Square Enix Consolidated Financial Results: Fiscal Year Ended March 31, 2005

Square Enix achieved robust financial expansion during the fiscal year ended March 31, 2005, characterized by a 16.9 percent increase in net sales to 73.86 billion yen and a 36.3 percent rise in operating income to 26.44 billion yen. This performance was underpinned by the successful integration of the former Enix and Square entities, which allowed for a unified accounting approach and strategic expansion into new markets, including the establishment of a subsidiary in China. The company’s net income reached 14.93 billion yen, supported by strong cash flow from operating activities totaling 24.87 billion yen.

Growth was primarily driven by the company's diversified portfolio, with the Online Games and Mobile Phone Content segments experiencing significant surges of 55.2 percent and 63.2 percent, respectively. High-profile titles such as Dragon Quest VIII and the Final Fantasy XI online service were instrumental in achieving a global sales volume of 11.05 million units. While domestic operations remained the primary revenue engine, the company noted a shift in geographic distribution, with overseas sales as a percentage of total revenue declining from 29.6 percent to 20.0 percent over the fiscal period.

Financial management remained disciplined despite the complexities of post-merger integration. Adjustments to retirement benefit accounting policies resulted in a 437 million yen increase in expenses, which impacted recurring profit, while the effective tax rate rose to 39.94 percent. Looking forward, the company maintains a long-term target of an operating profit ratio between 25 and 30 percent. Reflecting this confidence, the board doubled the dividend per share to 60 yen, including a commemorative 25th-anniversary payout, and established ambitious projections for the following fiscal year, targeting 90 billion yen in net sales and 27 billion yen in operating income.