DENA CO., LTD. May 11, 2017
DeNA Co., Ltd.Copyright © DeNA Co., Ltd. All Rights Reserved.
Financial Results
Strategy and Initiatives
Guidance
Reference
1
Copyright © DeNA Co., Ltd. All Rights Reserved.
FY2016 revenue and operating profit increased year-over-year
Operating profit for the game business grew on a year-on-year basis due to the Nintendo Alliance beginning to contribute and the operating results for the international business improving. Additionally, the operating profit of the Sports business dramatically improved as well
Revenue
Operating Profit (Non-GAAP)
Profit for the Year Attributable
to Owners of the Parent
FY2015 FY2016 FY2015 FY2016 FY2015 FY2016
*For IFRS revenue, we defer revenue over the period that we expect the user to use a particular game in games that have a single payment model or are similar to that model. 2
For full reconciliation of GAAP to Non-GAAP metrics, please see the reference section.
Copyright © DeNA Co., Ltd. All Rights Reserved.
Income tax benefit was recognized due to the increase of deferred tax assets and tax refundable related to the loss on the valuation of shares of overseas subsidiaries related to the West game business. Recognition of this loss on Japanese standalone financial statements occurred in the past
Based on our dividend policy, the year-end dividend per is expected to be 32 yen
（billion yen）
Item
FY2015
FY2016
YoY Change
Revenue
143.7
143.8
+ 0.1
Operating profit (IFRS)
19.8
23.2
+ 3.4
Operating profit (Non-GAAP)
20.1
24.9
+ 4.8
Profit before tax
20.9
25.6
+ 4.8
Income tax expense
-9.0
6.6
+ 15.5
Profit for the year
11.9
32.2
+ 20.3
Profit for the year:Owners of the parent
11.3
30.8
+ 19.5
Profit for the year:Non-controlling interests
0.5
1.4
+ 0.8
EPS (Yen)
78.76
212.49
+ 133.73
Dividend Per Share (Yen)
20.0
32.0
+ 12.0
Consolidated Dividend Payout Ratio (%)
25.4%
15.1%
-
*For IFRS revenue, we defer revenue over the period that we expect the user to use a particular game in games that have a single payment model or are similar to that model. 3
For full reconciliation of GAAP to Non-GAAP metrics, please see the reference section.
Copyright © DeNA Co., Ltd. All Rights Reserved.
(billion yen)
Item
FY2015
FY2016
Q4
Q1
Q2
Q3
Q4
Revenue (IFRS)
35.0
38.3
38.2
32.2
35.1
QoQ
YoY
3%
-3%
9%
1%
-0%
3%
-16%
-5%
9%
0%
Revenue excl. Sports
33.5
32.8
32.0
31.6
33.7
QoQ
YoY
1%
-5%
-2%
-3%
-3%
-4%
-1%
-5%
7%
0%
FY2015
FY2016
143.7
143.8
-
1%
-
0%
133.8
130.0
-
-1%
-
-3%
Operating profit (IFRS)
5.1
7.4
7.9
3.4
4.5
QoQ
YoY
55%
11%
43%
83%
7%
7%
-56%
4%
31%
-12%
Non-GAAP operating profit
3.9
7.8
7.9
3.4
5.8
QoQ
YoY
15%
-20%
101%
14%
1%
28%
-56%
2%
70%
52%
Operating profit excl. Sports
4.9
6.0
5.7
5.0
7.2
QoQ
YoY
-5%
-13%
21%
0%
-5%
11%
-11%
-3%
43%
45%
19.8
23.2
-
-20%
-
17%
20.1
24.9
-
-19%
-
24%
21.1
23.8
-
-20%
-
13%
*For IFRS revenue, we defer revenue over the period that we expect the user to use a particular game in games that have a single payment model or are similar to that model.
For full reconciliation of GAAP to Non-GAAP metrics, please see the reference section. 4
Copyright © DeNA Co., Ltd. All Rights Reserved.
