Consolidated Financial Report for the Second Quarter of
the Fiscal Year Ending March 31, 2009

November 5, 2008

DISCLAIMER- NAMCO BANDAI 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.

-1-

Stock Listing: Tokyo Stock Exchange
Code Number: 7832
(URL: http://www.bandainamco.co.jp/)
November 5, 2008

Consolidated Financial Report for the Second Quarter of
the Fiscal Year Ending March 31, 2009
Representative:
Contact:
Scheduled filing date of the quarterly report:
Scheduled starting date for dividend payments:

Takeo Takasu, President and Representative Director
Yuji Asako, Executive Officer, Corporate Planning Division
November 14, 2008
December 8, 2008

1. Consolidated Results for the Second Quarter of the Fiscal Year Ending March 31, 2009
(April 1, 2008 to September 30, 2008)(Millions of yen with fractional amounts discarded, unless otherwise noted)(1) Consolidated Operating Results (For the six months ended September 30, 2008)(Percentages indicate year-on-year changes.)
Operating income
Recurring income

Net sales

Second Quarter of the Fiscal
Year Ending March 31, 2009
Second Quarter of the Fiscal
Year Ended March 31, 2008

¥ million
190,795%–¥ million
5,576

%
–

¥ million
7,275

%
–

213,5223.3

15,085(12.6)

17,379(6.4)

Net income

Second Quarter of the Fiscal
Year Ending March 31, 2009
Second Quarter of the Fiscal
Year Ended March 31, 2008

Net income per share

Net income per share(diluted)¥ million
1,282

%
–

¥
5.13

¥
5.12

7,977

(27.6)

31.33

31.28

(2) Consolidated Financial Position
Total assets

Net assets

Equity ratio¥ million¥ million%
As of September 30, 2008
372,573275,017
73.0
As of March 31, 2008
413,023
289,944
69.4(Reference)
Equity: 271,883 million yen (as of September 30, 2008), 286,795 million yen (as of March 31, 2008)-2-

Net assets
per share¥
1,103.83
1,127.72

2. Dividend
Dividend per share
End of
End of
End offirst quarter second quarter third quarter
¥
¥
¥
–
12.00
–
–
12.00
–––
–––
–––
–

Dividend record dates

Fiscal Year Ended March 31, 2008

Fiscalyear-end

Total

¥
12.00
–––
12.00

¥
24.00
–––
24.00

Fiscal Year Ending March 31, 2009
(Projection)
Fiscal Year Ending March 31, 2009
Note: Revision of the projection in the second quarter of the fiscal year ending March 31, 2009: None
The stable portion of the dividend is given in the projection for the fiscal year-end based on the Company’s basic policy regarding
appropriation of profits. Thus, the actual fiscal year-end dividend will be decided according to the consolidated financial results.

3. Consolidated Projections for the Fiscal Year Ending March 31, 2009
(April 1, 2008 to March 31, 2009)(Percentages indicate year-on-year changes.)
OperatingRecurring
Net income
Net income
incomeincomeper share¥ million% ¥ million% ¥ million% ¥ million%¥
Full Year
440,000(4.4)
24,000(28.2)
26,000(28.2)
13,000(60.2)
52.33
Note: Revision of the projections in the second quarter of the fiscal year ending March 31, 2009: Yes
Net sales

4. Other Information(1) Changes in Significant Subsidiaries during the Period (Changes in Specified Subsidiaries Resulting in the Change in Scope ofConsolidation): Yes
Included: None

Excluded: 1 company (Banpresto Co., Ltd.)

Note: For more details, please refer to the section of 4. Others of Qualitative Information and Financial Statements on page 10.
(2) Application of Simplified Accounting and Special Accounting for Preparing the Quarterly Consolidated Financial Statements: Yes
Note: For more details, please refer to the section of 4. Others of Qualitative Information and Financial Statements on page 10.
(3) Changes in Accounting Policies, Procedures, and Methods of Presentation for Preparing the Quarterly Consolidated Financial
Statements
a. Changes due to revisions to accounting standards and other regulations: Yes
b. Changes due to other reasons: Yes
Note: For more details, please refer to the section of 4. Others of Qualitative Information and Financial Statements on page 10.
(4) Number of Issued Shares (Common Stock)a. Total number of issued shares at the end of the period (including treasury stock)
As of September 30, 2008

250,000,000 shares

As of March 31, 2008

256,080,191 sharesb. Number of shares of treasury stock at the end of the period
As of September 30, 2008

3,690,945 shares

As of March 31, 2008

1,766,271 sharesc. Average number of shares during the period (cumulative from the beginning of the fiscal year)
For the second quarter of the fiscal year ending March 31, 2009250,264,456 shares

For the second quarter of the fiscal year ended March 31, 2008

254,575,911 shares-3-

*Proper use of earnings projections, and other special matters
1. The consolidated projections for the FY2009.3 announced on August 6, 2008 were revised in these materials. The above projections are
based on information available to the Company as of the date of the announcement of these materials. Actual business results may differ
from the projections due to a number of factors in the future. Please refer to the section of “3. Qualitative Information Regarding
Consolidated Projections” of “Qualitative Information and Financial Statements” on page 9 for matters pertaining to the above
projections.
2. Commencing with the current fiscal year, the quarterly consolidated financial statements conform to the “Accounting Standard for
Quarterly Financial Reporting” (ASBJ [Accounting Standards Board of Japan] Statement No. 12, March 14, 2007) and the “Guidance on
Accounting Standard for Quarterly Financial Reporting” (ASBJ Guidance No. 14, March 14, 2007). They are also prepared inaccordance with the “Regulation for Quarterly Consolidated Financial Statements.”-4-

Qualitative Information and Financial Statements
Note: Concerning the comparison with the same period a year ago, the percentage values and the monetary amounts areprovided for reference purposes only.

