Kadokawa Corporation Summary of Consolidated Financial Results for the Nine Months Ended December 31, 2020

Kadokawa Corporation achieved robust financial growth during the nine-month period ending December 31, 2020, characterized by a 1.7 percent increase in net sales to 152,777 million yen and a substantial 56.1 percent rise in operating profit to 13,204 million yen. This performance reflects the company’s resilience amidst the global COVID-19 pandemic, which caused localized disruptions in the Video and Web Service segments but failed to impede overall profitability. Consequently, the organization revised its full-year consolidated forecasts upward and increased its dividend projections, supported by a stable liquidity position of 41,174 million yen in cash and cash equivalents.

The primary drivers of this success were the Publication Business and the Game Business. The latter experienced a 99 percent surge in operating profit, bolstered significantly by the high-profile release of Cyberpunk 2077 and sustained consumer demand for the Dark Souls franchise. To better align with its long-term strategic objectives, the company reorganized its reporting structure during the second quarter, separating the Video and Game segments into distinct entities. This structural shift is intended to provide greater clarity and focus as the company pursues its mid-term growth initiatives.

Financial stability remains a hallmark of the current fiscal period, as evidenced by the absence of impairment losses on non-current assets or goodwill. By effectively leveraging its diverse portfolio across publishing, gaming, and digital services, the company has successfully navigated market volatility. These results underscore a period of operational efficiency and strategic realignment, positioning the firm to maintain its momentum through the remainder of the fiscal year.