Stock Code: 7844
(First Section of Tokyo Stock Exchange)

Marvelous Inc.

Fiscal Year Ending March 31, 2017
First Quarter

Results Briefing
Materials
July 29, 2016
This document contains forward-looking statements which are based on
information currently available to the Company and which may change as a resultof numerous factors including the macroeconomic environment and industry
trends relevant to the Company. Therefore, these forward-looking statements are
made subject to certain risks and uncertainties which could cause results
including actual business performance to differ materially from those presented.

1

Contents

Fiscal Year Ending March 2017, First Quarter Results Summary

Fiscal Year Ending March 2017, Full-Year Business Forecast

Segment Results

Copyright (c) 2016 Marvelous Inc. All rights reserved.

2

Fiscal Year Ending March 2017,First Quarter Results Summary

Copyright (c) 2016 Marvelous Inc. All rights reserved.

3

Earnings Highlights (Statement of Income) Revenues decreased around 23% compared with the year-earlier period mainly due tolower sales in online game business.
 Operating income also declined mainly owing to strategic investments in consumer gamebusiness and write-off charges on online titles.
(Unit: million yen)
1Q FY ended March 2016

Actual

YOY change

1Q FY ending March 2017

Profit ratio

ActualProfit ratio(Amount)(%)

Net sales

8,045-

6,203--1,841

77.1%

Cost of sales

2,835-

2,844-

8

100.3%

SGA expenses

3,832-

2,721--1,111

71.0%

993-

552-

-441

55.6%

1,376

17.1%

638

10.3%

-738

46.3%

60-

-227-

-287

-

Ordinary income

1,436

17.9%

410

6.6%

-1,02628.6%

Extraordinary
income/losses

-52-

6-

59-

Income taxes

391-

113-

-278

28.9%

Profit attributable toowners of parent

992

12.3%

303

4.9%

-689

30.5%

Thereof advertisingexpenses

Operating income
Non-operating
income/losses

Copyright (c) 2016 Marvelous Inc. All rights reserved.

4

Development of Net Sales and Operating Income(Quarterly)(Unit: million yen)
Net sales

9,000

Operating income
8,233

7,500
6,629

8,045

2,500

8,402
7,781

7,591
2,000

6,820
6,203

Net Sales

1,475

1,486

4,758

1,376

1,464

4,500

3,000

1,446

1,500

1,130
1,000

793
655

638
500

1,500

0

Operating Income

6,000

1Q2Q

3Q

FY ended March 2015Copyright (c) 2016 Marvelous Inc. All rights reserved.

4Q

1Q

2Q

3Q

FY ended March 2016

4Q

1Q

0FY ending
March 2017

5

Segment Results(Unit: million yen)
1Q FY ended 1Q FY ending
March 2017
March 2016
ActualActual

YOY change(Amount)(%)●

Online GameBusiness

5,479

3,717

-1,761

67.8%●

Consumer GameBusiness

1,655

1,542-113

93.2%

●

Audio & VisualBusiness

912

945

33

103.7%

Total

8,045

6,203-1,841

77.1%

Net Sales

Online Game●Business

1,125576-549

51.2%

●

Consumer GameBusiness263123-139

47.0%

●

Audio & VisualBusiness

306253-53

82.7%

Total

1,695953-741

56.2%

Adjustments & eliminations-318-315

399.0%

Operating Income Total

1,376638-738

46.3%

Segment
IncomeCopyright (c) 2016 Marvelous Inc. All rights reserved.

POINT● Online Game Business• Mainstay titles posted lowersales.
• Income decline widened due
to poor performance of newtitles.

● Consumer Game Business• Costs increased due to newgame software and newamusement machine model
introductions.

