TOKYO, Nov 13, 2009 - (ACN Newswire) - CyberAgent, Inc. (TSE: 4751), a Tokyo-based leader in Internet media markets, has announced results for the full year ended September 30, 2009. The group's consolidated sales were 93,897 million yen, rising 7.8% on the previous year's 87,097 million yen, driven by solid growth in the Ameba service, despite the Internet Advertising Business facing the negative impact of the economic downturn across several industries.
Operating income fell 3.1% to 4,483 million yen from 4,629 million yen for the previous fiscal year and ordinary income decreased 3.6% to 4,347 million yen from 4,507 million yen since even though the investment development business did not contribute 1,019 million yen to ordinary income as it had for the previous fiscal year, earnings were firm for the Internet media business (advertising, fee collection, and content) and earnings expanded for Ameba due to growth in sales.
Net income increased 23.1% to 1,030 million yen from the 1,268 million yen in the previous term, following tax expenses.
A recent announcement from the Ministry of Internal Affairs and Communications said internet content continued its growth and was becoming a 1 trillion yen market: it expanded 11.5% to 977.2 billion yen in 2007. The high-speed mobile phone communication service, the wider use of the fixed-rate service, and other evolutions in the Internet positively pushed market growth. Based on blogs, social networking services, and other newly emerged offerings, Internet business will be further expanding in community and mobile content services in the future.
In this environment, the CyberAgent Group has continuously focused on strengthening its highly profitable Internet Media Business services centered on its flagship Ameba, and improving the productivity of Internet Advertising Business. Especially, Ameba has established itself as Japan's most popular blog service, and we achieved the initial goal of 10 billion page views (PVs; 11.69 billion PVs as of October 2009) ahead of schedule. Increase in advertising sales and service charges from users resulted in a turn to profitability in the fourth quarter.
1) Consolidated Financial Results for the Full year Ended September 30, 2009
A. Business Results (millions of yen)
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Full year ended Sept 30, 2009 % 2008 %
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Net Sales 93,897 7.8 87,097 14.6
Operating Income 4,483 (3.1) 4,629 (15.9)
Ordinary Income 4,347 (3.6) 4,507 (12.4)
Net Income 1,268 23.1 1,030 (48.9)
Net Income/Share(y) 1,955.96 1,587.04
Fully Diluted
Net Income/Share(y) -- 1,586.41
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Return on Equity (ROE) 5.1 4.1
Return on Assets (ROA) 6.7 8.0
Ordinary Income to
Operating Revenue Ratio 4.8 5.3
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B. Financial Position
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As of Sept 30, 2009 Sept 31, 2008
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Total Assets 67,291 62,911
Shareholders' Equity 31,579 30,146
Shlders' Eqty Ratio(%) 38.2 38.5
Shlders' Eqty/share(y) 39,687.65 37,317.27
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C. Consolidated Cash Flows
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CF from Operating Activities 4,760 1,752
CF from Investing Activities (1,597) (3,466)
CF from Financing Activities 376 (1,608)
Cash and Cash Equiv./Period End 17,982 14,487
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D. Dividends (yen)
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Year ended 2010 (Estimated) 2009 2008
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1,300 1.000 700
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E. Outlook for Fical Year 2010 (mil of yen)
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Year Ending September 30, 2010 Change
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Net Sales 85,000 (9.5)
Operating Income 6,000 33.8
Ordinary Income 5,800 33.4
Net Income 2,500 97.1
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2) Outlook and Adjusted Outlook
As noted in the subsequent events section, the company aims for a highly profitable business model centered on its flagship Ameba service, and divested on November 5, 2009 part of its stake in netprice.com, Ltd. from the choose and focus perspective. From the year ending in September 2010, netprice.com will become an equity method affiliate.
In this consolidated fiscal year, netprice.com recorded 13,140 million yen in sales, 277 million yen in operating income, 275 million yen in ordinary income, and 87 million yen in net income. So the group expects that there will be some impact on consolidated results especially in sales. Meanwhile, the Ameba business became profitable in the fourth quarter of this consolidated fiscal year, so increase in service charges and advertising sales is expected to contribute to earnings on a full-fledged manner.
Earnings from the internet advertising business and foreign exchange margin transaction business were firm, and they will likely make contributions to both sales and income during the next fiscal period.
Earnings projections for the full fiscal year ending September 31, 2010, which take into consideration these conditions, are provided below. To make comparisons easier, the figures in the table exclude net.price.com, Ltd. In addition, for various reasons such as the substantial effect of economic and market conditions, including market trends and liquidity, on earnings from the foreign exchange margin transaction business, and the impact of the period of peak advertising demand, the end of the first half, on earnings, projections for the first half have not been released but will be quickly provided at the end of the first quarter. If there are major differences between actual earnings and the earnings forecasts, revisions will be promptly announced.
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Year Ending September 30, 2010 2009 Change
*excluding
netprice.com, Ltd.
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Net Sales 85,000 80,756 5.3%
Operating Income 6,000 4,206 42.6%
Ordinary Income 5,800 4,072 42.4%
Net Income 2,500 1,180 111.7%
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* The figures for the fiscal year ended September 30, 2009 excluding
netprice.com, Ltd. are those that simply subtract netprice.com's
performance and do not include internal transactions, minority
interests, and other factors.
