Results for Adjusted OIBDA and Adjusted EBITDA for the Three and Six Months Ended September 30, 2023
Sony has established three-year cumulative Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) as the most important financial performance indicator (Group KPI) in the Fourth
Mid-Range Plan for the three fiscal years starting on April 1, 2021 and ending on March 31, 2024. Starting in the three months ended June 30, 2023, Sony has disclosed the actual results for Adjusted EBITDA on a consolidated basis, which is the Group
KPI, and Adjusted OIBDA (Operating Income Before Depreciation and Amortization) by segment.
The actual results for Segment Adjusted OIBDA and Consolidated Adjusted EBITDA for the three and six months ended September 30, 2023 are as follows:
Adjusted OIBDA and Adjusted EBITDA are not measures in accordance with IFRS. However, Sony believes that these disclosures may be useful information to investors. Please refer to
“Supplemental Information” on pages 5 to 11 for more details, including the formulas and reconciliations for Adjusted OIBDA and Adjusted EBITDA (the same applies below).
Three months ended September 30, 2023
|
|
(Yen in billions)
|
|
|
|
Three months ended September 30
|
|
|
|
2022
Restated
|
|
|
2023
|
|
Segment Adjusted OIBDA
|
|
Game & Network Services (G&NS)
|
|
|
64.2
|
|
|
|
83.1
|
|
Music
|
|
|
87.5
|
|
|
|
97.0
|
|
Pictures
|
|
|
40.4
|
|
|
|
42.6
|
|
Entertainment, Technology & Services (ET&S)
|
|
|
102.6
|
|
|
|
87.6
|
|
Imaging & Sensing Solutions (I&SS)
|
|
|
122.2
|
|
|
|
107.1
|
|
Financial Services
|
|
|
64.4
|
|
|
|
22.7
|
|
All Other, Corporate and elimination
|
|
|
(4.1
|
)
|
|
|
(14.1
|
)
|
Consolidated Adjusted OIBDA
|
|
|
477.1
|
|
|
|
425.9
|
|
Consolidated Adjusted EBITDA*
|
|
|
487.2
|
|
|
|
426.4
|
|
Six months ended September 30, 2023
|
|
(Yen in billions)
|
|
|
|
Six months ended September 30
|
|
|
|
2022
Restated
|
|
|
2023
|
|
Segment Adjusted OIBDA
|
|
Game & Network Services (G&NS)
|
|
|
134.4
|
|
|
|
158.9
|
|
Music
|
|
|
162.3
|
|
|
|
180.0
|
|
Pictures
|
|
|
102.2
|
|
|
|
71.0
|
|
Entertainment, Technology & Services (ET&S)
|
|
|
179.5
|
|
|
|
168.4
|
|
Imaging & Sensing Solutions (I&SS)
|
|
|
189.5
|
|
|
|
177.2
|
|
Financial Services
|
|
|
210.0
|
|
|
|
84.1
|
|
All Other, Corporate and elimination
|
|
|
(11.9
|
)
|
|
|
(17.6
|
)
|
Consolidated Adjusted OIBDA
|
|
|
966.0
|
|
|
|
822.0
|
|
Consolidated Adjusted EBITDA*
|
|
|
984.0
|
|
|
|
832.6
|
|
* The differences between Adjusted EBITDA and Adjusted OIBDA on a consolidated basis represent financial income and financial expenses (excluding interest expenses, net, and gains on revaluation of equity
instruments, net) (the same applies below). Adjusted EBITDA by segment is not calculated and disclosed because Sony does not include financial income and financial expenses in its performance evaluations by segment, mainly due to the fact that Sony
manages its foreign exchange exposure centrally and globally, except for the Financial Services segment.
Outlook for the Fiscal Year Ending March 31, 2024
The forecast for consolidated results for the fiscal year ending March 31, 2024, as announced on August 9, 2023, has been revised as follows:
As the results for the fiscal year ended March 31, 2023 are restated in accordance with IFRS 17, they differ from those disclosed in the earnings release for the fiscal year ended March
31, 2023.