● Audio & Visual Business• Profit margins tightenedowing to different
merchandise composition
but new stage
performances were highly
successful.
6Sales Structure by Segment (Quarterly)

9,000

Unit: million yen (percent of sales)■Audio & Visual Business
8,233■Consumer Game Business
8,000

8,402
8,045

■Online Game Business
1,532

7,000

6,629
1,019
(15.4%)

6,000

5,000

4,758

4,000

825
(17.3%)

2,152(32.5%)

6,820

1,322(19.4%)(18.6%)

912(11.3%)

1,655(20.6%)
1,884(22.9%)

1,189(14.2%)

7,781

7,591

862(11.1%)
1,564(20.6%)

2,086(24.8%)

2,177(28.0%)

6,203
945
(15.2%)

1,625(21.4%)

1,061(15.6%)

1,542(24.9%)

1,278
3,000(26.9%)

2,000

1,000

2,656(55.8%)

3,461(52.2%)

4,443(65.2%)

4,818(58.5%)

5,479(68.1%)

5,129(61.0%)

4,743(61.0%)

4,403(58.0%)

3,717(59.9%)

0
1Q

2Q

3Q

Fiscal Year ended March 2015

Copyright (c) 2016 Marvelous Inc. All rights reserved.

4Q

1Q

2Q

3Q
Fiscal Year ended March 2016

4Q

1Q
Fiscal Year ending
March 20177

Balance Sheet (Summary) Current assets lower mainly due to reduced cash and deposits after income tax
payment and dividend payment.
 Higher noncurrent assets and current liabilities from investment in new amusement
cabinets.
(Unit: million yen)
End ofMarch 2016

End ofJune 2016

ChangeCurrent assets (total)

16,204

14,805-1,399Noncurrent assets (total)

4,165

4,855

689

20,37019,660

-709

6,421

7,011

590

27

47

19

Total Liabilities

6,448

7,058

609

Net Assets (total)

13,921

12,601-1,319Total Assets
Current liabilities (total)
Noncurrent liabilities (total)

Copyright (c) 2016 Marvelous Inc. All rights reserved.

8

Fiscal Year Ending March 2017,
Full-Year Business Forecast

Copyright (c) 2016 Marvelous Inc. All rights reserved.

9Fiscal Year Ending March 2017,
Full-Year Business Forecast
 Original results projections remain intact.

(Unit: million yen)

Full Year

Online Game

● Business

FY ended March2016

FY ending March2017

ActualForecast

YOY change(Amount)(%)

19,75519,80044100.2%

7,544

9,400

1,855

124.6%

4,527

4,800

272

106.0%

31,82034,0002,179106.9%

4,182

3,900

- 282

93.2%

1,006

2,000

993

198.7%

1,308

1,350

41

103.2%

6,497

7,250

752

111.6%

Adjustments & eliminations-1,079- 1,250- 170

115.8%

Operating Income

5,418

6,000581

110.7%

Ordinary Income

5,228

5,850621

111.9%

Profit attributable toowners of parent

3,602

4,150547

115.2%

Consumer GameNet Sales● Business

Audio & Visual● Business

Total
Online Game

● Business

Consumer Game

Segment
Income● Business

Audio & Visual● Business

Total

Copyright (c) 2016 Marvelous Inc. All rights reserved.

10

Segment Results

Copyright (c) 2016 Marvelous Inc. All rights reserved.

11

Online Game Business:
FY Ending March 2017 Progress Status(Unit: million yen)

1Q Results for FY Ending March 2017

8,000

Lower revenues and earnings due to slipping
sales of existing titles and poor performanceof new titles.
Title Performance

6,000■Net sales ■Segment income

5,479

1,500

1,125
3,717

4,000

 Collaboration with popular IP surrounding"Logres of Swords and Sorcery: Goddess ofAncient."

2,000

1,000
576
500

2,000

 Sales of "SMASH DRAGOON" struggling
after service start in April; service to beterminated.

00
1Q Fiscal Year
ended March 2016

1Q Fiscal Yearending March 2017

〈Title Rollouts〉
Logres of Swords and Sorcery:Goddess of AncientBrowser Sangokushi

Ikki-Tousen Burst Fight(PC browser)(mobile browser)

Service launched in December 2013 (in Japan)

Service launched in July 2009

Service launched in May 2012

©Marvelous Inc. Aiming Inc.

