SEGA Reports 44.3 Billion Yen Growth for 2013, Digital Market Thrives

[Lady Lilith]

http://segabits.com/blog/2014/02/07/sega-reports-44-3-billion-yen-growth-for-2013-digital-market-thrives/

 

 

SEGA Sammy has released their earnings report for 2013, yielding a net profit of ¥44.3 billion, or $434 million, and a 564% increase year over year. The company attributed it to strong Pachinko performance and the sales of investment securities and non-current assets.

On the home electronics side, SEGA’s top three performing titles were Football Manager 14 at 680,000 units, Sonic Lost World for a combined 640,000 units, and the Japan-OnlySAKATSUKU Pro Succer Club wo Tsukurou! for 200,000. Despite this, the nine-month period ending on Dec. 31, 2013 in which SEGA tracked numbers returned only 6.5 million total units of games moved, a decrease it attributes to “the harsh market environment.”

It’s not all doom and gloom because the company also found what they call “continued favorable” success on the digital side with Phantasy Star Online 2 and mobile phone titlesPuyopuyo!! Quest and CHAIN CHRONICLE as the top runners there. The whole division saw a 19.7% increase year-to-year in net sales to a total of ¥72,934 million.

Keep in mind, back in November, SEGA purchased Atlus-parent company Index for a seemingly paltry ¥14 billion.

The release of the financial data comes hours after SEGA unveiled its plans for a massive spin-off of Sonic The Hedgehog with Sonic Boom.

 

 

Hopefully this means some localizations of games like PSO2, PS Nova, and Yakuza 5 & Ishin. 

[KitsuneChaos]

Considering their past woes, this is always welcoming news.

Just goes to show how some companies can see profit in tough fiscal times; Square Enix also showed signs of profit in their report as well.

[ExHaseo]

Glad to see Sega doing well. Especially glad to see Lost World did well. Was a great game that got panned for no good reason.

[KitsuneChaos]

Anyone feel like forming a fancy pie chart depicting just how much of this success is represented by the video games market versus that of the Pachinko market?

[Death]

Bring Yakuza 5 and Yakuza 1+2! Maybe this growth will hopefully influence them to make a new console? We can Dream right?

[Bandar__Online]

Thanks to the Japanese Markets. 

[D-Tron]

Thanks to the Japanese Markets.

I know right? Sega of America ain't doing sh*t outside of mediocre Sonic games.

[Bandar__Online]

I know right? Sega of America ain't doing sh*t outside of mediocre Sonic games.

I Don't remember I played Any Game From them on PS3 But Yakuza ( I Bought My Ps3 on 2008) 

And Every Single Yakuza Game Needs ''an Internet riot'' to bring it here, Also The Translation For Yakuza to English is kinda Poor if you played it. 

Short Answer, Sega Prefers to Sell their things to the Japanese, Opinion 

[TheVader66]

It's Ironic that the three console companies are doing badly (Nintendo losing profits on Wii U, Microsoft's Xbox One losing against the PS4, Sony losing money but that is because Sony sales on PC and TV are failing) and SEGA the one that left the Console Market due to Money issues is now the one that is doing well

[STRANGEgenius]

I know right? Sega of America ain't doing sh*t outside of mediocre Sonic games.

they have the Tennis games, and the Alien franchise, but Aliens CM sold very poorly.

[Lady Lilith]

Anyone feel like forming a fancy pie chart depicting just how much of this success is represented by the video games market versus that of the Pachinko market?

 

Not a pie chart, but here you go.

 

http://segabits.com/blog/2014/02/10/sega-sammy-q3-report-for-fiscal-year-2014-major-growth/

 

 

 

SEGA Sammy have released their latest report showing off robust earning through several of their division but certain segments of SEGA’s internal division still lost them money, however it was not the usual suspect as one might expect, click the break to find out how well the SEGA Sammy group did overall;

 

CONSUMER DIVISION

Despite traditionally being SEGA’s best selling IP, Sonic: Lost World was not SEGA’s most shipped product

SEGA’s consumer division enjoyed strong figures going into the third quarter with Football Manager 2014 being their standout seller, posting sales of 680,000 units though this figure is down from last year’s installment at 730,000, though it should be noted Football Manager 2013 is the fastest ever selling Football Manager. Whilst SEGA’s Japanese football management series, SAKATSUKU Pro Succer Club wo Tsukurou! sold 200,000 units, however according to Sinobi, SEGA was expecting sales of 280,000 in total for the title.