Other expenses: Q4 includes one-time costs associated with the Third-Party Committee, and retirement
and impairment of game assets and other investment assets
(billion yen)
Item
FY2015
FY2016
FY2015
FY2016
Q4
Q1
Q2
Q3
Q4
YoY Change
QoQ Change
YoY Change
Revenue
35.0
38.3
38.2
32.2
35.1
0%
9%
143.7
143.8
0%
Game
26.6
26.1
24.3
23.6
27.4
3%
16%
109.6
101.4
-7%
E-commerce
5.2
4.6
4.9
5.1
4.5
-14%
-13%
19.9
19.2
-4%
Sports
1.5
5.5
6.3
0.6
1.4
-5%
124%
9.9
13.8
39%
New Businesses and Others
2.0
2.3
3.0
3.1
2.1
6%
-33%
5.7
10.4
82%
Adjustments
-0.2
-0.3
-0.2
-0.2
-0.3
-
-
-1.5
-1.0
-
Operating profit
Operating profit margin
5.1
15%
7.4
19%
7.9
21%
3.4
11%
4.5
13%
-12%
-
31%
-
19.8
14%
23.2
16%
17%
-
Segment profit / loss
4.9
7.2
8.0
3.6
6.9
41%
92%
22.0
25.7
17%
Game
6.6
6.7
6.1
6.0
9.5
43%
59%
25.9
28.3
9%
E-commerce
0.7
0.4
0.5
0.5
0.7
-9%
43%
2.6
2.1
-22%
Sports
-1.1
1.8
2.2
-1.6
-1.3
-
-
-1.0
1.1
-
New Businesses and Others
-1.0
-1.3
-0.9
-1.4
-1.5
-
-
-4.7
-5.1
-
Adjustments
-0.4
-0.3
0.1
0.1
-0.4
-
-
-0.8
-0.5
-
Other income *
2.3
0.1
0.1
6.1
0.1
-94%
-98%
3.9
6.5
67%
Other expenses*
2.1
0.0
0.2
6.2
2.5
23%
-60%
6.0
9.0
50%
*Includes non-extraordinary gains and losses under Japanese GAAP. (e.g. Loss on sales / retirement of tangible / intangible assets)
5
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Controlled cost of sales and SG&A expenses as appropriate throughout the fiscal year
(billion yen)
Item
FY2015
FY2016
FY2015
FY2016
Q4
Q1
Q2
Q3
Q4
YoY
Change
QoQ
Change
YoY
Change
Cost of Sales
14.3
14.9
14.8
12.9
13.7
-4%
6%
59.6
56.3
-6%
Personnel Expenses
1.4
1.3
0.9
1.1
0.8
-45%
-28%
6.2
4.0
-34%
Depreciation and amortization
2.2
2.2
2.3
2.3
2.1
-4%
-9%
9.4
8.9
-5%
Outsourcing expenses
2.1
2.5
2.9
2.6
2.5
18%
-4%
9.2
10.5
13%
Commission fees
6.2
6.1
5.8
5.8
6.4
4%
11%
25.7
24.2
-6%
Others
2.4
2.8
2.9
1.2
1.9
-21%
62%
9.2
8.7
-5%
Selling, general, and administrative expenses
15.8
16.2
15.4
15.7
14.5
-8%
-7%
62.1
61.7
-1%
Personnel Expenses
3.4
3.7
3.6
3.6
3.7
8%
2%
13.5
14.6
8%
Sales promotion &
Advertising expenses
3.1
3.2
2.8
2.9
2.2
-28%
-22%
12.8
11.1
-14%
Outsourcing expenses
& Commission fees
7.0
7.3
7.0
7.0
6.6
-5%
-5%
27.8
27.9
0%
Others
2.4
2.0
2.0
2.3
2.0
-16%
-13%
8.0
8.2
3%
Other income*
2.3
0.1
0.1
6.1
0.1
-94%
-98%
3.9
6.5
67%
Other expenses*
2.1
0.0
0.2
6.2
2.5
23%
-60%
6.0
9.0
50%
Consolidated employee
headcount
2,435
2,497
2,496
2,413
2,400
-1%
-1%
2,435
2,400
-1%
*Includes non-extraordinary gains and losses under Japanese GAAP. (e.g. Loss on sales / retirement of tangible / intangible assets)
6
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Many positive growth factors in Q4, including the release of new titles from the Nintendo partnership and good performance of key existing titles, such as Gyakuten Othellonia (1st and 2nd party title) and Granblue Fantasy (3rd party title provided by Cygames)
Virtual Currency Consumption* Game Business Segment Operating Profit
FY2015
FY2016
FY2015 FY2016
*Includes consumption of free virtual currency
7
Copyright © DeNA Co., Ltd. All Rights Reserved.
