 million yen in cash andtime deposits mainly due to the acquisition of land, cash dividends paid, and the purchases of investment securities.
Total liabilities amounted to 153,135 million yen, an increase of 13,887 million yen from the end of the previous fiscal
year. The main factors were increases of 5,382 million yen in trade payables, and 4,218 million yen in other current
liabilities due to increases mainly in accounts payable-other.
Total net assets stood at 387,354 million yen, an increase of 38,570 million yen from the end of the previous fiscal year.
The main factors were increases of 36,279 million yen in retained earnings due to the recording of 54,109 million yen in
profit attributable to owners of parent, and 3,811 million yen in valuation difference on available-for-sale securities, net oftax, despite cash dividends paid of 18,023 million yen.
As a result, the equity ratio became 71.5% compared with 71.3% at the end of the previous fiscal year.
(3) Overview of Cash Flows for the Period
As of the end of the fiscal year, cash and cash equivalents (“funds”) remaining on hand had decreased by 24,835
million yen from the end of the previous fiscal year to 180,831 million yen.
Below is the breakdown of cash flows by activities.
(Cash Flows from Operating Activities)
The amount of funds provided by operating activities totaled 55,138 million yen (year-on-year decrease of 14.0%). Asa breakdown of funds used, income taxes paid was 19,709 million yen (compared with 10,462 million yen in the previous
fiscal year). However, overall, there was a net increase in funds due to profit before income taxes of 72,497 million yen(compared with 60,860 million yen in the previous fiscal year) and depreciation and amortization of 23,545 million yen(compared with 21,854 million yen in the previous fiscal year).
(Cash Flows from Investing Activities)
The amount of funds used in investing activities totaled 63,338 million yen (year-on-year increase of 386.6%). The
main breakdown of funds used was purchases of property, plant and equipment and intangible assets totaling 48,243
million yen (compared with 14,821 million yen in the previous fiscal year) and purchases of investment securities of
11,461 million yen (compared with 2,946 million yen in the previous fiscal year).
(Cash Flows from Financing Activities)
The amount of funds used in financing activities totaled 17,086 million yen (year-on-year increase of 29.7%). The main
breakdown of funds used was cash dividends paid of 18,023 million yen (compared with 11,429 million yen in the previous
fiscal year).

-3-

(Reference) Cash Flow Indices
FY2014.3

FY2015.3

FY2016.3

FY2017.3

FY2018.3

Equity ratio (%)

66.0

68.6

70.6

71.3

71.5

Equity ratio (market capitalization basis) (%)

132.5

116.3

120.2

149.9

142.1

0.2

0.1

0.0

0.0

0.0

308.0

635.3

1,123.3

1,718.0

1,468.2

Cash flows to interest bearing debt ratio(years)Interest coverage ratio (times)

Equity ratio: Total stockholders’ equity/Total assets
Equity ratio (market capitalization basis): Market capitalization/Total assets
Cash flows to interest bearing debt ratio: Interest-bearing debt/Cash flow
Interest coverage ratio: Cash flow/Interest expenses
Note 1: All calculations are performed using consolidated financial figures.
Note 2: Market capitalization is calculated on the basis of the number of issued shares excluding treasury stock.
Note 3: Operating cash flow is used for cash flow.
Note 4: Interest-bearing debt covers all debt reported in the consolidated balance sheets for which interest is paid.
(4) Future Outlook
Looking ahead, although there are bright signs in Japanese and overseas economic trends, the business environment is
expected to remain beset by uncertainties, including the impact on personal consumption from uncertainties in the overallsociety and the overall economy, as well as overseas political trends. Such factors are also expected to have an impact on
the entertainment industry, in which the Group is extensively involved, resulting in ongoing uncertainty in this businessenvironment, and also, even severe changes in the market environment and user preferences.
Facing these circumstances, the Group started a three-year new 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 aspirationto achieve changes in all aspects to progress to a next stage rather than being bound by previous business models andestablished ideas. In the new Mid-term Plan, the Group will aim to evolve “IP Axis Strategy” further to maximize IP value
through taking advantage of the worldview and unique characteristics of its IPs and providing the best products andservices at the best possible times, thereby achieving penetration and expansion in global markets. At the same time, wewill also strengthen development in regions and businesses with high growth potential. Furthermore, we will drive creationof new IP and regionally oriented strategies by unifying the efforts in each region across the Group under the ALL
BANDAI NAMCO concept.
We will implement the following four strategies as the main strategies in the new Mid-term Plan:
1. IP axis strategy “Accelerate evolution in IP axis strategy”
Boost capability to create IP (structural changes) / Invest aggressively in IP creation
2. Business strategy “Empower push into new entertainment”
Establish and enhance business infrastructure / Expand and strengthen business fields / Promote incubation
3. Region strategy “Gain momentum with ALL BANDAI NAMCO”
Make full-blown entry into Chinese market / Establish system for ALL BANDAI NAMCO
4. Personnel strategy “Make personnel the core of the Group”
Establish environment to optimize employees’ performance by tapping their individual strengths, and to empower
new ventures
By implementing these main strategies, we aim to further strengthen the Group’s business foundation and achieve
growth in global markets. Our numerical targets for the fiscal year ending March 31, 2021, the final year of the new
Mid-term Plan, are net sales of 750,000 million yen and operating profit of 75,000 million yen. We are also targeting
operating margin at 10% or more and ROE (profit attributable to owners of parent / net assets) at 10% or more.
Starting April 2018, the Group has changed its organizational structure to promote the advancement of each of thestrategies of the new Mid-term Plan. The name of the units of aggregated business companies that are to execute therespective business strategies has been changed from “SBUs” (Strategic Business Units) to “Units.” In addition, to enableswifter advancement of the main strategies for each mission stated in the Mid-term Plan, the Group has shifted from its
previous three-SBU structure to a five-Unit structure. Specifically, the Network Entertainment SBU has been reorganized-4-

