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Full-year forecast for the year ending March 31, 2017

Explanatory material

FIELDS CORPORATIONTSE 1st : 2767
January 23, 2017

I N D E XOverview
Revisions to Performance Forecast

P.2

Forecast revision
Outline of Business Forecast Revision

P.4

Major Causes (Based on Ordinary Income)P.5

Pachinko/pachislot
Trend in Sales of Pachinko/Pachislot Market

P.7

Fields’ Sales Condition

P.8

Pachislot Market Trends & Changes in Business Partnerships

P.9

Action to Strengthen Pachinko/Pachislot Field

P.10

StrategyYear ending March 31, 2018

P.121OverviewRevisions to Performance Forecast
Consolidated net sales: ¥73.0 billion (initial plan ratio -¥42.0 billion)
Consolidated ordinary loss: ¥7.5billion (initial plan ratio -¥9.5 billion)■ Pachinko/pachislot field Full-year sales volume target revised from approx. 350,000 machines to approx. 230,000 machines– Solid performance of the major titles launched for the yearend sales season; some titles in Q4 and later
affected by market slump– 6 models slated for sale during current term not soldAlliance partner

Number of titles

Factor of increase and decreaseMIZUHO CORP.

4 titlesFailure to reach agreement on sales timing, making sales during thecurrent term difficult

Other alliancemanufacturers

2 titlesSales moved to next term to boost product strength■ Cross-media field Solid progress in building IP (intellectual properties) and business startup– Measures aimed at boosting membership in part of game field failed to achieve projected results– Consolidated subsidiaries in visual and development contracting failed to achieve initial targets
2Forecast revision■Outline of Business Forecast Revision■Major Causes (Based on Ordinary Income)3

Outline of Business Forecast Revision
Full-year sales volume target for pachinko/pachislot revised from approx. 350,000 to approx. 230,000
Additionally, game business and consolidated subsidiaries failed to reach initial targets and suffered profit decline(Unit: Billions of yen)

Year ended March 31,
2016
Full-year

Year ending March 31, 2017
Initial plan

Revision plan

Net sales

94.4

115.0

73.0

Operating income

1.4

2.0(6.5)

Ordinary income

1.3

2.0(7.5)

Net income attributableto owners of pearent

0.1

1.0(8.5)

Initial plan
Increase/decrease

YoY
Increase/Decrease(42.0)(21.3)(-36.5%)(-22.7%)

(8.5)

(7.9)

(－)

(－)

(9.5)

(8.8)

(－)

(－)

(9.5)

(8.6)

(－)

(－)

*Figures within parentheses are the ratio to sales.

(Unit: Machines)

280,000

350,000

230,000-120,000-50,000(17 titles)(20 titles)(14 titles)(-6 titles)(-3 titles)

Pachinko

160,000－－－－

Pachislot

120,000－－－－Total sales(7 titles)(10 titles)

4

Major Causes (Based on Ordinary Income)Decline of approx. ¥6.9 billion over initial target due to reduction in the number of pachinko/pachislot machine titles launched
Decline of approx. ¥2.1 billion in games and consolidated subsidiaries in visual/development contracting(Unit: Billions of yen)
Initial plan

Q1

Q2

H2(Q3-Q4)

Increase/decrease

Main factors for increase and decrease

2.0
Pachinko and pachislot
Sales volume: down 120,000 machines etc.
①-6.9-3.2-9.5-7.5

Results of managementefficientGame field etc.
②-3.5-0.7

Main difference factors ①

Market effectSome titles in Q4 and later affected bymarket slump

Failure to reach agreement on sales
MIZUHO CORP.
timing, making sales during the current(4 titles)
term difficult
Other alliance
Sales moved to next term to boost
manufacturers
product
strength(2 titles)

+0.6

-1.4

Subsidiaries and affiliates
accounted for using theequity method etc.

-1.0

-0.6

Category

Consolidated
subsidiarity etc. ③

Main difference factors ③

Category

Main difference factors ②Existing
titlesMeasures aimed at boosting membershipfailed to achieve projected results

Visual/Steep cost rise due to higher video
Development quality and selection and concentration
contracting
resulted in projects cancellation

2 titles with leading IP postponed to next
New titles term and development of 1 title cancelled
because of selection and concentration

PS
Reduced royalty and loss of timing due
development to market slump and change in sales
contracting
datesCategory

5

Pachinko/pachislot■Trend in Sales of Pachinko/Pachislot Market■Fields’ Sales Condition■Pachislot Market Trends & Changes in Business Partnerships■Action to Strengthen Pachinko/Pachislot Fields

6

Sales Trends in the Pachinko/Pachislot Market
FY2016 pachinko/pachislot machine market expected to fall short in sales volume,
due to curb in replacement sales with the G7 Ise-Shima Summit and decline in number of units
per title for new regulation machines

PachislotPachinko■ FY 2015 and FY 2016
－ Despite removal/collection and active replacement intonew regulation machines in FY2016, sales expected tofall short of projection■ Q3 (Oct.- Dec. 2015/ Oct.- Dec. 2016)－ Sales volume for current Q3 to surpass previous year forall months■ FY 2015 and FY 2016
－ Volume per title reduced further in FY2016,
and replacement expected to be low for full year
■ Q3 (Oct.- Dec. 2015/ Oct.- Dec. 2016)－ Current 3Q sales volume to fall by 50,000 units overprevious year

(Trend in sales market)(Trend in sales market)

FY 2015

FY 2016

FY 2015

FY 2016

1,880,000
machines

1,650,000
machines

960,000
machines

800,000
machines(181 titles)(179 titles)(90 titles)(95 titles)

2015(3rd quarter)

machines(3rd quarter)
120,000

240,000

220,000 machines

2016

210,000 210,000
Rebound from maxtype new machine
installation deadline 140,000
machinesmachinesmachines

Source: FIELDS CORPORATION

machinesmachines

2016

Rebound from older
standard new machine
installation deadline

80,00070,000 machines

machinesmachines

40,00070,000Nov.