|
|
(Yen in billions)
|
|
|
|
|
|
|
|
|
|
March 31, 2023
Results
Restated
|
|
|
August
Forecast
|
|
|
November
Forecast
|
|
|
Change from
August Forecast
|
|
Sales *1
|
|
|
10,974.4
|
|
|
|
12,200
|
|
|
|
12,400
|
|
|
+200 bil
|
|
|
|
+1.6
|
%
|
Operating income
|
|
|
1,302.4
|
|
|
|
1,170
|
|
|
|
1,170
|
|
|
|
-
|
|
|
|
-
|
|
Income before income taxes
|
|
|
1,274.5
|
|
|
|
1,140
|
|
|
|
1,160
|
|
|
+20 bil
|
|
|
|
+1.8
|
%
|
Net income attributable to Sony Group Corporation’s stockholders
|
|
|
1,005.3
|
|
|
|
860
|
|
|
|
880
|
|
|
+20 bil
|
|
|
|
+2.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted OIBDA
|
|
|
1,816.9
|
|
|
|
1,770
|
|
|
|
1,785
|
|
|
+15 bil
|
|
|
|
+0.8
|
%
|
Adjusted EBITDA
|
|
|
1,797.6
|
|
|
|
1,750
|
|
|
|
1,785
|
|
|
+35 bil
|
|
|
|
+2.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For all segments excluding the Financial Services segment *2
|
|
March 31, 2023
Results
|
|
|
August
Forecast
|
|
|
November
Forecast
|
|
|
Change from
August Forecast
|
|
Net cash provided by operating activities
|
|
|
415.5
|
|
|
|
1,250
|
|
|
|
1,160
|
|
|
-90 bil
|
|
|
|
-7.2
|
%
|
*1 “Sales and Financial Services revenue” are shown as “Sales” (the same applies below).
*2 Cash flow for all segments excluding the Financial Services segment is not a measure in accordance with IFRS. However, Sony believes that this disclosure may be useful
information to investors. Please refer to page F-16 for details about the preparation of the Condensed Statements of Cash Flows.
Assumed foreign exchange rates are the following:
|
Assumed foreign exchange rates for the
second half of the fiscal year ending
March 31, 2024
|
(For your reference)
Assumed foreign exchange rates for the fiscal
year ending March 31, 2024 at the time of the
August forecast
|
1 U.S. dollar
|
approximately 142 yen
|
approximately 135 yen
|
1 Euro
|
approximately 152 yen
|
approximately 146 yen
|
Sales are expected to be higher than the August forecast mainly due to higher-than-expected sales in the Game & Network Services (“G&NS”), Music and Imaging & Sensing Solutions (“I&SS”)
segments, partially offset mainly by lower-than-expected sales in the Financial Services segment.
Operating income is expected to remain unchanged due to expected increases in operating income in the Music and I&SS segments, substantially offset by expected decreases in operating income in the
Financial Services and Pictures segments.
Both income before income taxes and net income attributable to Sony Group Corporation’s stockholders are expected to be higher than the August forecast due to an expected increase in financial income, net,
primarily resulting from a decrease in net foreign exchange losses.
Adjusted OIBDA is expected to be higher than the August forecast due to expected increases in Adjusted OIBDA in the Music, I&SS and G&NS segments, partially offset by an expected decrease in Adjusted
OIBDA in the Financial Services segment. Adjusted EBITDA is expected to be higher than the August forecast due to the above-mentioned expected increase in financial income, net, and the same factors affecting Adjusted OIBDA.
The forecast for each business segment for the fiscal year ending March 31, 2024 has been revised as follows:
As the results for the fiscal year ended March 31, 2023 are restated in accordance with IFRS 17, they differ from those disclosed in the earnings release for the fiscal year ended March
31, 2023.
Please refer to “Supplemental Information” on pages 5 to 11 for details of the reconciliation of Adjusted OIBDA from operating income in accordance with IFRS for the fiscal year ended
March 31, 2023.
