Out Run Master!
Join Date: Aug 2004
I wont make a new thread for this I'll hijack this one instead:
EGA SAMMY Holdings' Annual Report to Shareholders, 'Our Competetive Edge; Broader, Stronger, Soaring Higher'
Tokyo, Japan, Nov 8, 2006 - (JCN Newswire) - SEGA SAMMY Holdings (TSE: 6460; ADR: SGAMY), a comprehensive games and entertainment provider and market leader in a wide range of its fields, has published its Annual Report for the fiscal year ending March 31, 2006. In the Group's second fiscal year, the range of initiatives that the Group has implemented such as the restructuring of its development organization, the sale of overseas subsidiaries, and the acquisition of overseas development studios with promising intellectual property produced results, and each business segment recorded a strong performance. As a result, the Group recorded its best results since the management integration, not only by revenue but also by every measure of profit, while the Consumer Business achieved profitability in just a year and a half.
In the fiscal year ended March 31, 2006, net sales rose 7.3%, to JPY 553.2 billion. Strong contributions were made by the Amusement Machine Sales Business, which recorded favorable shipments of large-scale, high-value-added products; Amusement Center Operations, which registered higher sales at existing centers and favorable performances in children's card games; and the Consumer Business, which benefited from the results of development system reorganization measures and aggressive acquisitions overseas. Income before income taxes and minority interests increased 25.1%, to JPY 111.9 billion, and net income was up 30.9%, to JPY 66.2 billion. The net margin improved 2.2 percentage points, to 12.0%, and ROE increased to 23.0%, from 19.5% in the previous year.
"We will become the world's number one comprehensive entertainment company," says Hajime Satomi, Group Chairman and CEO, in his 2006 address to shareholders. "The SEGA SAMMY Group will use its business portfolio, the strongest in the industry, to create synergies and stake out a solid position in a new competitive environment.
"In only a year and a half from the 2004 management integration of SEGA and Sammy to the end of the year under review, we made substantial progress. The SEGA SAMMY Group has implemented reorganization measures targeting enhanced management efficiency and a stronger operational foundation. At the same time, to expand our operations in growth fields, we have invested aggressively, including making acquisitions. We have captured and retained the dominant number one share of the pachislot machine market.
This success is based on unrivaled development capabilities that have enabled Sammy to launch highly regarded machines, such as ALADDIN II Evolution. In the pachinko machine business, meanwhile, by bolstering our development capabilities, we have enhanced the quality of our products and obtained more machine approvals, thereby increasing unit sales and expanding our market share. In October 2005, we entered a capital and business tie-up with GINZA Co., Ltd., a developer, manufacturer, and marketer of pachislot and pachinko machines, in order to extend our successful multi-brand strategy from pachislot machines to pachinko machines. Through this tie-up, we will develop new pachinko and pachislot machines, enhance distribution networks, and obtain additional machine approvals.
In the Amusement Machine Sales Business, high-value-added products that leverage SEGA's advanced product development capabilities, such as StarHorse NEW GENERATION, are storming the market. We are taking steps to secure our foundation for further growth, such as establishing a production and distribution system that can respond smoothly to the demand generated by these hit titles.
In Amusement Center Operations, we are making steady progress in developing new markets. In children's card games, for example, The King of Beetles "MUSHIKING" and LOVE AND BERRY Dress up and Dance! are showing dramatic growth in both number of installed units and number of cards sold. Additionally, we have begun to expand our amusement center operations from Japan to North America and Asia.
In the Consumer Business, due to rigorous control of schedules and quality following the implementation of reorganization measures in development, as well as to the contributions made by listed subsidiaries SEGA TOYS, LTD., Sammy NetWorks Co., Ltd., and TMS ENTERTAINMENT, LTD., we have recorded a substantial improvement in profitability. TMS ENTERTAINMENT, which has been consolidated from the second half of the fiscal year ended March 31, 2006, is engaged in animation planning and production.
As our subsidiary, the company has substantially enhanced the Group's animation-related business. In these ways, we are establishing a foundation for success in the entertainment industry, which has moved onto a new competitive stage. With this strong foundation, we will strive not only in Japan but also overseas and work to achieve our medium-term management objectives - JPY 1 trillion in sales and JPY 200 billion in ordinary income.
Rather than simply pursuing scale and profits, as a good corporate citizen that makes an ongoing contribution to society, we strictly observe laws, regulations and social norms, and strive to build good relationships with all stakeholders, thereby realizing sound management and fulfilling our social responsibilities. We believe that such endeavors are indispensable for raising our corporate value, and in accordance with this approach, we have formulated the Group CSR Charter and enhanced our internal control system.
At the same time, we have formulated our management philosophy - "By providing entertainment filled with dreams and excitement to people throughout the world, we will strive to enrich our society and culture." As a group that grows together with all of its stakeholders, the SEGA SAMMY Group will strive to record continued development in global markets, and I would like to ask for your continued support in the years ahead."
(Extracts from the SEGA SAMMY Group 2006 Annual Report to Shareholders)
To download the 2006 Report, please visit the SEGA SAMMY IR homepage at http://www.segasammy.co.jp/english/ir/index.jsp .
About SEGA SAMMY Holdings
On October 1, 2004, SEGA CORPORATION and Sammy Corporation integrated their operations for the purpose of building an even more powerful base as a comprehensive global entertainment organization. A holding company called SEGA SAMMY HOLDINGS INC. was established with the aim of maximizing corporate value, giving the two companies a new beginning as the SEGA SAMMY Group. The Group is embarking upon a new journey with the overriding goal of becoming the World's number one comprehensive entertainment enterprise by providing entertainment to people of all ages the world over. For more information, please visit www.segasammy.co.jp
Good news in all areas, profits up etc etc.