© 2017 Nintendo / INTELLIGENT SYSTEMS
Released in February 2017
Focusing on operations as we perform rapid updates and run events for
this title with the goal of making it enjoyable over a long period of time
Reached a satisfactory level of sales
© 2016 Nintendo
Released for iOS in December 2016 and for Android in March 2017
Distributing in 165 countries and regions, anticipate that the game will
soon reach 150 million downloads (between both iOS and Android)
*All titles referenced on this slide are published by Nintendo 8
Copyright © DeNA Co., Ltd. All Rights Reserved.
Scheduled for release during FY2017
More detailed information about the release timing will be provided later
Future titles
The Nintendo Partnership is a mid to long term partnership, and we will announce more details about the future title lineup at the appropriate timing
Future partnership titles are in development
*All titles referenced on this slide are published by Nintendo 9
Copyright © DeNA Co., Ltd. All Rights Reserved.
Solid progress in strengthening of in-game operations of existing key 1st and 2nd party titles as well as
in new releases
Gyakuten Othellonia Duels X Machina Tenka Hyakken -Zan-
Exceeded 9 million downloads, continued focus on in-game operations
Digital trading card game, launched March 30, 2017
Sword girl action RPG,
launched April 20, 2017
©KADOKAWA CORPORATION 2016
©DeNA Co.,Ltd. All rights reserved.
10
Copyright © DeNA Co., Ltd. All Rights Reserved.
Gross transaction value for DeNA Travel saw steady growth, and increased usage outside of DeNA
services drove growth in our processing settlement service Paygent
Revenue**
Travel
Gross Transaction Value
*Previous quarter revenue has been restated to exclude the DeNA Shopping and au Shopping Mall businesses which were sold on December 28, 2016.
In FY2015, revenue for these businesses was 5.2 billion yen, and operating profit was 580 million yen 11
Copyright © DeNA Co., Ltd. All Rights Reserved.
Business Results Recent Updates
(million yen)
Item
FY2015
FY2016
Q4
Q1
Q2
Q3
Q4
Revenue*
669
976
1,484
1,229
-29
Segment profit / loss*
-349
-603
-236
-849
-1,195
*The above figures are based on management accounting, following the allocation of shared costs for the relevant business; review procedures have not been undertaken in accordance with the Financial Instruments and Exchange Act.
March 13, 2017
Disclosure of the Third-Party Committee Investigation Report
April to June, 2017
Announced agreement with Shogakukan to explore opportunities in digital media on April 20, 2017
As yet, no decisions have been made regarding future plans
12
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Financial Results
Strategy and Initiatives
Guidance
Reference
13
Copyright © DeNA Co., Ltd. All Rights Reserved.
