Earnings Presentation for the H1 FY2019: Question & Answer Session (Summary)

On Friday, November 8, 2019, at 13:00, FIELDS CORPORATION held a financial results briefing for the H1 of the fiscal year ending March 31, 2020 at its head office (Shibuya-ku, Tokyo).
This page provides an overview of the main question & answer session (summary) at the briefing.

Question & Answer Session (Summary)

Q1. What do you think about the outlook for the sales units of NEON GENESIS EVANGELION Rebirth of Angels?

A1. We already have over 30,000 of orders, and therefore we expect that more units will be sold than we planned.

Q2. Why did the gross profit ratio of Q2 (Jul. - Sep.) decrease YoY?

A2. In Q2 FY2018, we sold many titles which are sold by distribution sales* centered on pachislot machines, and therefore profit and gross profit increased. Also, the whole figures were affected by the contribution to the profit by the other companies. In Q2 FY2019, however, the gross profit ratio decreased mainly due to decrease of unit sales of machines sold by agency sales* centered on pachinko, although the number of machines sold exceeded YoY.

*Please refer to (Reference) Recording method of Pachinko/Pachislot machine under Our Market of About FIELDS in our IR website.

Q3. How many pachinko/pachislot (hereafter, “PS”) titles do you have in Q4 FY2019?

A3. We will sell one pachinko title (+ five amadigi-type titles in reserve) and three pachislot titles (+ one title in reserve). We will determine installation of preliminary titles considering the whole progress.

Q4. Passing test ratio of model certification tests in pachislot has been sluggish in the range around 20%. What do you think about the outlook?

A4. Current passing test ratio seems to be resulted from the manufacturers’ trial and error studying about contents and spec of new-regulation machines. The ratio will recover when manufacturers formulate development policy and develop the merchandises which meet demand from both fans and pachinko halls.

Q5. What do you think about the demand for replacing PS machines resulting from removal of old-regulation machines? Can manufacturers provide machines to respond the demand?

A5. It is the serious responsibility for manufacturers and distributors to provide sufficient products supply respond to fulfill demand from pachinko halls.
We will endeavor to enhance structure that we can provide appropriate products to nationwide pachinko halls in timely.

Q6. You mentioned that you aim to sell 500,000 units of PS machines in a year. What will take to reach this ideal status; development systems, regulations, or the whole issues in the market?

A6. We think these two are the important point; developing products with high playability which can only be realized by pachinko while competing with leisure activities in other industries, and steadily offering the products to both fans and pachinko halls.
We will further enhance the product lineup with help of various manufacturers, and aim to realize those targets.

Q7. What about the progress of Pachinko Pachislot Information Station?

A7. We are roughly ready to start the service as we completed distributing the pilot version for some pachinko hall. We will start the service properly from 2020.

Q8. How are the movie and merchandising business in Tsuburaya Productions progressing?

A8. The movie business has been progressing well. We have a strong expectation for the movie as we produce it with partners and staffs who have achievements, in the situation that the industry as a whole is on strong trend. Also in the merchandising business, it has promoting developments in Japan and abroad, the President and COO, Nagatake, becoming central to it.

Q9. Could you tell us the current profit for Total Workout and how far do you think it will grow?

A9. The final profit of Total workout was approximately ¥100 million. We positioned it at first as a place where we can build relationships with various business partners, including IP-related people. We will be challenging the health industry with our Total Workout as a core brand to meet recent increasing demand for health. We are now examining carefully about the revenue target.

Q10. What is the strength and the target of the business in Total Workout in the health industry?

A10. Kevin Yamazaki, who has many achievements as a personal trainer, opened Total Workout in 2001 as the first personal training gym in Japan. For 18 years since then, Total Workout has provided leading-edge methods in cooperation with various research institutions and partners in America, the country leading the fitness industry.
It has a strength to provide various programs with high specialization; over 3,000 kinds of training, support of diet, body care and group fitness. We plan to grow the brand of Total Workout utilizing its strong points, and invest steadily considering expansion of the number of gym. We will announce the specific goal of the business at the full-year financial statement scheduled in May 2020.