Football Manager allows players to take control of their favourite team and lead them to glory

The major talking point though was the latest adventure starring SEGA’s blue mascot, Sonic: Lost World. The title managed to sell 640,000 which seems to be the lowest entry for sales for a mainline Sonic game since 2006, what would be interesting is seeing how the title does for SEGA’s entire fiscal year as we would have a better idea of how well the title is selling, the previous two Sonic titles usually add between 200,000 – 300,000 between the January – March period (Sonic Colours went from 1.85 million to 2.18 million and Sonic Generations went from 1.63 million to 1.85 million) At this point it is hard to estimate just how much has been sold through to consumers as we know sales in America have not pushed beyond 200,000, the game could either have sold a late flurry of units or there maybe a lot of units on the shelves. The full year report in May should give us a better understanding just how long the titles legs will be.

Puyo Tetris is one of a number of titles pushing a strong lineup for Q4

The division in sales between packaged goods and digital goods are almost identical, with packaged goods selling ¥28.4 billion and digital goods selling ¥28.3 billion, no doubt soon we will see stronger digital sales for SEGA than packaged goods. In the Consumer Division’s other departments, SEGA Toys noted continued sales in their mainstay product “Jewelpod Diamond Premium” and recording sales of ¥7.4 billion whilst their animation department reported to favourable sales for their latest animated feature “Anpanman: Fly! Handkerchief of Hope” recording ¥8.3 billion in sales.

 Hero Bank is one of two new IPs SEGA releasing in Q4

In total the Consumer Division posted sales of ¥72.3 billion (£436,052,400/$714,798,000) with a year on year growth of 20% and whilst the consumer division had a few titles that under-performed, still managed to post a robust operating profits of ¥2.7 billion (£16,083,900/$26,365,500) a mighty increase of 436.7% year on year growth. SEGA Sammy is predicting the consumer division to build further on their operating profits with a full year forecast of ¥109.5 billion net sales and  operating profits ¥3.9 billion (£23,233,626 / $38,083,500) And whilst SEGA have a very little in terms of Western software (Project Diva F for the Vita being their only title) their Japanese lineup is quite strong, featuring Ryu Ga Gotoku Ishin, PSO2 Episode 2 for Vita and Puyo Tetris to name but a few as well as significant growth for SEGA Networks which recorded revenues of ¥6.7 billion (Year on year growth 55%)

Ryu Ga Gotoku: Ishin is no doubt SEGA’s biggest title in the final quarter

Despite this however, it might still be a tricky task as Puyo Tetris experiences long term sales rather than an initial burst of sales, PSO2 Episode 2 will probably see sales around 100,000 – 120,000 in line with the original, Hero Bank is an untested new IP and we know that SEGA’s stab in the rhythm dance genre in Utakumi 575 was a massive failure, it may come down to how well Ryu Ga Gotoku: Ishin and Hatsune Miku: Project Diva 2nd f perform and whilst the latter seems like it should have strong sales, Ryu Ga Gotoku: Ishin current preorder numbers align closer with Ryu Ga Gotoku: Kenzan meaning a debut of around 180,000. No doubt the success of the Playstation 4 will effect the long term sales of Ru Ga Gotoku: Ishin. Still I would expect the consumer division to produced a good operating profit by the end of the fiscal year.

PACHINKO & PACHISLOT

Pachislot machines continue to show year on year for SEGA Sammy

Continuing to be SEGA Sammy’s biggest money maker, the pachinko & pachislot segment posted a mighty ¥160.2 billion (£954,151,200 / $1,565,794,800) in net sales. The biggest contributor to the number, Pachislot, provided much of the bulk with sales of ¥107.1 billion ( ) with the group putting the impressive number down to solid sales of “Pachislot Eureka Seven 2” (59,000 units sold) and “Pachislot Juoh” (42,000 units solid) helping to push the division to a growth of 143% selling a total of 286,396 units which is up staggering from last year’s numbers of 130,590 units. The group expect the growth to be even greater by the end of the year, predicting net sales of ¥165.0 billion with year on growth of 157%

Over on the Pachinko side of the business the group noted strong sales of “Pachinko CR Hokuto No Ken 5 Hyakuretsu” (64,077 units)  and “Pachinko CR SOUTEN-NO-KEN” (27,139 units) with total unit shipments accounting to 156,538 units. Net sales for the segment was ¥49.3 billion though SEGA Sammy is expecting that revenue to more than double to ¥100.8 billion for the full year as major titles will arrive to help boost the profitability of the division. Altogether the pachinko & pachislot division recorded an impressive ¥50.0 billion in operating profits seeing a massive growth of 549% year on year.

AMUSEMENT MACHINE SALES & AMUSEMENT CENTRES

In Code of Joker players pit their monsters against one another via a table top fashion

Unfortunately it was not all good news for SEGA Sammy as their previously stable arcade division recorded an operating loss which was further exacerbated due to the trouhled amusement centres unable to make up the difference. SEGA’s arcade sales division biggest money maker was Code of Joker earning them ¥2.3 billion, a good strong figure and historically what is expected for a tentpole new release for SEGA’s arcade division. Other major titles WORLD CLUB Champion Football Series and Border Break made ¥2.1 billion and ¥1.2 billion respectively. The segment produced revenues of ¥28.0 billion with an operating loss of ¥0.2 billion. Blaming the loss on sluggish market condition as well as the lack of many major new titles, however the group is hopefully of an end of year operating income of ¥2.7 billion.

