Leveraging the distinctive strengths of the BANDAI NAMCO Group to make a strong start in what will be an important year leading up to the next ...
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NEWSLETTER
September 2021
BANDAI NAMCO Holdings Inc. BANDAI NAMCO Mirai-Kenkyusho
5-37-8 Shiba, Minato-ku, Tokyo 108-0014
Interview with the President
Leveraging the distinctive strengths of the
BANDAI NAMCO Group to make a strong start
in what will be an important year leading up to
the next Mid-term Plan
BANDAI NAMCO Holdings has announced its results for the first three months
of FY2022.3. In this issue of the newsletter, President Masaru Kawaguchi
Masaru Kawaguchi
discusses the circumstances in the first quarter, future outlook, current trends President & Representative Director,
in each business, and other matters. BANDAI NAMCO Holdings Inc.
The results for the first three months previous fiscal year, there were no major releases In the Creation business, revenues from the
of FY2022.3 have been announced. of new titles in home video games and network production of visual products increased, and
Kawaguchi: In the first three months of content, but in the first three months of this fiscal licensing revenues were favorable due to the
FY2022.3, we achieved net sales of ¥178.0 bil- year we recorded initial expenses for the intro- growing popularity of Gundam IP. On the other
lion, operating profit of ¥27.0 billion, and profit duction of new titles on an upfront basis. hand, at GUNDAM FACTORY YOKOHAMA,
attributable to owners of parent of ¥20.9 billion. The Toys and Hobby business achieved which opened in December 2020, we took steps
These are record-high levels for sales and record-high results for the first three months. to address the spread of COVID-19, such as
profits in the first three months. The spread of Products for the mature fan base, such as shortening operating hours and suspending
COVID-19 has had an influence, but we are Gundam plastic models and figures, recorded events. The Amusement business was affected
approaching changes in the business envi- favorable results around the world. In addition, by the influence of the spread of COVID-19,
ronment as opportunities to acquire customers we saw a recovery in categories such as prizes, including the suspension of operations at facil-
and create markets, and employees on the front which in the same period of the previous fiscal ities and the reduction of operating hours.
lines are taking on a variety of challenges. I year were affected by the suspension of oper- However, the influence was less than in the same
think that we have been able to leverage the ations at amusement facilities due to the spread period of the previous fiscal year. Moreover,
distinctive strengths of the BANDAI NAMCO of COVID-19. Furthermore, new IP* products, campaigns utilizing IP also had an effect. Sales
Group and make a strong start in what will be such as Demon Slayer: Kimetsu no Yaiba, con- at existing facilities in Japan were up 115.6%
an important year leading up to the next Mid- tinued to be popular, and favorable results were year on year (more than 70% of the level seen
term Plan. also recorded by confectionary and capsule in the first quarter of FY2020.3). We are starting
toys, where hits have included not only to see signs of recovery. Sales of amusement
Would you provide an overview of products that utilize IP but also non-character machines were also up year on year.
the circumstances in each business? products. Moreover, the Digimon: Digital
Kawaguchi: In Digital business, SCARLET Monsters trading card game for the North The results forecasts for the
NEXUS, a new home video game title, got off American market was popular. In these ways, first six months of the fiscal year have
to a good start. In addition, repeat sales of exist- favorable performances by toy-related items been revised.
ing titles were up year on year on a unit basis. also made a contribution to results. In the Visual Kawaguchi: For the first six months of
In these ways, results remained favorable, cen- and Music business, we sold visual and music FY2022.3, our initial forecasts were for net
tered on markets around the world. In network packaged products that leverage mainstay IP, sales of ¥350.0 billion and operating profit of
content, the new My Hero Academia title got and game-related licensing revenues made a ¥35.0 billion. Recently, with consideration for
off to a solid start, and mainstay titles also contribution to results. In the same period of results in the first three months, the current
recorded stable results. However, overall per- the previous fiscal year, for the most part we market environment, and the circumstances in
formance in network content did not reach the were unable to hold live events due to the influ- our businesses, we reviewed the forecasts for
level seen in the same period of the previous ence of COVID-19, but in the first quarter of the Toys and Hobby business and the Visual
year, when results were favorable due to demand this fiscal year we utilized online distribution and Music business, and we revised the
associated with people staying at home. Fur- and new technologies, and we substantially Group-wide forecasts to net sales of ¥380.0
thermore, in the first three months of the increased the number of events held. billion and operating profit of ¥43.0 billion.