1. Qualitative Information Regarding Consolidated Operating Results
The economic environment during the first six months of the fiscal year ending March 31, 2009 was sluggish, particularly
with respect to private consumption both in Japan and overseas amid a growing concern for the economic outlook, which was
fueled by the disarray in the financial markets that emerged out of the U.S. subprime mortgage crisis, the soaring oil prices
and the steep price rises in raw materials and food. In the entertainment industry, uncertainty remained due to the flagging
consumption in the industry.
With these general economic concerns as a background, the BANDAI NAMCO Group (“the Group”) is pushing ahead
with “strengthening, enriching, and expanding of its portfolio management” in line with the three-year Medium-termManagement Plan, which is in its final year.
On the business front, the Group’s main products and services are concentrated in the third quarter of this fiscal year
onwards. Overall, business performance of the first six months was down on the same period a year ago. When comparedwith the year’s initial plan, although performance in the Game Contents Business fell short due to domestic release dates forsome titles being postponed to the third quarter, performance was generally on track in the other business segments.
With regard to expenses, amortization of goodwill was recorded for BANDAI VISUAL CO., LTD., and BANDAI
NETWORKS CO., LTD., which both became wholly owned subsidiaries in the previous fiscal year. Also, loss on valuationof investment securities was recorded, along with an increase in income taxes in Americas region.
As a result, the consolidated operating results for the first six months were as follows. Net sales were 190,795 million yen(a year-on-year decrease of 10.6%), operating income was 5,576 million yen (a year-on-year decrease of 63.0%), recurringincome was 7,275 million yen (a year-on-year decrease of 58.1%), and net income was 1,282 million yen (a year-on-year
decrease of 83.9%).

Operating Results by Business Segment(¥ million)
Net Sales

Current 2nd
QuarterPrior 2nd
Quarter

Operating Income
ChangeCurrent 2nd
QuarterPrior 2nd
Quarter

ChangeToys and Hobby

73,213

83,578(10,364)

4,416

5,768

(1,352)

Amusement Facility

40,542

46,124(5,582)

1,030

2,078

(1,047)

Game Contents

56,49061,835(5,344)

123

4,856

(4,733)

Network

5,355

5,936

(580)

378

431

(53)

Visual and Music Content

15,993

17,888(1,894)

654

3,035

(2,380)

Other

9,514

10,065

(550)

280

476

(196)

Elimination and Corporate(10,313)(11,905)

1,591(1,307)(1,562)

255

Consolidated

190,795

213,522(22,726)

5,576

15,085(9,509)Toys and Hobby BusinessIn the Toys and Hobby Business, in Japan, the long-established character toys such as Engine Sentai Go-Onger and YES!
Pretty Cure 5 GoGo! maintained strong performance in the main toy businesses, but the peripheral toy businesses struggled-5-

in an environment of weak private consumption.
In overseas, the BEN10 character toys for boys contributed to earnings in the U.S. and Europe, but the performance fell
short of the same period last year which enjoyed strong performance from Tamagotchi.
As a result, net sales in the Toys and Hobby Business were 73,213 million yen (year-on-year decrease of 12.4%) andoperating income was 4,416 million yen (year-on-year decrease of 23.4%).

Amusement Facility BusinessIn the Amusement Facility Business, existing facilities in Japan were in harsh market conditions, and maintained sluggish
sales at 87.2% of the result of the same period a year ago. Under these conditions, aiming to make ongoing improvements inoperational efficiency to improve profitability, the Group implemented actions toward closing some of its facilities.
Overseas, in the U.S., facilities battled harsh market conditions, while in Europe, performance was steady, particularly
among hybrid facilities. In Asia, a large-scale facility leveraging the Group’s synergy, Wonder Park Plus (Hong Kong)
became popular.
As a result, net sales in the Amusement Facility Business were 40,542 million yen (year-on-year decrease of 12.1%) andoperating income was 1,030 million yen (year-on-year decrease of 50.4%).

Facilities as of September 30, 2008
Directly-Managed Facilities

Revenue-Sharing Facilities

Theme Parks

Spa Facilities

Total

356

1,459

4

3

1,822

Game Contents BusinessIn the Game Contents Business, Dragon Ball Z Burst Limit for PLAYSTATION 3 and Xbox360, which has been releasedin Japan and Europe, maintained strong performance in home video game software. Also Super Robot Wars Z for PlayStation
2 and Taiko Drum Master for Nintendo DS were popular in Japan, while NARUTO-related software was popular in the U.S.
However, title release dates are concentrated in the second half of this fiscal year and some titles scheduled for release inJapan in the second quarter were postponed to the third quarter.
With regard to arcade game machines, although the large medal machine Sea Story Lucky Marine Theater gained
popularity, sales were down on the same period a year ago when strong sales were maintained particularly with respect torepeat sales. Game contents for mobile phones and other mobile devices delivered steady performance as a result of thedevelopment of a variety of contents catering to users’ increasingly diverse preferences.
As a result, net sales in the Game Contents Business were 56,490 million yen (year-on-year decrease of 8.6%) andoperating income was 123 million yen (year-on-year decrease of 97.5%).

Network BusinessIn the Network Business, game contents within the mobile content business, tailored to a variety of users’ needs fromhigh value-added contents such as GUNDAM GATE and ONE PIECE Mobile Jack to casual games such as SIMPLE 100 and
Zoo Keeper, continued to perform well. In addition, the number of ring tone service subscribers continued to follow a trend of
decline, but customizable wallpapers for mobile phones such as Mobile Suit Gundam and Hello Kitty became popular.
As a result, net sales in the Network Business were 5,355 million yen (year-on-year decrease of 9.8%). Operating income,which includes the recording of amortization of goodwill, was 378 million yen (year-on-year decrease of 12.4%).
-6-

Visual and Music Content BusinessIn the Visual and Music Content Business, with regard to visual software packages, the TV animation Macross F(Frontier) and CODE GEASS: Lelouch of the Rebellion R2, released simultaneously on Blu-ray Disc and DVD, became
popular. However, performance overall was sluggish amid a transitional period of hardware from DVD to Blu-ray Disc. Salesof music software packages, particularly those related to animation, delivered strong performance.
As a result, net sales in the Visual and Music Content Business were 15,993 million yen (year-on-year decrease of 10.6%).
Operating income, which includes the recording of amortization of goodwill, was 654 million yen (year-on-year decrease of
78.4%).