into the Network Entertainment Unit, which develops business in fields such as network content and home video games,
and the Real Entertainment Unit, which provides content for real-world based facilities, services, equipment, and so forth,unique to the Group. Moreover, the IP Creation Unit has been established as a spin-off from the Visual and Music
Production SBU to focus on creating new IP.
In the fiscal year ending March 31, 2019, the first year of the new Mid-term Plan, the Group will work to push forward
implementation of main strategies in each Unit. As part of the initiatives to be implemented across the Units, we will
strengthen new IP creation and cultivation capability in various ways including product or service-originated IP, visual
product-originated IP, utilization of an internal idea posting system, collaboration with partner companies and strategic
investments. The Group also plans to push ahead with strengthening foundations across the Units in preparation for afull-blown entry into the Chinese market. In the Toys and Hobby Unit, we will maintain and expand our domestic market
share while strengthening the business in products for mature fan base in Japan and overseas. In the Network
Entertainment Unit, we will further accelerate the worldwide roll-out of network content and home video games, and also
push ahead with activities for creating new entertainment including a new platform. In the Real Entertainment Unit, we
will strengthen our capability of providing venues, services and content leveraging unique strength of the Group. In the
Visual and Music Production Unit, we will promote the IP expansion with visuals, music and live performance integrated.
In the IP Creation Unit, we will strengthen new IP creation through collaboration among Units over respective products andservices.
We will strengthen the foundation for growth under the Mid-term Plan by implementing these initiatives. In light of theabove considerations, the consolidated projections of the fiscal year ending March 31, 2019 are as follows: net sales of
650,000 million yen (year-on-year decrease of 4.2%), operating profit of 60,000 million yen (year-on-year decrease of
20.0%), recurring profit of 61,000 million yen (year-on-year decrease of 19.1%), and profit attributable to owners of parentof 43,000 million yen (year-on-year decrease of 20.5%).
(5) Basic Policy on the Distribution of Profits
The Company ranks the return of profits to shareholders as one of its highest priorities in its management. The
Company aims to further strengthen the Group’s competitiveness and, while maintaining a sound financial status, toachieve regular distributions of dividends and improvement in the Company’s corporate value. As part of starting the new
Mid-term Plan in April 2018, and in light of the Group’s strategy and the environment surrounding its business, the basic
policy for providing returns to shareholders was examined from various angles. As a result, the Company changed over to abasic policy of providing a return to shareholders that targets a total return ratio of 50% or more based on stable dividend
payments of 2% of DOE (dividends on equity). Under this policy, the Company strives to maintain long-term and stabledividend levels and be more aware of capital cost. In line with this change, it was resolved at the Board of Directors
meeting held on February 9, 2018, that the new basic policy will be applied to the distribution of dividends ahead ofschedule starting with the year-end dividend for the fiscal year ended March 31, 2018.
For the annual cash dividend per share for the fiscal year ended March 31, 2018, a performance-based dividend of 66
yen, and a special dividend of 25 yen, paid to express the Company’s thanks to shareholders concerning its achievement ofrecord-high net sales and operating profit, will be added to a base dividend of 32 yen. In total, the annual cash dividend forthe fiscal year will be 123 yen per share. Since the Company paid an interim dividend of 12 yen per share on December 7,
2017, the year-end dividend will be 111 yen per share.
The Company’s annual dividend forecast for the fiscal year ending March 31, 2019 is 36 yen per share, which is thebase dividend set in accordance with the Company’s basic policy on the distribution of profits. The year-end cash dividend
for the fiscal year ending March 31, 2019 will be considered by the Company based on the basic policy on the distributionof profits.

2. Basic Concept Regarding Selection of Accounting Standards
The Group plans to continue using Japanese GAAP to prepare its consolidated financial statements for the time being,as they facilitate comparison with previous consolidated financial statements and with other companies.
The Group’s policy on applying International Financial Reporting Standards is to take action as appropriate based on
considerations of various conditions in Japan and overseas.

-5-

3.

Consolidated Financial Statements and Significant Notes(1) Consolidated Balance Sheets(¥ million)
Prior Fiscal Year

Current Fiscal Year(As of March 31, 2017)(As of March 31, 2018)

AssetsCurrent assets
Cash and time deposits

205,516

185,517

Trade receivables

75,51988,061Finished goods and merchandise

14,466

14,780Work in process

28,82337,684

Raw materials and supplies

3,398

3,216

Deferred tax assets

9,240

8,995

Other current assets

21,271

22,529(453)(1,172)357,782359,61330,69930,122

Accumulated depreciation(15,343)(15,006)

Buildings and structures, net

15,35615,116

Amusement facilities and machines

58,97563,008

Accumulated depreciation(46,876)(47,341)

Amusement facilities and machines, net

12,09815,666

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

11,15543,420

Other property, plant and equipment

117,199

118,868(103,624)(106,967)

13,575

11,900

Accumulated depreciation
Other property, plant and equipment, net
Total property, plant and equipment

52,184

86,104

Intangible assets

9,686

9,475

Investments and other assets
Investment securities

39,20256,495Net defined benefit asset

71

117

Deferred tax assets

12,444

13,251Other investments and assets

18,321

16,827

Allowance for doubtful receivables(1,662)(1,394)

Total investments and other assets

68,37885,297130,249

180,877

488,032

540,490

Total fixed assets
Total assets-6-(¥ million)
Prior Fiscal Year

Current Fiscal Year(As of March 31, 2017)(As of March 31, 2018)