* IP: Characters and other intellectual property
September 2021 1
(Information in this section is as of the end of August 2021.)
Interview with the President
first quarter. With the popular Pui Pui Molcar,
Deepening fusion and collaboration among the new Units work to develop product brands into pillars year. In July, we began to introduce a highly
of our operations, in a follow on to such series in addition to a visual packaged product, we anticipated new amusement machine, Mobile
Further cultivating a sense of unity as Charapaki. In capsule toys, we will increase are also implementing secondary development Suit Gundam: Senjo no Kizuna II. We will
customer touch-points in collaboration with the in the Toys and Hobby business. continue to advance measures to increase
What is the outlook for the full a variety of projects to promote understanding games, we will launch high-quality new titles Amusement business. Moreover, The Digimon: In these ways, we are implementing multi- efficiency while introducing unique BANDAI
fiscal year? of mutual IP-creation know-how and to and work to expand new mainstay titles. In Digital Monsters IP started from a toy, and now faceted development of IP, centered on visual NAMCO topics for both amusement facilities
Kawaguchi: We have not revised our initial strengthen integration and collaboration. In addition, in the digital field, we will continue wearable devices and, in North America, card and music products. In live events, at this point, and machines. The amusement business is
plans for the full fiscal year. The second half addition, the IP Production Unit is taking steps to advance technical research to rapidly games leveraging this IP are popular, centered the number of audience members has not an important outlet under the Group’s IP axis
includes the busy year-end/new-year sales to activate communication and to cultivate a address intensifying competition and new on younger customers. A new anime will be returned to the level in the period before strategy, and going forward we will aim to
period, which is the largest sales period during sense of unity as a new Unit, such as jointly technologies. Furthermore, the 2022 release broadcast from the fall in Japan, and we also COVID-19. However, we will work to roll-out bolster the earnings platform in this business,
the year. In addition, we plan to launch major sponsoring family events for employees and of the latest theatrical version of DRAGON plan to launch a home video game. Accordingly, new live events that combine real and virtual which provides important venues for direct
home video game titles. With the current state their families. BALL SUPER has been announced. The entire the entire Unit will work to create buzz. elements, such as through the use of online contact with customers.
of emergency and the expansion of the regions Group, including game content and toys and In products for the mature fan base, Gundam distribution and new platforms.
covered, we will continue to carefully assess Would you discuss the trends in the hobby products, we will collaborate with the plastic models are recording favorable results
the uncertain market environment going Digital business? film and work to create buzz. in China, where we installed a life-size Gundam What are the trends in the
forward. Kawaguchi: In the Digital business, in home statue, and in North America, where the roll- Amusement business?
video games we expect to sell 1 million units What is the current situation in the out of products at large-scale distributors is Kawaguchi: In amusement facilities, future
What types of initiatives have been of SCARLET NEXUS in FY2022.3. This prod- Toys and Hobby business? making solid progress. Looking at business market trends are not clear, but currently
implemented since the Unit reorgani- uct was created through strategic IP investment Kawaguchi: In the Toys and Hobby business, development initiatives around the world, we initiatives leveraging Group resources are
zation in April? under the previous Mid-term Plan. We will looking at new series for established IP in Japan, want to establish the culture of plastic model drawing attention, such as BANDAI NAMCO
Kawaguchi: We are working to further deepen nurture this title as new IP through collaborative Ultraman Trigger products were launched in making, rather than simply offering IP and limited prize campaigns and Capsule Toy
integration and collaboration in the Entertain- initiatives that involve both a home video game July, followed by the launch in September of products that are ended after a short-term Store facilities. We are also seeing results
ment Unit, which combines the Digital business and an anime produced by the creation busi- Kamen Rider Revice products, which are com- boom. Also, in tandem with the highlighting from the measures to increase efficiency
and the Toys and Hobby business, and in the ness. We also plan to launch major titles, such memorative products for the 50th anniversary of Gundam plastic models, we are also work- through structural reforms, which we have
IP Production Unit, which combines the Visual as Tales of ARISE in September 2021 and of KAMEN RIDER, in September. Also, in ing to promote recycling of the plastic used been implementing since the previous fiscal
and Music business and the Creation business. ELDEN RING in January 2022. We will strive November we will start sales of Tamagotchi as a raw material, and to advance the use of
In the Entertainment Unit, we currently have a to nurture these new products into long-lived Smart, a wearable Tamagotchi product. For new materials.
