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CyberAgent Reports Full Year Results; Operating Income Up 53.7%


October 27, 2011 - Tokyo

CyberAgent, Inc. (TSE: 4751), a Tokyo-based leader in Internet media markets, has announced results for the full year ended September 30, 2011. The Group's operating results for this consolidated fiscal year were as follows. Net sales reached 119,578 million yen (up 23.7% from 96,650 million yen in the previous fiscal year); operating income reached 14,349 million yen (up 53.7% from 9,337 million yen in the previous fiscal year); ordinary income reached 14,114 million yen (up 53.0% from 9,225 million yen in the previous fiscal year); and quarterly net income reached 7,323 million yen (up 33.3% from 5,493 million yen in the previous fiscal year).

In fiscal 2010, the domestic Internet business market expanded to about 12 trillion yen, and it is expected to reach 13 trillion yen in 2011, and later 18 trillion yen in 2015 (Source: Nomura Research Institute, Ltd.). In 2010, the Internet advertising market totaled 774.7 billion yen, and it has now overtaken newspaper advertising, and has grown to become the second-largest advertising medium, after TV advertising (Source: Dentsu Inc.). Among future Internet business, based on blogs and SNSs (social networking services) that have newly emerged in recent years, segments such as services related to smartphones, rapidly spreading, and social games businesses are expected to expand. The social games market is expected to increase from 33.8 billion yen in 2009 to 74.7 billion yen in 2010, and then 117.1 billion yen in 2011 (Source: Yano Research Institute Ltd.).

Under such conditions, while targeting a highly-profitable business model, the company Group has strived to expand our Internet media services, which are based around our core Ameba business, and to strengthen our business power and boost productivity through our Internet advertising agency business. At the same time, we have also endeavored to expand services for social games and smartphones, for which we anticipate rapid growth.

1) Consolidated Financial Results for the Full year Ended September 30, 2011


A. Business Results (millions of yen)
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Full year ended Sept 30, 2011 % 2010 %
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Net Sales 119,578 23.7 96,650 2.9
Operating Income 14,349 53.7 9,337 108.2
Ordinary Income 14,114 53.0 9,225 112.2
Net Income 7,323 33.3 5,493 333.2
Net Income/Share(y) 11,281.91 8,473.75
Fully Diluted
Net Income/Share(y) 11,262.93 -
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Return on Equity (ROE) 21.9 19.7
Return on Assets (ROA) 14.4 12.2
Ordinary Income to
Operating Revenue Ratio 12.0 9.7
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B. Financial Position
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As of Sept 30, 2011 Sept 30, 2010
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Total Assets 111,689 83,723
Shareholders' Equity 38,677 33,464
Shlders' Eqty Ratio(%) 33.0 36.0
Shlders' Eqty/share(y) 56,499.21 46,511.86
Equity Capital 36,851 30,155
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C. Consolidated Cash Flows
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CF from Operating Activities 8,268 10,969
CF from Investing Activities (8,564) (7,796)
CF from Financing Activities (1,665) (954)
Cash and Cash Equiv./Period End 18,108 20,134
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D. Dividends (yen)
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Year ended 2012 (Forecast) 2011 2010
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3,500 3,500 2,200
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E. Outlook for Fical Year 2012 (mil of yen)
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Year Ending September 30, 2012 Change
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Net Sales 130,000 8.7
Operating Income 17,000 18.5
Ordinary Income 16,700 18.3
Net Income 8,500 16.1
Net Income per Share 13,031.79
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2) Earnings Estimates for the Next Period (October 1, 2011 to September 30, 2012)

As for earnings estimates for the next period forecast, FX business will be influenced by the strengthening of regulations on leverage; however, we anticipate that consolidated sales will be 130,000 million yen, consolidated operating income will be 17,000 million yen, consolidated ordinary income will be 16,700 million yen, and consolidated net income will be 8,500 yen due to steady expansion of advertising business and fee-based business centered on Ameba Pigg in Ameba related business, a conversion of the Internet advertising agency business to an integrated Internet business, growth of social games, the strengthening of communities and services for smart phones, and other developments.

Interim earnings forecasts have not been performed due to the large influence on earnings by the advertising demand period at the end of the interim period and the large influence of the economic and market environments, such as changes in market liquidity and price movements in the FX business. Therefore, quarterly financial statements will be disclosed swiftly.

Additionally, in the event that actual earnings differ significantly from announced earnings forecasts, a revision to earnings forecasts will be issued forthwith.

3) Results by Business Segment

Performance of each business segment was as follows.