Liabilities
Current liabilities
Trade payables

64,17369,555

Accrued income taxes

8,657

8,597

Provision for directors’ bonuses

1,822

1,803

Provision for sales returns

780

1,024

Provision for contract loss

113

629

Other provision

746

629

Other current liabilities

49,81554,034

Total current liabilities

126,110

136,273

5,766

8,485

433

348

Other long-term liabilities

6,938

8,028

Total long-term liabilities

13,13816,862

139,248

153,135

Common stock

10,00010,000Additional paid-in capital

52,06452,196

Retained earnings

297,984

334,264

Long-term liabilities
Net defined benefit liability
Deferred tax liabilities for land revaluation

Total liabilities
Net assets
Stockholders’ equity

Treasury stock(2,423)(2,326)

Total stockholders’ equity

357,626

394,133

7,884

11,696

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

210

(300)

Revaluation reserve for land, net of tax(5,693)(5,887)

Foreign currency translation adjustments(8,725)(8,330)Remeasurements of defined benefit plans, net of tax(3,195)(4,756)

Total accumulated other comprehensive income(9,519)(7,577)

Share acquisition rights

99–

Non-controlling interests

577

797

348,784

387,354

488,032

540,490

Total net assets
Total liabilities and net assets-7-

(2) Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income(Consolidated Statements of Operations)(¥ million)
Prior Fiscal Year
(From April 1, 2016
to March 31, 2017)

Current Fiscal Year
(From April 1, 2017
to March 31, 2018)

Net sales

620,061

678,312

Cost of sales

396,302436,730

Gross profit

223,759

241,581

Selling, general and administrative expenses

160,520

166,557

Operating profit

63,23875,024

Interest income

318

269

Dividend income

275

334

Equity in gain of affiliated companies

556

930

Rent income

211

338

Other non-operating income

817

566

Total non-operating income

2,179

2,438

Non-operating income

Non-operating expenses
Interest expense

36

37

Loss on valuation of derivatives–

817

Provision of allowance for doubtful accounts

667

945

Other non-operating expenses

1,424

282

Total non-operating expenses

2,127

2,083

63,29075,380Gain on sales of fixed assets

316

72

Other extraordinary income

139

6

Total extraordinary income

455

79

Loss on impairment of fixed assets

1,306

1,463

Loss on disposal of fixed assets

545

766

Loss on valuation of stocks of affiliated companies

221

479

Other extraordinary loss

813

251

Recurring profit
Extraordinary income

Extraordinary loss

Total extraordinary loss

2,886

2,961

Profit before income taxes

60,86072,497

Corporate income, inhabitant and enterprise taxes

17,343

19,867(680)(1,258)

Total income taxes

16,662

18,609Profit44,19753,888Adjustment for income taxes

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

-8-

37

(220)

44,15954,109(Consolidated Statements of Comprehensive Income)(¥ million)
Prior Fiscal Year
(From April 1, 2016
to March 31, 2017)
ProfitCurrent Fiscal Year
(From April 1, 2017
to March 31, 2018)44,19753,888Valuation difference on available-for-sale securities, net of
tax

890

3,611

Deferred gains or losses on hedges, net of tax

906

(509)

Other comprehensive income

Foreign currency translation adjustments(2,936)395

Remeasurements of defined benefit plans, net of tax(50)(1,560)Share of other comprehensive income of associates
accounted for using equity method

96

199

(1,092)

2,136

43,10456,024Comprehensive income attributable to owners of parent

43,06756,245Comprehensive income attributable to non-controllinginterests

37

(220)

Total other comprehensive income
Comprehensive income
Comprehensive income attributable to-9-(3) Consolidated Statements of Changes in Net Assets
Prior Fiscal Year (From April 1, 2016 to March 31, 2017)(¥ million)
Stockholders’ equity
Common stock
Balance at beginning of year

10,000Additional paid-in
capital52,246

Retained earnings
265,231

Treasury stock(2,410)Total stockholders’equity325,067

Changes during the period
Cash dividends(11,429)(11,429)

Profit attributable to ownersof parent

44,15944,159Change of scope of
consolidation–

Change of scope of
consolidation - foreign
currency translation
adjustment–

Purchase of treasury stock0

Disposal of treasury stock
Change in ownership interestof parent due to transactions
with non-controllinginterests
Changes in treasury stock
accompanying changes toholdings in companies towhich the equity method isappliedReversal of revaluation
reserve for land

(4)

(4)

0

0

(182)

(182)

(8)

22

(8)

22

Net changes of items otherthan stockholders’ equity
Total changes during the period
Balance at end of year

–

(182)

32,753(12)

32,55810,00052,064297,984(2,423)357,626- 10 -

(¥ million)
Accumulated other comprehensive income
Valuation
Remeasurements Total accumulateddifference on Deferred gains or
Revaluation
Foreign currencyof defined
otheravailable-for-sale losses on hedges, reserve for land,translation
benefit plans, net comprehensive
securities, net of
net of tax
adjustments
net of tax
of taxincometax

Balance at beginning of year

6,907

(706)

(5,670)(5,788)(3,145)(8,403)

Shareacquisitionrights99

Non-controllinginterests

541

Total net assets

317,304

Changes during the period
Cash dividends(11,429)

Profit attributable to ownersof parent

44,159Change of scope of
consolidation–

Change of scope of
consolidation - foreign
currency translation
adjustment–

Purchase of treasury stock(4)

Disposal of treasury stock0

Change in ownershipinterest of parent due totransactions with
non-controlling interests
Changes in treasury stock
accompanying changes toholdings in companies towhich the equity method isapplied

(182)

(8)

Reversal of revaluation
reserve for land

(22)

(22)

–

Net changes of items otherthan stockholders’ equity

977

916

–

(2,936)(50)(1,092)–36(1,055)

Total changes during the period

977

916

(22)

(2,936)(50)(1,115)–36

31,4797,884

210(5,693)(8,725)(3,195)(9,519)99577

348,784

Balance at end of year

- 11 -

Current Fiscal Year (From April 1, 2017 to March 31, 2018)(¥ million)
Stockholders’ equity
Common stock
Balance at beginning of year

