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Bandai Namco to focus on creating new properties as profits slide

As part of its new 'Change for the Next' strategy, Bandai says it will "invest aggressively" in the development of new properties by opening a dedicated IP creation unit.

Bandai Namco has revised its business strategy as it looks to gain momentum following its latest results. 

According to the company's financials for the nine months ended December 31, 2017, year-over-year sales were up by 5.2 percent to 483.2 billion yen ($4.44 billion), but profits were down by 12.1 percent to 40.8 billion yen ($375.4 million). 

In the firm's Network Entertainment division, which houses its video game operations, nine-month sales rose by 9.4 percent to 285.3 billion yen ($2.62 billion), while operating profit slipped by 5.7 percent to 33.8 billion yen ($311 million). 

Global home video game sales were also down, falling to 16.8 million units in FY2018 from 19.67 million units in FY2017. That's despite the fact that Bandai actually launched 128 new titles this year, compared to just 90 during the previous fiscal year.

Dragon Ball Z was the company's most lucrative IP by a long shot, with nine-month sales totaling 65.4 billion yen ($601.6 million). That was followed by Mobile Suit Gundam, which raked in 50.4 billion yen ($463.6 million), and One Piece, which pulled in sales of 22.3 billion yen ($205.2 million). 

Based on those results, Bandai wants to implement a new three-year plan to drive the creation of new properties and strengthen its position in the global market. 

As part of that new 'Change for the Next' strategy, the company will "invest aggressively" in the development of new properties by opening a dedicated IP creation unit, and make a "full-blown" entry into the Chinese market. 

It also intends to implement a new regionally-focused 'All Bandai Namco' structure, allowing it to share expertise between units in every region to devise and implement market-specific sales strategies. 

Looking ahead, Bandai expects to see sales in the Network Entertainment segment total 380 billion yen ($3.5 billion) by the end of the fiscal year -- a 6.9 percent increase on FY2017. Operating profits, meanwhile, are predicted to slide by 14.4 percent year-on-year to 36 billion yen ($331.2 million).

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