Square Enix 2004 Annual Report Download - page 15

SQUARE ENIX 2004 13
3. Analysis of Business Performance for Fiscal 2004
Total Assets
(Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Total Assets 57,465 54,354 111,819 110,633 (1,186)
As of March 31, 2004, total assets amounted to ¥110,633 million, a
decrease of ¥1,186 million from the Simple Total of ¥111,819 million a
year earlier. A breakdown follows:
Cash and Time Deposits
(Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Cash and Time 39,847 23,219 63,066 58,676 (4,390)
Deposits
Net cash provided by operating activities was ¥14,139 million. Net cash
used in investing activities totaled ¥10,579 million, owing primarily to
expenses related to the move of headquarters in July 2003 to combine the
employees of the former two companies in one location, and expenditures
for the acquisition of UIEVOLUTION INC. in the United States. These
were one-time factors.
Net cash used in financing activities was ¥6,739 million, as a result of
the payment of ¥69 per share to former SQUARE shareholders instead of
ordinary dividends as part of the merger procedure. Cash and cash equiva-
lents, end of period amounted to ¥58,676 million, a decrease of ¥4,390 mil-
lion from the Simple Total a year earlier.
Notes and Accounts Receivable
(Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Notes and 5,150 11,808 16,958 12,046 (4,912)
accounts
receivable
Notes and accounts receivable is largely affected by the release of titles by
the end of the fiscal year. As of March 31, 2003, the former SQUARE had
shipped 1.95 million copies of FINAL FANTASY X-2, and the former
ENIX had shipped 550,000 copies of Dragon Quest Monsters: Caravan
Heart. By March 31, 2004, the Company had shipped 1.3 million copies of
Dragon Quest V: Tenkuu no Hanayome. Due to a difference in the num-
ber of titles sold at the end of respective fiscal year, notes and accounts
receivable decreased ¥4,912 million to ¥12,046 million on March 31, 2004.
Content Production Account
(Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Content — 3,679 3,679 10,128 6,449
Production
Account
At the former ENIX, payments to external developers in charge of plan-
ning and creating game titles were charged as expenses when incurred.
From this Fiscal Year, however, the Company capitalizes payments during
the development process in the content production account until the time
of product launch. This change was made as a result of the Company
strengthening the decision-making process at the start of game title devel-
opment with stricter standards for starting title development projects. The
content production account includes the amount of ¥3,763 million used in
this Fiscal Year for development of titles started by ENIX. All of the devel-
opment costs of titles started by the former SQUARE were accounted for
the content production account as before.
In the event that a title development project is canceled, the Company
may write off capitalized development costs for the canceled title in the
content production account as an extraordinary loss. In this Fiscal Year, no
title development projects were canceled. As of March 31, 2004, the con-
tent production account totaled ¥10,128 million, an increase of ¥6,449 mil-
lion from the end of the previous fiscal year.
Deferred Tax Assets
(Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Deferred Tax 941 3,257 4,198 1,850 (2,348)
Assets
Deferred tax assets at the end of the Fiscal Year were ¥1,850 million, a
decline of ¥2,348 million, owing mainly to the reversal of a deductible
temporary difference in the movie assets at the former SQUARE.
Property, Plant and Equipment
(Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Property, 5,188 3,821 9,009 9,087 78
Plant and
Equipment
Property, plant and equipment totaled ¥9,087 million as of March 31,
2004, an increase of ¥78 million from the previous fiscal year. Buildings
and structures increased ¥307 million to ¥2,195 million, tools and fixtures
declined ¥176 million to ¥3,077 million, land was unchanged at ¥3,813 mil-
lion, and construction in progress decreased ¥53 million to ¥0.