|
|
(Yen in billions)
|
|
|
|
March 31, 2023
Results
Restated
|
|
|
August
Forecast
|
|
|
November
Forecast
|
|
Game & Network Services (G&NS)
|
|
Sales
|
|
|
3,644.6
|
|
|
|
4,170
|
|
|
|
4,360
|
|
Operating income
|
|
|
250.0
|
|
|
|
270
|
|
|
|
270
|
|
Adjusted OIBDA
|
|
|
337.0
|
|
|
|
375
|
|
|
|
385
|
|
Music
|
|
Sales
|
|
|
1,380.6
|
|
|
|
1,490
|
|
|
|
1,560
|
|
Operating income
|
|
|
263.1
|
|
|
|
280
|
|
|
|
295
|
|
Adjusted OIBDA
|
|
|
316.4
|
|
|
|
335
|
|
|
|
350
|
|
Pictures
|
|
Sales
|
|
|
1,369.4
|
|
|
|
1,470
|
|
|
|
1,460
|
|
Operating income
|
|
|
119.3
|
|
|
|
120
|
|
|
|
115
|
|
Adjusted OIBDA
|
|
|
168.2
|
|
|
|
165
|
|
|
|
165
|
|
Entertainment, Technology & Services (ET&S)
|
|
Sales
|
|
|
2,476.0
|
|
|
|
2,430
|
|
|
|
2,440
|
|
Operating income
|
|
|
179.5
|
|
|
|
180
|
|
|
|
180
|
|
Adjusted OIBDA
|
|
|
276.9
|
|
|
|
280
|
|
|
|
280
|
|
Imaging & Sensing Solutions (I&SS)
|
|
Sales
|
|
|
1,402.2
|
|
|
|
1,560
|
|
|
|
1,590
|
|
Operating income
|
|
|
212.2
|
|
|
|
180
|
|
|
|
195
|
|
Adjusted OIBDA
|
|
|
408.9
|
|
|
|
425
|
|
|
|
440
|
|
Financial Services
|
|
Financial services revenue
|
|
|
889.1
|
|
|
|
1,320
|
|
|
|
1,210
|
|
Operating income
|
|
|
318.1
|
|
|
|
180
|
|
|
|
155
|
|
Adjusted OIBDA
|
|
|
322.4
|
|
|
|
205
|
|
|
|
180
|
|
All Other, Corporate and elimination
|
|
Operating loss
|
|
|
(39.8
|
)
|
|
|
(40
|
)
|
|
|
(40
|
)
|
Adjusted OIBDA
|
|
|
(12.9
|
)
|
|
|
(15
|
)
|
|
|
(15
|
)
|
Consolidated
|
|
Sales
|
|
|
10,974.4
|
|
|
|
12,200
|
|
|
|
12,400
|
|
Operating income
|
|
|
1,302.4
|
|
|
|
1,170
|
|
|
|
1,170
|
|
Adjusted OIBDA
|
|
|
1,816.9
|
|
|
|
1,770
|
|
|
|
1,785
|
|
Adjusted EBITDA
|
|
|
1,797.6
|
|
|
|
1,750
|
|
|
|
1,785
|
|
Game & Network Services (G&NS)
Sales are expected to be higher than the August forecast primarily due to the impact of foreign exchange rates and an expected increase in sales of non-first-party titles including add-on content. Operating
income is expected to remain unchanged from the August forecast mainly due to the impact of the above-mentioned increase in sales of non-first-party titles, substantially offset primarily by the impact of changes in the launch dates of a portion of
first-party titles. Adjusted OIBDA is expected to be higher than the August forecast mainly due to the same factors affecting operating income.
Music
Sales are expected to be higher than the August forecast primarily due to the impact of foreign exchange rates as well as higher sales in mobile game applications in Visual Media & Platform and an
increase in revenues from streaming services in Music Publishing. Operating income and Adjusted OIBDA are expected to be higher than the August forecast due to the positive impact of foreign exchange rates and the impact of the above-mentioned
increase in sales.
Pictures
Sales and operating income are expected to be lower than the August forecast, primarily due to the impact of the
strikes in Hollywood, which is expected to lead to lower revenues mainly due to the impact of release date changes for some theatrical releases and restrictions on promotional activities in Motion Pictures and delays in series deliveries in
Television Productions, partially offset by the impact of foreign exchange rates. Adjusted OIBDA remains unchanged from the August forecast, mainly due to the same factors affecting operating income.
Entertainment, Technology & Services (ET&S)
Sales are expected to be higher than the August forecast due to the impact of foreign exchange rates, partially offset by a decrease in sales of televisions and smartphones resulting from lower unit sales.
The forecasts for operating income and Adjusted OIBDA remain unchanged from the August forecast due to the positive impact of foreign exchange rates, substantially offset by the impact of the above-mentioned decrease in sales of televisions.
Imaging & Sensing Solutions (I&SS)
Sales are expected to be higher than the August forecast mainly due to the impact of foreign exchange rates, partially offset by an expected decrease in sales of image sensors for automotive and for
industrial and social infrastructure. Operating income and Adjusted OIBDA are expected to be higher than the August forecast mainly due to the positive impact of foreign exchange rates and cost reductions, partially offset by the impact of the
above-mentioned expected decrease in sales.