10,000Additional paid-in
capital52,064Retained earnings
297,984

Treasury stock(2,423)

Total stockholders’equity357,626

Changes during the period
Cash dividends(18,023)(18,023)

Profit attributable to ownersof parent

54,10954,109(0)(0)

Change of scope of
consolidation
Change of scope of
consolidation - foreign
currency translation
adjustment–

Purchase of treasury stock131

Disposal of treasury stock
Change in ownership interestof parent due to transactions
with non-controllinginterests
Changes in treasury stock
accompanying changes toholdings in companies towhich the equity method isappliedReversal of revaluation
reserve for land

(4)

(4)

100

232
–

0

193

0

193

Net changes of items otherthan stockholders’ equity
Total changes during the period
Balance at end of year–131

36,27996

36,507

10,00052,196334,264(2,326)394,133- 12 -

(¥ million)
Accumulated other comprehensive income
Valuation
Remeasurements Total accumulateddifference on Deferred gains or
Revaluation
Foreign currencyof defined
otheravailable-for-sale losses on hedges, reserve for land,translation
benefit plans, net comprehensive
securities, net of
net of tax
adjustments
net of tax
of taxincometax

Balance at beginning of year

7,884

210

(5,693)(8,725)(3,195)(9,519)Shareacquisitionrights99

Non-controllinginterests

577

Total net assets

348,784

Changes during the period
Cash dividends(18,023)

Profit attributable to ownersof parent

54,109Change of scope of
consolidation(0)

Change of scope of
consolidation - foreign
currency translation
adjustment

(7)

(7)

(7)

Purchase of treasury stock(4)

Disposal of treasury stock

232

Change in ownershipinterest of parent due totransactions with
non-controlling interests
Changes in treasury stock
accompanying changes toholdings in companies towhich the equity method isapplied–0

Reversal of revaluation
reserve for land

(193)

(193)

–

Net changes of items otherthan stockholders’ equity

3,811

(510)

–

403

(1,560)

2,144

(99)

220

2,264

Total changes during the period

3,811

(510)

(193)

395

(1,560)

1,942

(99)

220

38,570

Balance at end of year

11,696(300)(5,887)(8,330)(4,756)(7,577)–797

387,354- 13 -

(4) Consolidated Statements of Cash Flows(¥ million)
Prior Fiscal Year
(From April 1, 2016
to March 31, 2017)

Current Fiscal Year
(From April 1, 2017
to March 31, 2018)

Cash flows from operating activities
Profit before income taxes

60,86072,497

Depreciation and amortization

21,85423,545

Loss on impairment of fixed assets

1,306

1,463

Amortization of goodwill

741

190

Increase (decrease) in allowance for doubtful receivables

394

1,121

Increase (decrease) in provision for sales returns

(160)

226

Increase (decrease) in provision for directors’ bonuses

421

(17)

–

515

Increase (decrease) in provision for contract loss
Increase (decrease) in other provision

119

(136)

Increase (decrease) in net defined benefit liability

1,094

388

Contribution to retirement benefit trust(5,350)

–

(593)

(603)

36

37

Interest and dividend income
Interest expense
Foreign exchange losses (gains)

0261

Equity in loss (gain) of affiliated companies

(556)

(930)

Loss (gain) on valuation of derivatives

(135)

817

Loss on disposal of fixed assets

545

766

Loss (gain) on sales of fixed assets, net

(211)

(32)

Loss on disposal of amusement facilities and machines

576

533

Loss (gain) on sales of investment securities, net

(71)

(1)

Loss on valuation of stocks of affiliated companies

221

479

Decrease (increase) in trade receivables(2,999)(13,048)

Decrease (increase) in inventories(1,048)(9,008)Acquisition of amusement facilities and machines(3,471)(7,349)

Increase (decrease) in trade payables

1,517

5,412

Increase (decrease) in accounts payable-other

2,940

1,435

Increase (decrease) in consumption tax payables

1,074

(579)

Other

(5,044)(3,708)Subtotal

74,06074,275Interest and dividends received

575

610

Interest paid

(37)

(37)

Income taxes paid

(10,462)(19,709)

Net cash provided by operating activities

64,13655,138- 14 -

(¥ million)
Prior Fiscal Year
(From April 1, 2016
to March 31, 2017)

Current Fiscal Year
(From April 1, 2017
to March 31, 2018)

Cash flows from investing activities
Payments for deposit in time deposits(1,902)(4,934)

Proceeds from withdrawal from time deposits

6,184

993

Purchases of property, plant and equipment(9,451)(42,850)

Sales of property, plant and equipment

1,191

601

Purchases of intangible assets(5,369)(5,392)

Purchases of investment securities(2,946)(11,461)

177

53(1,472)(80)

Sales of investment securities
Purchase of shares of subsidiaries and associates
Proceeds from sales of shares of subsidiaries and associates

35–

Purchase of shares of subsidiaries resulting in change inscope of consolidation

(340)

–

Proceeds from purchase of shares of subsidiaries resulting inchange in scope of consolidation

955

385

Payments of loans receivable(1,591)(2,273)

Collection of loans receivable

760

2,727

Payments of guarantee money deposited(782)(1,703)

Collection of guarantee money deposited

1,586

633

(51)

(36)

(13,016)(63,338)

(341)

5

Other
Net cash used in investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable

200

790

Repayments of long-term loans payable(1,315)(217)

Repayments of lease obligations

(62)

(77)

Purchase of treasury stock

(4)

(4)

Proceeds from disposal of treasury stock0–

Proceeds from share issuance to non-controllingshareholders–

441(11,429)(18,023)(217)–(13,171)(17,086)

Effect of exchange rate changes on cash and cash equivalents(1,823)351

Net increase (decrease) in cash and cash equivalents

36,124(24,935)

Cash and cash equivalents at beginning of year

169,542

205,667–99

205,667

180,831

Cash dividends paid
Payments from changes in ownership interests in
subsidiaries that do not result in change in scope of
consolidation
Net cash used in financing activities

Increase in cash and cash equivalents from newly consolidated
subsidiary
Cash and cash equivalents at end of year

- 15 -

(5) Notes to Consolidated Financial Statements(Notes on Premise of Going Concern)
Not applicable.

