Operating Income

Security Code: 2329
Tohokushinsha Film Corporation
March 2009 term
Information Session on the 1H Financial Report
November 26, 2008
Business Overview
TFC has three main business segments of Production, Entertainment Media Content and
Satellite Channels Operation, as well as Retail Merchandising and Others (Education business).
Group companies: 15 consolidated subsidiaries / 10 affiliates subject to the equity method
Segment
Advertising Production
Composition of net sales for the 3/2008 Full Year
(Before offsetting between segments)
12.3%
Production
business
9,725
18.6%
14,669
58.8%
46,385
Three main entertainment
content-related segments
content-
Retail
merchandising
Others
Satellite
(Education
business)
channels
operation
10.3%
business
8,120
Production
business
Entertainment
media
content
business
Satellite
channels
operation
business
(Unit: Million Yen)
Retail
merchandising
Entertainment
media
content
business
Sub-Segment
Sales Promotion (SP)
Tohokushinsha
Advertising Production
Division
Nibankohboh Productions Corp. / Nitten
Alti Creatives /
Thermal Corp. / TFC Plus Corp.
Post-production
Murayama Inc. / White Box
Omnibus Japan Inc.
Production of feature films / TV
programs
Tohokushinsha Creates Inc.
TV Distribution
Television Distribution Division
Content Rights Management
Business
Entertainment Content Division
Dubbing / Subtitling
Dubbing and Subtitling Division
※Content rights-management business
・Film distribution
・Packaged media sales
・Anime production
・Joint development and investments
・Character and licensing business
8 brands 12 channels
Satellite Broadcasting
Satellite Channels Operation
Division
Others
(Education
business)
Main affiliates
VisualVisual-Techno Academy
Super!dramaTV / Family Theater
History Channel / The Cinema
Classica Japan / PLAYBOY Channel
Channel RUBY /Star Channel
National Trading Inc.
＝Segment where TFC is rated as an industry leader
No.1 & Only 1 Comprehensive Audio-Visual Production
TFC’s
Strength
Industry leader position in main business segments
Synergy effects within the Group generating a competitive edge
1
March 2009 Term
Overview of the 1H financial results
２
Consolidated
1H 03/2009 Term: Profit and Loss Summary
The net sales are down from the same period last year and projection at the start of the term, but the operating and
ordinary incomes have exceeded the respective start-of-term projections.
Net Sales ¥34.1 billion (-1.8% YOY and -1.5% vs. Initial Projection),
Operating Income ¥3.6 billion (+¥2.2 billion and +164% YOY; +14% vs. Initial Projection)
Ordinary Income ¥3.4 billion (+¥1.8 billion and +115% YOY; +13% vs. Initial Projection), Net Income ¥0.5 billion (-8.5% YOY; +¥0.4 billion and +356% vs. Initial Projection)
3 / ’09 First Half Results
(3/ ’08 First Half
Results) vs. Same Period Last Year
Unit: Million Yen
(Rounded off at unit digit)
Net Sales
34,180
34,806
-626
-626
Cost of Sales
25,543
28,556
-3,014
-3,014
General / Administrative
Expenses
-1.8%
-1.8%
-506
-506
-1.5%
-1.5%
■Cost of Sales
-10.6%
-10.6%
4,996
4,872
+124
+124
+2.5%
+2.5%
Operating Income
3,640
1,376
+2,264
+2,264
+164.4%
+164.4%
Non-Operating Profit /
Loss
-245
+202
-447
-447
-%
-%
Ordinary Income
3,395
1,579
+1,816
+1,816
+115.0%
+115.0%
Extraordinary Profit /
Loss
-3,266
-258
-3,009
-3,009
－
－
558
610
-52
-52
Net Income
Vs.Projection
-8.5%
-8.5%
Reduction in the cost
of entertainment
media content
amortization
+449
+449
+14.1%
+14.1%
+388
+388
+12.9%
+12.9%
+436
+436
+356.4%
+356.4%
■Special loss
YOY -¥3.6
billion
Total ¥3.26 billion
Loss on valuation of inventories
¥2.53 billion
Loss on sales of investment securities ¥0.36 billion
Provision of allowance for doubtful
¥0.28 billion
Etc.
accounts
3
Consolidated
1H 03/2009 Term Financial Results:
Main
Main Factors
Factors for
for Fluctuation
Fluctuation from
from Last
Last Year’s
Year’s Figures
Figures
Production：Higher sales and steady income／Entertainment Media Content ：Lower sales but higher income／
Satellite Channels Operation：Higher sales and higher income
Production Segment
:Net Sales ¥22.6 billion (+¥0.7 billion)
Operating Income +¥3.8 billion (-¥0.1 billion)
Entertainment Media Content Segment
:Net Sales ¥4.1 billion (-¥1.6 billion)
Operating Income -¥0.5 billion (+¥2 billion)
Satellite Channels operation segment :Net Sales ¥4.9 billion (+¥0.4 billion)
Operating Income +¥1.3 billion (+¥0.3 billion)
Compared to Last Year
Operating Income
Net Sales
3/08 First Half
34,806
Results
3/08 First Half
Unit: Million Yen
1,376
Results
+715
3,859
-82
Entertainment
Media Content
Business
4,164
-1,660
-502
+2,080
Satellite Channels
Operation Business
4,984
+439
1,318
Retail
Merchandising /
Others
3,985
+64
107
Eliminations
-1,566
-184
-1,142
Change
34,180
-626
3,640
3/09 First Half
Results
- +
34,180
Main Factors for Fluctuation
22,613
Main Factors for Fluctuation
Production
3/09 First Half
Results
+
+361
-73
-22
+2,264
3,640
4
Consolidated
1H 03/2009 Term Financial Results:
Main
Main factors
factors for
for fluctuations
fluctuations from
from initial
initial projection
projection figures
figures
Production and Entertainment Media Content：Lower sales while maintaining income／
Satellite Channels Operation：Higher sales and higher income
:Net Sales -¥0.2 billion,
:Net Sales -¥0.2 billion,
Satellite Channels Operation Segment :Net Sales +¥0.2 billion,
Production Segment
Entertainment Media Content Segment
Operating Income +¥0.01 billion
Operating Income +¥0.07 billion
Operating Income +¥0.25 billion
vs. Initial Projection
Operating Income
Net Sales
34,687
Initial Projection
-238
3,859
Entertainment Media
Content Business
4,164
-201
-502
Satellite Channels
Operation Business
4,984
+212
1,318
Retail Merchandising
/ Others
3,985
-94
107
Eliminations
-1,566
-184
-1,142
Change
34,180
-506
3,640
Main Factors for Fluctuation
22,613
Production
3/09 First Half
Results
-
34,180
Main Factors for Fluctuation
Initial Projection
3/09 First Half
Results
Unit: Million Yen
3,191
+
+9
+76
+253
-68
+179
+449
3,640
5
B/S Highlights <as
<as of
of 9/30/2008
9/30/2008 >>
Consolidated
Total Assets ¥107.7 billion (-¥8 billion from last year) / Reduced liabilities (-¥7.6 billion in total) improving fiscal stability
03/2008 term
1H 03/2009 term
(As of the end of 3/08)
(As of the end of 9/08)
Share
Total Assets
Current Assets
Cash & Deposits
Assets
Notes & Accounts Receivable
Acquired Rights
Fixed Assets
Investment Securities
Liabilities / Net Aseets
Current Liabilities
Long-Term Liabilities
100.0%
107,774
100.0%
-8,037
88,128
76.1%
78,569
72.9%
-9,558
36,478
29,442
16,238
27,684
Capital
Capital/Profit Retained Earnings etc
Treasury Stock
23.9%
29,204
+626
27.1%
5,687
55.0%
58,378
5,346
2,487
51,194
△1,347
-6,887
-5,184
29,591
24,258
16,864
5,975
52,087
Net Assets
Share
115,812
63,724
Liabilities
YOY
56,050
-288
52.0%
51,774
4,305
45.0%
51,724
2,487
51,090
△1,263
+1,520
Unit: Million Yen
Main Points
■Reduced liabilities streamlining assets
Liabilities
-¥7.6 billion
[Defining the commitment line]
■Acquisition of overseas TV dramas etc increasing acquired rights
1H：
Acquisition Approx. ¥6.5 billion
Amortization Approx. ¥5.9 billion
■Increased fixed assets
Capital investments related to the Satellite Broadcasting
business
+¥0.5 billion
Deferred tax assets (Star Channel, etc.) +¥0.7 billion etc.