Border Break continues to bring in a steady level of income for SEGA Sammy

However SEGA’s Amusement Centres continues to suffer as the group was forced to close a further 3 stores domestically whilst opening 4 more, unfortunately that is all they will be opening this year but closing 5 more by the end of the year. It certainly is a shame and no doubt the arcade industry is in it’s twilight years perfectly demonstrated by the number of amusement centres it had in the beginning of 2010 (260 facilities) compared to the total facilities they will have by the end of fiscal year 2014 (197) The segment recorded net sales of ¥32.4 billion of which saw them make an operated loss of ¥0.0 billion, meaning a minor loss but a loss none the less.

CONCLUSION

Alien: Isolation contributed to SEGA’s increased Research & Development cost

Overall the group saw a raise in net sales from ¥207 billion to ¥303 billion (£1,811,334,000 / $2,970,006,000) But whilst the rise was only 55% in net sales, they saw a massive increase in profitability recording net profit of ¥44.3 billion (£264,825,400 / $433,519,800) up 1377% from the same period the last fiscal year. A major reason for the increase outside of both the consumer, pachislot and pachinko divisions all coming off of major year on year increase in profitability was the sales of shares in Sanrio Co., Ltd (2.87 million) making an additional profit of ¥10 billion in profits. Going into the final quarter, it seems almost certain for both the pachislot, pachinko and consumer division of meeting their goals and should prepare them for a strong finish to the current fiscal year.

[Wolvie_181]

Sega made a profit because unlike Nintendo,they release games for smartphones and tablets (same thing with Square Enix)

[Parker]

So would anyone else be completely okay with Nintendo and Sega switching places? I'd love to see Sega make a Dreamcast 2 and Nintendo making games for the other companies. 

 

 

Parker

[Goekie]

Who wants Yakuza if you can have Shenmue

[Parker]

Who wants Yakuza if you can have Shenmue

 

Truer words have never been spoken. 

 

 

Parker

[Goekie]

they have the Tennis games, and the Alien franchise, but Aliens CM sold very poorly.

 

I spent a lotta money at the arcades playing Virtua Tennis as a kid. Sadly enough we haven't seen a good tennis game since, well since Super Tennis on the SNES of course! To this day the best tennis game around!

 

The fact that Aliens sold so poorly might having something to do with it being a huge pile of shit.

 

Truer words have never been spoken. 

 

 

Parker

 

One of the most impressive and influential games from the 90's. Also one of the most underrated if you ask me. This game has had the highest production value for years which ultimately led to its own downfall. Selling a million copies is good but if you break even then it makes you wonder why you invested 5 years production time and a lot of money into a game. Sadly enough I think thats why we will never see a Shenmue 3.

 

A few years back Sega was in really dire straits. Their saving grace was Platinum Games who surprised friend and foe by selling more than a million copies of Bayonetta. Can someone explain to me why the hell Microsoft and Sony refused to bring Bayo 2 on their platforms. That is beyond me really. Now you have this awesome game on the Wii U that the casual gamer doesn't care about.

[Parker]

I spent a lotta money at the arcades playing Virtua Tennis as a kid. Sadly enough we haven't seen a good tennis game since, well since Super Tennis on the SNES of course! To this day the best tennis game around!

 

The fact that Aliens sold so poorly might having something to do with it being a huge pile of shit.

 

 

One of the most impressive and influential games from the 90's. Also one of the most underrated if you ask me. This game has had the highest production value for years which ultimately led to its own downfall. Selling a million copies is good but if you break even then it makes you wonder why you invested 5 years production time and a lot of money into a game. Sadly enough I think thats why we will never see a Shenmue 3.

 

A few years back Sega was in really dire straits. Their saving grace was Platinum Games who surprised friend and foe by selling more than a million copies of Bayonetta. Can someone explain to me why the hell Microsoft and Sony refused to bring Bayo 2 on their platforms. That is beyond me really. Now you have this awesome game on the Wii U that the casual gamer doesn't care about.

 

I still remember buying the game when it came out and playing it with my brother. The opening scene was the first game that made my jaw drop, it was amazing and I was hooked on the franchise since then. I really, really hope we see a Shenmue III one day. I remember an article about some PlayStation higher ups meeting with the creator of Shenmue and I really hope that means something. I'd love to see Shenmue I and II re-released in HD for the PS4 (and PS3) and finally have Shenmue III released. Sega has to know there is a huge following for the series so I don't know why they've left it alone for so long. 

 

 

Parker