Other Business
Other Businesses consist of companies that provide support to the Group’s strategic business units such as logistics andbuilding management services. During the first six months of the fiscal year ending March 31, 2009, the business remained
focused in its efforts to improve the operational efficiency of these group support services.
As a result, net sales in the Other Business were 9,514 million yen (year-on-year decrease of 5.5%) and operating
income was 280 million yen (year-on-year decrease of 41.2%).

Operating Results By Geographic Segment(¥ million)
Net Sales

Current 2nd
QuarterPrior 2nd
Quarter

Operating Income (Loss)
ChangeCurrent 2nd
QuarterPrior 2nd
Quarter

ChangeJapan

154,133

170,570(16,436)

4,282

12,005(7,723)

Americas18,463

21,960(3,497)

(813)

147

(961)

Europe20,36621,004

(638)

2,742

3,062

(320)

Asia

16,481

17,298

(817)

931

1,263

(332)

Elimination and Corporate(18,649)(17,312)(1,336)(1,564)(1,393)(171)

Consolidated

190,795

213,522(22,726)

5,576

15,085(9,509)Japan
In the Toys and Hobby Business, long-established character toys such as Engine Sentai Go-Onger maintained strong
performance, but the peripheral toy businesses struggled due to weak private consumption. In the Game Contents Business,
Super Robot Wars Z for PlayStation 2 and other games maintained strong sales in home-use video game software, but thereleases of some titles were postponed to the third quarter. Moreover, in the Amusement Facility Business, existing facilities
struggled under harsh market conditions, and in the Visual and Music Content Business, sales remained sluggish amid a
hardware transition period.
As a result, net sales in Japan were 154,133 million yen (year-on-year decrease of 9.6%). Operating income, which
includes the recording of amortization of goodwill in association with BANDAI VISUAL CO., LTD. and BANDAI
NETWORKS CO., LTD. becoming wholly-owned subsidiaries, was 4,282 million yen (year-on-year decrease of 64.3%).

Americas
In the Toys and Hobby Business, the BEN10 character toys for boys performed strongly but the performance fell short ofthe same period last year which enjoyed strong performance from Tamagotchi. In the Amusement Facility Business, the-7-Group battled under harsh conditions, while in the Game Contents Business, results remained on track thanks to
NARUTO-related software and repeat sales of software released in the previous fiscal year.
As a result, net sales in Americas were 18,463 million yen (year-on-year decrease of 15.9%) and operating loss was 813
million yen (compared with an operating income of 147 million yen in the same period a year ago).

EuropeIn the Toys and Hobby Business, the BEN10 character toys for boys performed strongly but the performance fell short ofthe same period last year which enjoyed strong performance from Tamagotchi. The Amusement Facility Business showedsteady performance, particularly among hybrid facilities. In the Game Contents Business, Dragon Ball Z Burst Limit for the
PLAYSTATION 3 and the Xbox360 became popular.
As a result, net sales in Europe were 20,366 million yen (year-on-year decrease of 3.0%) and operating income was 2,742
million yen (year-on-year decrease of 10.5%).

Asia
The Toys and Hobby Business delivered a steady performance centering on the Mobile Suit Gundam plastic models andthe POWER RANGERS character toys for boys, but the performance fell short of the same period last year. In the Amusement
Facility Business, Wonder Park Plus (Hong Kong), a large-scale facility also serving as the base for the Group’s information
dissemination in the Asia region, became popular.
As a result, net sales in Asia were 16,481 million yen (year-on-year decrease of 4.7%) and operating income was 931
million yen (year-on-year decrease of 26.3%).

2. Qualitative Information Regarding Consolidated Financial Position
At the end of the second quarter of the fiscal year ending March 31, 2009, total assets stood at 372,573 million yen, adecrease of 40,449 million yen from the end of the previous fiscal year. The main factors of this decline were a decrease of
20,406 million yen in cash and time deposits due to the purchase of treasury stock and the payments of dividends and income
taxes, and a decrease of 17,923 million yen in trade receivables.
Total liabilities amounted to 97,556 million yen, a decrease of 25,523 million yen from the end of the previous fiscal year.
The main factors of this decline were decreases in accounts payable–other included in other current liabilities, trade payables,
accrued income taxes, and long-term debt of 7,694 million yen, 5,861 million yen, 3,384 million yen, and 2,669 million yen,respectively.
Total net assets stood at 275,017 million yen, a decrease of 14,926 million yen from the end of the previous fiscal year.
The main factors of this decline were 10,444 million yen of the purchase of treasury stock and 3,053 million yen of dividends
paid.
As a result, the equity ratio became 73.0% compared with 69.4% at the end of the previous fiscal year.

As of the end of the second quarter, cash and cash equivalents (hereafter “funds”) remaining on hand had decreased by
19,558 million yen from the end of the previous fiscal year to 109,731 million yen. Below is the breakdown of cash flows by
activities.

-8-Cash Flows from Operating Activities
The amount of funds used in Operating Activities totaled 2,780 million yen (10,242 million yen provided in the same
period of the previous fiscal year). As a main breakdown of funds provided, trade receivables decreased by 16,291 million
yen (17,298 million yen in the same period of the previous fiscal year). However, this increase in funds was offset as a whole
by 9,542 million yen in income taxes paid (11,067 million yen in the same period of the previous fiscal year), the decrease of
7,563 million yen in accounts payable–other (6,893 million yen in the same period of the previous fiscal year), and thedecrease of 5,035 million yen in trade payables (2,398 million yen in the same period of the previous fiscal year).

