Consolidated Financial Report for the Third Quarter of
the Fiscal Year Ending March 31, 2017

February 7, 2017

DISCLAIMER- 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/)
February 7, 2017

Consolidated Financial Report for the Third Quarter of
the Fiscal Year Ending March 31, 2017 (Japanese GAAP)
Representative:
Mitsuaki Taguchi, President and Representative Director
Contact:
Yuji Asako, Director, Division General Manager of the Corporate Planning Division
Scheduled filing date of the quarterly security report:
February 10, 2017
Scheduled starting date for dividend payments:–
The Financial Highlights of the Financial Results for the Quarter: Yes
The information session of the Financial Results for the Quarter: Yes (for institutional investors and analysts)* Figures are in millions of yen, rounded down
1. Consolidated Results for the Third Quarter of the Fiscal Year Ending March 31, 2017
(April 1, 2016 to December 31, 2016)(1) Consolidated Operating Results (For the Nine Months Ended December 31, 2016)

Third Quarter of the Fiscal YearEnding March 31, 2017
Third Quarter of the Fiscal Year
Ended March 31, 2016

Third Quarter of the Fiscal YearEnding March 31, 2017
Third Quarter of the Fiscal Year
Ended March 31, 2016
(Note)Net sales¥ million
459,103%
8.0

425,183

3.9

Profit attributable toowners of parent¥ million%
46,50334.3
34,620(Percentages indicate year-on-year changes.)
Operating income
Recurring income¥ million%¥ million%
60,16032.9
60,53928.3
45,273(5.0)

47,175(6.1)

Basic earnings per share

Diluted earnings per share¥
211.69¥211.63157.60157.56

8.3

Comprehensive income: 48,794 million yen [40.4%] (FY2017.3 3Q), 34,762 million yen [(9.3)%] (FY2016.3 3Q)(2) Consolidated Financial Position

As of December 31, 2016
As of March 31, 2016
(Reference)

Total assets¥ million
485,198
448,336

Net assets¥ million
354,474
317,304

Equity ratio
%
72.9
70.6

Equity: 353,856 million yen (as of December 31, 2016), 316,663 million yen (as of March 31, 2016)

2. Cash Dividends
End offirst quarterEnd ofsecond quarter¥12.00¥12.00

Annual cash dividends
End ofFiscalthird quarteryear-end–¥40.00–¥12.00

Total

Fiscal Year Ended March 31, 2016–¥52.00Fiscal Year Ending March 31, 2017–
Fiscal Year Ending March 31, 2017¥24.00(Projections)(Note) Revision to the projections of cash dividends for the Fiscal Year Ending March 31, 2017: No
Concerning the projected amount of the year-end cash dividend for the fiscal year ending March 31, 2017, the stable dividend portion isstated based on the Company’s basic policy on the distribution of profits. The year-end cash dividend for the fiscal year ending March
31, 2017, is scheduled to be resolved by the Company in light of the consolidated operating results and other factors.
3. Consolidated Projections for the Fiscal Year Ending March 31, 2017 (April 1, 2016 to March 31, 2017)(Percentages indicate year-on-year changes.)
Net sales
OperatingRecurring
Profit attributable
Basic earnings
incomeincometo owners
per shareof parent¥ million% ¥ million% ¥ million% ¥ million%¥
Full Fiscal Year
590,000
2.5
57,00014.8
57,00012.3
39,00012.8
177.54(Note) Revision to the projections: No* Notes(1) Changes in Significant Subsidiaries during the Period(Changes in Specified Subsidiaries Resulting in the Change in Scope of Consolidation): No(2) Application of Special Accounting for Preparing the Quarterly Consolidated Financial Statements: Yes(Note) For more details, please refer to the section of “(2) Application of Special Accounting for Preparing the Quarterly Consolidated
Financial Statements” of “2. Matters Regarding Summary Information (Notes)” on page 4 of the attached material.
(3) Changes in Accounting Policies, Changes in Accounting Estimation and Restatementa) Changes in accounting policies due to revisions to accounting standards and other regulations: Nob) Changes in accounting policies due to revisions to other reasons: Noc) Changes in accounting estimation: Nod) Restatement: No(4) Number of Issued Shares (Common Stock)a) Total number of issued shares at the end of the period (including treasury stock)
222,000,000 shares
As of December 31, 2016
222,000,000 shares
As of March 31, 2016b) Number of shares of treasury stock at the end of the period
As of December 31, 2016
2,334,227 shares
2,321,565 shares
As of March 31, 2016c) Average number of shares during the period (cumulative from the beginning of the fiscal year)
For the Third Quarter of the Fiscal Year Ending March 31, 2017219,674,045 shares
219,679,522 shares
For the Third Quarter of the Fiscal Year Ended March 31, 2016
* Implementation status of quarterly review
This Consolidated Financial Report for the Third Quarter was exempt from quarterly review which was based on Financial Instruments
and Exchange Law of Japan. As of the third quarter disclosing, quarterly review for the consolidated financial statements is under way.
* 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 “(3) Explanation Regarding Consolidated Projections and Other Forward-Looking Statements” of “1.
Qualitative Information Regarding Consolidated Results for the Third Quarter” on page 3 of the attached material for matters pertaining
to the earnings projections.
- To obtain Financial Highlights:
The Financial Highlights will be posted on the Company’s website on February 7, 2017.