Financial Services
Financial services revenue is expected to be lower than the August forecast primarily due to a decrease in net gains on investments in both the general account and the separate accounts at Sony Life
Insurance Co., Ltd. (“Sony Life”). Operating income and Adjusted OIBDA are expected to be lower than the August forecast primarily due to a deterioration in net gains and losses related to market fluctuations for variable life insurance and other
products at Sony Life.
The effects of future gains and losses on investments held by the Financial Services segment due to market fluctuations have not been incorporated within the above forecast as it is difficult for Sony to
predict market trends in the future. Accordingly, future market fluctuations could further impact the above forecast.
The above forecast is based on management’s current expectations and is subject to uncertainties and changes in circumstances. Actual results may differ materially from those included in this forecast due to
a variety of factors. See “Cautionary Statement” below.
Notes about Financial Performance of the Music, Pictures and Financial Services segments
The Music segment results include the yen-based results of Sony Music Entertainment (Japan) Inc. and the yen-translated results of Sony Music Entertainment and Sony Music Publishing LLC, which aggregate the
results of their worldwide subsidiaries on a U.S. dollar basis.
The Pictures segment results are the yen-translated results of Sony Pictures Entertainment Inc., which aggregates the results of its worldwide subsidiaries on a U.S. dollar basis.
The Financial Services segment results include Sony Financial Group Inc. (“SFGI”) and SFGI’s consolidated subsidiaries such as Sony Life, Sony Assurance Inc. and Sony Bank Inc. The results discussed in the
Financial Services segment differ from the results that SFGI and SFGI’s consolidated subsidiaries disclose separately on a Japanese statutory basis.
Supplemental Information
Regarding Adjusted OIBDA and Adjusted EBITDA
Sony believes that Adjusted OIBDA and Adjusted EBITDA are performance metrics suitable for the long-term management that Sony prioritizes. This is because (i) they represent the sustainable earnings power of
the business as they do not include the effects of one-time gains and losses, (ii) they enable management to confirm that all the businesses of the Sony Group, including the Financial Services business, are expanding over the mid- to long-term
through cycles of investment and return, and (iii) they are often used to calculate corporate value. Adjusted OIBDA and Adjusted EBITDA are not measures in accordance with IFRS. However, Sony believes that these disclosures may be useful information
to investors. Adjusted OIBDA and Adjusted EBITDA should be considered in addition to, not as a substitute for, Sony’s results in accordance with IFRS.
Adjusted OIBDA (Operating Income Before Depreciation and Amortization) is calculated by the following formula:
Adjusted OIBDA = Operating income + Depreciation and amortization expense excluding amortization for film costs and broadcasting rights, as well as for internally developed game content
and master recordings included in Content assets - the profit and loss amount that Sony deems non-recurring
Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is calculated by the following formula:
Adjusted EBITDA = Net income attributable to Sony Group Corporation’s stockholders + Net income attributable to noncontrolling interests + Income taxes + Interest expenses, net, recorded
in Financial income and Financial expense - Gain on revaluation of equity instruments, net, recorded in Financial income and Financial expense + Depreciation and amortization expense excluding amortization for film costs and broadcasting rights, as
well as for internally developed game content and master recordings included in Content assets - the profit and loss amount that Sony deems non-recurring
The following table shows a reconciliation of Adjusted OIBDA from operating income in accordance with IFRS for the three months ended September 30, 2022 and 2023, respectively.
As the results for the three months ended September 30, 2022 are restated in accordance with IFRS 17, they differ from those disclosed in the earnings release for the second quarter of
the fiscal year ended March 31, 2023.