Cash Flows from Investing Activities
The amount of funds provided by Investing Activities totaled 669 million yen (15,461 million yen used in the same periodof the previous fiscal year). There was 4,713 million yen in payments for purchases of property, plant and equipment, andintangible assets (8,772 million yen in the same period of the previous fiscal year). However, this was offset mainly by 3,492
million yen in proceeds from sales of property, plant and equipment (544 million yen in the same period of the previous fiscal
year) and 2,108 million yen in proceeds from withdrawal from time deposits (858 million yen in the same period of theprevious fiscal year).

Cash Flows from Financing Activities
The amount of funds used in Financing Activities amounted to 16,248 million yen (up 0.6% compared with the same
period of the previous fiscal year). Main factors of this decline in funds are 12,000 million yen in payments into fund trust forpurchase of treasury stock (not applicable in the same period of the previous fiscal year) and dividends paid of 3,053 million
yen (4,127 million yen in the same period of the previous fiscal year).

3. Qualitative Information Regarding Consolidated Projections
As for the future of the economy, weak private consumption is expected to continue because of the global financial
instability and the rising prices of resources and food. This, moreover, is impacting the entertainment industry, in which theGroup is extensively involved, and the Group expects the harsh business environment will continue.
Amidst these conditions, during the current Medium-term Management Plan, the BANDAI NAMCO Group will continue
to promote the “strengthening, enriching, and expanding of its portfolio management”. In addition, the Group will focus ondeveloping strong foundations with respect to profitability and organizational structure for the next Medium-termManagement Plan starting April 2009.
Specifically, in the Toys and Hobby Business, in Japan, while developing the product range of long-established character
series, such as Engine Sentai Go-Onger, Masked Rider Kiba, and YES! Pretty Cure 5 GoGo!, the Group will focus on Mobile
Suit Gundam 00, which began airing on TV in the third quarter, and Battle Spirits, which will center on a card game.
Overseas, in addition to the POWER RANGERS and BEN10, the Group will work on developing the product range with theintroduction of Dragon Ball toys.
For the Amusement Facility Business, in Japan, the Group will pursue improved profitability by closing some facilities,
reviewing the rules for facility openings/closures, and implementing a variety of other efficiency improvement strategies,
continuing from the first half of the fiscal year. For overseas, the Group will aim to strengthen its earnings base by continuing
to expand its business according to strategies that exploit regional characteristics.
In the Game Contents Business, the Group will strengthen its balanced multi-platform strategy for home video game-9-

software targeted for the global market, which adapts to user preferences, centering on such title as Soul Calibur IV for the
PLAYSTATION 3 and the Xbox360. As for the arcade game machines, the Group will beef up the link between its arcade
game machines and its amusement facilities.
As for the Network Business, it will bolster the earnings base by developing content designed with profitability in mind
and strengthening collaboration within the Group.
In the Visual and Music Content Business, the Group will continue to market TV animation CODE GEASS: Lelouch of
the Rebellion R2, Macross F (Frontier) and Mobile Suit Gundam 00 on Blu-ray Disc and DVD. Also, the Group will releasesuch globally well-known titles as FREEDOM on Blue-ray Disc simultaneously throughout the world, focusing on making
sure the content characteristics are tailored to suit the platform and the geographic location.
Concerning the Group’s consolidated projections for the second half of the fiscal year ending March 31, 2009, the Grouphas made revisions entirely in light of the harsh market environment. Specifically, the Group has revised its projections for
the Toys and Hobby Business, with particular focuses on the peripheral toy businesses in Japan, including candy toys andapparel, and on Americas region. Also, in the Amusement Facility Business, the Group expects the market environment toremain sluggish particularly with respect to existing facilities in Japan and overseas. Moreover, the Group has revised its
sales plans for the second half of the fiscal year for the Game Contents Business, where the Japan market continues toperform sluggishly, and the Visual and Music Content Business, where it is difficult to foresee the future because of the
hardware transition period.
As a result of the above, the Group has revised its consolidated projections for the fiscal year ending March 31, 2009, as
follows.
Revisions to the Consolidated Projections for the Fiscal Year Ending March 31, 2009
(April 1, 2008 to March 31, 2009)(¥ million)
Net sales

OperatingincomeRecurringincomeNet income

Net income per
share

Previous projections (A)470,000

38,00039,50022,50090.57 yen

Revised projections (B)440,000

24,00026,00013,00052.33 yen

Change in amount (B-A)(30,000)(14,000)(13,500)(9,500)—Change (%)(6.4%)(36.8%)(34.2%)(42.2%)—

Reference: Results for the same
period of the previous fiscal year
(April 1, 2007 to March 31, 2008)

460,473

33,41136,19832,679128.65 yen

4. Others(1) Changes in Significant Subsidiaries during the Period (Changes in Specified Subsidiaries Resulting in the Change in
Scope of Consolidation)
As of April 1, 2008, the prize business of Banpresto Co., Ltd. (hereafter, “Banpresto”), a specified subsidiary of theCompany, was separated to newly incorporate Banpresto Co., Ltd. At the same time, Banpresto’s game operations,encompassing planning, development, and sales of Banpresto’s game software and amusement machines were merged byabsorption-type merger with NAMCO BANDAI Games, Inc., a specified subsidiary of the Company. As a result,
Banpresto is an extinct company and is not included within the scope of specified subsidiary from the first quarter.

- 10 -

(2) Application of Simplified Accounting and Special Accounting for Preparing the Quarterly Consolidated Financial
Statements
a. Calculation of debt default estimate for general receivables
As it is deemed that there is no material change in the debt default ratio and the like at the end of the current second
quarter from what was calculated at the end of the previous fiscal year, debt default estimate was calculated using thedebt default ratio and the like at the end of the previous fiscal year.

b. Inventory valuation method
With respect to the calculation of inventories at the end of the current second quarter, physical inventories wereomitted and a reasonable calculation method based on the physical inventories at the end of the previous fiscal year was
employed.
In addition, concerning the write-down of the book value of inventories, only for those items whose drop in
profitability was apparent, was an estimate of net selling price made and were book values written down.

c. Calculation of depreciation of fixed assets
For fixed assets to which the declining-balance method is applied, the amount of depreciation for the fiscal year is
proportionally divided up into amounts for the quarterly period.

d. Calculation of taxes
Taxes are calculated first by reasonably estimating the effective tax rate after applying tax effect accounting against
income before income taxes and minority interests for the fiscal year including the current second quarter, and next bymultiplying the quarterly income before income taxes and minority interests by such estimated effective tax rate.
Also, adjustment for income taxes is included in income taxes.