130,000

90,000machinesmachines

Oct.

2015

Dec.

Oct.

Nov.

Dec.

7

Fields’ Sales Condition
Average sales volume per title expected to exceed market average for both pachinko and pachislot
Solid performance of major titles in yearend sales season; market rebound (pachinko) anddrop in demand (pachislot) impacted Q4 figures

Pachinko machine sales

Pachislot machine sales■ Fields’ sales condition■ Fields’ sales condition– Average sales volume per title exceeded market– Average sales volume per model exceeding market average

average despite fluctuation by title– However, average sales volume declining recently with decline
in market demand– Rise in FY2016 amid decline in market average
Market sales volume
Market average sales volume
Fields average sales volume(Machine)

4,000,000
3,500,000
3,000,000

59,000machines
2,900,000(Machine)(Machine)

80,0002,000,000

80,00070,0001,800,000

70,0002,600,000

1,400,000
2,490,000
2,060,000 2,010,000

2,000,000

1,880,000

50,0001,200,000

40,0001,000,000

1,650,000

1,500,000

30,0001,000,000

28,00020,000machines
16,000machines

09,000machines

FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
ESource: FIELDS CORPORATION(Machine

1,600,000
60,0002,500,000

500,000

Market sales volume
Market average sales volume
Fields average sales volume

10,0000800,000

1,250,000
970,000

35,000machines
600,000

1,320,000

60,0001,390,000
1,230,000

50,000960,000

40,000800,000

30,00010,000 20,000
machines
10,000200,000
9,000
8,000
machines 00 machines
FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
E400,0008

Pachislot Market Trends & Changes in Business PartnershipsRegulation 5 machine market growing since FY2009 until Sep. 2014
Business partnerships with three manufacturers and startup of one development subsidiary during this period■ Pachislot market■ Changes in business partnerships－ Full switch to Regulation 5 machines in Oct 2007

－Established F Corporation (currently BOOOM Corporation) in May 2009

－ Market growth in ART/AT-type machine introduction－Alliance with Enterrise Co., Ltd. (subsidiary of CAPCOM CO., LTD) in Nov. 2009－MIZUHO CORP. joint enterprise alliance with Universal Entertainment

since FY2009－ Peak in FY2013, marking approx. 1.4 million units

Corporation in Feb. 2012

－ Pachislot model certification test method revised in Sep. 2014

(Machine)

Shift to reguration
5 machine－Alliance with NANASHOW Corporation in Jan. 2014

Pachinko

Pachislot

MIZUHO CORP. joint enterprisealliance with Universal
Entertainment Corporation

3,500,000

Changed model certification
test method

3,000,000

Alliance withNANASHOW Corporation

Alliance alliance withEnterrise Co., Ltd.
(subsidiary ofCAPCOM CO., LTD)

2,500,000
2,000,000

Established BOOOMCorporation

1,500,0001,000,000
500,0000
FY 2007

FY 2008

Source: FIELDS CORPORATION

FY 2009

FY 2010

FY 2011

FY 2012FY 2013

FY 2014

FY 2015

FY 20169

Action to Strengthen Pachinko/Pachislot Field
Reinforcement of distribution (trading company) capabilities to maximize sales volume

Distribution
capabilities

Distribution
capabilities

Distribution
capabilities

IP

Distribution
capabilities

IP

Distribution
capabilities

IP

CapitalDistribution
capabilities

IP

CapitalIP

Offering our resources through improvement in distribution capability
Distribution capabilities

PeopleInformation

IP

Rebuilding relations with nationwide pachinko halls for expanding fan base【Distribution (trading company) capabilities】
PeopleSales staffs of 26 branches in Japan

Pachinko halls in Japan

Concierge service function
Information

Expanded information service
IPAcquisition and provision of leading IP suited to pachinko/pachislot machines
10Strategy■ Year ending March 31, 201811

Year ending March 31, 2018
To speed up growth of cyclical IP business and realize sustainable growth that is Fields
Corp.'s medium-to long-term growth strategy, action will be taken to boost earnings andstrengthen its business base

Management overview
・Strengthen business foundation－ Lower breakeven point from this fiscal year with cuts in SGA expenses, etc., and continue efforts to increase efficiency－ Minimize business risks・Profitability－ Strong implementation of IP strategy and early realization of profits in IP business

Action plan to enhance effectivenessof our medium-to long-term strategy for further growth

Medium-to long-term management plan to be announced in May 201712

Disclaimer/Contact Information

The plans, strategies and estimates of the Company indicated in these documents,
other than actual results and established facts, include potential risks anduncertainties and cannot be guaranteed.

Potential risks and uncertainties include, but are not limited to, the economic environment of
the pachinko/pachislot market in which the Company operates, market competition andthe products handled by the Company.

FIELDS CORPORATION
Corporate Communications Office
TEL: +81-3-5784-2109

E-mail: ir@fields.biz