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

2. Matters Regarding Summary Information (Notes) ........................................................................... 4(1) Changes in Significant Subsidiaries during the Period ...................................................................................................... 4(2) Application of Special Accounting for Preparing the Quarterly Consolidated Financial Statements ................................ 4(3) Additional Information ....................................................................................................................................................... 4

3. Consolidated Financial Statements ..................................................................................................... 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) Notes to Consolidated Financial Statements .................................................................................................................... 10(Notes on Premise of Going Concern) ............................................................................................................................. 10(Notes on Significant Changes in the Amount of Stockholders’ Equity) ......................................................................... 10(Segment Information) ..................................................................................................................................................... 10(Significant Subsequent Events) ...................................................................................................................................... 12-1-

1. Qualitative Information Regarding Consolidated Results for the Third Quarter(1) Explanation Regarding Operating Results
During the third quarter (nine months) of the fiscal year ending March 31, 2017, the economy in Japan continued tomoderately recover, however, the outlook for the overall economy remained uncertain. Overseas, personal consumption
was steady despite continuing uncertainty in the business environment due to ongoing political instability and other factors.
In this environment, the BANDAI NAMCO Group (“the Group”) is targeting medium- and long-term growth under the
Vision of “NEXT STAGE: Empower, Gain Momentum and Accelerate Evolution” in the three-year Mid-term Plan thatstarted in April 2015. The Group has focused on creating and cultivating new IP (Intellectual Property: Characters andother intellectual property), expanding target markets, and growing new businesses as part of efforts to strengthen the “IP
Axis Strategy” that aims to maximize IP value through the provision of the best products and services at the best possible
times.
The Group also strengthened its development in the global market, such as working to expand its IP lineup, businessfields and areas in overseas including North America and Europe, and Asia.
Consequently, the Group’s consolidated results for the third quarter (nine months) were net sales of 459,103 million
yen (year-on-year increase of 8.0%), operating income of 60,160 million yen (year-on-year increase of 32.9%), recurringincome of 60,539 million yen (year-on-year increase of 28.3%), and profit attributable to owners of parent of 46,503
million yen (year-on-year increase of 34.3%).
Operating results by segment are as follows.
Toys and Hobby BusinessIn the Toys and Hobby Business, earnings declined from the same period of the previous fiscal year, when highly
profitable products had grown in popularity in Japan and Asia, however, the Group’s key long-established IP products soldfavorably in each region. In Japan, there were favorable sales for long-established IP products such as Mobile Suit Gundam
series, KAMEN RIDER series, and PRETTY CURE! series. In addition, the Group implemented measures to strengthen the
IP axis strategy by taking steps to expand its target markets for adults and IP lineup and so forth. Overseas, in the Asian
region, products of the Mobile Suit Gundam series and collectable toys for adults became more popular. Meanwhile, insome regions the Group started undertakings to more finely tune operations, including rightsizing of inventory to promote
future development aligned to regional characteristics. In North America and Europe, products of the Power Ranger series
gained in popularity, and the Group worked to strengthen its IP lineup by commercializing locally developed IP and soforth.
As a result, net sales in the Toys and Hobby Business were 146,028 million yen (year-on-year decrease of 9.9%), andsegment income was 12,679 million yen (year-on-year decrease of 27.7%).
Network Entertainment BusinessFor home video game software in the Network Entertainment Business, sales were favorable for the new title DARKSOULS III and DRAGON BALL XENOVERSE 2 in North America and Europe. In network content such as gameapplications for smartphones, and PC online games, key titles already existing in Japan such as The iDOLM@STER
Cinderella Girls: Starlight Stage retained stable popularity, while titles such as DRAGON BALL Z DOKKAN BATTLE
gained in popularity overseas. In amusement facilities, the Group’s existing facilities in Japan performed favorably due totargeting resources on key facilities and other measures, and the Group also took measures to strengthen stores in new
business formats. In the arcade game machines, the Group took various measures to strengthen its foundations and thereby
improve profitability.
As a result, net sales in the Network Entertainment Business were 280,453 million yen (year-on-year increase of
23.2%), and segment income was 38,525 million yen (year-on-year increase of 102.3%).
Visual and Music Production BusinessIn the Visual and Music Production Business, sales were favorable in the GIRLS und PANZER series for visual andmusic package software, and related products amid escalated popularity, especially for products themed around a movie
release. Also, the LoveLive! series, which is IP for which visual content was developed in conjunction with music content
and live events, retained popularity. Moreover, in the Mobile Suit Gundam series, visual package software of MOBILESUIT GUNDAM THE ORIGIN series sold favorably.
As a result, net sales in the Visual and Music Production Business were 40,980 million yen (year-on-year increase of
8.5%), and segment income was 11,933 million yen (year-on-year increase of 18.6%).