-7,674
-6,603
-1,041
48.0%
-363
0
-103
＋83
■Improvement of the net asset ratio due to
reduced liabilities (-¥7.6 billion)
45% at the end of 3/08→48%(+3%) at the end of 9/08
6
・
Overview of 1H March 2009 term
・Overview
financial results(by segment)
・
Full-year business forecast
・Full-year
７
Consolidated
Production Business
Change of client needs：
needs：
115%
100%
Shift of focus from 4 mass media to mixed promotional activities
Transition in advertising spending
(2005=100%)
Non-4 mass media
112%
345 billion
Total advertising
spending
・Notable decline in advertising through 4 mass media
・Solid promotional demands mainly in the digital / event area
・Economic recession and resulting deterioration in business conditions and corporate
profitability are a cause for concern.
106%
102%
103%
100%
99% 98% TV advertising
98%
199.8 billion
Reinforcing intra-Group contracting to secure profits and minimize the
impact of market conditions
95%
4 mass media total
85%
Market environment (Two trends)
2005
2006
357 billion
（TV Advertising／Post-production）
2007
Source: “Japanese advertising spending” by Dentsu
Progress into high-definition and fully digitalized contents
Change of technologies & platforms：
platforms：
・Shift to high definition production in TV Advertising in addition to TV programs
→Making use of TFC’s strength in high definition video production (facilities, human
resources, know-how)
・Gradual increase in demands for digital filming / comprehensive production coordination
・Latest video technologies such as CGI and 3D
→Utilizing TFC’s strength as the market leader in high-end video production
Core competence / Digital & high definition technology / Creativity
Creativity
Market share expansion seizing the trend of market leader dominance in TV commercial production / post-production
Expansion in the area of promotional contracts
Expansion in the area of digital cinema contracts （Cutting-edge technologies such as digital filming, CGI and 3D)
8
Production Business
Consolidated
Results roughly as initially projected in H1 for advertising production, sales promotion and post-production
Tough mass media advertising conditions incorporated into H2 projections
Operating Income
Unit: Million Yen
Operating Income Ratio
to Net Sales
10,000
17.0%
0
8,102
8,114
3,890
4,264
10%
The sales promotion industry making relatively steady performance
Solid flow of event contracts resulting in YOY improvement in
business performance in H1
Projected to increase sales and income YOY in full-term results
Performance as initially projected in H1
Expecting softer business for TV advertising in H2 despite solid
PostPostperformance in editing, filming and CGI contracts
Production Increasing intra-Group contracting for sales supplementation
Projecting net sales decrease of 4% YOY in H2 (steady YOY in fullterm results)
5%
+10【+0.3%】
’08/3
3,849
’07/3
4,160
7,406
4,247
’06/3
Sales
Promotion
-83【-2.1%】
3,942
1,000
3,158
2,000
3,067
22,613
19,174
22,851
’09/3
First Half
Results
-364【-4.5%】
Full-year forecast for the segment
Results
/forecast
’08/3
3,000
15%
-352【-4.3%】
Initial
Projection
’07/3
Results
/forecast
’06/3
-238【-1.0%】
Initial
Projection
18,498
10,000
Full Year
Results
Projection
3,410
23,061
24,804
4,000
6,477
45,675
47,656
46,385
5,000
+716【+3.3%】
First Half
Results
6,000
Securing production contracts for relatively well-performing
sectors such as foodstuffs / beverages / communications, and for
Advertising high unit-cost projects
Production Net sales projected to decline by 7% YOY in H2 due to tough market
conditions
17.0%
17.2%
16.3%
7,000
-1,981【-4.2%】
21,897
First Half
-710【-1.5%】
24,487
43,153
23,978
39,700
Full Year
Results
Projection
21,201
Full Year
40,000
Second-Half
17.1%
17.5%
8,000
0
16.8%
16.5%
50,000
20,000
20%
18.0%
9,00016.6%
30,000
Full Year Results / Projection
7,750
60,000
Market environment and overview of sub-segments
First Half Results
Compared to last year
3,859
Net Sales
Unit: Million Yen
’09/3
0%
＞Net Sales:
¥45.6 billion
＞Operating Income: ¥7.7 billion
-¥0.7 billion 【-1.5%】
-¥0.3 billion 【-4.3%】
9
Production Business(Sales
(Sales trend
trend by
by main
main sub-segment)
sub-segment)
Consolidated
Advertising production sales for H2 forecast to dip below the H1 results for last year and the year before
Aim at increase in full-term sales for post-production and sales promotion YOY
Advertising Production
Post Production
Sales Promotion
9,344
9,101
8,273
8,352
8,636
8,910
’09/3
4,773
4,472
4,628
4,233
4,039
4,661
4,303
4,049
1,000
0
4,377
5,143
5,276
5,020
’06/3 ’07/3 ’08/3
4,571
0
3,493
1,000
3,633
15,572
7,229
2,000
3,041
15,502
4,072
2,000
3,156
14,587
16,269
15,761
13,038
Results
/forecast
12,545
4,000
3,000
Results
/forecast
Initial
Projection
’09/3
5,000
Initial
Projection
’06/3 ’07/3 ’08/3
7,000
3,000
5,000
0
8,000
6,000
5,000
4,000
First Half
Results
6,958
7,000
8,061
8,000
3,780
30,159
9,000
6,000
15,743
16,853
26,165
9,000
3,177
SecondHalf
First
Half
10,000
10,000
Results
/forecast
15,000
Full Year
Results
Projection
10,000
Initial
Projection
20,000
13,620
Full
Year
25,000
31,772
29,892
30,000
31,504
35,000
9,039
Unit: Million Yen
’06/3 ’07/3 ’08/3
’09/3
10
Consolidated
Changes in the media environment
LongLong-tail development in visual media
Transitional period in which visual contents are transferring and spreading to a diverse range of media
Terrestrial TV
broadcasting
Shrinking TV
advertising market
• The change of client needs
and declining ratings
chilled substantially the
spot advertising market in
particular.
