TOKYO, Japan – May 14, 2013 – GREE today announced financial results for its fiscal 2013 third quarter ended March 31, 2013. GREE recorded net sales of ¥37.8 billion and operating profit of ¥10.8 billion for the third quarter.

FY2013 Third Quarter Financial Summary

Millions of yen, rounded down

FY2013 Q3 FY2013 Q2
Net sales 37,892 39,407
EBITDA1 12,688 15,763
Operating profit 10,811 14,258
Ordinary profit2 12,129 16,330
Net profit3 4,706 9,048
  • 1. EBITDA = operating profit/loss + depreciation costs + amortization of goodwill
  • 2. FY2013 Q3 ordinary profit includes gain on currency exchange of approximately ¥1.43 billion
  • 3. GREE posted an extraordinary loss of ¥4.03 billion in FY2013 Q3 on a one-time write-off of assets related to some titles

Financial Highlights

  • Net sales for the third quarter totaled ¥37.8 billion, a decrease of 4% compared with ¥39.4 billion in the second quarter of fiscal 2013
  • Operating profit was ¥10.8 billion, a decrease of 24% compared with ¥14.2 billion in the second quarter of fiscal 2013
  • Paid services sales amounted to ¥34.8 billion, a decrease of 4% compared with ¥36.2 billion in the second quarter of FY2013
  • Advertisement sales were ¥3.0 billion, a decrease of 3% compared with ¥3.1 billion in the second quarter of fiscal 2013. Although smartphone advertising sales were firm, these were insufficient to completely offset declining feature phone advertising sales
  • Cost of sales was ¥6.6 billion, an increase of 5% compared with ¥6.3 billion in the second quarter of fiscal 2013
  • Sales, general & administrative costs were ¥20.4 billion, an increase of 9% compared with ¥18.8 billion in the second quarter of fiscal 2013
  • An extraordinary loss of ¥4.03 billion was recorded on a one-time write-off on assets related to some titles

Business Highlights

  • Japan coin consumption on smartphone titles grew, but fell short of targets
  • Overseas coin consumption doubled QoQ on strong performance from titles developed by the U.S. studio such as Crime City and Modern War
  • Established several joint ventures aimed at pursuing joint development and operation of social games and mobile content, as well as investment in anime business:
    • Griphone, Inc., a mobile social game developer established with CyberAgent, Inc. on February 18, 2013
    • Future Content Partners, Inc., a company established with GyaO Corporation, a subsidiary of Yahoo Japan Corporation, on February 25, 2013, with the aim of forming and operating fund targeting investment in Japanese animation content
    • AltDash, Inc., mobile social game developer established with AltPlus, Inc. on March 14, 2013
    • GxYz, Inc., a mobile social game developer established with Yahoo Japan Corporation on March 15, 2013
  • Established strategic business partnership with Grani, Inc. aimed at strengthening development capabilities through collaboration on hit title

New Growth Strategy

  • Shift growth strategy to selection and concentration: use selection and concentration to ensure top-line growth and pursue rigorous cost control
  • Prioritize shift to smartphones and redeploy resources to rapidly improve KPIs
  • Streamline native app title portfolio in Japan and redeploy portion of freed-up resources to shore up smartphone browser development
  • Streamline overseas portfolio and optimize global development system through measures including closure of Beijing office and studio
  • Build on growth momentum of U.S. studio and use horizontal knowledge sharing to apply proven expertise to other markets

FY2013 Earnings Forecast (revised May 14, 2013)

In view of its business performance during the nine months to March 31, 2013, GREE has revised its full-year earnings forecasts. (For further details, please refer to the announcement, “GREE Announces Extraordinary Loss and Revised Forecast for Fiscal 2013” dated today.)

  • Net sales are projected to be approximately ¥150 billion
  • Operating profit is projected to be approximately ¥46 billion
  • Ordinary profit is projected to be approximately ¥49 billion
  • Net profit is projected to be approximately ¥24 billion

Reference

For further information, see FY2013 Third Quarter Financial Results [PDF : 1,364KB]

About GREE, Inc.

GREE is a global mobile social company with businesses that include social gaming, social media, advertising, licensing and merchandising, and venture capital. Established in December 2004, GREE operates one of Japan's largest social networking services, supporting 14 languages. GREE created the world's first mobile social game in 2007 and today its mobile social gaming ecosystem reaches 169 countries and regions. With studios in Tokyo, Osaka, San Francisco, Vancouver, London, and Seoul and subsidiaries in ten countries, GREE employs more than 2,500 people around the world. GREE is listed on the Tokyo Stock Exchange (3632).

GREE and the GREE logo are trademarks or registered trademarks of GREE, Inc. in Japan and/or other countries. All other trademarks are the property of their respective owners.

Contact Information

GREE, Inc. PR
Roppongi Hills Mori Tower, 6-10-1 Roppongi, Minato-ku, Tokyo, Japan
E-mail: jp-pr@gree.net
URL: http://corp.gree.net/jp/en/
Twitter: @GREE_pr_jp