(Segment Information)a. Segment Information
1. Overview of reportable segments
The reportable segments of the Company are components of the Group whose separate financial information isavailable and which are periodically evaluated by the Board of Directors in deciding how to allocate management
resources and in assessing the performance.
The Group is made up of (1) three SBUs, one for each business domain, namely the Toys and Hobby SBU, theNetwork Entertainment SBU, and the Visual and Music Production SBU, and (2) the affiliated business companies thatmainly serve a supporting role for these SBUs. The core company of each SBU leads the planning and promotion of thebusiness strategies of the strategic business unit for Japan and overseas.
Accordingly, the Group has the following three reportable segments: Toys and Hobby Business, Network
Entertainment Business, and Visual and Music Production Business.
The Toys and Hobby Business conducts manufacturing and sales of toys, candy toys and production for vending
machines. The Network Entertainment Business conducts planning, development and distribution services for network
content, planning, development and sales of home video games and arcade game machines, and planning, development
and operation of amusement and other facilities. The Visual and Music Production Business conducts production andsales of visual and music related products and live entertainment operations.
As explained in “2. Information regarding changes to reportable segments, etc.” below, the Group changed theclassification of part of its reportable segments from the current fiscal year.

2. Information regarding changes to reportable segments, etc.
Effective from the current fiscal year, the Company has decided to change the classification of planning, development,
production and sales businesses of prizes for amusement facilities and Loto prizes for convenience stores and so forthpreviously belonging to the Network Entertainment Business to the Toys and Hobby Business.
Segment information of the prior fiscal year is prepared and disclosed based on the reportable segment classifications
after the change.

3. Method for calculating the amounts of net sales, profit/loss, assets, liabilities and others by reportable segment
The accounting method used for the business segments reported is the same as the accounting method stated in“Important Information Constituting the Basis for Preparation of Consolidated Financial Statements” presented in themost recent annual security report (filed on June 19, 2017).
The profit of reportable segments is measured by operating profit.
The inter-segment transactions are based on prevailing market prices.

- 16 -

4. Information regarding the amounts of net sales, profit/loss, assets, liabilities and others by reportable segment
Prior Fiscal Year (From April 1, 2016 to March 31, 2017)(¥ million)
Reportable Segments
Toys and
Hobby
Business

Visual and
Network
Music
Entertainment
Production
Business
Business

Other
Subtotal(Note 1)

Total

Adjustments(Note 2)

Consolidated
Total(Note 3)

Net sales
To externalcustomers

208,811

348,889

52,896

610,597

9,464

620,061–

620,061Inter-segment sales
and transfers

9,286

6,696

3,393

19,376

17,33336,710(36,710)–

Total

218,098

355,585

56,290629,974

26,797656,771(36,710)620,061

Segment profit

13,33042,034

13,43668,802702

69,504(6,266)

63,238Segment assets

118,108

167,871

44,031330,01131,319361,330

126,701

488,032

Depreciation andamortization

12,735

7,145

614

20,495438

20,933920

21,854

Amortization of
goodwill

649

26

65

741

–

741

–

741

Loss on impairmentof fixed assets

573

661

–

1,235

66

1,301

4

1,306

Investment inassociates accounted
for using equity
method

889

–

–

889

12,49913,388–13,388

Increase in property,
plant and equipment
and intangible assets

14,303

7,891

836

23,031

544

23,575

1,440

25,016

Others

Notes:

1.
2.

3.

The “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’s strategic business units are classified.
The details of adjustment amounts are as follows:(1)
Included in the 6,266 million yen deducted from segment profit as adjustment are a deduction of 257
million yen in inter-segment eliminations, and a deduction of 6,008 million yen in corporate expenses
that cannot be allocated to any reportable segment. The corporate expenses are mainly costs related to theadministration division that has not been attributed to a reportable segment.
(2)
Included in the 126,701 million yen added to segment assets as adjustment are a deduction of 20,696
million yen in inter-segment eliminations, and an addition of 147,398 million yen in corporate assets thatcannot be allocated to any reportable segment. The corporate assets are mainly cash and time deposits,
investment securities, and assets etc. related to the administration division that has not been attributed toa reportable segment.
(3)
Included in the 920 million yen added to depreciation and amortization as adjustment are a deduction of
736 million yen in inter-segment eliminations, and an addition of 1,656 million yen in depreciation andamortization related to the administration division that has not been attributed to a reportable segment.
(4)
Included in the 4 million yen added to loss on impairment of fixed assets as adjustment is related tocorporate assets that cannot be allocated to any reportable segment.
(5)
Included in the 1,440 million yen added to increase in property, plant and equipment and intangible
assets as adjustment is the amount of corporate assets that cannot be allocated to any reportable segment.
Segment profit is adjusted with operating profit in the consolidated statements of operations.

- 17 -

Current Fiscal Year (From April 1, 2017 to March 31, 2018)(¥ million)
Reportable Segments
Toys and
Hobby
Business

Visual and
Network
Music
Entertainment
Production
Business
Business

Other
Subtotal(Note 1)

Total

Adjustments(Note 2)

Consolidated
Total(Note 3)

Net sales
To externalcustomers

213,296403,561

52,060668,917

9,394

678,312–678,312Inter-segment sales
and transfers

9,121

2,425

3,998

15,545

18,24533,791(33,791)–

Total

222,417405,986

56,058684,463

27,640712,103(33,791)

678,312Segment profit

14,47652,374

12,50879,359767

80,126(5,101)75,024

Segment assets

127,923

196,571

49,134

373,629

29,203402,833

137,657

540,490

Depreciation andamortization

12,716

9,221

646

22,585411

22,997548

23,545

Amortization of
goodwill

82

28

79

190

–

190

–

190

Loss on impairmentof fixed assets

816

638

–

1,454

–

1,454

8

1,463

Investment inassociates accounted
for using equity
method

844

–

–

844

13,254

14,099–14,099

Increase in property,
plant and equipment
and intangible assets

11,115

14,374702

26,192506

26,69833,80260,501Others

Notes:

1.
2.