(3) Changes in Accounting Policies, Procedures, and Methods of Presentation for Preparing the Quarterly Consolidated
Financial Statements
Changes in Accounting Treatments
a. Application of “Accounting Standard for Quarterly Financial Reporting” and related regulations
Commencing with the current fiscal year, the quarterly consolidated financial statements conform to the “AccountingStandard for Quarterly Financial Reporting” (ASBJ Statement No. 12, March 14, 2007) and the “Guidance on
Accounting Standard for Quarterly Financial Reporting” (ASBJ Guidance No. 14, March 14, 2007). They are also
prepared in accordance with the “Regulation for Quarterly Consolidated Financial Statements.”

b. Application of “Accounting Standard for Measurement of Inventories”
Before the change, in consolidated subsidiaries in Japan, game software and other work in process were stated byusing the specific cost method, and inventories held for normal sales were stated at cost by mainly using the total averagemethod. However, because the “Accounting Standard for Measurement of Inventories” (ASBJ Statement No. 9, July 5,2006) is applied from the first quarter, game software and other work in process are stated by using the specific cost
method (for the value stated in the balance sheet, write-downs based on the decreased profitability), and inventories held
for normal sales are stated at cost by mainly using the total average cost method (for the value stated in the balance sheet,- 11 -

write-downs based on the decreased profitability).
This change has no impact on operating income, recurring income and income before income taxes and minority
interests.

c. Application of “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for
Consolidated Financial Statements”
From the first quarter, the “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries
for Consolidated Financial Statements” (PITF Practical Solution No. 18, May 17, 2006) is applied, and necessary
amendments for consolidated financial statements are made.
As a result of this change, operating income decreased by 15 million yen, and recurring income and income before
income taxes and minority interests each decreased by 22 million yen.
Note that the impact on segment information is shown on the segment information page.

d. Application of “Accounting Standard for Lease Transactions” and related regulation
Before the change, in the Company and consolidated subsidiaries in Japan, the accounting treatment for finance leasetransactions not involving the transfer of ownership followed, mutatis mutandis, the method for operating leasetransactions. However, because the “Accounting Standard for Lease Transactions” (ASBJ Statement No. 13 [BusinessAccounting Council Committee No. 1, June 17, 1993; revised March 30, 2007]) and the “Guidance on AccountingStandard for Lease Transactions” (ASBJ Guidance No. 16 [The Japanese Institute of Certified Public Accountants(JICPA) Accounting Standard Committee, January 18, 1994; revised March 30, 2007]) can be applied starting fromquarterly consolidated financial statements for the fiscal year beginning on or after April 1, 2008, commencing with thefirst quarter, this accounting standard and guidance is applied and the accounting treatment for such transactions follows
the method for ordinary purchase or sales transactions.
Depreciation of lease assets pertaining to finance lease transactions not involving the transfer of ownership is
calculated on a straight-line method over the lease period as useful life without residual value.
This change has no impact on operating income, recurring income and income before income taxes and minority
interests.
Also, the accounting treatment for finance and lease transactions not involving the transfer of ownership whosetransaction commenced before the current first fiscal year in which the Accounting Standard for Lease Transactions andrelated regulations are applied continuously follows, mutatis mutandis, the method for operating lease transactions.

Additional Information
Change in useful life for property, plant and equipment
Commencing with the first quarter, some consolidated subsidiaries in Japan have changed the useful life following
the amendment of statutory useful life due to the revision of the Corporate Tax Law in 2008.
This change has immaterial impact on operating income, recurring income and income before income taxes andminority interests.

- 12 -

5. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets(¥ million)
Current 2nd Quarter
As of September 30, 2008

(Summary) Prior Fiscal YearAs of March 31, 2008

AssetsCurrent assets
Cash and time deposits

105,696

126,103

Trade receivables

55,217

73,140

Short-term investments

7,034

7,068

Merchandise and finished goods

13,08911,463Work in process

23,355

21,481

Raw materials and supplies

4,430

3,484

Other current assets

25,83325,578

Allowance for doubtful receivables

(398)

(607)

234,258

267,71359,46763,446

Goodwill

14,14115,800

Other intangible assets

10,908

11,191

Total intangible assets

25,05026,991Other investments and other assets

54,991

56,087

Allowance for doubtful receivables(1,194)(1,215)

Total investments and other assets

53,79754,871

138,315

145,309372,573

413,023

Total current assets
Fixed assets
Property, plant and equipment
Intangible assets

Investments and other assets

Total fixed assets
Total assets- 13 -

(¥ million)
Current 2nd Quarter
As of September 30, 2008

(Summary) Prior Fiscal YearAs of March 31, 2008

Liabilities
Current liabilities
Trade payables

36,74242,603

Short-term borrowings

5,338

5,338

Accrued income taxes

5,878

9,262

Provision

1,817

2,385

Other current liabilities

29,652

42,059Total current liabilities

79,428

101,648

Long-term debt

7,993

10,662

Provision

1,839

1,598

298

346

Other long-term liabilities

7,996

8,823

Total long-term liabilities

18,127

21,43097,556

123,079

Common stock

10,00010,000Additional paid-in capital

79,651

87,945Retained earnings

191,847

192,865

Treasury stock(4,947)(2,840)Total stockholders' equity

276,551

287,971

Other securities valuation difference

492

192

Deferred gains or losses on hedges, net of
taxes

(84)

(112)

