SNK Corporation Financial Statements: 22nd Fiscal Period Ended July 2023

Key insights

7 takeaways

01
SNK Corporation reported a net loss of 4.65 billion yen for the fiscal year ended July 31, 2023, driven by an operating loss of 4.28 billion yen.See it on page 2
02
The company recorded a gross loss of 278.29 million yen, with total sales of 4.41 billion yen failing to cover the 4.69 billion yen cost of sales.See it on page 2
03
Financial performance was further impacted by 507.07 million yen in impairment losses and approximately 4 billion yen in selling, general, and administrative expenses.See it on page 2
04
Despite operational losses, the company maintains a stable financial position with 20.58 billion yen in total assets, including 10.74 billion yen in cash and deposits.See it on page 1
05
The business model relies heavily on intellectual property licensing, with revenue recognition split between point-in-time license grants and over-time access rights for gaming and animation assets.See it on page 3
06
Operations involve significant intercompany transactions with subsidiaries in China and Singapore, primarily focused on development outsourcing and licensing agreements.See it on page 4
07
The fiscal year concluded with a net loss per share of 22,088.09 yen.See it on page 2

Summary

The SNK Corporation financial statements for the 22nd fiscal period, covering the year ended July 31, 2023, detail a challenging financial performance characterized by significant net losses. The company reported total sales of 4.41 billion yen against a cost of sales of 4.69 billion yen, resulting in a gross loss of 278.29 million yen. After accounting for selling, general, and administrative expenses of approximately 4 billion yen, the company recorded an operating loss of 4.28 billion yen. Including non-operating items and special losses—most notably 507.07 million yen in impairment losses—the total net loss for the fiscal year reached 4.65 billion yen.

Despite these losses, the company maintains a solid capital base with total assets of 20.58 billion yen, of which 10.74 billion yen is held in cash and deposits. Total net assets stand at 19.50 billion yen, supported by capital stock and capital surplus. The financial statements reflect a business model heavily reliant on intellectual property licensing, including character and game rights, as well as animation access rights. The company utilizes specific accounting standards for revenue recognition, distinguishing between point-in-time license grants and over-time access rights.

The scope of the report encompasses the parent company’s individual financial position and results, with significant intercompany transactions involving subsidiaries in China and Singapore. These transactions primarily involve development outsourcing and licensing agreements. The methodology follows standard Japanese accounting principles, including the use of the cost method for inventory and specific depreciation schedules for intangible assets such as software. The fiscal year concludes with a net loss per share of 22,088.09 yen, highlighting the impact of the year's operational and impairment-related financial pressures.