Guiding Principles Most Important Management Topics
Mission
Delight and Impact the World
Vision
As an eternal venture*, bring delight to the world using the internet and AI
Enhance trust
Strengthen governance, management structure, and compliance to set an example as an industry leader
Promote a thorough mindset transformation and redefine our mission and vision for each of our business areas to ensure we prioritize delighting our users
Strengthen business portfolio to target
*How DeNA defines eternal venture:
Continuously challenge ourselves to provide new value
Social responsibility is a key priority
continuous growth
Establish a solid foundation by FY2020 to create new business pillars in addition to strengthening the game business
Become a company able to create significant and stable value over the long term
14
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Planned Initiatives
Announced
March 13, 2017
Strengthening of top management
Increasing oversight of business activities by the Board of Directors
Strengthening compliance systems and our management structure
Corporate culture reform
Transitioned to a two representative director system as of March 13, 2017
Comprehensive discussion in progress concerning ways to significantly strengthen our business execution and corporate audit function
Plan to provide more specific details about our initiatives by the end of May 2017
Aim to have improvements in place by July 1, 2017
Progress & Future Plans
15
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Financial Results
Strategy and Initiatives
Guidance
Reference
Financial Results
Strategy and Initiatives
Guidance
Reference
Travel (DeNA Travel, Shumee-to Club)
Shopping (DeNA Shopping*, au Shopping Mall*, SEIYU.com)
Auction (Mobaoku)
Processing Settlement (Paygent)
Curation platform (MERY, iemo, Find Travel)
IP-generating platform (Manga Box, Everystar, MyAnimeList)
Automotive
Healthcare (MYCODE, KenCoM)
Mobile social incubation (SHOWROOM, Mirrativ)
16
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Consolidated Financial Guidance for Q1 FY2017FY2017 |
Q1e |
36.4 |
29.9 |
FY2016
Q1 Q2 Q3 Q4
(billion yen)
Revenue(IFRS) | 38.3 | 38.2 | 32.2 | 35.1 | |
Revenue excluding Sports | 32.8 | 32.0 | 31.6 | 33.7 | |
FY2016 | FY2017 | ||||
Q1 | Q2 | Q3 | Q4 | Q1e | |
Reconciliation of operating profit to non-GAAP operating profit | |||||
Operating profit (IFRS) | 7.4 | 7.9 | 3.4 | 4.5 | 7.5 |
Accounting adjustments related to seasonality, net | +0.1 | -0.2 | -0.4 | +0.5 | -0.1 |
Acquisition and restructuring related expenses | +0.3 | +0.2 | +6.4 | +0.8 | +0.0 |
Sales and disposition related gains | -0.0 | - | -5.9 | - | - |
Non-GAAP operating profit | 7.8 | 7.9 | 3.4 | 5.8 | 7.5 |
Non-GAAP operating profit excl. Sports | 6.0 | 5.7 | 5.0 | 7.2 | 5.0 |
17
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18
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(billion yen) | ||||||||||
FY2015 | FY2016 | |||||||||
Reconciliation of Operating profit to Non-GAAP operating profit Operating profit(IFRS) | 4.0 | 7.4 | 3.3 | 5.1 | 7.4 | 7.9 | 3.4 | 4.5 | 19.8 | 23.2 |
Accounting adjustments related to seasonality, net | +0.3 | -0.2 | -0.2 | +0.1 | +0.1 | -0.2 | -0.4 | +0.5 | -0.0 | +0.0 |
Acquisition and restructuring related, net | +2.5 | +0.2 | +0.2 | +0.6 | +0.3 | +0.2 | +6.4 | +0.8 | +3.6 | +7.7 |
Sales and disposition related gain (loss) | - | -1.2 | - | -2.0 | -0.0 | - | -5.9 | - | -3.2 | -5.9 |
Non-GAAP operating profit | 6.8 | 6.1 | 3.4 | 3.9 | 7.8 | 7.9 | 3.4 | 5.8 | 20.1 | 24.9 |