ＢＳ・ＣＳ
broadcasting
Cinema distribution
Video/DVD Distribution
Steady expansion
mainly in digital cable
television
・Stagnant market size
・Poor performance of
foreign movies
・Shrinking sell through
market
・Steady rental market
• The proliferation of flatscreen TV has expanded
the use of digital 3-wave
tuners.
• With the triple-play function
by CATV services, pay
multi-channel TV is
expanding steadily.
• The spread of cinema
complexes has slowed
down, stalling growth in
cinema turnouts.
• The foreign film market
continues to experience
difficulty due to the
increase of Japanese
movies and titles in tie-up
with TV stations.
• The market has shrunk for
animated titles and foreign
films..
• Rental titles, e.g. overseas
drama series, are
performing well.
Digital/IP
Internet / Mobile / IP broadcasting
・Increased visual
contents use
・Slowly expanding
market size
• While the use / distribution
of visual contents are
expanding, the market size
itself is still being
developed.
• While simultaneous
broadcasting of terrestrial
channels started, there
remain rights issues to be
resolved.
Core competence: Creating synergy between the video contents business
business and media business
Rebuilding TFC’s visual content-related business operations
・Reducing the inventory of TV distribution rights (output deals)
・Reinforcing sales to the growing BS / CS broadcasting
・Coordinating with TFC’s CS business
11
Synergy within the TV program sales business
and changes of broadcasting media
Synergy in TV program sales business forms core competitiveness in the changing media environment.
Focal shift of program sales from terrestrial broadcasting to diverse media
ＴＶ distribution rights
ＴＶ distribution rights
Acquisition
Sales
Sales proportion by media
Acquiring
Acquiring
killer
killer contents
contents
Sales of content exploitation rights
Prominent domestic and
international licensors
・Hollywood major studios
・Independent domestic
movie companies,
animation companies, etc.
3/2001 term
TV program sales business
42%
66%
ＴＶ distribution
P
Terrestrial
broadcasters
3/2008 term
Sharing contents
according to buyers
Satellite broadcasting
ＢＳ･ＣＳ
broadcasters
(＋ＶＯＤ)
Program sales
Dubbing/
Subtitling
24%
8%
Contracts within
the TFC group
TFC Group’s
ＣＳ Channels
26%
34%
★The figures shown are before off-sets between sub-segments.
※Estimation partially included
Producing subtitles and dubbing for applicable titles
12
Entertainment
Entertainment Media
Media Content
Content Business
Business–Overall
Consolidated
H1: Progress as initially projected with the net sales of ¥4.1 billion and operating loss of ¥0.5 billion
Forecasting positive operating income in full-term results (¥14.3 billion in net sales and ¥0.03 billion in operating income)
Operating Income
Unit: Million Yen
Unit: Million Yen
20,000
1,000
+2,741
14,319
△2,582
△578
△502
＞Net Sales:
¥14.3 billion
＞Operating Income: ¥0.03 billion
-¥0.3 billion 【-2.4%】
+¥2.7 billion
Results
/forecast
△2,709
’06/3 ’07/3 ’08/3
Initial
Projection
’09/3
4,000
△3,651
10,155
4,164
4,365
Compared to last year
△1,793
8,844
5,824
5,436
7,341
3,500
Initial
Projection
’06/3 ’07/3 ’08/3
First Half
Results
Full-year forecast for the segment
Full Year
-201【-4.6%】
Results
/forecast
0
+2,080
First Half
3,000
-1,660【-28.5%】
First Half
Results
2,000
2,500
4,000
First
Half
2,000
Results
+76
1,000
1,500
-704【-4.7%】
Results
Projection
10,657
First
Half
6,000
15,023
Full Year -350【-2.4%】
Projection
Full Year
7,203
11,275
Second
Half
8,000
14,669
12,640
Full
Year
12,000
△2,361
500
△1,345
0
14,000
10,000
406
18,617
16,000
-374
500
18,000
Full Year
Projection
32
Net Sales
’09/3
13
TV Distribution Business (Entertainment
(Entertainment Media
Media Content
Content Business･Performance
Business･Performance trend)
trend)
Consolidated
★The figures are before off-set within the segment.
H1: ¥1.7 billion in net sales (+¥0.07 billion from initial projection), -¥0.9 billion in operating income (+¥0.01 billion from initial projection)
Forecasting the full-term sales of ¥8.8 billion and operating loss of ¥0.9 billion
Net Sales
Unit: Million Yen
■Both net sales and operating income results as initially projected in H1
Unit: Million Yen
△951
△626
△962
△2,890
1,000
△963
11,826
△2,440
500
12,000
△2,263
0
14,000
10,000
Market overview
Operating Income
47%
△3,323
1,689
7,110
7,557
1,620
△3,640
’06/3 ’07/3 ’08/3
Results
/forecast
’09/3
4,000
Full-year forecast for the sub-segment
Compared to last year
Initial
Projection
Results
/forecast
Initial
Projection
’06/3 ’07/3 ’08/3
3,500
△2,926
3,000
5,727
2,711
2,441
53%
2,500
5,883
3,441
8,337
2,000
Full Year
3,489
Terrestrial commercial
broadcaster total
First Half
0
[Full[Full-term sales distribution forecast for 3/2009 term by media/TV Distribution
Distribution Business]
ＢＳ･ＣＳ, etc.
2,000
First Half
Results
[Terrestrial network stations] [Terrestrial local stations]
・Amidst the tough market environment, sales activities concentrated
on TV stations with relatively larger budget.
（Network and local stations）
Full Year
Result
Projection
6,000
4,000
8,799
8,439
8,000
9,177
1,500
[Satellite broadcasting/BS・CS]
・Positive sales of Foreign movies and TV dramas
’09/3
＞Net Sales:
＞Operating Income:
¥8.8 billion
-¥0.9 billion
+¥0.3 billion 【+4.3%】
+¥2.4 billion
14
Inventory of Entertainment Media Content Exploitation
Rights
Consolidated
The reduction of output deal inventory almost completed in this term, significantly contributing to income improvement
[Output deal inventory as of the end of March 2009: Down to ¥0.7 billion (down ¥2.7 billion YOY)]
Entertainment Media Content Exploitation Rights Inventory (unit: billion yen)
250
23.3
24.4
21.5
21.6
200
Consolidated
Inventory
･Special loss accounted: Approx. ¥2.5 billion
･Temporary increase of content exploitation rights due
to the concentration of acquisition in H1
Plan
Plan
Other Media
Exploitation Rights
(¥6.5 billion in H1 acquisition as opposed to ¥8.4 billion in full-term acquisition)
16.2
16.8
-2.9 billion
150
15.7
12.4
12.8
8.9
50
Output Deal
Exploitation Rights
‘04/3
‘05/3
‘06/3
Cold Case Series 4
Without a Trace Series 5
ONE TREE HILL Series 4
Smallville Series 6
The O.C. Series 4 and others
The Chronicles of Narnia
Flight Plan
and others
-0.7
billion
3.4
‘07/3
□Overseas drama series
□Movies
1.4
0
・ acquisition of foreign drama series, that are showing solid demand
・Acquisition of Disney titles (BVI) as a package deal contracts
Main titles acquired
13.9
12.7
100
H1 overview
Due to the application of the Financial Accounting Standard for Inventory Valuation
‘08/3
‘08
/9
Balance at the
end of Q2 3/2009
term
0.7
‘09/3
(projection)
Main titles for sale
Deep Blue
Ocean’s Twelve
Shrek
and others
M:I:Ⅲ
Minority Report
The Chronicles of Narnia Chapter 1 and others
The blue text indicates titles scheduled for H2
H2 Projection
0.1
‘10/3
(projection)
・The output deal inventory is to be reduced to ¥0.7 billion
by the end of the term.