variety of projects underway that are related to titles while engaging in close communication Demon Slayer: Kimetsu no Yaiba, which con-
Defining the BANDAI NAMCO Group’s presence
IP, products, and services. Looking around the with fans. Looking at repeat sales, we think tinues to enjoy high popularity, we will roll What are the circumstances in the in a sustainable society
world, in China we are planning to integrate that the favorable effect of demand associated out products in a wide range of categories, Visual and Music business and the
the companies in the Digital business and the with people staying at home is gradually set- such as toys, in conjunction with the broadcast Creation business? What is the status of the formulation their understanding of our strengths and the
Toys and Hobby business. We have already tling down. Last year, sales were centered on of the second season of the anime. Kawaguchi: In FY2022.3, we expect to expand of the next Mid-term Plan? issues we face. Developing a shared awareness
consolidated multiple offices into a single office repeat sales of existing titles, but this year, we In toy-related items, which are recording the lineup in comparison with the previous fiscal Kawaguchi: After FY2022.3, which is a of issues through discussions will be a major
in China, and we are also consolidating offices expect the percentage of sales from new titles favorable results, in confectionary we will year, when the spread of COVID-19 had an period for establishing a foundation, the next positive factor within organizational units.
in South Korea and Spain. We expect these to increase, and we will record initial expenses effect on the production and release of visual Mid-term Plan will start from April 2022. Cur- Employees will be able to take the initiative
initiatives to further activate communication associated with the launch of major titles on products as well as the launch schedules for rently, deliberations regarding the strategies in addressing strategies that they have deter-
within Units. an upfront basis. visual and music packaged products. Looking are reaching the most important stage, and in mined based on thorough discussions.
The IP Production Unit is also advancing In network content, as with home video at visual products from SUNRISE, Mobile Suit the formulation of the next Mid-term Plan, In the next Mid-term Plan, in addition to
Gundam Hathaway, a theatrical product, has rather than goals for three years in the future, our business strategies, we will also redefine
been highly evaluated, and box-office revenues which will be the final year of the Mid-term BANDAI NAMCO’s presence in a sustainable
surpassed ¥2.0 billion in early August. Also, Plan, we are focusing on what challenges we society. In other words, we will redefine our
Love Live! Superstar!!, the new title in the will need to address over the next three years starting point — how the BANDAI NAMCO
Love Live! series, was broadcast on NHK Edu- in order to foster continued growth for the Group can fulfill our social responsibilities by
cational TV from July and has become a focus BANDAI NAMCO Group for five or 10 years working together with society, fans, and other
of attention. Accordingly, the entire Unit will into the future. A stable foundation is necessary stakeholders. I would like to ask for everyone’s
work to create buzz through visual, music, and to support initiatives to take on the challenge continued support of the BANDAI NAMCO
live event initiatives. of growth, and accordingly we will steadily Group as we move forward.
We will strive to bolster IP creation by not implement defensive measures from a variety
only working with in-house studios but also of perspectives, including systems and finance.