(a) Ameba business

The Ameba business includes Ameba, Ameba Pigg, AMoAd and poupeegirl, etc. Ameba's PV number for September 2011 was 290.0 billion PV (up 12.15 billion PV from 16.85 billion PV in the same month of the previous year), and subscribers totaled 18.23 million (up 7 million from 11.23 million in the same month of the previous year), representing a significant increase.

In this business, advertising revenue and fees generated by Ameba Pigg, etc. increased, and as a result, net sales totaled 20,738 million yen (up 99.9% year-on-year from 10,376 million yen), and we recorded an operating income of 5,714 million yen (up 273.6% year-on-year from an operating income of 1,529 million yen).

(b) Media business

The media business includes: social game businesses such as CyberX Co., Ltd., Sumzap, Inc., Cygames Inc., and GCREST, Inc.; mobile-related businesses, including primarily CA Mobile, LTD..

In this business, due to factors such as steady expansion of our social games business, net sales totaled 36,102 million yen (up 7.8% from 33,490 million yen in the previous fiscal year), and we recorded an operating income of 2,415 million yen (up 8.1% from an operating income of 2,235 million yen in the previous fiscal year).

(c) Internet advertising agency business

The Internet advertising agency business includes our advertising agency business, which is centered on the Company's Internet advertising agency business, and our SEM (search engine marketing) business.

In the current business year, while striving to boost productivity, we also delivered proposals in line with customer needs, and steadily addressed advertising demand. As a result, net sales totaled 62,983 million yen (up 24.4% from 50,620 million yen in the previous fiscal year), and we recorded an operating income of 3,258 million yen (up 54.0% from 2,116 million yen in the same period of the previous year).

(d) FX business

The FX business includes foreign exchange margin trading in CyberAgent FX, Inc.

In the current business year, despite the effects of leverage regulations that came into effect in August 2010, the number of account openings and deposit accounts increased steadily. As a result, net sales totaled 7,751 million yen (up 5.0% from 7,385 million yen in the previous fiscal year), and we recorded an operating income of 3,200 million yen (down 16.1% from an operating income of 3,814 million yen in the same period of the previous year).

(e) Investment development business

Our investment development business includes the Company's corporate venture capital business, and fund operation in CyberAgent Ventures, Inc. It discovers, develops and generates value for promising venture companies both within Japan and in Asian countries such as China and Vietnam.

In the current business year, due to sales of shares, net sales totaled 234 million yen (down 53.1% from 499 million yen in the previous fiscal year), and we recorded an operating loss of 239 million yen (against an operating loss of 358 million yen for the previous fiscal year).

4) Segment Information


Oct 1, 2010 to Sept 30, 2011
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A B C D E F G H
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Sales
- Sales to external customers
15,674 34,858 61,059 7,751 234 119,578 - 119,578
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- Inter-segment sales
5,063 1,244 1,924 - 0 8,232 (8,232) -
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Total
20,738 36,102 62,983 7,751 234 127,810 (8,232) 119,578
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Segment Income (Loss)
5,714 2,415 3,258 3,200 (239) 14,349 - 14,349
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Segment Assets
6,566 23,694 10,436 57,179 3,625 101,502 10,186 111,689
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Other Items
- Depreciation
699 1,020 243 378 3 2,345 - 2,345
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- Increase/Decrease in Current/Non-current Assets
1,331 2,625 559 230 10 4,757 - 4,757
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A. Ameba
B. Media
C. Internet Advertising Agency
D. Investment Development
E. Subtotal
F. Adjustment Amount
G. Consolidated Quarterly Balance Sheet Amount
H. Total


Notes: Main products of each business segment
(1) Ameba business: Ameba, Ameba Pigg, AMoAd, poupeegirl, etc.
(2) Media business: Social game business, operation of PC and mobile media, EC business, etc.
(3) Internet advertising agency business: Advertising business, SEM (search engine marketing) business, SEO (search engine optimization) business, etc.
(4) FX business: Foreign exchange margin trading
(5) Investment development business: Investment through corporate venture capital, fund operation, etc.

For further details, please visit http://www.cyberagent.info/

About CyberAgent, Inc.

CyberAgent, Inc. is a leading worldwide developer, publisher and distributor of interactive entertainment for PCs, handheld and wireless devices. Founded in 1998, the company has provided many kinds of businesses in Japan including being the largest social game provider, operator of the #1 blog based communication service (Ameba), the #1 internet Ad and the #1 corporate venture capital in Japan. CyberAgent maintains operations in the U.S., China, Vietnam and Japan, with corporate headquarters located in Tokyo, Japan. For additional information on the company and its offerings, please visit: www.cyberagent.info or contact pub@cyberagent.co.jp



Source: CyberAgent, Inc.

Contact:

CyberAgent
PR/IR Division
Akiko Kashiwa
Tel: +81-3-5459-0227



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