・Solid sales for BS / CS are helping amortization.
15
Content
Content Rights
Rights Management
Management and
and Other
Other Businesses
Businesses
Consolidated
(entertainment
(entertainment media
media content
content business
business // Business
Business performance
performance trend)
trend)
★The figures are before off-set within the segment.
Content Rights Management Business: Character-related business performing well to secure income in full-term results
despite underperformance of theater / DVD sales compared to initial projection
Other Businesses: Progress as initially projected in H1, and forecasting as-projected progress in full-term results
Content Rights Management Business
Net Sales
Other (dubbing and subtitling, etc.) business
Operating Income
Unit: Million Yen
474
4,140
4,186
2,113
2,148
4,214
4,262
4,372
2,061
2,201
2,244
2,283
2,088
2,027
2,037
1,969
△1,077
1,207
693
966
△172
△481
1,464
△444
1,395
2,110
2,227
1,420
Results
/forecast
’06/3
1,000
500
0
’07/3
’08/3
Results
/forecast
1,200
2,500
Initial
Projection
1,000
3,000
1,500
Full Year
’09/3
800
3,500
2,000
Initial
Projection
’08/3
Results
/forecast
’07/3
600
Initial
Projection
’06/3
400
First Half
First
Half
500
Results
△46
34
0
△63
1,900
148
2,430
2,816
3,148
4,000
200
1,500
0
4,500
△103
2,000
1,000
200
Full Year
Results
Projection
1,037
2,500
5,000
400
1,053
3,000
600
3,281
3,500
Unit: Million Yen
Net Sales
’09/3
’06/3 ’07/3 ’08/3
’09/3
16
Satellite Channel Operation Business
Consolidated
H1: ¥4.9 billion in net sales (+9.7% YOY / +4.5% vs. projection), ¥1.3 billion in operating income (+37.7% YOY / +23.8% vs. initial projection)
Full-term: Forecasting performance above initial projection to achieve last year’s level of operating income
Overview of Sub-Segments
Net Sales
Operating Income
Unit: Million Yen
4,500 33.1%
31.2%
4,000
2,000
2,838
2,380
2,587
+535【+26.1%】
Compared to last year
-1【-0.0%】
15%
987
10%
+361【+37.7%】
1,318
’06/3 ’07/3 ’08/3
1,065
957
1,416
1,226
4,984
4,771
4,544
4,403
3,705
+¥0.1 billion 【 +1.8%】
-¥0 billion 【 -0.0%】
Continued solid growth in contract work associated with
high definition adaptation and program sales
5%
Results
/forecast
’09/3
＞Net Sales:
¥9.9 billion
＞Operating Income:¥2.5 billion
+253【+23.8%】
Initial
Projection
Results
/forecast
’06/3 ’07/3 ’08/3
Initial
Projection
0
Full-year forecast for the segment
20%
500
0
【Program sales】 【Related contract work】
・Positive contracting of work associated with the TFC Group’s 3
channels that started high definition broadcasting
・Positive sales of HEROES and other programs to various channels
・New contract to feed the Shochiku-affiliated channels contributing to
increased income
【Channel administration】
・Steady subscription increase for ”Family Theater” topping 6 million
subscribers
Delay in high definition adaptation increasing operating income
20.9%
1,631
+213【+4.5%】
1,000
25%
1,421
1,500
+440【+9.7%】
First Half
Results
2,000
1,153
4,916
5,050
4,687
3,967
4,000
5,179
7,672
Full Year
Results
Projection
21.1%
2,500
+78【+0.8%】
26.1%
22.3%
3,000
+176【+1.8%】
26.4%
26.6%
3,500
1,268
9,900
9,822
9,724
9,090
8,000
6,000
30%
31.0%
10,000
35%
32.2%
2,052
12,000
2,588
Unit: Million Yen
’09/3
TFC’
TFC’s Satellite Channel Operation
【Program sales】
sales】
・Program sales to TFC Group main channels
0%
【Commissioned operations】
operations】
・Programming, sales promotion, marketing/ Channels Sales to Cable Operators &
Hotels/ Ad sales operations/
operations/ Program production/ Broadcasting preparation/
Transmission work etc.
【Satellite channel operation】(3 channels subject to consolidated results)
Family Theater, PLAYBOY Channel Japan, Classica Japan
17
Consolidated
Satellite Broadcasting: Market Environment
Acquiring bandwidth in digital CATV and BS / CS110 to win a business opportunity in the high-growth media market
Capital investments related to high definition almost completed, with HD broadcasting starting on the Group’s basic three channels
Transition of TFC Group main channel subscription
Start of high definition broadcasting
Exceeding 20 million subs in Group channels total
Continued subscription expansion, helped by CATV digitization
Group total
11.26
12.54
14.39
16.30
18.76
20.56
21.78
unit: million
25
Expansion of approx. 10% per annum
HD introduction to TFC’s all basic channels before SkyPerfecTV
124/128 expands its HD services (scheduled for the autumn of 2009)
3/2009
20
The Cinema
Super!dramaTV
History Channel
HD broadcasting started
3/2009 onwards
Pay channels
Family Theater
The Cinema
15
Basic 4 channel
total:
20.82 million
(as of 9/08)
History Channel
Initiatives for the ＢＳ・ＣＳ１１０ bandwidth
・Expression of interest for the acquisition of BS/CS 110 bandwidth submitted
（ＴＦＣ・Star Channel）
10
Family Theater
5
Super!dramaTV
0
3/03
3/04
3/05
3/06
3/07
3/08
9/08
■BS bandwidth allocation schedule
・8/2008
：Pilot survey
・End of 2008 ：Announcement of allocation criteria
・4/2009
：Licensing application taken
・7/2009
：Licensee selected
・2011 onwards ：Broadcasting to commence
18
Summary of projections by segment
Consolidated
Forecasting positive operating income for the entertainment media content business, and increased
sales and operating income for the satellite channels operation business
Forecasting negative YOY results in sales and operating income for the production business
Unit: Million Yen
Net Sales
3/’08Full Year
Results
3/’09 Full Year Projection
Ratio
Production
business
46,385
45,675
58.5%
14,669
8,439
2,816
14,319
8,799
1,900
18.3%
Satellite Channels
Operation Business
9,724
9,900
12.7%
Retail