3.

The “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’s strategic business units are classified.
The details of adjustment amounts are as follows:(1)
Included in the 5,101 million yen deducted from segment profit as adjustment are an addition of 981
million yen in inter-segment eliminations, and a deduction of 6,083 million yen in corporate expenses
that cannot be allocated to any reportable segment. The corporate expenses are mainly costs related to theadministration division that has not been attributed to a reportable segment.
(2)
Included in the 137,657 million yen added to segment assets as adjustment are a deduction of 23,269
million yen in inter-segment eliminations, and an addition of 160,927 million yen in corporate assets thatcannot be allocated to any reportable segment. The corporate assets are mainly cash and time deposits,
investment securities, and assets etc. related to the administration division that has not been attributed toa reportable segment.
(3)
Included in the 548 million yen added to depreciation and amortization as adjustment are a deduction of
611 million yen in inter-segment eliminations, and an addition of 1,159 million yen in depreciation andamortization related to the administration division that has not been attributed to a reportable segment.
(4)
Included in the 8 million yen added to loss on impairment of fixed assets as adjustment is related tocorporate assets that cannot be allocated to any reportable segment.
(5)
Included in the 33,802 million yen added to increase in property, plant and equipment and intangible
assets as adjustment is the amount of corporate assets that cannot be allocated to any reportable segment.
Segment profit is adjusted with operating profit in the consolidated statements of operations.

- 18 -

b. Related Information
Prior Fiscal Year (From April 1, 2016 to March 31, 2017)
1. Information by product and service
This information is omitted because the same information has been presented in Segment Information.
2. Information by region(1) Net sales(¥ million)
Japan

Americas454,630

Europe65,058

Asia
45,115

Total
55,257620,061

Note: Net sales are classified by country and region based on customer location.
(2) Property, plant and equipment(¥ million)
Japan

Americas40,856

Europe
2,358

Asia
3,935

Total
5,035

52,184

3. Information by major customer(¥ million)
Name of customer

Net sales

Names of related segments
Network Entertainment Business, and Visual andApple Inc.

68,579Music Production Business
Toys and Hobby Business, Network Entertainment

Google Inc.

62,539Business, and Visual and Music Production
Business

Note: Apple Inc. and Google Inc. are both platform-provision companies. The actual results of sales to thesecompanies are usage fees, etc. for users (ordinary users) of game services provided by the Group.

Current Fiscal Year (From April 1, 2017 to March 31, 2018)
1. Information by product and service
This information is omitted because the same information has been presented in Segment Information.
2. Information by region(1) Net sales(¥ million)
Japan
478,281

Americas

Europe79,277

Asia
60,054

Note: Net sales are classified by country and region based on customer location.

- 19 -

Total
60,699678,312(2) Property, plant and equipment(¥ million)
Japan

Americas74,612Europe
2,155

Asia

Total

4,428

4,907

86,104

3. Information by major customer(¥ million)
Name of customer

Net sales

Names of related segments
Network Entertainment Business, and Visual andApple Inc.

95,259Music Production Business
Toys and Hobby Business, Network Entertainment

Google Inc.

82,370Business, and Visual and Music Production
Business

Note: Apple Inc. and Google Inc. are both platform-provision companies. The actual results of sales to thesecompanies are usage fees, etc. for users (ordinary users) of game services provided by the Group.

c. Information Regarding Loss on Impairment of Fixed Assets by Reportable Segment
Prior Fiscal Year (From April 1, 2016 to March 31, 2017)
This information is omitted because the same information has been presented in Segment Information.
Current Fiscal Year (From April 1, 2017 to March 31, 2018)
This information is omitted because the same information has been presented in Segment Information.

d. Information Regarding Amortized Amounts and Unamortized Balance of Goodwill by Reportable Segment
Prior Fiscal Year (From April 1, 2016 to March 31, 2017)(¥ million)
Toys and
Hobby
Business

Network
Entertainment
Business

Visual andMusic
Production
Business

Eliminations
and Corporate

Other

Total

Amortized
amount

649

26

65

–

–

741

Unamortizedbalance

165

87

85

–

–

337

- 20 -

Current Fiscal Year (From April 1, 2017 to March 31, 2018)(¥ million)
Toys and
Hobby
Business

Network
Entertainment
Business

Visual andMusic
Production
Business

Eliminations
and Corporate

Other

Total

Amortized
amount

82

28

79

–

–

190

Unamortizedbalance

82

58

82

–

–

222

e. Information Regarding Gain on Negative Goodwill by Reportable Segment
Prior Fiscal Year (From April 1, 2016 to March 31, 2017)
Not applicable.

Current Fiscal Year (From April 1, 2017 to March 31, 2018)
Not applicable.