|
|
(Yen in billions)
|
|
|
|
Three months ended September 30
|
|
|
|
2022
Restated
|
|
|
2023
|
|
Game & Network Services (G&NS)
|
|
|
|
|
|
|
Operating income
|
|
|
42.1
|
|
|
|
48.9
|
|
Depreciation and amortization expense*
|
|
|
22.0
|
|
|
|
34.2
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
64.2
|
|
|
|
83.1
|
|
Music
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
78.7
|
|
|
|
81.0
|
|
Depreciation and amortization expense*
|
|
|
14.5
|
|
|
|
16.0
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(5.7
|
)
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
87.5
|
|
|
|
97.0
|
|
Pictures
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
27.6
|
|
|
|
29.4
|
|
Depreciation and amortization expense*
|
|
|
12.8
|
|
|
|
13.1
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
40.4
|
|
|
|
42.6
|
|
Entertainment, Technology & Services (ET&S)
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
77.8
|
|
|
|
61.0
|
|
Depreciation and amortization expense*
|
|
|
24.8
|
|
|
|
26.5
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
102.6
|
|
|
|
87.6
|
|
Imaging & Sensing Solutions (I&SS)
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
74.0
|
|
|
|
46.4
|
|
Depreciation and amortization expense*
|
|
|
48.2
|
|
|
|
60.8
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
122.2
|
|
|
|
107.1
|
|
Financial Services
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
80.0
|
|
|
|
15.7
|
|
Depreciation and amortization expense*
|
|
|
6.5
|
|
|
|
7.0
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(22.1
|
)
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
64.4
|
|
|
|
22.7
|
|
All Other, Corporate and elimination
|
|
|
|
|
|
|
|
|
Operating loss
|
|
|
(10.9
|
)
|
|
|
(19.4
|
)
|
Depreciation and amortization expense*
|
|
|
6.8
|
|
|
|
5.3
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
(4.1
|
)
|
|
|
(14.1
|
)
|
Consolidated
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
369.4
|
|
|
|
263.0
|
|
Depreciation and amortization expense*
|
|
|
135.5
|
|
|
|
162.9
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(27.8
|
)
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
477.1
|
|
|
|
425.9
|
|
The following table shows a reconciliation of net income attributable to Sony Group Corporation’s stockholders reported in accordance with IFRS to Adjusted EBITDA for the three months ended September 30,
2022 and 2023, respectively.
As the results for the three months ended September 30, 2022 are restated in accordance with IFRS 17, they differ from those disclosed in the earnings release for the second quarter of
the fiscal year ended March 31, 2023.
|
|
(Yen in billions)
|
|
|
|
Three months ended September 30
|
|
|
|
2022
Restated
|
|
|
2023
|
|
Net income attributable to Sony Group Corporation’s stockholders
|
|
|
281.7
|
|
|
|
200.1
|
|
Net income attributable to noncontrolling interests
|
|
|
3.7
|
|
|
|
1.1
|
|
Income taxes
|
|
|
85.7
|
|
|
|
56.4
|
|
Interest expenses, net, recorded in Financial income and Financial expense
|
|
|
1.4
|
|
|
|
2.1
|
|
(Gain) / loss on revaluation of equity instruments, net, recorded in Financial income and Financial expense
|
|
|
6.9
|
|
|
|
3.7
|
|
Depreciation and amortization expense*
|
|
|
135.5
|
|
|
|
162.9
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(27.8
|
)
|
|
|
-
|
|
Adjusted EBITDA
|
|
|
487.2
|
|
|
|
426.4
|
|
* Depreciation and amortization expense excludes amortization for film costs and broadcasting rights, as well as for internally developed game content and master recordings included in
Content assets.
** The following table shows the details of the profit and loss amount that Sony deems non-recurring in calculating Adjusted OIBDA and Adjusted EBITDA for the three months ended
September 30, 2022 and 2023, respectively.
|
|
(Yen in billions)
|
|
|
|
Three months ended September 30
|
|
|
|
2022
Restated
|
|
|
2023
|
|
(Profit) / loss amount that Sony deems non-recurring
|
|
|
|
|
|
|
Impact of litigation settlements, net of expenses, received in relation to lawsuits for Recorded Music and Music Publishing (Music segment)
|
|
|
(5.7
|
)
|
|
|
-
|
|
Recovery of an unauthorized withdrawal of funds at a subsidiary of Sony Life which occurred in the three months ended June 30, 2021 (Financial Services segment)
|
|
|
(22.1
|
)
|
|
|
-
|
|
Total
|
|
|
(27.8
|
)
|
|
|
-
|
|
The following table shows a reconciliation of Adjusted OIBDA from operating income in accordance with IFRS for the six months ended September 30, 2022 and 2023, respectively.