Merchan
dising
8,120
8,187
10.5%
Total
78,899
78,081
100%
Total
75,780
74,671
Entertainment Media
Content Business
TV Distribution
Content Rights
Management
Operating Income
▲709
【-1.5%】
vs. Initial
Projection
▲1,980
【-4.2%】
▲349
【-2.4%】
+359
▲703
【-4.7%】
▲377
▲915
▲529
+176
+78
YOY
3/’08Full Year
Results
3/’09 Full Year Projection
Ratio
8,102
7,750
72.5%
▲2,709
0.3%
▲481
32
▲963
▲46
2,588
2,587
338
YOY
▲352
【-4.3%】
vs. Initial
Projection
▲364
【-4.5%】
+2,742
【-】
+2,360
▲374
【-】
▲336
+435
▲80
24.2%
▲0
【-0.0%】
+534
【+26.0%】
322
3.0%
▲15
【-4.6%】
▲85
【-20.9%】
8,318
10,691
100%
5,959
8,225
+2,266
【+38.0%】
▲68
【-0..8%】
▲3,323
★Before intra-segment eliminations
＋
Others
after eliminations
【+1.8%】
+66
【+0.8%】
▲1,109
【-1.5%】
【+0.8%】
▲139
【-1.7%】
▲3,038
【-3.9%】
19
Consolidated
Full Year Business Forecast (Consolidated)
Forecasting a decline in full-term sales (-1.5% YOY), but increased operating and ordinary incomes
Net Sales ¥74.6 billion (- 1.5% YOY)
Ordinary income ¥7.9 billion (+28.4% YOY)
Operating income ¥8.2 billion (+38.0% YOY)
Net income ¥2.6 billion (+ 0.0% YOY)
3/2009 Full Year
Second-Half Full Year Projection
Projection
Unit: Million Yen
First Half
Results
Net Sales
34,180
40,490
74,671
75,780
-1,109
【-1.5%】
1.5%】
-3,038
【-3.9%】
3.9%】
Operating Income
1,376
3,640
4,584
8,225
5,959
+2,266
【+38.0%】
+38.0%】
-68
【-0.8%】
0.8%】
Operating Income Ratio
to Net Sales
10.7%
11.3%
11.0%
Ordinary Income
3,395
4,559
7,955
6,197
+1,758
【+28.4%】
+28.4%】
-124
【-1.5%】
1.5%】
Ordinary Income Ratio
to Net Sales
9.9%
11.3%
10.7%
Net Income
558
2,033
2,591
2,589
+1
【+0.0%】
+0.0%】
-104
【-3.9%】
3.9%】
Net Income Ratio
1.6%
5.0%
3.5%
08/3Full Year
Results
YOY
vs. Initial
Projection
20
Setting the framework of treasury stock acquisition
※TFC announcement on 11/12/08
Treasury stocks to be acquired for shareholder return enhancement in view of the market environment
＞ As of 9/30/2008
： Approx. 1.06 million treasury stocks held (2.3% of all issued stocks)
＞[11/2008～3/2009]
：Up to 600,000 shares to be acquired (1.3% of all issued stocks [excluding treasury stocks])
Mid-term business goals
Considering uncertain economic conditions and trends in the advertising / media markets
Goals to be defined in view of the market environment from H2 onwards
２１
Attachments
２２
Consolidated
Retail Merchandising Business
Other Business (Education)
★The figures are those obtained before intraintra-segment eliminations.
eliminations
H1 results：Net Sales ¥3.9 billion (+1.6% YOY)/Operating Income ¥0.11 billion (-40% YOY)
Net Sales
Operating Income
Unit: Million Yen
Unit: Million Yen
10,000
First Half Results
7.0%
Full Year Results / Projection
700
7%
600
6%
9,000
4.6% 4.9%
4.2%
338
3%
230
200
Full-year forecast for the segment
3/’06 3/’07 3/’08
107
176
180
288
201
3,985
0
Results
/forecast
3/’09
1%
Initial
Projection
Results
/forecast
Initial
Projection
3/’06 3/’07 3/’08
4,080
3,921
4,118
4,006
100
0
2%
214
2,000
1,000
(The 3/07 business performance is attributable to work
associated with the Shimbashi Studio Building)
2.7%
157
3,000
・Income decrease from initial projection due to the skyrocketing
costs of materials for the supermarket business, and decline in
the high profit-margin interior business
3.9%4%
407
461
173
380
300
5%
4.3%
179
4,201
4,246
4,199
4,047
4,289
400
5,000
5.5%
500
4.7%
6,000
4,000
5.0%
322
8,187
8,326
8,120
8,407
7,000
8,054
8,000
・Positive sales in the supermarket business and the distribution
of business-use tapes and other equipment resulting in business
performance approximately as initially projected
3/’09
＞Net Sales:
¥8.1 billion
＞Operating Income: ¥0.32 billion
0%
23
Cash Flow Highlights <as
<as of
of 9/30/2008>
9/30/2008>
Consolidated
4/2008 – end of 9/2008: Operations CF+¥2.2 billion, Investment CF-¥2.7 billion, Financing CF-¥5.8
Cash & Equivalents Balance ¥26.6 billion (-¥4.1 billion YOY)
(unit:Million yen)
1320
4286
1957
386
△ 922
△ 4207
△ 376
409
2854
△ 1878
976
128
5184
△ 626
△ 203
△ 35
△ 1138
584
534
4428
△ 2169
2258
Difference from same
period last year
-1192
+897
-2584
-590
+8868
+3069
+960
+125
+1574
-291
+1282
3/2008 mid-term 3/2009 mid-term
From Operations
Net income before tax
Change in Trade Receivables (△ amount of increase)
Change in Acquired Rights (△ amount of increase)
Change in Advance Payments (△ amount of increase)
Change in Inventories (△ amount of increase)
Change in Trade Payables (△ amount of decrease)
Change in Advance Receipts (△ amount of decrease)
Others
Subtotal
Interest, corporate tax, etc.
CF total
From Investments
Change in Time Deposits
Balance of Tangible Fixed Assets
Balance of Investment Securities
Balance of Loans
Others
CF total
153
△ 98
△3
△ 232
△ 38
△ 218
△ 152
△ 518
△ 463
△ 1478
△ 118
△ 2731
-306
-419
-460
-1246
-80
-2512
From Financing
Balance of Short-term Borrowings
Balance of Long-term Borrowings
Acquisition of Treasury Stock
Others
CF total
2050
0
0
446
△
1603
△ 5291
0
△ 23
△ 572
△ 5888
-7341
+0
-23
-126
-7491
Balance at the beginning of the term
After conversion: Increase
Balance at the end of the term
28431
2347
30779
33037
Cash etc.
△ 6360
26676
+4605
-8708
-4102
billion
24
Advertising Production-related Indicators
Transition
Transition inin the
the number
number of
of advertising
advertising production
production projects
projects inin Inventory
Inventory
(Unit: Titles)
240
220
200
180
160
140
120
100
3/07 term
3/08 term
3/09 term
Apr.
May
157
166
199
164
170
193
Jun.
170
208
198
July
181
193
203
Aug.
181
194
185
Sep.
190
173
174
Oct.
214
198
169
Nov.
196
212
Dec.
222
199
Jan.
200
210
Feb.
193
212
Mar.