Profit (loss) from seasonal sports business | -0.9 | -1.0 | +1.8 | +1.1 | -1.8 | -2.2 | +1.6 | +1.3 | +1.0 | -1.1 |
Non-GAAP operating profit excluding Sports | 5.9 | 5.1 | 5.2 | 4.9 | 6.0 | 5.7 | 5.0 | 7.2 | 21.1 | 23.8 |
Q1 | FY 2015 Q2 Q3 | Q4 | Q1 | FY 2016 Q2 Q3 | Q4 | FY2015 | FY2016 |
Q1 | FY 2015 Q2 Q3 | Q4 | Q1 | FY 2016 Q2 Q3 | Q4 |
Reconciliation of Operating profit to Non-GAAP EBITDA
Operating profit(IFRS) | 4.0 | 7.4 | 3.3 | 5.1 | 7.4 | 7.9 | 3.4 | 4.5 | 19.8 | 23.2 |
Accounting adjustments related to seasonality, net | +0.3 | -0.2 | -0.2 | +0.1 | +0.1 | -0.2 | -0.4 | +0.5 | -0.0 | +0.0 |
Acquisition and restructuring related expenses | +2.5 | +0.2 | +0.2 | +0.6 | +0.3 | +0.2 | +6.4 | +0.8 | +3.6 | +7.7 |
Sales and disposition related gains | - | -1.2 | - | -2.0 | -0.0 | - | -5.9 | - | -3.2 | -5.9 |
Depreciation and amortization | +3.2 | +2.8 | +2.7 | +2.6 | +2.7 | +2.8 | +2.9 | +2.7 | +11.3 | +11.1 |
Retirement of fixed assets (excl. one-time factors) | +0.4 | +0.7 | +0.2 | +1.3 | +0.0 | +0.2 | +0.1 | +0.8 | +2.7 | +1.1 |
Non-GAAP EBITDA | 10.4 | 9.7 | 6.3 | 7.8 | 10.5 | 10.9 | 6.4 | 9.4 | 34.2 | 37.1 |
*Please consult the Q4 FY2015 Operating Results for more information regarding our introduction of Non-GAAP disclosure
19
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(billion yen)
FY2015 | FY2016 | |
Operating cash flow (A) | 26.7 | 22.7 |
Profit before tax | 20.9 | 25.6 |
Depreciation and amortization | 11.3 | 11.1 |
Income tax paid | -7.8 | -9.8 |
Others | 2.3 | -4.2 |
Investing cash flow (B)* | -40.0 | -7.4 |
Financing cash flow | 20.1 | -2.4 |
Cash dividends paid | -2.6 | -2.9 |
Disposition of Treasury Stock* | 22.2 | 0.3 |
Others | 0.6 | 0.2 |
FCF ((A)+(B)) | -13.3 | 15.3 |
Cash and cash equivalents (Consolidated) | 75.2 | 88.2 |
(Non-consolidated basis) | 48.6 | 57.0 |
*Impact from the business and capital alliance with Nintendo is reflected to investing cash flow and disposition of treasury stock in financing cash flow by approximately 22 billion yen respectively in FY2015. Acquisition of Nintendo's shares and disposition of our treasury stock were both effective April 2, 2015.
20
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Segments | Businesses |
Game Business | Japan and international game businesses |
E-Commerce Business | Sub-segment names (Major service names in parenthesis) |
Sports Business | Baseball, Running Club, etc. |
New Businesses and Others | Sub-segment names (major service names in parenthesis) |
*DeNA Shopping and au Shopping Mall were sold to KDDI on December 28, 2016
21
Copyright © DeNA Co., Ltd. All Rights Reserved.
The information and data contained within this presentation and these presentation materials have been determined based on information available as of May 11, 2017. The company disclaims any obligation to update or revise such information and data, whether as a result of new information, future events or otherwise.
In addition, any forward-looking statements contained in this presentation or these presentation materials are based on our opinions and information available as of May 11, 2017, and involve uncertainty. Please be aware that the actual performance data and similar information are subject to influence from diverse factors and may differ from the forecasts presented herein.
DeNA Co., Ltd.
22
Copyright © DeNA Co., Ltd. All Rights Reserved.
DeNA Co. Ltd. published this content on 11 May 2017 and is solely responsible for the information contained herein.
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