Land revaluation(6,284)(6,284)

Translation adjustments

1,207

5,028

Total valuation difference and translation
adjustments(4,668)(1,175)

Stock subscription rights

1,617

1,531

Minority interests

1,516

1,616

Total net assets

275,017289,944372,573

413,023

Long-term liabilities

Negative goodwill

Total liabilities
Net assets
Stockholders' equity

Valuation difference and translation
adjustments

Total liabilities and net assets- 14 -

(2) Quarterly Consolidated Statement of Income(¥ million)
Current 2nd Quarter(From April 1, 2008
to September 30, 2008)
Net sales

190,795

Cost of sales

124,098

Gross profit

66,696

Selling, general and administrative expenses

61,119Operating income

5,576

Non-operating income
Interest income

1,067

Dividend income

260

Amortization of negative goodwill

57

Equity in gain of affiliated companies

181

Other non-operating income

328

Total non-operating income

1,895

Non-operating expenses
Interest expense

80

Expense related to rental assets

47

Other non-operating expenses

68

Total non-operating expenses

196

Recurring income

7,275

Extraordinary income
Gain on sale of fixed assets

1,582

Reversal of allowance for doubtful receivables

47

Other extraordinary income

80

Total extraordinary income

1,709

Extraordinary loss
Loss on sale of fixed assets

6

Loss on impairment of fixed assets

43

Loss on valuation of investment securities

880

Special retirement expenses

651

Litigation settlement

520

Other extraordinary loss

213

Total extraordinary loss

2,317

Income before income taxes and minority
interests

6,667

Income taxes

5,255

Minority interests

128

Net income

1,282- 15 -

(3) Quarterly Consolidated Statement of Cash Flows(¥ million)
Current 2nd Quarter(From April 1, 2008
to September 30, 2008)
Cash Flows from Operating Activities
Income before income taxes and minority
interests

6,667

Depreciation and amortization

10,351

Loss on impairment of fixed assets

43

Amortization of goodwill

2,029

Increase (decrease) in allowance for doubtfulreceivables(240)

Increase (decrease) in provision(372)

Interest and dividend income(1,327)

Interest expense

80

Foreign exchange loss (gain)(29)

Equity in loss (gain) of affiliated companies(181)

Loss on disposal of fixed assets

76

Loss (gain) on sale of fixed assets(1,575)

Loss on disposal of amusement facilities andmachines

283

Loss (gain) on sale of investment securities(66)

Loss (gain) on valuation of investment
securities

880

Decrease (increase) in trade receivables

16,291

Decrease (increase) in inventories(4,763)

Investment for amusement facilities andmachines(4,543)

Increase (decrease) in trade payables(5,035)

Increase (decrease) in accounts payable–other(7,563)

Increase (decrease) in consumption tax
payables(1,369)Other(4,158)Subtotal

5,475Interest and dividends received

1,355Interest paid

(69)

Income taxes paid

(9,542)

Net cash used in operating activities(2,780)- 16 -

(¥ million)
Current 2nd Quarter(From April 1, 2008
to September 30, 2008)
Cash Flows from Investing Activities
Payments for deposit in time deposits(1,155)

Proceeds from withdrawal from time deposits

2,108

Purchases of property, plant and equipment(3,430)

Proceeds from sale of property, plant andequipment

3,492

Purchases of intangible assets(1,283)Purchases of investment securities(139)

Sales of investment securities

233

Acquisition of shares in consolidated
subsidiaries, net of cash acquired(25)

Advances of loans receivable(60)

Collection of loans receivable

268

Guarantee money deposited(384)

Proceeds from collection of guarantee money
deposited

1,052

Other

(5)

Net cash provided by investing activities

669

Cash Flows from Financing Activities
Repayment of long-term debt

(2,669)Payments into fund trust for purchase oftreasury stock
Proceeds from withdrawal of fund trust forpurchase of treasury stock(12,000)
1,555

Purchase of treasury stock(5)

Dividends paid

(3,053)

Dividends paid to minority interests(76)

Net cash used in financing activities(16,248)

Effect of exchange rate changes on cash andcash equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at beginningof period
Increase in cash and cash equivalents due toconsolidation of additional subsidiaries(2,342)(20,701)
129,289
1,142

Cash and cash equivalents at end of period

109,731- 17 -

Commencing with the current fiscal year, the quarterly consolidated financial statements conform to the “Accounting Standard for
Quarterly Financial Reporting” (ASBJ Statement No. 12, March 14, 2007) and the “Guidance on Accounting Standard for Quarterly
Financial Reporting” (ASBJ Guidance No. 14, March 14, 2007). They are also prepared in accordance with the “Regulation for Quarterly
Consolidated Financial Statements.”(4) Notes on Premise of Going Concern
No items to report(5) Segment Information[By industry segment]
Current 2nd quarter (April 1, 2008 to September 30, 2008)(¥ million)

Toys and Amusement Game
Hobby
Facility
Contents

Network

Visual andMusic
Content

Other

Total

Elimination
Consolidated
andCorporate

Net sales(1) To external customers

71,86540,33053,5255,201

15,6194,253

190,795–

190,795(2) Intersegment transactions

1,348

211

2,964

154

373

5,260

10,313(10,313)–

Total

73,21340,54256,4905,355

15,9939,514

201,109(10,313)

190,795

Operating income

4,416

1,030

123

378

654

280

6,883

(1,307)

5,576

Notes:
1. The industry segments used above are those used for internal management purposes.
2. Main products in each business segment:
Toys, candy toys, products for vending machines, cards, plastic models, apparel, sundries(1) Toys and Hobby:
and stationery
Amusement facility operations(2) Amusement Facility:
Home-use video game software, commercial-use video game machines and prizes for(3) Game Contents:
amusement arcade machines
Mobile content(4) Network:
Video products, visual software and on-demand video distribution(5) Visual and Music Content:
Transportation and storage of products, leases, real estate management, printing and(6) Other:development and sale of environmental devices
3. Changes in accounting policy
As set out in 4. (3) Changes in Accounting Treatments c. of Qualitative Information and Financial Statements, we apply the“Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for Consolidated Financial Statements”(PITF Practical Solution No. 18, ASBJ, May 17, 2006) from the first quarter.
These changes had the following effect on operating income for each segment.
(¥ million)
Toys and Amusement Game
Hobby
Facility
Contents