205
184
25
Production Business: Advertising Production-related Indicators
Main Television Advertising
Awards Share
（FY2006）
FY2006）
Sales Ranking
(FY2007)
0
100
200
（unit: billion yen）
3 TFC Group
Companies Total
19.7
Tohokushinsha
12.8
Company A
7.8
Company B
Company C
Company D
(Undisclosed)
5.3
5.2
Nibankohboh
Nitten Alti
3.3
Company E
3.1
Company F
2.4
Company G
2.3
300
（本）
Market Share
0
28.1 13.9%
(+1.6%)
Companies Total
9.7%
(+1.5%)
Tohokushinsha
6.3%
(+0.9%)
Company a
3.8%
(-0.9%)
Company b
-
-
Company c
2.6%
(-0.1%)
2.5%
(-0.0%)
1.6%
(+0.1%)
1.5%
(+0.2%)
1.2%
(-0.0%)
0.9%
(-0.0%)
“Advertising and Economy” July 2008 edition
10
(Compare
to last
4 TFCdGroup
year)
20
30
40
50
48
40
21
14
9
Market Share
25.5%
(+1.9%)
21.3%
(+1.4%)
11.2%
(-1.9%)
7.4%
(+2.2%)
4.8%
(+1.7%)
Company d
6
3.2%
(+1.6%)
Company e
6
3.2%
(+0.6%)
2.7%
(-0.4%)
Company f
5
Nibankohboh
3
1.6%
(-0.5%)
Thermal
サーマル
3
1.6%
(+1.6%)
2
1.1%
(-0.5%)
Nitten Alti
FY2006 Statistics. Source: “Current state of advertising agencies”
26
Consolidated
Content
Content Rights
Rights Management
Management Business:
Business: Completed
Completed Titles
Titles && Titles
Titles In
In Development
Development // Production(1)
Production(1)
Title
Aquarion
A Spirit of the Sun
Yoiko-no Eco Eco Variety, Tensai? Dr. Hamax
Anime
REIDEEN
Tetsuko-no Tabi
Red Line (feature film version)
Love Con
Akai Kujira to Shiroi Hebi
NARA: Yoshisato Nara Travelogue
Shiawase no Switch
Original
Productio
ns
Mushishi
Ai-no Rukeichi
Yunagi-no Machi Sakura-no Kuni
LiveAction Kowai Doyo (Part I and Part II)
Feature
Movies Zenzen Daijobu
Yamano Anata Tokuichi-no Koi
TOKYO JOE
Sambongi Nogyo Koko Bajutsu-bu
Tengoku-wa Mada Toku
Gelatine Silver LOVE
MasakiKu araba
Toyo’s Camera
Anticipated use in the mid-term plan
Primary use
1st Half 3/06 term
(TV broadcasting completed)
1st Half 3/07 term
(TV broadcasting)
2nd Half 3/08 term
(TV broadcasting)
2nd Half 3/07 term
(TV broadcasting)
1st Half 3/08 term
(TV broadcasting)
1st Half 3/10 term
(Cinema Release)
1st Half 3/07 term
(Cinema Release)
2nd Half 3/07 term
(Cinema Release)
2nd Half 3/07 term
(Cinema Release)
2nd Half 3/07 term
(Cinema Release)
2nd Half 3/07 term
(Cinema Release)
2nd Half 3/07 term
(Cinema Release)
1st Half 3/08 term
(Cinema Release)
1st Half 3/08 term
(Cinema Release)
2nd Half 3/08 term
(Cinema Release)
1st Half 3/09 term
(Cinema Release)
2nd Half 3/09 term
(Cinema Release)
2nd Half 3/09 term
(Cinema Release)
2nd Half 3/09 term
(Cinema Release)
2nd Half 3/09 term
(Cinema Release)
1st Half 3/10 term
(Cinema Release)
1st Half 3/10 term
(Cinema Release)
Secondary use
1st Half 3/06 term
2nd Half 3/08 term
(DVD release)
(TV broadcasting)
2nd Half 3/07 term
2nd Half 3/08 term
(DVD release)
(TV broadcasting)
1st Half 3/10 term
(DVD release)
1st Half 3/08 term
(DVD release)
2nd Half 3/08 term
(DVD release)
2nd Half 3/10 term
(DVD release)
2nd Half 3/07 term
1st Half 3/08 term
(DVD release)
(PPV broadcasting)
1st Half 3/08 term
(DVD release)
2nd Half 3/08 term
(DVD release)
1st Half 3/08 term
2nd Half 3/08 term
(DVD release)
(TV broadcasting)
2nd Half 3/08 term
1st Half 3/09 term
(DVD release)
(TV broadcasting)
1st Half 3/08 term
2nd Half 3/08 term
(DVD release)
(PPV broadcasting)
2nd Half 3/08 term
1st Half 3/09 term
(DVD release)
(TV broadcasting)
2nd Half 3/08 term
1st Half 3/09 term
(DVD release)
(TV broadcasting)
1st Half 3/09 term
2nd Half 3/09 term
(DVD release)
(TV broadcasting)
2nd Half 3/09 term
(DVD release)
1st Half 3/10 term
(DVD release)
1st Half 3/10 term
(DVD release)
1st Half 3/10 term
(DVD release)
1st Half 3/10 term
(DVD release)
2nd Half 3/10 term
(DVD release)
2nd Half 3/10 term
(DVD release)
Description
“The Super Dimension Fortress Macross” directed by Masaharu Kawamori. A new-century love romance that transcends time and space,
Anime adaptation of a popular comic, for which the author Kaiji Kawaguchi won the Shogakkan Manga Award. Mad House production. Aired on WOWOW.
Jointly produced by Family Theater and Tohokushinsha. Won the second “Anime Project Award”. Featuring the comedy duo Yoiko as the main characters
Produced by Production IG. Return of the hero of the original animated series Yusha Reideen
Anime-adaptation of a popular comic series. Comical travel journal of a railway fan, who is dedicated to train travel with no interest in sightseeing, local foods or spa resorts
Produced by Mad House, and directed by Katsuto Ishii (creative director) & Ken Koike
Movie adaptation of a popular comic. Produced by TFC content production & CM production staff
Epic drama on the theme of human love and war, featuring an elderly woman who visit a town in Uchiboso 60 years after the war, and depicting the lives of three generations of
women
Highly-anticipated documentary on Yoshisato Nara, an artist of rare talent with followers across the world
Story of a local electrical store in Wakayama, featuring Juri Ueno and Kenji Sawada. First “Cinemarketing” joint project with Theatres
Movie adaptation of a popular comic series. Japan’s first VFX historical fantasy title, directed and written by Katsuhiro Otomo and featuring Joe Odagiri.
Love story portraying the “ultimate love” that a man and a woman may reach at the height of their love. Written by Junichi Watanabe and directed by Yasuo Tsuruhashi
Movie adaptation of a comic series by Fumiyo Kono. Depicting the life of two women from the time 10 years after the Hiroshima A-bomb attack through to today, to describe the
effects of atomic bombing. Directed by Kiyoshi Sasabe (“Hanochi”)
School horror mystery in two parts (70 minutes each), using folklore tunes as motifs. Directed by Osamu Fukutani (“Shibuya Kaidan Series”) and featuring Megumi Yasu and
Mikako Tabe
Light comedy with clever humor, using the theme of “Happiness of Not Winning” to describe the difficulties of life for youths and the middle-aged. Originally written script, and
produced with staff and cast members of the theater group Otona Keikaku. Fe
Director Katsuhito Ishii's remake of the 1938 film "Anma-to Onna" directed by Hiroshi Shimizu, a filmmaker from the same generation as Yasujiro Ozu. This remake is staged in a
picturesque hot spring resort in the pre-war Japan. Cast: Tsuyoshi Kusanagi
The tale of the adventure-filled life of Ken Eto (told through the testimony of a former FBI agent), a Japanese-American gang leader dubbed “TOKYO JOE” in late-20th-century
Chicago.