As the results for the six months ended September 30, 2022 are restated in accordance with IFRS 17, they differ from those disclosed in the earnings release for the second quarter of the
fiscal year ended March 31, 2023.
|
|
(Yen in billions)
|
|
|
|
Six months ended September 30
|
|
|
|
2022
Restated
|
|
|
2023
|
|
Game & Network Services (G&NS)
|
|
|
|
|
|
|
Operating income
|
|
|
94.9
|
|
|
|
98.1
|
|
Depreciation and amortization expense*
|
|
|
39.5
|
|
|
|
60.9
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
134.4
|
|
|
|
158.9
|
|
Music
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
139.7
|
|
|
|
154.4
|
|
Depreciation and amortization expense*
|
|
|
28.3
|
|
|
|
31.6
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(5.7
|
)
|
|
|
(6.0
|
)
|
Adjusted OIBDA
|
|
|
162.3
|
|
|
|
180.0
|
|
Pictures
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
78.3
|
|
|
|
45.4
|
|
Depreciation and amortization expense*
|
|
|
23.9
|
|
|
|
25.6
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
102.2
|
|
|
|
71.0
|
|
Entertainment, Technology & Services (ET&S)
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
131.4
|
|
|
|
116.7
|
|
Depreciation and amortization expense*
|
|
|
48.1
|
|
|
|
51.8
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
179.5
|
|
|
|
168.4
|
|
Imaging & Sensing Solutions (I&SS)
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
95.7
|
|
|
|
59.1
|
|
Depreciation and amortization expense*
|
|
|
93.8
|
|
|
|
118.1
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
189.5
|
|
|
|
177.2
|
|
Financial Services
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
219.2
|
|
|
|
70.2
|
|
Depreciation and amortization expense*
|
|
|
12.9
|
|
|
|
13.9
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(22.1
|
)
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
210.0
|
|
|
|
84.1
|
|
All Other, Corporate and elimination
|
|
|
|
|
|
|
|
|
Operating loss
|
|
|
(24.9
|
)
|
|
|
(27.8
|
)
|
Depreciation and amortization expense*
|
|
|
13.0
|
|
|
|
10.2
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
(11.9
|
)
|
|
|
(17.6
|
)
|
Consolidated
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
734.3
|
|
|
|
516.1
|
|
Depreciation and amortization expense*
|
|
|
259.5
|
|
|
|
312.0
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(27.8
|
)
|
|
|
(6.0
|
)
|
Adjusted OIBDA
|
|
|
966.0
|
|
|
|
822.0
|
|
The following table shows a reconciliation of net income attributable to Sony Group Corporation’s stockholders reported in accordance with IFRS to Adjusted EBITDA for the six months ended September 30, 2022
and 2023, respectively.
As the results for the six months ended September 30, 2022 are restated in accordance with IFRS 17, they differ from those disclosed in the earnings release for the second quarter of the
fiscal year ended March 31, 2023.
|
|
(Yen in billions)
|
|
|
|
Six months ended September 30
|
|
|
|
2022
Restated
|
|
|
2023
|
|
Net income attributable to Sony Group Corporation’s stockholders
|
|
|
542.8
|
|
|
|
417.7
|
|
Net income attributable to noncontrolling interests
|
|
|
3.8
|
|
|
|
1.4
|
|
Income taxes
|
|
|
173.8
|
|
|
|
114.5
|
|
Interest expenses, net, recorded in Financial income and Financial expense
|
|
|
2.2
|
|
|
|
2.6
|
|
(Gain) / loss on revaluation of equity instruments, net, recorded in Financial income and Financial expense
|
|
|
29.7
|
|
|
|
(9.6
|
)
|
Depreciation and amortization expense*
|
|
|
259.5
|
|
|
|
312.0
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(27.8
|
)
|
|
|
(6.0
|
)
|
Adjusted EBITDA
|
|
|
984.0
|
|
|
|
832.6
|
|
* Depreciation and amortization expense excludes amortization for film costs and broadcasting rights, as well as for internally developed game content and master recordings included in
Content assets.
** The following table shows the details of the profit and loss amount that Sony deems non-recurring in calculating Adjusted OIBDA and Adjusted EBITDA for the six months ended September
30, 2022 and 2023, respectively.
|
|
(Yen in billions)
|
|
|
|
Six months ended September 30
|
|
|
|
2022
Restated
|
|
|
2023
|
|
(Profit) / loss amount that Sony deems non-recurring
|
|
|
|
|
|
|
Impact of litigation settlements, net of expenses, received in relation to lawsuits for Recorded Music and Music Publishing (Music segment)
|
|
|
(5.7
|
)
|
|
|
-
|
|
Recovery of an unauthorized withdrawal of funds at a subsidiary of Sony Life which occurred in the three months ended June 30, 2021 (Financial Services segment)
|
|
|
(22.1
|
)
|
|
|
-
|
|
Remeasurement gain resulting from the consolidation of a company previously accounted for using the equity method (Music segment)
|
|
|
-
|
|
|
|
(6.0
|
)
|
Total
|
|
|
(27.8
|
)
|
|
|
(6.0
|
)
|
The following table shows a reconciliation of Adjusted OIBDA from operating income in accordance with IFRS for the fiscal year ended March 31, 2023.