-2-

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 20,207 million yen (year-on-year decrease of 2.7%), and segment
income was 1,208 million yen (year-on-year increase of 12.1%).
(2) Explanation Regarding Financial Position
At the end of the third quarter of the fiscal year ending March 31, 2017, total assets stood at 485,198 million yen, an
increase of 36,862 million yen from the end of the previous fiscal year. The main factors were increases of 9,341 million
yen in cash and time deposits, 10,220 million yen in trade receivables, 2,828 million yen in work in process, and 6,128
million yen in investment securities included in other investments and assets.
Total liabilities amounted to 130,723 million yen, a decrease of 308 million yen from the end of the previous fiscal year.
The main factors were decreases of 659 million yen in trade payables and 563 million yen in provision under current
liabilities, while there was an increase of 1,998 million yen in accrued income taxes included in other current liabilities.
Total net assets stood at 354,474 million yen, an increase of 37,170 million yen from the end of the previous fiscal year.
The main factor was an increase of 35,096 million yen in retained earnings due to the recording of 46,503 million yen in
profit attributable to owners of parent, despite cash dividends paid of 11,429 million yen.
As a result, the equity ratio became 72.9% compared with 70.6% at the end of the previous fiscal year.
(3) Explanation Regarding Consolidated Projections and Other Forward-Looking Statements
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 economic trends in North America and Europe. 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 business environment.
Facing these circumstances, the Group started a new Mid-term Plan with the vision “NEXT STAGE: Empower, Gain
Momentum, and Accelerate Evolution” in April 2015. In the Mid-term Plan, the Group will further strengthen the “IP Axis
Strategy” to expand the value of its IPs through taking advantage of the worldview and unique characteristics of its IPs andproviding the best products and services at the best possible times. In addition, aiming towards growing in the global
market, the Group will undertake various measures including strengthening business development in the area of highgrowth potential, which is the Asian region.
For its main strategies in the Mid-term Plan, the Group will implement Business Strategies to “Accelerate Evolution in
IP Axis Strategy,” Region Strategies to “Gain Momentum in Global Markets” and Functional Strategies to “Empower andInnovate Business Model.” In its Business Strategies to “Accelerate Evolution in IP Axis Strategy,” the Group will not
only cultivate Group IP by such means as creating and obtaining IP, but also expand new IP business such as live events,
expand its target markets, and strengthen collaboration among its businesses. In its Region Strategies to “Gain Momentumin Global Markets,” the Group will not only maintain its pursuit of becoming No. 1 in each of its markets in Japan, but also
proactively expand its business in Asia, where there is a promising outlook for future growth. In North America andEurope, the Group will implement initiatives aimed at maintaining its business foundations and expanding its businesses.
Furthermore, in its Functional Strategies to “Empower and Innovate Business Model,” the Group will create and cultivate
new IP business for the next generation and push ahead with creating foundations for the implementation of its IP axis
strategy in global markets.
In order to carry out these initiatives, the Group is pushing ahead with each of its strategies with a focus on these three
SBUs (Strategic Business Units). The Toys and Hobby SBU will aim to strengthen the “IP Axis Strategy” and gain
momentum in global markets, the Network Entertainment SBU will aim to deploy a new business that goes beyond theframework of the existing game business and fuses networks and entertainment, and the Visual and Music Production SBU
will create IP and strengthen the Group’s business deployment as it looks toward new outlets.
In the fiscal year ending March 31, 2017, the second year of the Mid-term Plan, the Group is implementing various
measures including strategic investments to further intensify the key strategies of “Accelerate Evolution in IP Axis
Strategy,” “Gain Momentum in Global Markets,” and “Empower and Innovate Business Model,” based on the results andissues from the first year of the plan. Going forward, the Group will continue to implement a range of measures to respondrapidly and flexibly to the fast-changing entertainment market based on constant monitoring of conditions in the Group andthe operating environment, and develop solid business foundations in order to generate stable earnings in this industry that-3-

