Summary of Consolidated Financial Results for the Three Months Ended June 30, 2022

Koei Tecmo Holdings reported consolidated financial results for the first quarter of the fiscal year ending March 31, 2023, covering the three-month period from April 1, 2022, to June 30, 2022. The data reveals a complex fiscal performance characterized by rising operational efficiency despite declining top-line revenue and significant non-operating headwinds. Net sales for the quarter reached 18.65 billion yen, representing a 9.1% decrease compared to the same period in the previous year. Conversely, operating profit grew by 19.9% to 11.66 billion yen, driven by a substantial reduction in the cost of sales, which fell from 7.11 billion yen to 3.37 billion yen year-over-year.

The bottom-line results were heavily impacted by non-operating factors. Ordinary profit fell by 50.6% to 9.09 billion yen, and profit attributable to owners of the parent dropped by 49.6% to 6.75 billion yen. This decline was largely attributed to a sharp increase in non-operating expenses, which rose from 1.25 billion yen to 9.54 billion yen. Key contributors to these expenses included a 5.68 billion yen loss on the valuation of derivatives and a 2.34 billion yen loss on the redemption of securities. Furthermore, the company recorded a comprehensive loss of 185 million yen for the quarter, primarily due to a 7.80 billion yen negative swing in the valuation difference on available-for-sale securities.

Looking ahead, the full-year forecast for the period ending March 31, 2023, anticipates net sales of 77 billion yen, a 5.8% increase over the prior year. However, profitability is expected to contract across the board, with projected declines in operating profit (5.9%), ordinary profit (12.7%), and profit attributable to owners (10.9%). The company’s financial position remains stable with total assets of 203.10 billion yen and an equity ratio of 59.4%, though net assets per share decreased from 874.33 yen to 766.20 yen during the quarter.