As the results for the fiscal year ended March 31, 2023 are restated in accordance with IFRS 17, they differ from those disclosed in the earnings release for the fiscal year ended March
31, 2023.
|
|
(Yen in billions)
|
|
|
|
Fiscal year ended
March 31, 2023
|
|
|
|
Restated
|
|
Game & Network Services (G&NS)
|
|
|
|
Operating income
|
|
|
250.0
|
|
Depreciation and amortization expense*
|
|
|
87.0
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
337.0
|
|
Music
|
|
|
|
|
Operating income
|
|
|
263.1
|
|
Depreciation and amortization expense*
|
|
|
59.0
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(5.7
|
)
|
Adjusted OIBDA
|
|
|
316.4
|
|
Pictures
|
|
|
|
|
Operating income
|
|
|
119.3
|
|
Depreciation and amortization expense*
|
|
|
48.9
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
168.2
|
|
Entertainment, Technology & Services (ET&S)
|
|
|
|
|
Operating income
|
|
|
179.5
|
|
Depreciation and amortization expense*
|
|
|
97.4
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
276.9
|
|
Imaging & Sensing Solutions (I&SS)
|
|
|
|
|
Operating income
|
|
|
212.2
|
|
Depreciation and amortization expense*
|
|
|
196.7
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
408.9
|
|
Financial Services
|
|
|
|
|
Operating income
|
|
|
318.1
|
|
Depreciation and amortization expense*
|
|
|
26.3
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(22.1
|
)
|
Adjusted OIBDA
|
|
|
322.4
|
|
All Other, Corporate and elimination
|
|
|
|
|
Operating loss
|
|
|
(39.8
|
)
|
Depreciation and amortization expense*
|
|
|
26.8
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
-
|
|
Adjusted OIBDA
|
|
|
(12.9
|
)
|
Consolidated
|
|
|
|
|
Operating income
|
|
|
1,302.4
|
|
Depreciation and amortization expense*
|
|
|
542.2
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(27.8
|
)
|
Adjusted OIBDA
|
|
|
1,816.9
|
|
The following table shows a reconciliation of Adjusted EBITDA from net income attributable to Sony Group Corporation’s stockholders in accordance with IFRS for the fiscal year ended March 31, 2023.
As the results for the fiscal year ended March 31, 2023 are restated in accordance with IFRS 17, they differ from those disclosed in the earnings release for the fiscal year ended March
31, 2023.
|
|
(Yen in billions)
|
|
|
|
Fiscal year ended
March 31, 2023
|
|
|
|
Restated
|
|
Net income attributable to Sony Group Corporation’s stockholders
|
|
|
1,005.3
|
|
Net income attributable to noncontrolling interests
|
|
|
6.5
|
|
Income taxes
|
|
|
262.7
|
|
Interest expenses, net, recorded in Financial income and Financial expense
|
|
|
4.0
|
|
(Gain) / loss on revaluation of equity instruments, net, recorded in Financial income and Financial expense
|
|
|
4.6
|
|
Depreciation and amortization expense*
|
|
|
542.2
|
|
(Profit) / loss amount that Sony deems non-recurring**
|
|
|
(27.8
|
)
|
Adjusted EBITDA
|
|
|
1,797.6
|
|
* Depreciation and amortization expense excludes amortization for film costs and broadcasting rights, as well as for internally developed game content and master recordings
included in Content assets.
** The following table shows the details of the profit and loss amount that Sony deems non-recurring in calculating Adjusted OIBDA and Adjusted EBITDA for the fiscal year
ended March 2023.