- 21 -

(Per-Share Data)
Prior Fiscal Year

Current Fiscal Year

(From April 1, 2016 to March 31, 2017)(From April 1, 2017 to March 31, 2018)

1,584.71 yen

1,758.99 yen

Basic earnings per share

201.03 yen

246.29 yen

Diluted earnings per share

200.97 yen

246.23 yen

Net assets per share

Note: The basis of calculating basic earnings per share and diluted earnings per share figure is as follows:

Prior Fiscal Year

Current Fiscal Year

(From April 1, 2016 to March 31, 2017)(From April 1, 2017 to March 31, 2018)44,15954,109––44,15954,109219,672,077

219,698,981

Profit attributable to owners of parent
adjustment (¥ million)––

Increase in number of common stock(shares)

63,17953,463[Share acquisition rights (shares)][63,179][53,463]

Basic earnings per share
Profit attributable to owners of parent(¥ million)
Amount not applicable to common
stockholders (¥ million)
Profit attributable to owners of parent
available to common stock (¥ million)
Average number of common stock
outstanding (shares)

Diluted earnings per share

Summary of potential shares not includedin the calculation of diluted earnings per
share as they do not have a diluting effect.

–- 22 -–

(Significant Subsequent Events)(Change to reportable segments)
The Group has been executing business strategies centered on three units of aggregated businesses called strategic
business units (“SBU”), one for each business domain, namely the Toys and Hobby SBU, the Network Entertainment
SBU, and the Visual and Music Production SBU. However, starting April 2018, the Group has changed its organizational
structure to promote the advancement of each of the strategies of the new Mid-term Plan. The name of the units ofaggregated business companies that are to execute the respective business strategies has been changed from “SBUs” to“Units.” In addition, to enable swifter advancement of the main strategies for each mission stated in the Mid-term Plan,
the Group has shifted from its previous three-SBU structure to a five-Unit structure.
Specifically, the Network Entertainment SBU has been reorganized into the Network Entertainment Unit, whichdevelops business in fields such as network content and home video games, and the Real Entertainment Unit, which
provides content for real-world based facilities, services, equipment, and so forth, unique to the Group. Moreover, the
new IP Creation Unit has been established as a spin-off from the Visual and Music Production SBU to focus on creating
new IP.
In conjunction with this organizational restructure, the reporting segments are to be changed from the current Toys andHobby Business, Network Entertainment Business, and the Visual and Music Production Business. From the fiscal year
ending March 31, 2019, the reporting segments will be the Toys and Hobby Business, Network Entertainment Business,
Real Entertainment Business, Visual and Music Production Business, and IP Creation Business.
Information regarding the amounts of net sales, profit/loss, assets, liabilities and others by reportable segment for thecurrent fiscal year, assuming the classification of its reportable segments after the organizational change is as follows.

- 23 -

Current Fiscal Year (From April 1, 2017 to March 31, 2018)(¥ million)
Reportable Segments
Total

Adjustments(Note 2)

Consolidated
Total(Note 3)

9,394

678,312–678,31228,247

18,24546,493(46,493)–

16,970697,165

27,640724,805(46,493) 678,312

6,618

5,264

79,678767

80,445(5,421)75,02458,20328,391

18,190377,809

29,203407,013

133,477

540,490

2,829

6,431

563

48

22,590411

23,002542

23,545

82

0

28

79

–

190

–

190

–

190

Loss on impairment of
fixed assets

816

–

638

–

–

1,454

–

1,454

8

1,463

Investment inassociates accounted
for using equity
method

844

–

–

–

–

844

13,254

14,099–14,099

Increase in property,
plant and equipment
and intangible assets

11,1152,805

11,611597

61

26,192506

26,69833,80260,501

Network
Real
Visual andToys andIP
Entertain- Entertain- Music
Hobby
Creationmentment Production
Business
Business
Business Business Business

Subtotal

To external customers

213,296319,567

89,87735,831

10,345Inter-segment sales
and transfers

9,121

6,969

672

4,860

Total

222,417

326,537

90,549Segment profit

14,47650,150

Segment assets

127,923

Depreciation andamortization

Other(Note 1)

668,917

6,624

40,691

3,168

145,101

12,716

Amortization of
goodwill

Net sales

Others

Notes:

1.
2.

3.

The “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’s units are classified.
The details of adjustment amounts are as follows:(1)
Included in the 5,421 million yen deducted from segment profit as adjustment are an addition of 662
million yen in inter-segment eliminations, and a deduction of 6,083 million yen in corporate expenses
that cannot be allocated to any reportable segment. The corporate expenses are mainly costs related to theadministration division that has not been attributed to a reportable segment.
(2)
Included in the 133,477 million yen added to segment assets as adjustment are a deduction of 27,450
million yen in inter-segment eliminations, and an addition of 160,927 million yen in corporate assets thatcannot be allocated to any reportable segment. The corporate assets are mainly cash and time deposits,
investment securities, and assets etc. related to the administration division that has not been attributed toa reportable segment.
(3)
Included in the 542 million yen added to depreciation and amortization as adjustment are a deduction of
616 million yen in inter-segment eliminations, and an addition of 1,159 million yen in depreciation andamortization related to the administration division that has not been attributed to a reportable segment.
(4)
Included in the 8 million yen added to loss on impairment of fixed assets as adjustment is related tocorporate assets that cannot be allocated to any reportable segment.
(5)
Included in the 33,802 million yen added to increase in property, plant and equipment and intangible
assets as adjustment is the amount of corporate assets that cannot be allocated to any reportable segment.
Segment profit is adjusted with operating profit in the consolidated statements of operations.

- 24 -

(Reorganization of subsidiaries)
At the Board of Directors Meeting held on February 9, 2018, the Company passed a resolution to reorganize its
subsidiaries and carried out the reorganization on April 1, 2018.