©Marvelous Inc.

©2014 YUJI SHIOZAKI・SHONENGAHOSHA/IKKITOUSEN EE PARTNERS(native app)

Copyright (c) 2016 Marvelous Inc. All rights reserved.

12

Online Game Business:
Initiatives Starting in 2Q of FY Ending March 2017
(Unit: million yen)
25,000TOPICS
 "Logres of Swords and Sorcery: Goddessof Ancient" considered for further continued
collaboration programs.
 "Logres of Swords and Sorcery: Goddess ofAncient" projected for launch of Chineseversion this summer.
 Additionally, new titles are in planning anddevelopment stages.
〈Title Rollouts〉

20,00015,000■Net sales ■Segment income
19,7558,000

19,800
6,000

4,182

3,900

4,000

10,000
2,000

5,000
0

Fiscal Year ended Fiscal Year ending
March 2016
March 20170Overseas Initiatives

劍與魔法王國-遠古的女神战斗吧 蘑菇君（Logres of Swords and Sorcery: Goddess of Ancient)（Logres of Swords and Sorcery: Goddess of Ancient）

Launched in October 2015 (Taiwan, Hong Kong, and Macau).

Scheduled in summer of 2016 for the Chinese market©Marvelous Inc. Aiming Inc.
©Garena Online.

Copyright (c) 2016 Marvelous Inc. All rights reserved.

©Marvelous Inc. Aiming Inc.
© SkyMoons.com

13

Consumer Game Business:
FY Ending March 2017 Progress Status(Unit: million yen)

1Q Results for FY Ending March 2017
Strategic investments in new titles
proceeding as planned.

2,500

Favorable performance continuing after launch.

Title Performance

2,000

BOKUJO MONOGATARIMITTSU NO SATO NO
TAISETSU NA TOMODACHI (3DS)
Released June 23, 2016

500400

1,655
1,500

"BOKUJO MONOGATARI MITTSU NO SATONO TAISETSU NA TOMODACHI" marked
1,000
favorable start following sales launch on June 23.
"Dragon Quest: Monster Battle Scanner"
500
Operations initiated on June 23, marking
successful start.
0US subsidiary Marvelous USA sees continued
strong performance.
〈Title Rollouts〉■Net sales ■Segment income

1,542
300

263

200
123
100

1Q Fiscal Year
ended March
2016

1Q Fiscal Yearending March2017

0Dragon Quest:
Monster Battle Scanner(Amusement)
Launched June 23, 2016©2016 Marvelous Inc. All Rights Reserved.

Copyright (c) 2016 Marvelous Inc. All rights reserved.

©2016 ARMOR PROJECT/BIRD STUDIO/Marvelous/SQUARE ENIX All Rights Reserved.

14

Consumer Game Business:
Initiatives Starting in 2Q of FY Ending March 2017
(Unit: million yen)
12,000

TOPICS"Pokémon Ga-Olé" operations initiated onJuly 7.
Sales launch of own new production"UPPERS" on July 14.
Sales launch of "Fate/EXTELLA," first newproduction in the series in three years,scheduled for November 10; reservations
performing strongly.

■Net sales ■Segment income
9,400

10,000
8,000

7,544

2,000

6,000
4,000

2,500
2,000
1,500

1,006

1,000

2,000
0

3,000500

Fiscal Year endedMarch 2016

Fiscal Year ending
March 20170〈Title Rollouts〉
Pokémon Ga-Olé(Amusement)

UPPERS

Fate/EXTELLA(PS Vita)(PS4/PS Vita)

Released July 14, 2016

Scheduled for release
November 10, 2016

Launched July 7, 2016©2016 Pokémon. ©1995-2016 Nintendo/Creatures Inc. /GAME FREAK inc.
Developed by T-ARTS and MARV
Pokémon is a registered trademark of Nintendo, Creatures, and GAME FREAK.

Copyright (c) 2016 Marvelous Inc. All rights reserved.