Operating income (loss)

(13)

–

Network

Visual andMusic
Content––(1)- 18 -

Other

Total

–

(15)

Elimination
andConsolidated
Corporate–(15)

[By geographic segment]
Current 2nd quarter (April 1, 2008 to September 30, 2008)
Japan(¥ million)

Americas

Europe

Asia

Total

Elimination
and Corporate

Consolidated

Net sales(1) To external customers

146,599

17,371

20,358

6,465

190,795–

190,795(2) Intersegment transactions

7,534

1,091

7

10,015

18,649(18,649)–

Total

154,133

18,463

20,366

16,481

209,444(18,649)

190,795

4,282

(813)

2,742

931

7,141

(1,564)

5,576

Operating income (loss)

Notes:
1. Definition of geographic segments and main countries and regions in geographic segments(1) Foreign geographic segments are defined by geographic region, similarity of economic activities, interrelation of businessactivities.
(2) The main countries and regions in each geographic segment are as follows:(i) Americas: United States and Canada(ii) Europe: France, United Kingdom and Spain(iii) Asia:
Hong Kong, Thailand, Korea and China
With the recent establishment of BANDAI (SHENZHEN) CO., LTD., in the current second quarter, the Group’s Asia region
now includes China.
2. Changes in accounting policy
As set out in 4. (3) Changes in Accounting Treatments c. of Qualitative Information and Financial Statements, we apply the“Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for Consolidated Financial Statements”(PITF Practical Solution No. 18, ASBJ, May 17, 2006) from the first quarter.
These changes had the following effect on operating income for each segment.
(¥ million)Japan
Operating income (loss)

Americas–

Europe

–

Asia

(11)

Total
(3)

Elimination
and Corporate

Consolidated

–

(15)

(15)

[Foreign sales]
Current 2nd quarter (April 1, 2008 to September 30, 2008)
Americas
I.

Foreign sales (¥ million)

II.

Consolidated sales (¥ million)

III. Share of sales to customers outside Japan (%)

Europe

Asia

Total

18,07621,0298,399

47,505–––

190,795

9.5

11.0

4.4

24.9

Notes:
1. Foreign sales are defined as total sales by the Company and its consolidated subsidiaries in countries and regions other than Japan.
2. Segmentation by country or by region and the main countries and regions in each geographic segment are as follows:(1) Foreign geographic segments are defined by geographic region, similarity of economic activities, and interrelation of businessactivities.
(2) The main countries and regions in each geographic segment are as follows:(i) Americas: United States, Canada and Latin America(ii) Europe: France, United Kingdom, Spain, Middle East, and Africa(iii) Asia:
Hong Kong, Singapore, Thailand, Korea, Australia, China and Taiwan- 19 -

(6) Notes on Significant Changes in the Amount of Stockholders’ Equity
The Company purchased 8,000,000 shares of its treasury stock (10,438 million yen) during the first six months inaccordance with the provision of Article 156 of the Company Law as applied pursuant to Article 165, Paragraph 3 of theCompany Law.
In addition, the Company retired 6,080,191 shares of its treasury stock (8,336 million yen) pursuant to Article 178 of
the Company Law as of August 18, 2008, thus reducing its additional paid-in capital by the same amount.
(7) Significant Subsequent Event
Purchase of treasury stock
In accordance with a resolution by the Board of Directors meeting on November 5, 2008, the Company resolved topurchase treasury stocks as follows in accordance with the provision of Article 156 of the Company Law as applied
pursuant to Article 165, Paragraph 3 of the Company Law.
(1) Reason for purchase
In order to implement a flexible capital policy that utilizes assets effectively and responds to changes in businessconditions(2) Type of shares to be purchased
Common stock of the Company(3) Total number of shares to be purchased
5,000,000 shares (maximum)(4) Total amount of shares to be purchased
5,500 million yen (maximum)(5) Purchase period
From November 10, 2008 to December 30, 2008

- 20 -

Reference
Quarterly Consolidated Financial Statements for the prior 2nd Quarter(1) Interim Consolidated Statement of Income
Prior interim period(April 1, 2007 - September 30, 2007)
Share%¥ millionI

Net sales

213,522

100.0

II

Cost of sales

136,351

63.9

Gross profit

77,17036.1

Selling, general and administrative expenses

62,08429.0

Operating income

15,085

7.1

2,483

1.1

190

0.1

17,379

8.1

696

0.4

1,025

0.5

17,050

8.0

8,519

4.0

553

0.3

7,977

3.7

III

IV

Non-operating income
1. Interest income

1,168

2. Dividend income

153

3. Other non-operating income
V

1,161

Non-operating expenses
1. Interest expense

82

2. Expenses related to rental assets

50

3. Sales discounts

26

4. Other non-operating expenses

30

Recurring income
VI

VII

Extraordinary income
1. Gain on sale of fixed assets

27

2. Gain on sale of investment securities

1

3. Reversal of allowance for doubtful receivables

189

4. Reversal of accrued retirement and severance benefits

478

Extraordinary loss
1. Loss on sale of fixed assets

12

2. Loss on disposal of fixed assets

394

3. Loss on impairment of fixed assets

81

4. Litigation settlement288

5. Loss on valuation of investment securities

188

6. Provision for losses on business restructuring

60

Income before income taxes and minority interests
Corporate income, inhabitant and enterprise taxes

6,861

Deferred income taxes

1,658

Minority interests
Net income- 21 -

(2) Interim Consolidated Statement of Cash Flows
Prior interim period(April 1, 2007 September 30, 2007)¥ millionI

