Nippon Ichi Software: Q2 Financial Report, 16th Term

Key insights

6 takeaways

01
Nippon Ichi Software generated 750,618 thousand yen in total sales and 149,581 thousand yen in ordinary profit for the second quarter ending September 30, 2008.See it on page 5
02
The consumer game segment is the primary revenue driver, contributing 703,356 thousand yen in sales and 229,526 thousand yen in operating profit through the release of eight titles.See it on page 5
03
The North American market is critical to the company's financial performance, accounting for 69.6% of total sales during the quarter.See it on page 24
04
The mobile and amusement business segments underperformed, both reporting operating losses for the three-month period.See it on page 5
05
The company maintains a stable financial position with total assets of 2,249,735 thousand yen and a capital adequacy ratio of 56.2%.See it on page 15
06
The board of directors authorized a share buyback program to begin in November 2008 to allow for more flexible capital management.See it on page 26

Summary

This financial report outlines the performance of Nippon Ichi Software for the second quarter of its 16th fiscal term, covering the period from July 1, 2008, to September 30, 2008. The company operates primarily in the consumer game, mobile, and amusement sectors. During this period, the company reported total sales of 750,618 thousand yen and an ordinary profit of 149,581 thousand yen for the three-month accounting period.

The consumer game segment remains the company's primary revenue driver, contributing 703,356 thousand yen in sales and 229,526 thousand yen in operating profit for the quarter. This performance was supported by the release of eight titles, including both new software and budget-priced versions across platforms such as the Nintendo DS, PlayStation Portable, and PlayStation 3. Notably, the North American market accounted for a significant portion of the company's success, representing 69.6% of total sales for the quarter. Conversely, the mobile and amusement segments faced challenges, both reporting operating losses for the period.

The company maintains a stable financial position with total assets of 2,249,735 thousand yen and a capital adequacy ratio of 56.2%. Cash and cash equivalents at the end of the quarter stood at 394,062 thousand yen. The report notes that the company has adopted new accounting standards regarding inventory valuation and lease transactions, though these changes did not materially impact the reported profits. Additionally, the board of directors resolved to initiate a share buyback program in November 2008 to facilitate flexible capital policy in response to changing economic conditions. The financial statements were reviewed by Azusa & Co. (now KPMG AZSA LLC) with no significant issues identified.