COLOPL FY Sep. 2018 4Q Results

COLOPL’s fiscal year 2018 results reflect a period of transition characterized by a significant fourth-quarter recovery, though overall annual performance fell short of initial projections. For the full fiscal year ending September 2018, the company reported sales of 45.7 billion yen and an operating profit of 6.9 billion yen, representing year-over-year declines of 12% and 46%, respectively. These results were primarily attributed to the sluggish performance and delayed release of new titles. Despite these challenges, the company achieved a notable rebound in the fourth quarter, with sales and operating profits increasing sequentially due to successful anniversary events for key titles like White Cat Project and White Cat Tennis.

The company’s operational strategy remains focused on a long-term "mille-feuille" approach, where new app releases are layered upon a foundation of stable, existing titles. Key performance indicators, specifically Quarterly Active Users (QAU) and Average Revenue Per Quarterly User (ARPQU), showed improvement in the fourth quarter, bolstered by returning users during anniversary campaigns. Financial management during this period included a heavy allocation of advertising costs—reaching an advertising-to-sales ratio of 10.8%—to support new launches. Additionally, the company increased its dividend to 17 yen per share, incorporating a 5-yen commemorative dividend for its 10th anniversary.

Looking ahead to fiscal year 2019, the company has opted not to disclose a formal financial plan. This decision stems from the inherent difficulty in forecasting results given the planned doubling of new title releases to six, the experimental nature of these titles in "proposing new ways to play," and the potential for significant fluctuations in advertising expenditures. The company intends to maintain a balanced IP strategy, leveraging both in-house and licensed intellectual property while continuing to explore consumer and location-based gaming opportunities.