Sony Group Corporation saw gains in sales and net profits in the fourth quarter of its financial year, but full year profits shaded down by 14%. For the newly begun financial year, running from April 2022 to March 2023, it forecasts further downward pressure on profits.
Sales in the January to March period increased 1% to JPY2.26 trillion. Net Income surged ahead by 67% to JPY111 billion.
But the profits increase was not enough to stop the 12-month figures from turning downwards. Sales in the 2021-22 financial year increased by 10% to JPY9.92 trillion, but net profits fell from JPY1.03 trillion to JPY882 billion.
For the 2022-23 financial year, the group issued guidance indicating a 15% increase in sales, to JPY11.4 trillion, but a 6% deterioration in net profitability, and a fall to JPY830 billion.
The Pictures Division, which spans feature film, TV networks and television production, had a strong fourth quarter and a strong full year. In the fourth quarter it made profits of $101 million on revenues of $2.69 billion. Over 12 months it made profits of $1.94 billion (more than double the previous year’s $756 million) on revenues of $11 billion (compared with $7.10 billion previously).
Within the division sales gains came across the board, film, streaming revenues, licensing of catalog (“Seinfeld” in particular and the integration of the Crunchyroll acquisition. Profit margins became thinner as the unit felt the return to the full cost of feature film marketing, which had been curtailed during the height of the pandemic. It put 14 films into theatrical release (including hits “Venom: Let There Be Carnage,” “Spider-Man: No Way Home” and “Uncharted”) compared with six films in 2020-21 for a combined gross box office of just $46 million.
For the current year, Sony is forecasting that the pictures division’s profits will be reduced by more than half as such a string of hit films is unlikely to be repeated.
– More to follow.