is characterized by rapid changes in operating climate and user preferences. The objective is to move to the next stage as anentertainment corporate group.
The Group will push ahead with these various strategies in the Mid-term Plan, and aims to achieve the following
numerical targets for the fiscal year ending March 31, 2018: net sales of 600,000 million yen, operating income of 60,000
million yen, and ROE of 10% or more.
The consolidated projections for the full fiscal year ending March 31, 2017, are unchanged from the projections
announced on November 8, 2016.

2. Matters Regarding Summary Information (Notes)(1) Changes in Significant Subsidiaries during the Period
Not applicable.
(2) Application of Special Accounting for Preparing the Quarterly Consolidated Financial Statements
Calculation of taxes
Taxes are calculated first by reasonably estimating the effective tax rate after applying tax effect accounting against
profit before income taxes for the fiscal year including the current third quarter, and next by multiplying the profit before
income taxes by such estimated effective tax rate.
(3) Additional Information
Application of Implementation Guidance on Recoverability of Deferred Tax Assets
Effective from the first quarter ended June 30, 2016, the Company has applied the Implementation Guidance on
Recoverability of Deferred Tax Assets (ASBJ Guidance No. 26, March 28, 2016).
Organizational restructuring in Europe and establishment of subsidiary in association thereof
At its meeting of the Board of Directors held on December 16, 2016, the Company has passed the resolution to
restructure its organization in Europe and establish a subsidiary in association thereof.
1. Objective
Currently in Europe, BANDAI S.A.S. (“Current BSAS”), a subsidiary of the Company based in France under
the regional headquarters in the U.K., has two roles – a Toys and Hobby Business company and a holding
company. Current BSAS is a business holding company responsible for the Company’s operations in Continental
Europe. The Company has decided to reorganize Current BSAS in order to promote greater cooperation within theGroup and expand operations, by clearly separating Current BSAS’s business company and holding company
roles and strengthening governance function in Continental Europe.
2. Flow of organizational restructuring (scheduled)
March 2017
• The new company BANDAI Toy S.A.S. (provisional name; “BToy”) will be established as a subsidiary ofCurrent BSAS
September 2017
• Current BSAS will change its name to BANDAI NAMCO Holdings France S.A.S. (“BNHFR”), and BToy
will change its name to BANDAI S.A.S. (“New BSAS”)• BNHFR will transfer the Toys and Hobby Business to New BSAS
3. Overview of company to become pure holding company (scheduled)(1) Name:
BANDAI NAMCO Holdings France S.A.S. (name changed from Current
BSAS)(2) Content of business:

Pure holding company in Continental Europe(3) Common stock:Euro(4) Percentage of shares held:

100.0% by the Company

21,690 thousand-4-4. Overview of new company to be established (scheduled)(1) Name:
BANDAI S.A.S.
(2) Content of business:

Sales of toys and other products in France(3) Common stock:

Euro
Euro

(4) Establishment:

March 2017 (Establish with provisional name of BToy)

10 thousand (March 2017)
9,018 thousand (September 2017)* It is planned that BToy will change its name to New BSAS in September
2017 and to commence operations after receiving transfer of the Toys andHobby Business from BNHFR.
(5) Percentage of shares held:

100.0% by Current BSAS

5. Transactions conducted by commonly controlled entities(1) Overview of transaction(i) Name and content of business to be transferred
Toys and Hobby Business in France of BNHFR(ii) Date of business combination
September 2017 (scheduled)(iii) Legal form of the business combination
A method corresponding to a Japanese absorption-type company split (BNHFR will transfer the assets
and liabilities related to the Toys and Hobby Business at the book value, and New BSAS will issue shares
to BNHFR as consideration for the transaction)(2) Overview of accounting process
The accounting process for the consolidated financial statements is to be carried out as transactions
conducted by commonly controlled entities, in accordance with the Accounting Standard for Business
Combinations (ASBJ Statement No. 21, September 13, 2013), the Accounting Standard for Business
Divestitures (ASBJ Statement No. 7, September 13, 2013) and Guidance on the Accounting Standard forBusiness Combinations and the Accounting Standard for Business Divestitures (ASBJ Guidance No. 10,
September 13, 2013).

