Kadokawa Dwango Corporation Summary of Consolidated Financial Results for the Nine Months Ended December 31, 2018

Kadokawa Dwango Corporation’s consolidated financial results for the nine months ended December 31, 2018, reflect a period of stagnant top-line growth coupled with significant bottom-line volatility. The company reported net sales of 152.1 billion yen, representing a marginal year-on-year increase of 0.1%. While operating profit improved by 8.2% to 3.18 billion yen and ordinary profit rose by 26.5% to 4.37 billion yen, the company recorded a net loss attributable to owners of the parent of 2.17 billion yen, a sharp reversal from the 1.71 billion yen profit reported in the same period of the previous year.

The primary driver for the net loss was a substantial impairment charge of 3.8 billion yen recorded as an extraordinary loss. This charge significantly impacted the company’s overall profitability, leading to a negative earnings per share of 33.84 yen for the nine-month period. Despite these challenges, the company maintained a stable financial position with total assets of 236.85 billion yen and an equity ratio of 43.4% as of December 31, 2018.

Operating cash flows showed improvement, moving from a net outflow of 1.36 billion yen in the prior year to a net inflow of 3.16 billion yen. However, heavy investment in property, plant, and equipment—totaling over 10 billion yen—contributed to a net decrease in cash and cash equivalents to 62.96 billion yen. Looking ahead to the full fiscal year ending March 31, 2019, the company projects net sales of 207 billion yen and anticipates a full-year net loss of 4.3 billion yen, underscoring the ongoing impact of the impairment losses and broader operational adjustments.