collaborating actively with external partners. At the same time, in areas where we need to
ELDEN RING, a highly anticipated major title Vital Bracelet Digivice V, produced We will aim to increase IP value by developing go take a proactive approach, we will imple-
©BANDAI NAMCO Entertainment Inc. / ©2021 FromSoftware, Inc. in collaboration with the latest the IP for visual and music packaged products ment aggressive, finely tuned initiatives. In
Digimon: Digital Monsters anime
and also taking on the challenge of other roll- addition, in formulating strategies, I have
©本郷あきよし・東映アニメーション
©本郷あきよし・フジテレビ・東映アニメーション
Mobile Suit Gundam Hathaway,
out methods. One of those is game licensing requested that everyone hold thorough discus-
©BANDAI
a theatrical product revenues, which made a contribution in the sions at each worksite in order to reconfirm
©創通・サンライズ
2 BANDAI NAMCO NEWS September 2021 3
Closeup
number of products on a short cycle, from conducted among three companies — BANDAI
Record high results in the Toys and Hobby business
several months to a year. In contrast, the CO., LTD., BANDAI SPIRITS CO., LTD., and
Aiming for further growth through synergies among businesses Digital business develops and manages a BANDAI NAMCO Entertainment Inc. Each of
single title over a long period of time measured the three companies set themes related to its
In April 2021, the BANDAI NAMCO Group reorganized its Units for the next
Going forward, we will strive to create these in units of several years. The purpose of com- own products, and proposals were recruited from
Mid-term Plan. In this section, Kazuhiro Takenaka, president and representative
types of IP that leverage the distinctive bining these businesses is not to make these all employees. The plans that were submitted
director of BANDAI CO., LTD., which oversees the Toys and Hobby business in
strengths of the Toys and Hobby business. different characteristics completely the same. were publicly shared among the three compa-
the newly created Entertainment Unit, discusses the current circumstances and
Rather, each will strive to learn from and nies, and officers and employees could vote for
future outlook in the Toys and Hobby business.
The business is also devoting efforts leverage the other’s strengths. For the Digital the proposals they like. By creating a venue for
to sales and marketing initiatives that business I think that gathering information employees of the three companies to freely
Please discuss the effect of COVID-19 What is the status of new IP initiatives? utilize digital technologies. about the IP in the Toys and Hobby business exchange ideas, this program became an oppor-
and the current results in the Toys and Takenaka: We are working to quickly create Takenaka: COVID-19 has had an influence, and a sense of speed will provide motivation. tunity to deepen mutual understanding.
Hobby business. products based on new IP from other compa- and the pace of digitalization throughout soci- And for the Toys and Hobby business too, I
Takenaka: In FY2021.3, in the Toys and nies, such as Demon Slayer: Kimetsu no Yaiba, ety has accelerated. The Toys and Hobby think that further growth will result from a
Hobby business, the suspension of operations Disney: Twisted-Wonderland, and Jujutsu business is also working aggressively in pro- deeper understanding of the Digital business,
at amusement facilities due to the spread Kaisen. In addition to toys, these efforts have motions with online elements and in e-commerce. which rolls out a single product for an
of COVID-19 had an effect on prizes for also produced a large number of hits in related The mature fan base has a strong affinity for extended period of time on a worldwide basis.
amusement facilities, digital card games, etc., products. online initiatives, and 700,000 fans participated To foster integration, we are actively Kazuhiro Takenaka,
especially in the first quarter. The business division in charge of prizes in one of our online events over a period of three President and Representative Director,
advancing personnel exchanges among busi-
BANDAI CO., LTD.
On the other hand, we quickly strengthened and lottery-related products, which have a days. The merits of online events include the nesses. For example, from April, under a Group
sales and marketing initiatives leveraging digital rapid business cycle, has been gathering infor- fact that anyone can participate easily. As a initiative, there has been personnel exchange
technologies, and as a result we secured demand mation about new IP from a wide range of result, we have been able to connect with new among executives from BANDAI SPIRITS CO.,
associated with people staying at home. Prod- sources, and has rapidly commercialized new customers as well as dormant customers. LTD., and BANDAI NAMCO Entertainment
ucts for the mature fan base, such as Gundam products. Its methods of gathering information On the other hand, real events have a special Inc. Also from June an idea contest was
plastic models and collectible items, recorded are also being adopted by other business com- ability to create buzz among the participants.