A non-fiction drama portraying the interactions between a blind horse and a girl who belongs to a horse-riding club. Ayane Nagabuchi (daughter of the singer Tsuyoshi
Nagabuchi) makes a feature film debut as the lead in this movie. Directed by Kiyoshi Sa
Depicting how a working woman with a death wish experiences the rich nature of Miyazu, Kyoto, and meets heart-warming people, before regaining the energy to live and move
on. Cast: Rosa Kato and Yoshimi Tokui (of the comedy act Tutorial)
The first feature film by Kazumi Kurigami, a 72-year-old photographer who remains on the forefront of art of photography. Cast: Masatoshi Nagase, Rie Miyazawa, Koji Yakusho,
Yuki Amami. Theme song by Yosui Inoue
A story of forbidden love between a convicted murderer on death row and the victim's former girlfriend. Directed by Kaito Okachimachi and music by Naotaro Moriyama. Cast:
Hiroyuki Kubota and Machiko Ono
A joint Japan-US documentary film about the photographs of Miyatake Toyo, a photographer who managed to make a camera with a smuggled-in lens and captured the reality of
Japanese Americans forcibly sent to an internment camp during World War II
27
Consolidated
Content
Content Rights
Rights Management
Management Business:
Business: Completed
Completed Titles
Titles && Titles
Titles In
In Development
Development // Production(2)
Production(2)
Title
Lost in Translation
Deep Blue
Good Night & Good Luck
Copying Beethoven
Marie Antoinette
Joe Strummer-The Future is Unwritten
Balls of Fury
Acquired Titles
Bridge to Terabithia
Because I Said So
HIGHLANDER (Feature Film Version)
ACROSS THE UNIVERSE
Shine A Light
CHOCOLATE
RUDO Y CURSI
THE BURNING PLAIN
Anticipated use in the mid-term plan
Description
Primary use
1st Half 3/05 term
(Cinema Release)
1st Half 3/05 term
(Cinema Release)
1st Half 3/07 term
(Cinema Release)
2nd Half 3/07 term
(Cinema Release)
Secondary use
2nd Half 3/05 term 1st Half 3/07 term
(DVD release)
(TV broadcasting)
1st Half 3/06 term 1st Half 3/07 term
(DVD release)
(TV broadcasting)
2nd Half 3/06 term 2nd Half 3/08 term
(DVD release)
(TV broadcasting)
2nd Half 3/08 term 1st Half 3/09 term
(DVD release)
(TV broadcasting)
2nd Half 3/07 term
（Cinema Release ）
1st Half 3/08 term
（DVD release ）
1st Half 3/09 term
epidemic drama on the world's most famous qieen consort, featuring Kirsten Dunst from the Spiderman
(TV broadcasting)
1st Half 3/08 term
(Cinema Release)
1st Half 3/09 term
(Cinema Release)
2nd Half 3/08 term
(Cinema Release)
1st Half 3/08 term
(Cinema Release)
1st Half 3/09 term
(Cinema Release)
1st Half 3/09 term
(Cinema Release)
2nd Half 3/09 term
(Cinema Release)
2nd Half 3/10 term
(Cinema Release)
2nd Half 3/10 term
(Cinema Release)
2nd Half 3/10 term
(Cinema Release)
2nd Half 3/08 term
(DVD release)
2nd Half 3/09 term
(DVD release)
3/09 term
(DVD release)
2nd Half 3/08 term
(DVD release)
2nd Half 3/09 term
(DVD release)
A documentary film depicting the life of Joe Strummer, the charismatic drummer of the legendary punk rock
band The Clash. Directed by Julien Temple.
Ping Pong meets Kung Fu! A bizarre sport comedy depicting an obese former ping-pong prodigy, waging a
fight against an underworld organization.
2nd Half 3/09 term Movie adaptation of the children’s book “Bridge to Terabithia” by Katherine Paterson, winner of the Hans
(TV broadcasting) Christian Andersen award.
1st Half 3/10 term
(DVD release)
1st Half 3/11 term
(DVD release)
1st Half 3/11 term
(DVD release)
1st Half 3/11 term
(DVD release)
Directed and written by Sophia Coppola. Academy Award Winner(Best original screenplay)
Grand-scale documentary, compiling footage from 7 years of filming by the production staff of BBC, which is
renowned for excellence in wilderness documentaries
Won six nominations for the Academy Awards, and directed by George Clooney (3 awards at the Venice Film
Festival). Drama depicting men who stood up for the Red Scare.
Music movie describing how Beethoven composed his 9th Symphony . The female director, Agnieszka
Holland, portrays spiritual connection between Beethoven and a female copyist from a unique perspective.
The latest written and directed by Sofia Coppola, who won the Academy Award with her previous work. An
series. Entry for Official Selection of Golden Palm
2nd Half 3/09 term
A romantic comedy about a mother who tries to find a boyfriend for her daughter (featuring Diane Keaton).
(TV broadcasting)
Produced by Mad House, and directed by Yoshiaki Kawajiri
1st Half 3/10 term
A novel musical depicting life of yonungsters in 60's, featuring over 30 Beatles songs.
(TV broadcasting)
A live music entertainment film featuring the Rolling Stones
An action-filled Thai movie. The cast includes Hiroshi Abe.
First film produced by Cha Cha Cha Production established by directors of ‘Harry Potter and the Prisoner of
Azkavan’ and ‘Babel’.
A human drama starring two Oscar winning actresses Charlize Theron and Kim Basinger .
Entrant of the 65th Venice International Film Festival.
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Flow of Advertising Production Business
Branding
Marketing
Media Planning
Bidding / Appointment
Campaign Contracts
Time Slot Orders / Sponsorship
Advertising
Agency
Advertiser
Timeslot Sales
Campaign Management
Promotion
Media
Companies
(TV Stations, etc.)
Advertising
Tohokushinsha
Planning /
Production Revenues
Planning / Production
Advertising Production HQ
Advertising
Production
Sales Promotion
Editing / CG
Editing Revenues
Post-Production
(Visual Image Processing)
【Strengths】
Overwhelming planning and production capacities with human resources of the industry’s highest standard.
State-of-the-art visual image technology / Partnership with major advertising agencies in the entertainment content business in general.