1. Absorption-type company split between subsidiaries(1) Purpose
In the Toys and Hobby Unit, a wholly-owned subsidiary of the Company, BANDAI SPIRITS CO., LTD. wasestablished on February 15, 2018 as a split preparation company to strengthen the business in products for mature fanbase in Japan and overseas. From the effective date of April 1, 2018, the business divisions of BANDAI CO., LTD.
that deal with products for the mature fan base such as figures and plastic models and the business divisions that deal
with prizes for convenience stores, etc. within BANPRESTO CO., LTD. have been transferred in a company split to
BANDAI SPIRITS CO., LTD.
(2) Transactions conducted by commonly controlled entities(i)

Overview of transaction
a. Name and description of business transferred
BANDAI CO., LTD.’s planning, development, manufacture and sales of figures and plastic models forthe mature fan base
BANPRESTO CO., LTD.’s planning, development, and sales of prizes for convenience stores, etc.
b. Date of business combination
April 1, 2018c. Legal form of business combination
Absorption-type company split with BANDAI CO., LTD. and BANPRESTO CO., LTD. as the splitting
companies and BANDAI SPIRITS CO., LTD. as the successor company
d. Company name after combination
No change.

(ii) Overview of accounting process
The accounting process has been carried out as transactions conducted by commonly controlled entities, inaccordance with the Accounting Standard for Business Combinations and Guidance on the AccountingStandard for Business Combinations and the Accounting Standard for Business Divestitures.

- 25 -

2. Absorption-type company split between subsidiaries and change in trade name of subsidiary(1) Purpose
To strengthen the Real Entertainment Business, which provides content for real-world based facilities, services,and equipment, etc., unique to the Group, on the effective date of April 1, 2018, the amusement machine businessdivision of BANDAI NAMCO Entertainment Inc. was transferred in an absorption-type company split to NAMCO
LIMITED, which conducts the planning and operation of amusement facilities. Furthermore, on the effective date, thetrade name of NAMCO LIMITED was changed to BANDAI NAMCO Amusement Inc.
(2) Transactions conducted by commonly controlled entities(i)

Overview of transaction
a. Name and description of business transferred
BANDAI NAMCO Entertainment Inc.’s planning, production, and sales of amusement machines
b. Date of business combination
April 1, 2018c. Legal form of business combination
Absorption-type company split with BANDAI NAMCO Entertainment Inc. as the splitting company and
NAMCO LIMITED as the successor company
d. Company name after combination
BANDAI NAMCO Amusement Inc.

(ii) Overview of accounting process
The accounting process has been carried out as transactions conducted by commonly controlled entities, inaccordance with the Accounting Standard for Business Combinations and Guidance on the AccountingStandard for Business Combinations and the Accounting Standard for Business Divestitures.
3. Absorption-type merger between subsidiaries and change in trade name of subsidiary(1) Purpose
To enable more integrated development of visual products, music, and live events, on the effective date of April 1,
2018, the visual business operating company BANDAI VISUAL CO., LTD. has merged as the surviving company
with the music business operating company Lantis Co., Ltd. Furthermore, on the effective date, the trade name of
BANDAI VISUAL CO., LTD. has been changed to BANDAI NAMCO Arts Inc.
(2) Transactions conducted by commonly controlled entities(i)

Overview of transaction
a. Name and description of business of the company involved in combination
Merging company (surviving company)
Name:

BANDAI VISUAL CO., LTD.

Description of business:

Planning, production, and sales of visual software

Merged company (disappearing company)
Name:

Lantis Co., Ltd.

Description of business:

Planning, production, and sales of music software

b. Date of business combination
April 1, 2018c. Legal form of business combination
Absorption-type merger with BANDAI VISUAL CO., LTD. as the surviving company and Lantis Co.,
Ltd. as the disappearing company- 26 -

d. Company name after combination
BANDAI NAMCO Arts Inc.
(ii) Overview of accounting process
The accounting process has been carried out as transactions conducted by commonly controlled entities, inaccordance with the Accounting Standard for Business Combinations and Guidance on the AccountingStandard for Business Combinations and the Accounting Standard for Business Divestitures.

4. Other
Changes in Directors and Audit & Supervisory Board Members(1) Change in Representative
Not applicable.
(2) Other Changes in Directors and Audit & Supervisory Board Members
New candidates for Director
Director

Hitoshi Hagiwara (current position: Executive Officer of
the Company and President and Representative Director of
BANDAI NAMCO Amusement Inc.)

Director

Yasuo Miyakawa (current position: Executive Officer of
the Company and President and Representative Director of
SUNRISE INC.)

Retiring Director
Chairman of the Board

Shukuo Ishikawa (Scheduled to assume office as Adviserof the Company)

New candidates for Audit & Supervisory Board Member
Full Time Audit & Supervisory Board Member

Masataka Nagaike (current position: Senior Adviser ofCorporate Communications Department of the Company)

Full Time Audit & Supervisory Board Member (Outside) Toru Shinoda
Retiring Audit & Supervisory Board Members
Full Time Audit & Supervisory Board Member

Kazuo Asami (Scheduled to assume office as Full Time
Audit & Supervisory Board Member (Outside) of
BANDAI NAMCO Arts Inc.)

Full Time Audit & Supervisory Board Member (Outside) Katsuhiko Kohtari (current position: Full Time Audit &Supervisory Board Member of BANDAI NAMCOEntertainment Inc.)(3) Scheduled Date of Assuming Office and Retirement
June 18, 2018

- 27 -

(4) Responsible Area of Directors (Effective June 18, 2018)
Mitsuaki Taguchi

President and Representative Director

Shuji Ohtsu

Director and Division General Manager of the Group Administrative Headquarters

Yuji Asako

Director and Division General Manager of the Corporate Planning Division

Masaru Kawaguchi

Director (Part-time) in charge of Toys and Hobby Unit

Satoshi Oshita

Director (Part-time) in charge of Network Entertainment Unit

Hitoshi Hagiwara

Director (Part-time) in charge of Real Entertainment Unit

Kazumi Kawashiro

Director (Part-time) in charge of Visual and Music Production Unit

Yasuo Miyakawa

Director (Part-time) in charge of IP Creation Unit

Yuzuru Matsuda

Director (Outside)

Satoko Kuwabara

Director (Outside)

Mikiharu Noma

Director (Outside)- 28 -