Cash Flows from Operating Activities
Income before income taxes and minority interests

17,050Depreciation and amortization

11,125

Loss on impairment of fixed assets

81

Amortization of goodwill

1,227

Increase (decrease) in allowance for doubtful receivables(1,478)

Increase (decrease) in provision for directors' bonus(228)

Increase (decrease) in provision for losses on businessrestructuring
Increase (decrease) in provision for sales return

60
115

Increase (decrease) in accrued retirement and severance
benefits
Increase (decrease) in directors' and auditors' retirement andseverance benefits
Interest and dividend income

(452)
(517)
(1,322)

Interest expense

82

Foreign exchange loss (gain)

4

Equity in loss (gain) of affiliated companies(211)

Loss on disposal of fixed assets

394

Loss (gain) on sale of fixed assets(14)

Loss on disposal of amusement facilities and machines

493

Loss (gain) on sale of investment securities(1)

Loss on valuation of investment securities

188

Decrease (increase) in trade receivables

17,298Decrease (increase) in inventories(6,687)

Investment for amusement facilities and machines(4,622)

Increase (decrease) in trade payables(2,398)

Increase (decrease) in accounts payable—other(6,893)Other(3,223)
Subtotal

20,067

Interest and dividends received

1,322Interest paid

(80)

Income taxes paid

(11,067)

Net cash provided by operating activities

10,242- 22 -

Prior interim period(April 1, 2007 September 30, 2007)¥ millionII

Cash Flows from Investing Activities
Payments for deposit in time deposits(2,750)

Proceeds from withdrawal from time deposits

858

Purchases of property, plant and equipment(6,244)

Proceeds from sales of property, plant and equipment

544

Purchases of intangible assets(2,528)Purchases of investment securities(3,896)

Sales of investment securities

23

Acquisition of shares in consolidated subsidiaries, net ofcash acquired
Proceeds from (payments for) sale of subsidiary shares
related to changes in scope of consolidation
Advances of loans receivable(2)

Collection of loans receivable(1,105)

Proceeds from collection of guarantee money deposited

696

Other

(16)

Net cash used in investing activities(15,461)

Cash Flows from Financing Activities
Net increase (decrease) in short-term borrowings

IV(1,529)567

Guarantee money deposited

III

(78)

(298)

Repayment of long-term debt

(1,475)Purchases of treasury stock(9,967)

Dividends paid

(4,127)

Dividends paid to minority interests(290)

Net cash used in financing activities(16,158)
2,123

V

Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents(19,254)

VI

Cash and cash equivalents at beginning of period

124,155

VII

Increase in cash and cash equivalents due to consolidationof additional subsidiaries
Cash and cash equivalents at end of period

VIII- 23 -

485
105,387

(3) Segment Information[By industry segment]
Prior interim period (April 1, 2007 to September 30, 2007)(¥ million)

Toys and Amusement Game
Hobby
Facility
Contents

Network

Visual andMusic
Content

Other

Elimination
Consolidated
andCorporate

Total

Net sales(1) To external customers

81,69345,951

57,887

5,783

17,412

4,793

213,522–

213,522(2) Intersegment transactions

1,884

172

3,947

153

475

5,271

11,905(11,905)–

Total

83,57846,124

61,835

5,936

17,88810,065

225,428(11,905)

213,522

Operating expenses

77,80944,04556,9785,505

14,852

9,588

208,779(10,343)

198,436

Operating income

5,768

2,078

4,856

431

3,035

476

16,648(1,562)

15,085

Notes:
1. The industry segments used above are those used for internal management purposes.
2. Main products in each business segment:
Toys, candy toys, products for vending machines, cards, plastic models, apparel, sundries(1) Toys and Hobby:
and stationery
Amusement facility operations(2) Amusement Facility:
Home-use video game software, commercial-use video game machines and prizes for(3) Game Contents:
amusement arcade machines
Mobile contents(4) Network:
Video products, visual software and on-demand video distribution(5) Visual and Music Content:
Transportation and storage of products, leases, real estate management, printing and(6) Other:development and sale of environmental devices[By geographic segment]
Prior interim period (April 1, 2007 to September 30, 2007)
Japan

Americas(¥ million)
Europe

Asia

Total

Elimination andCorporate

Consolidated

Net sales(1) To external customers

164,529

21,24921,0006,742

213,522–

213,522(2) Intersegment transactions

6,040

710

4

10,556

17,312(17,312)–

Total

170,570

21,96021,004

17,298230,834(17,312)

213,522

Operating expenses

158,564

21,812

17,942

16,035214,355(15,918)

198,436

Operating income

12,005

147

3,062

1,263

16,479(1,393)15,085

Note:
Definition of geographic segments and main countries and regions in geographic segments(1) Foreign geographic segments are defined by geographic region, similarity of economic activities, and interrelation of businessactivities.
(2) The main countries and regions in each geographic segment are as follows:(i) Americas: United States and Canada(ii) Europe: France, United Kingdom and Spain(iii) Asia:
Hong Kong, Thailand and Korea- 24 -

[Foreign sales]
Prior interim period (April 1, 2007 to September 30, 2007)
Americas
I.

Foreign sales (¥ million)

II.

Consolidated sales (¥ million)

III.

Share of sales to customers outside Japan (%)

Europe

Asia

Total

22,214

21,233

10,38853,836–––

213,522

10.4

9.9

4.9

25.2

Notes:
1. Foreign sales are defined as total sales by the Company and its consolidated subsidiaries in countries and regions other than Japan.
2. Segmentation by country or by region and the main countries and regions in each geographic segment are as follows:(1) Foreign geographic segments are defined by geographic region, similarity of economic activities, and interrelation of businessactivities.
(2) The main countries and regions in each geographic segment are as follows:(i) Americas: United States, Canada and Latin America(ii) Europe: France, United Kingdom, Spain, Middle East, and Africa(iii) Asia:
Hong Kong, Singapore, Thailand, Korea, Australia, China and Taiwan- 25 -