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Flow of Entertainment Content Production Business
Acquisition of movie /
TV adaptation rights
Development of
production framework
Production
Sales Promotion
Sales Representation
Production Committee
Profit distribution from rights
exploitation (through investment)
Feature
Film
Movie
Studios
Advertising
Agencies
Contingent
Remuneration
Feature Film / TV Program
Production Business
Development
TV
Series
Toy
Manufacturers
Publishers
Production
Committee
Representation
Commission Revenues
Feature Film / TV
Program Production
Theatrical Distribution
(Entertainment Content)
Production Revenues
Planning /
Marketing
TV
Stations
(Partial OR Combined)
TV
Stations
Entertainment
Content
Sales
Distribution Revenues
Videogram Distribution
(Entertainment Content)
PostProduction
Editing Revenues
(Visual Image Processing)
Dubbing /
Subtitling
Editing Revenues
(Audio Processing)
Sales Promotion
(Distribution Revenues)
SP Revenues
TV Distribution
Distribution Revenues
Merchandising /
Licensing Business
Licensing Revenues
【Strengths】
Exploitation Rights Acquisition Capacity + State-of-the-art Visual Image Technology + Multiple Revenue-Raising Opportunities
= Development of Diverse Production Schemes & Enhanced Business Profitability
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Flow of Content Distribution Business
Acquisition
Production
Sales Promotion
Sales
Sales Representation
TV
Distribution
Rights
Representation
Commission Revenues
TV Distribution
Theatrical Distribution
(Entertainment Content)
Distribution Revenues
Post-Production
Foreign /
Domestic
Content
Holders
Videogram Distribution
(Entertainment Content)
Editing Revenues
(Visual Image Processing)
Dubbing /
Subtitling
All
Rights
Entertainment
Content
Editing Revenues
(Audio Processing)
Sales Promotion
Distribution Revenues
SP Revenues
TV Distribution
Distribution Revenues
Merchandising /
Licensing Business
Licensing Revenues
【Strengths】
Acquisition know-how; Long-term relationship of trust with foreign & domestic content holders, as well as major TV stations;
Revenue raising from associated production businesses.
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Flow of Satellite Channel Operations Business
Satellite Channels
Comprehensive Contract
Distribution Revenues
TFC
Satellite Channels
Operation Business
Flow of Entertainment Content
Foreign &
Domestic
Content
Holders
Contracted Work
Revenues
・Program Acquisition
・Programming
・Marketing
・Transmission
・Advertising / CATV Sales
SP Revenues
TV Distribution
Entertainment
Content
Program Acquisition
Japanese
Localization
Sales Promotion
Sales Promotion
Production Revenues
Subtitling / Dubbing
【Strengths】
Efficient administration through comprehensive contracting of channel operations;
Multiple revenue raising through related businesses; Entertainment content development/ acquisition capacities.
32
Synergy of TFC
We deliver unparalleled strength through the strong synergy which links all production / content rights business segments
Business Model
Content Development / Production
Education
Content Rights Exploitation
HR Development
Latest Information
Overseas
Overseas shooting, etc.
Advertising
Production
Movie
Studios
Movie / TV Program
Planning & Production
Toy
Companies
Content
Rights
Rights Acquisition
io
uct
Sales Promotion
Adv
er
/ Int
erne
t/S
P
Entertainment
Content
(All Rights Sales)
Film / Videogram distribution,
etc.
terne
Rights Exploitation
tisin
g
r
g / In
rtisin
e
v
d
A
rde
Content
Production
Companies
Japanese
Localization
t / SP
ns
ratio
Op e
Rights Management Product Development
Merchandising /
Licensing Business
Exploitation
Rights Holders
CoCo-Productions,
Acquisitions,
etc.
nO
Dubbing /
Subtitling
TV Stations
Advertising
Agencies
d
Pro
Editi
ng, D
VD A
utho
ring
Tape Ordering
Content
Rights
ing
Post-Production
Merchandising
ing
Rights Exploitation
c
Pla
it
Ed
GI
/C
TV Distribution
TV Stations
Advertising
Agencies
(TV Distribution Right Sales)
Program Distribution
Satellite Channel
Operation Business
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Glossary
Postproduction
The finishing process after shooting video materials (pre-production), e.g. processing and editing video/ audio to turn it into a completed product. Postproduction represents
processing/ editing video, and adding voice/ music/ sound effects. It requires highly value-added operation know-how using high-performance equipment, including computer
graphics and HD (high definition) compatibility. Tohokushinsha/ Omnibus Japan has always led the industry in introducing cutting-edge equipment, and developing/ accumulating
innovative visual technologies/ know-how, yielding an overwhelming impact on the industry.
Producers
People who oversee each advertising production/movie planning and production. Producers have the responsibility and authority in each project’s profitability and overall quality,
covering aspects ranging from project promotion/commissioning to external negotiations, budget management and staff recruitment.
Tohokushinsha is the advertising production industry’s pioneer in adopting the “Producer system”, leading others in production quality and cost management know-how.
Directors (planning/ production)
People who direct and produce advertising production and movie projects. Directors have responsibility and authority in production quality. Tohokushinsha overwhelms competitors in
having outstanding directors/ planners under contract, such as Shinya Nakajima (winner of 1993 Grand - Prix at Cannes Lions International Advertising Festival).
Output deal
One of the formats in entertainment content rights license agreements (distribution rights). An output deal buys the distribution rights of all movies and TV programs which a specific
movie studio produces during a set period of time, as well as rights for specified library titles. The term of such an agreement is generally for 3 to 5 years. In the case of first-run
movies, the cost (purchase price) slides according to their box-office earnings in Japan. An output deal may have an optional agreement (e.g. agreement of extending the term of
contract) attached. Tohokushinsha has had an output deal with Warner Brothers (2000 - 2004) and Buena Vista (2001 - 2003 / until 2005 if an optional agreement is exercised).
Package deal
One of the formats in entertainment content rights license agreements. A package deal packages a main title produced by a specific movie studio together with other movies/
programs in acquiring entertainment content rights. The content, scale and term of such a package is determined in negotiations between the licensee (distribution company, i.e.
Tohokushinsha) and licensor (movie/ program production company). Generally, a package deal has a smaller scale than an output deal, which buys out all new movies/ programs
output in a specified period of time, and rarely extends over one year.
Start date of subsub-licensing period
Date and time from when a certain title can be broadcast, as stipulated in an agreement between a TV station and a distributor in the TV distribution business. A TV station/ channel
cannot broadcast the title before this date, but may put it on air anytime after the date within a specified period of time. In other words, the actual broadcasting date is after the sublicensing start date and within the specified period of time. Tohokushinsha amortizes the title’s cost fully on the start date of the sub-licensing period (for initial broadcast).
Baseband
In (satellite) TV broadcasting, “baseband” signifies assembling programs/ video titles/ commercials, accumulated in VTR or a video server, according to program schedule, and
making a real-time feeding in a form of broadcasting signals. Tohokushinsha conducts baseband for all related channels at its Satellite Transmission Center.
UpUp-link
Transforming broadcasting signals to electromagnetic waves, and uplinking them to satellite.
Tohokushinsha undertakes up-link operations for all channels available on CS110 and e2by Sky PerfecTV!, and feeds the signals from its Todoroki Broadcasting Center.
Basic channels/ pay channels
Basic channels are channels provided as part of the basic package in CATV services, etc. TFC Group channels include Super Channel, Family Theater, History Channel and THE
CINEMA. (*Provided as part of the basic package at Sky PerfecTV!, rather than part of the Must-Buy package sales.) For pay channels, viewers are required for a subscription
contract separate from the basic package.）
TFC’s affiliated pay channels include Star Channel, Classica Japan and Playboy Channel.
34
About future projections
In this material, performance projection figures have been calculated based on judgments
and assumptions made with currently available information. Actual figures and results may
differ from projections due to uncertain factors in such judgments/assumptions, and
variability of future business administration and domestic/overseas situations.
Please also note that this material has been compiled to promote understanding on
Tohokushinsha, and is not aimed at soliciting investment in this company.
TFC shall not be held liable for any disadvantage or damage arising from information
carried in this material.
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