Earnings Presentation for the First Quarter of the Year Ending March 31, 2016: Question & Answer Session (Summary)

FIELDS CORPORATION held a financial presentation for the first quarter of the year ending March 31, 2016 in OTEMACHI 1st SQUARE CONFERENCE (Chiyoda-ku, Tokyo) on August 3, 2015 (Monday) at 11:30 am.
This page provides an overview of the main question & answer session (summary) at the financial presentation.

Question & Answer Session (Summary)

(August 3, 2015)

Q1. Earnings results for the first quarter were solid, but to what extent has performance been in line with forecasts in the second half, including titles sold?

A1. In pachinko/pachislot machines sales, titles have been launched as planned in the first two quarters, and there is little chance that our future development plans will change significantly.
The first quarter has just ended so we cannot be optimistic, but we have made a strong start to achieving full-year forecasts.

Q2. The deadlines for installing new pachinko and pachislot machines that conform to the old regulations are approaching in October and November, respectively. Do you expect that this will be the last of the regulations, or will they continue?

A2. The general outline is being finalized for pachislot machines, but the outlook for pachinko machines is still unclear.

Q3. Please tell us about the status of last-minute sales of new machines conforming to the old regulations prior to the deadline, and the market environment following the deadline.

A3. Compliance to new regulation of pachislot machine was hard when companies were adapting to the changes in the model certification test method in September 2014, after which manufacturers had more leeway in their schedules to conform to the new regulations.
However, many of the pachinko machines that are part of a series are of the MAX type, so we anticipate last-minute sales before the deadline to install new machines.
We do not anticipate a sharp drop-off in the market after the deadline since there are many examples of low-spec pachislot machines with impressive story line and game functions that enjoy support from users. Similarly, we believe we can offer good pachinko products even under the new regulations.

Q4. When will IP contribute to revenue?

A4. We believe it is likely that IP will contribute to profit in the fiscal year ending in March 2017 or March 2018, given the progress made in bringing IP to the screen and the condition of merchandising expansion.
We are targeting a contribution of about 1 billion yen in operating income, and we expect to see the outcome from our IP investment around that time.

Q5. In the overseas expansion of Tsuburaya Productions Co., Ltd., what progress has been made in making the live entertainment business profitable and what is the progress relative to plans?

A5. We plan to expand the live entertainment business overseas to Macao and 7 cities in China, and it will make a major contribution to revenue when merchandising is expanded. Advertising using live entertainment shows as a hook and toy development are currently proceeding smoothly as planned.