-5-

3. Consolidated Financial Statements(1) Consolidated Balance Sheets(¥ million)
Prior Fiscal Year(As of March 31, 2016)

Current 3rd quarter(As of December 31, 2016)

AssetsCurrent assets
Cash and time deposits

174,757

184,099

Trade receivables

72,53082,750Finished goods and merchandise

16,743

17,673Work in process

25,60528,434

Raw materials and supplies

3,893

4,051

Other current assets

29,25332,884

(606)

(527)

322,176

349,365

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

53,702

55,721Intangible assets

9,449

10,019Other investments and assets

64,022

71,298

Allowance for doubtful receivables(1,015)(1,206)

Total investments and other assets

63,00770,091

126,159

135,832

448,336

485,198

Investments and other assets

Total fixed assets
Total assets-6-(¥ million)
Prior Fiscal Year(As of March 31, 2016)

Current 3rd quarter(As of December 31, 2016)

Liabilities
Current liabilities
Trade payables

62,64561,986

Provision

3,016

2,453

Other current liabilities

48,671

49,114

Total current liabilities

114,333

113,554

32

3

Net defined benefit liability

9,920

10,024

Other long-term liabilities

6,745

7,140

Long-term liabilities
Provision

Total long-term liabilities

16,697

17,168131,031130,723

Common stock

10,00010,000Additional paid-in capital

52,24652,064Retained earnings

265,231300,327

Total liabilities
Net assets
Stockholders’ equity

Treasury stock(2,410)(2,422)

Total stockholders’ equity

325,067

359,970

6,907

8,271

Accumulated other comprehensive income
Unrealized gains or losses on other securities, net of tax
Deferred gains or losses on hedges, net of tax

(706)

1,116

Revaluation reserve for land, net of tax(5,670)(5,693)Foreign currency translation adjustments(5,788)(6,968)Remeasurements of defined benefit plans, net of tax(3,145)(2,838)

Total accumulated other comprehensive income(8,403)(6,113)

Subscription rights to shares

99

99

Non-controlling interests

541

518

317,304

354,474

448,336

485,198

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 3rd quarter(From April 1, 2015
to December 31, 2015)
Net sales

Current 3rd quarter(From April 1, 2016
to December 31, 2016)

425,183

459,103

Cost of sales

269,408

285,975

Gross profit

155,775

173,128

Selling, general and administrative expenses

110,501

112,968

Operating income

45,27360,1601,527

602

Non-operating income
Equity in gain of affiliated companies
Other non-operating income

1,172

1,191

Total non-operating income

2,699

1,794

Foreign exchange losses

456

846

Other non-operating expenses

342

568

Non-operating expenses

Total non-operating expenses

798

1,415

47,17560,539Gain on sales of fixed assets

56

286

Other extraordinary income

15

142

Total extraordinary income

71

429

Loss on impairment of fixed assets

421

466

Other extraordinary loss

134

731

Total extraordinary loss

555

1,197

Profit before income taxes

46,691

59,770

Income taxes

12,16013,289Profit34,53046,481

Recurring income
Extraordinary income

Extraordinary loss

Loss attributable to non-controlling interests
Profit attributable to owners of parent

-8-

(90)

(22)

34,62046,503

(Consolidated Statements of Comprehensive Income)(¥ million)
Prior 3rd quarter(From April 1, 2015
to December 31, 2015)
ProfitCurrent 3rd quarter(From April 1, 2016
to December 31, 2016)

34,53046,481

Unrealized gains or losses on other securities, net of tax

1,760

1,289

Deferred gains or losses on hedges, net of tax

Other comprehensive income(1,291)

1,813

Foreign currency translation adjustments(425)(1,179)Remeasurements of defined benefit plans, net of tax

212

306

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

(24)

83

Total other comprehensive income

231

2,313

34,762

48,79434,852

48,816(90)(22)

Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to non-controllinginterests-9-(3) Notes to Consolidated Financial Statements(Notes on Premise of Going Concern)
Not applicable.