favorable results around the world. In addition, panies and divisions. The Toys and Hobby With a focus on the period after COVID-19,
in Japan popularity was enjoyed by products business has a variety of outlets, such as toys, we will conduct effective hybrid promotions Implementing organizational restructuring to expand overseas business
utilizing new IP and by related products, such figures, plastic models, toy confectionary and that leverage the merits of both online and
as confectionary. As a result, overall the Toys foods, capsule toys, card games, apparel, and real events. What is the situation with restructuring. In China, plans call for the com- Toy Store facilities, and official shops for
and Hobby business achieved record-high net daily use sundries. By working together and overseas initiatives? bination of the company handling the Digital ichibankuji lottery-related products. In these
sales and operating profit. acting quickly, the Toys and Hobby business The Toys and Hobby business and the Takenaka: China and North America have business and the company handling the Toys ways, we will strive to make a contribution
In the first three months of FY2022.3, our is able to provide products at the optimal Digital business have been combined been positioned as focus regions. In China, and Hobby business in January 2022. Also, in to Groupwide results.
results were led by businesses that continued timing, ranging from young customers to the into a single Unit. in May we put a life-sized Freedom Gundam North America, the Group will combine the
to enjoy favorable performances, and busi- mature fan base. I believe that these compre- Takenaka: In a general sense, the Toys and statue on display in Shanghai, and in conjunc- company handling the Toys and Hobby busi- What are your policies toward work?
nesses that were affected by COVID-19 in the hensive abilities and speed are a major Hobby business and the Digital business are tion with that event, we opened our second ness for specialty retail shops and the company Takenaka: As someone in a field related to
same period of the previous fiscal year recov- strength of the Toys and Hobby business. in the same market — entertainment — but Gundam plastic model flagship shop in Shang- handling the Toys and Hobby business for manufacturing, I place the highest priority on
ered. Consequently, we achieved record-high In addition, looking at in-house IP, we have there are major differences in the features of hai. The response has been positive. In large-scale retailers. Through these reorgani- making products that delight customers. Prod-
net sales and operating profit for the first three hit products in the field of entertainment con- the products that they offer. For example, the addition, Ultraman and KAMEN RIDER prod- zations, we will aim for business growth over ucts that customers enjoy lead to motivation
months of a fiscal year. fectionary, such as Charapaki and Tsurigumi. Toys and Hobby business turns over a large ucts are also popular, and moving forward we the medium to long term in each region. for employees, and as a consequence, to results
will aim to further expand sales. for the Group. That motivation then leads to
In North America, business for the mature What is the outlook for the second the creation of further products that customers
fan base is recording favorable growth. In the half and thereafter? enjoy. The entire Toys and Hobby business
previous period, we succeeded in introducing Takenaka: From the second half, new will work together and do our utmost so that
products in large-scale retailers, including KAMEN RIDER and Demon Slayer: Kimetsu we can create this type of favorable cycle.
Target. Gundam plastic models were intro- no Yaiba programs will start. Furthermore,
duced in about 3,000 stores, and Gundam and plans call for the latest theatrical version of
DRAGON BALL figures in about 4,000 stores. DRAGON BALL SUPER to open in 2022. For
Also, favorable results are currently being this type of IP from other companies, we will
recorded by a Digimon: Digital Monsters step up our efforts in the planning and devel-
trading card game, a new initiative. In these opment of high-quality products, based on
ways, we are seeing new progress. strong partnerships with rights holders. In
For the BANDAI NAMCO Group to record addition, we will also actively work in col-
continued growth, we must strengthen busi- laboration with other Group Units in the
Demon Slayer: Kimetsu no Yaiba — DX Nichirin Sword 2020 Events DIGIMON CARD GAME BOOSTER
©吾峠呼世晴／集英社・アニプレックス・ufotable GUNPLA EXPO 2020 (above), BATTLE OF OMNI [BT05] ness operations around the world. To that creation and nurturing of IP and in business
TAMASHII NATION 2020 (below) ©Akiyoshi Hongo, Toei Animation end, the Group is advancing organizational roll-outs, such as with Kyoukai Senki, Capsule
©創通・サンライズ ©ダイナミック企画
©永井豪・石川賢/ダイナミック企画・真早乙女研究所
Voltron TM & © WEP, LLC. All rights reserved.
4 BANDAI NAMCO NEWS September 2021 5
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