Kadokawa (9468) investor relations material

Executive summary

• Net sales rose 5.3% year-over-year to ¥68.3 billion, but operating profit dropped 45.5% to ¥1.26 billion due to higher costs and a one-time early retirement program expense.

• Ordinary profit increased 2.5% to ¥2.41 billion, while net profit swung to a loss of ¥4.54 billion, mainly from extraordinary losses related to early retirement.

• EBITDA declined 19.3% year-over-year to ¥3.61 billion.

• Publication/IP Creation and Education/EdTech segments saw strong sales and profit growth, while Animation/Film and Gaming segments faced profit declines despite some sales gains.

Financial highlights

• Net sales: ¥68.3 billion (+5.3% YoY); Operating profit: ¥1.26 billion (-45.5% YoY); Ordinary profit: ¥2.41 billion (+2.5% YoY); Net profit: -¥4.54 billion (down ¥7.4 billion YoY).

• EBITDA fell 19.3% to ¥3.61 billion.

• Extraordinary losses of ¥5.4 billion from a special early retirement program weighed on net profit.

• Gross profit decreased to ¥22.61 billion from ¥23.44 billion YoY.

• Earnings per share dropped to -30.90 yen from 19.51 yen YoY.

Outlook and guidance

• Full-year net sales forecast is ¥300.3 billion (+6.1% YoY), with operating profit projected at ¥10.1 billion (+24.7%) and ordinary profit at ¥12.0 billion (+2.6%).

• Full-year net profit forecast revised down to ¥1.0 billion due to extraordinary losses, but operating and ordinary profit forecasts maintained.

• Fixed cost reductions of ¥1.1 billion expected from 2Q onward due to early retirement.

• Segment forecasts unchanged: Publication/IP Creation and Animation/Film expected to drive growth; Gaming profit to decline.