(Notes on Significant Changes in the Amount of Stockholders’ Equity)
Not applicable.

(Segment Information)
Segment Information
I. Prior 3rd quarter (From April 1, 2015 to December 31, 2015)
1. Information regarding the amounts of net sales and income/loss by reportable segment(¥ million)
Reportable Segments
Toys and
Hobby
Business

Network
Entertainment
Business

Visual andMusic
Production
Business

To external customers

157,098

225,457

Inter-segment sales
and transfers

4,952

Total

Adjustments(Note 2)

Consolidated
Total(Note 3)

Total

Subtotal

Other(Note 1)35,304

417,860

7,323

425,183–

425,183

2,174

2,479

9,606

13,44323,049(23,049)–

162,050

227,63137,784427,466

20,766448,233(23,049)

425,183

17,532

19,042

10,05846,633

1,078

47,711(2,437)45,273

Net sales

Segment income
Notes:

1.

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.

2.

Included in the 2,437 million yen deducted from segment income as adjustment are an addition of 368 million
yen in inter-segment eliminations, and a deduction of 2,806 million yen in corporate expenses that cannot beallocated to any reportable segment. The corporate expenses are mainly costs related to the administration
division that has not been attributed to a reportable segment.

3.

Segment income is adjusted with operating income in the consolidated statements of operations.

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

- 10 -

II. Current 3rd quarter (From April 1, 2016 to December 31, 2016)
1. Information regarding the amounts of net sales and income/loss by reportable segment(¥ million)
Reportable Segments
Toys and
Hobby
Business

Network
Entertainment
Business

Visual andMusic
Production
Business

To external customers

140,507272,914

Inter-segment sales
and transfers

5,521

Total

Adjustments(Note 2)

Consolidated
Total(Note 3)

Total

Subtotal

Other(Note 1)

38,617452,038

7,065

459,103–459,103

7,539

2,362

15,424

13,142

28,566(28,566)–

146,028

280,453

40,980467,462

20,207

487,670(28,566)

459,103

12,67938,525

11,933

63,1381,208

64,346(4,186)60,160Net sales

Segment income
Notes:

1.

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.

2.

Included in the 4,186 million yen deducted from segment income as adjustment are a deduction of 772 million
yen in inter-segment eliminations, and a deduction of 3,413 million yen in corporate expenses that cannot beallocated to any reportable segment. The corporate expenses are mainly costs related to the administration
division that has not been attributed to a reportable segment.

3.

Segment income is adjusted with operating income in the consolidated statements of operations.

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

- 11 -

(Significant Subsequent Events)
Change to reportable segments
The Company has decided to change its organizational structure in April 2017, in order to further strengthen its
business in Japan and overseas related to collectable products for adults, centered on figures.
Planning, development, production and sales businesses of prizes for amusement facilities and Loto prizes forconvenience stores and so forth currently belong to the Network Entertainment Business. From the fiscal year ending
March 31, 2018, however, the Company plans to change their classification to the Toys and Hobby Business following
the change of its organizational structure.
Information regarding the amounts of net sales and income/loss by reportable segment for the current third quarter(nine months), assuming the classification of its reportable segments after the organizational change is as follows.

Current 3rd quarter (From April 1, 2016 to December 31, 2016)(¥ million)
Reportable Segments
Toys and
Hobby
Business

Network
Entertainment
Business

Visual andMusic
Production
Business

To external customers

158,764

254,657

Inter-segment sales
and transfers

6,886

Total

Adjustments(Note 2)

Consolidated
Total(Note 3)

Total

Subtotal

Other(Note 1)

38,617452,038

7,065

459,103–459,103

6,263

2,362

15,512

13,14228,655(28,655)–

165,650

260,920

40,980467,551

20,207487,759(28,655)

459,103

15,36235,882

11,93363,1781,208

64,387(4,227)60,160Net sales

Segment income
Notes:

1.

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.

2.

Included in the 4,227 million yen deducted from segment income as adjustment are a deduction of 813 million
yen in inter-segment eliminations, and a deduction of 3,413 million yen in corporate expenses that cannot beallocated to any reportable segment. The corporate expenses are mainly costs related to the administration
division that has not been attributed to a reportable segment.

3.

Segment income is adjusted with operating income in the consolidated statements of operations.

- 12 -