3) Dividends
The Group is aware that sharing profits with shareholders is an important issue and would like to continue to pay dividends that are tied to corporate earnings while increasing the medium- and long-term value of shares through various efforts including business expansion and the more efficient use of capital. In particular, with the aim of paying around 30% of the difference between consolidated net income and the sum of extraordinary loss/income and special items such as tax deductions due to losses carried forward, the Group decides the actual figure based on a comprehensive consideration of items such as internal reserves for improving the financial soundness of the Group and developing future businesses.
The Group expects to pay an annual dividend of 1,000 yen per share.
4) Results by Business Segment
i. Internet Media Business - Blog
This business includes Ameba and Amebapigg, Poupeegirl, and MicroAd. The number of page views (PVs) for Ameba for September 2009 had risen to 10.79 billion, a dramatic increase of 5.17 billion compared to the 5.62 billion for September 2008.
Full-scale efforts were made to turn the business profitable, which included launching fee services such as Amebapigg while continuing to make upfront investments and using the increase in Ameba's PVs as the most important indicator.
Therefore, sales for the segment rose 54.7% to 5,526 million yen from 3,571 million in the previous term, and the business posted an operating loss of 529 million yen compared to an operating loss of 1,758 million yen for the previous term.
ii. Internet Media Business - Advertising/fee collection/content
This business segment includes mobile advertising, mobile advertisement centered on the CA MOBILE Group, the price comparison site operated by EC Navi, online game fee collection service provided by GCREST Co., Ltd., and financial operations such as foreign exchange margin transaction business operated by CyberAgent FX.
As a result of aggressive advertising and firm growth in the number of members, sales increased 21.0% to 33,020 million yen from 27,289 million yen in the pervious term, and the business recorded operating income of 4,194 million yen, 1.5% increase from a 4,134 million operating income for the previous term.
iii. Internet Media Business - Commerce
The business segment includes online shopping businesses, including "gathering" (joint purchasing) operated by netprice.com, Ltd. While continuing to strive to reduce expenses, the CyberAgent Group focused on increasing sales through low-price strategies in response to the stagnant economy and worked on new overseas businesses such as the global shopping business "sekaimon."
Therefore, sales for the segment rose 3.8% to 18,199 million yen from 17,537 million yen for the previous term, and the business recorded an operating income of 638 million yen, a 14.3% decline from 744 million yen for the previous term.
iv. Internet Advertising Business
This business segment includes the Internet advertising agency business, centered on the company's Internet Advertising Management Division, and the SEM (search engine marketing) business. The CyberAgent Group made proposals to meet customer needs and worked to capture advertising and improve productivity at a time when the deterioration in economic conditions was impacting the advertising market.
As a result, sales for the segment decreased 0.7% to 41,356 million yen from 41,632 million in the previous term, and the company posted operating income of 559 million yen, a 14.4% increase compared to the 488 million for the previous term.
v. Investment Development Business
This business segment is composed mainly of the company's corporate venture capital business and fund management operations within CyberAgent Investment. The business has several responsibilities, including discovering, developing, and raising the value of promising venture companies with the goal of generating capital gains. For various reasons including the disposal of its holding, sales decreased 89.5% to 222 million yen from 2,109 million yen in the previous term, and operating losses were 389 million yen, compared to operating incomes of 1,019 million yen in the previous term.
5) Segment Information
Current consolidated third quarter (Oct 1, 2008 to Sept 30, 2009)
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A B C D E F G H
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Sales
1)Sales to external customers
3,944 30,645 18,180 40,904 222 93,896 0 93,897
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2)Sales or transfers within segments
1,581 2,375 18 452 -- 4,428 (4,428) --
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Total
5,526 33,020 18,199 41,356 222 98,325 (4,428) 93,897
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Operating Income
6,055 28,825 17,561 40,797 611 93,851 (4,438) 89,413
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A. Media - Blog
B. Media - Advertising/fee collection/content
C. Media - Commerce
D. Advertising Agency
E. Investment Development
F. Total
G. Write-off or Company Total
H. Consolidation
Notes:
1. 'Business segments' refers to segments the Company uses for internal management.
2. Main products of each business segment
(1) Media (Blog): Operations of Ameba and Amebapigg, Poupeegirl, MicroAd, and the word-of-mouth marketing business, etc.
(2) Media (Advertising/fee collection/content): Operations of PC and mobile media, online game business, foreign exchange margin transaction business, content offering, etc.
(3) Media (Commerce): Online shopping businesses, publishing business, etc.
(4) Internet advertising agency: Advertising agency business, SEM(Search engine marketing) business, ad network business, advertising creation, etc.
(5) Investment development: Investment by corporate venture capital, fund operation, etc.
Contact:
CyberAgent
PR/IR Division
Akiko Kashiwa
Tel: +81-3-5459-0227
Topic: Press release summary
Source: CyberAgent, Inc.
Sectors: Daily Finance, Daily News
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