|
|
(Yen in billions)
|
|
|
|
Fiscal year ended
March 31, 2023
|
|
|
|
Restated
|
|
(Profit) / loss amount that Sony deems non-recurring
|
|
|
|
Impact of litigation settlements, net of expenses, received in relation to lawsuits for Recorded Music and Music Publishing (Music segment)
|
|
|
(5.7
|
)
|
Recovery of an unauthorized withdrawal of funds at a subsidiary of Sony Life which occurred in the three months ended June 30, 2021 (Financial Services segment)
|
|
|
(22.1
|
)
|
Total
|
|
|
(27.8
|
)
|
Cautionary Statement
Statements made in this release with respect to Sony’s current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking statements about the future
performance of Sony. Forward-looking statements include, but are not limited to, those statements using words such as “believe,” “expect,” “plans,” “strategy,” “prospects,” “forecast,” “estimate,” “project,” “anticipate,” “aim,” “intend,” “seek,”
“may,” “might,” “could” or “should,” and words of similar meaning in connection with a discussion of future operations, financial performance, events or conditions. From time to time, oral or written forward-looking statements may also be included in
other materials released to the public. These statements are based on management’s assumptions, judgments and beliefs in light of the information currently available to it. Sony cautions investors that a number of important risks and uncertainties
could cause actual results to differ materially from those discussed in the forward-looking statements, and therefore investors should not place undue reliance on them. Investors also should not rely on any obligation of Sony to update or revise any
forward-looking statements, whether as a result of new information, future events or otherwise. Sony disclaims any such obligation. Risks and uncertainties that might affect Sony include, but are not limited to:
(i)
|
Sony’s ability to maintain product quality and customer satisfaction with its products and services;
|
(ii)
|
Sony’s ability to continue to design and develop and win acceptance of, as well as achieve sufficient cost reductions for, its products and services, including image sensors, game and network platforms, smartphones and televisions, which
are offered in highly competitive markets characterized by severe price competition and continual new product and service introductions, rapid development in technology and subjective and changing customer preferences;
|
(iii)
|
Sony’s ability to implement successful hardware, software, and content integration strategies, and to develop and implement successful sales and distribution strategies in light of new technologies and distribution platforms;
|
(iv)
|
the effectiveness of Sony’s strategies and their execution, including but not limited to the success of Sony’s acquisitions, joint ventures, investments, capital expenditures, restructurings and other strategic initiatives;
|
(v)
|
changes in laws, regulations and government policies in the markets in which Sony and its third-party suppliers, service providers and business partners operate, including those related to taxation, as well as growing consumer focus on
corporate social responsibility;
|
(vi)
|
Sony’s continued ability to identify the products, services and market trends with significant growth potential, to devote sufficient resources to research and development, to prioritize investments and capital expenditures correctly and
to recoup its investments and capital expenditures, including those required for technology development and product capacity;
|
(vii)
|
Sony’s reliance on external business partners, including for the procurement of parts, components, software and network services for its products or services, the manufacturing, marketing and distribution of its products, and its other
business operations;
|
(viii)
|
the global economic and political environment in which Sony operates and the economic and political conditions in Sony’s markets, particularly levels of consumer spending;
|
(ix)
|
Sony’s ability to meet operational and liquidity needs as a result of significant volatility and disruption in the global financial markets or a ratings downgrade;
|
(x)
|
Sony’s ability to forecast demands, manage timely procurement and control inventories;
|
(xi)
|
foreign exchange rates, particularly between the yen and the U.S. dollar, the euro and other currencies in which Sony makes significant sales and incurs production costs, or in which Sony’s assets, liabilities and operating results are
denominated;
|
(xii)
|
Sony’s ability to recruit, retain and maintain productive relations with highly skilled personnel;
|
(xiii)
|
Sony’s ability to prevent unauthorized use or theft of intellectual property rights, to obtain or renew licenses relating to intellectual property rights and to defend itself against claims that its products or services infringe the
intellectual property rights owned by others;
|
(xiv)
|
the impact of changes in interest rates and unfavorable conditions or developments (including market fluctuations or volatility) in the Japanese equity markets on the revenue and operating income of the Financial Services segment;
|
(xv)
|
shifts in customer demand for financial services such as life insurance and Sony’s ability to conduct successful asset liability management in the Financial Services segment;
|
(xvi)
|
risks related to catastrophic disasters, geopolitical conflicts, pandemic disease or similar events;
|
(xvii)
|
the ability of Sony, its third-party service providers or business partners to anticipate and manage cybersecurity risk, including the risk of unauthorized access to Sony’s business information and the personally identifiable information
of its employees and customers, potential business disruptions or financial losses; and
|
(xviii)
|
the outcome of pending and/or future legal and/or regulatory proceedings.
|
Risks and uncertainties also include the impact of any future events with material adverse impact. The continued impact of developments relating to the situations in Ukraine and Russia and in Israel and
Palestine could heighten many of the risks and uncertainties noted above. Important information regarding risks and uncertainties is also set forth in Sony’s most recent Form 20-F, which is on file with the U.S. Securities and Exchange Commission.