©2016 Marvelous Inc.

©TYPE-MOON ©2016 Marvelous Inc.

15

Audio & Visual Business:
FY Ending March 2017 Progress Status
1Q Results for FY Ending March 2017
Profit margins tightened owing to different
merchandise composition but new stage
performances were highly successful.

Title Performance(Unit: million yen)
1,200
1,000

Witchy Pretty Cure!

Touken Ranbu the Stage

Sales launch of the first volume
on June 15, 2016

Performances in May 2016

©Touken Ranbu the Stage Production Committee

945

912

800

 Package sales launch of "Witchy Pretty Cure!" Public performances of "Touken Ranbu the Stage" 600in May sold out every day; live viewing and goods
400
sales, etc., in top form.
 Public performances of "MUSICAL THE PRINCE200
OF TENNIS Concert Dream Live 2016" in May.
 Public performances of "Ensemble Stars! On Stage" 0in June.
〈Title Rollouts〉■Net sales ■Segment income

500400306253300

2001000
1Q Fiscal Year
ended March 2016

1Q Fiscal Yearending March 2017

MUSICAL THE PRINCE OF TENNIS
Concert Dream Live 2016

Ensemble Stars! On Stage

Performances in May 2016
(Revenue recognition in 2Q)

Performances in June 2016
(Revenue recognition in 2Q)©2009 TAKESHI KONOMI ©2014 NAS, THE PRINCE OF TENNIS II PROJECT©1999 TAKESHI KONOMI／2015 MUSICAL THE PRINCE OF TENNIS PROJECT©2016 Happy Elements K.K／Ensemble Stars! STAGEPROJECT©Toei Animation. All Rights Reserved

Copyright (c) 2016 Marvelous Inc. All rights reserved.

16

Audio & Visual Business:
Initiatives Starting in 2Q of FY Ending March 2017
TOPICS(Unit: million yen)
6,000

 TV broadcasting launch of new anime production"QUALIDEA CODE" in July.
5,000
 TV broadcasting launch of new anime production“TOUKEN RANBU HANAMARU”slated for October. 4,000
 Series of public performances projected including
3,000“Stage K -Lost Small World-"and "ULTRAMUSICAL Samurai Jam-Bakumatsu The Arrival of 2,000
the Black Ships." Performances of "Touken Ranbu the Stage" to be 1,000
resumed on the back of huge success in the winter0of 2016.
〈Title Rollouts〉
QUALIDEA CODETV broadcasting started inJuly 2016

TOUKEN RANBU HANAMARU
Scheduled to air on TV inOctober 2016

Stage Ｋ
-Lost Small WorldPerformances in July 2016

©Speakeasy・Marvelous/QUALIDEA Production Committee■Net sales ■Segment income

4,527

4,800

3,000
2,500
2,000

1,308

1,350

1,500
1,000500

Fiscal Year ended Fiscal Year ending
March 2017
March 2016

0ULTRA MUSICAL Samurai Jam-Bakumatsu RockThe Arrival of the Black Ships
Performances scheduled forAugust to September 2016©2014 Marvelous Inc./BakumatsuRock Production Committee©2014 Marvelous Inc./ULTRA MUSICAL BakumatsuRock Production Committee©2016 TOUKEN RANBU HANAMARU Project

Copyright (c) 2016 Marvelous Inc. All rights reserved.

© GoRA・GoHands／k-project© GoRA・GoHands／stage k-project17

Thank you for your attention.
Inquiries
Administration Division, Corporate Planning Department
TEL: +81-3-5769-7447
FAX: +81-3-5769-7448
URL:http://www.marv.jp

This document contains forward-looking statements which are based on information currently available to the Companyand which may change as a result of numerous factors including the macroeconomic environment and industry trends
relevant to the Company. Therefore, these forward-looking statements are made subject to certain risks and uncertainties
which could cause results including actual business performance to differ materially from those presented.

Copyright (c) 2016 Marvelous Inc. All rights reserved.

18