Financial

Consolidated Financial Results for the Year Ended March 31, 2024

1 April 202410 pages3,408 words

Summary

Koei Tecmo Holdings achieved a 7.9% increase in net sales to ¥84.6 billion for the fiscal year ended March 31, 2024, reflecting a period of steady top-line growth. While profit attributable to owners rose 9.2% to ¥33.8 billion, the company experienced a notable 27.2% decline in operating profit, which fell to ¥28.5 billion. This contraction in operating margins was primarily driven by rising selling and administrative expenses. However, ordinary profit remained resilient, growing 14.6% to ¥45.7 billion due to substantial non-operating gains derived from investment securities and derivative valuations. The financial position of the organization strengthened considerably throughout the year, with total assets expanding to ¥245.8 billion and net assets reaching ¥175.6 billion. Cash flow from operating activities remained robust at ¥36.6 billion, supported by efficient trade receivable collections and higher pre-tax profits. These inflows effectively balanced a ¥24.9 billion net outflow in investing activities, largely attributed to the strategic acquisition of investment securities. Despite distributing ¥15.7 billion in dividends, the company maintained a stable liquidity position with ¥10.5 billion in cash and cash equivalents at the close of the period. Looking toward the fiscal year ending March 31, 2025, the outlook suggests continued revenue expansion alongside tightening profitability. Net sales are projected to grow by 6.4%, yet profit attributable to owners is expected to decline by 11.2%. This forecast indicates a transitionary phase where increased market activity and sales volume may be offset by shifting investment returns or continued pressure on operating costs. The overall trajectory emphasizes a shift toward leveraging a strong balance sheet and non-operating income to navigate fluctuations in core gaming profitability.

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Financial

Consolidated Financial Results for the Year Ended March 31, 2023

Koei Tecmo Holdings demonstrated robust operational growth during the fiscal year ended March 31, 2023, characterized by a 7.8% increase in net sales to ¥78,417 million and a 13.3% rise in operating profit to ¥39,133 million. This performance reflects a strengthening of core business activities despite a broader decline in net income. Profit attributable to owners fell by 12.5% to ¥30,935 million, a downturn primarily driven by non-operating factors, including a significant reduction in gains from investment securities and a ¥13,976 million loss on the redemption of securities. The financial position remains resilient with total net assets increasing to ¥142.7 billion and a capital adequacy ratio of 67.3%. Cash flow dynamics shifted significantly during the period, resulting in a net decrease in cash and cash equivalents of ¥7,959 million. While operating activities generated a healthy inflow of ¥29.7 billion, this was offset by substantial financing and investing outflows. Notable expenditures included ¥81.7 billion in investment security purchases, ¥28,000 million in short-term borrowing repayments, and ¥17.0 billion in dividend distributions. Looking toward the fiscal year ending March 31, 2024, the outlook remains aggressive with a projected revenue increase of 21.1% to ¥95,000 million. Management intends to maintain a stable shareholder return policy with a dividend payout ratio of approximately 50%. These results indicate a strategic transition where strong organic growth in the gaming sector is being balanced against volatile non-operating investment returns and a proactive reduction of debt obligations.

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Consolidated Financial Results for the Year Ended March 31, 2024

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