http://www.forbes.com/technology/feeds/afx/2007/05/09/afx3700516.html
TOKYO (XFN-ASIA) - Namco Bandai Holdings Inc reported its net profit for the fiscal year ended March 31 climbed 71 pct to 24.2 bln yen, buoyed by brisk sales of DVDs and game software, but the company predicts earnings
growth in the current year will be slower because of the lower-than-expected sales of games for Sony Corp (nyse: SNE - news - people )'s PlayStation 3.
The holding company for toymaker Bandai and game publisher and game arcade facility operator Namco said operating profit rose 18 pct to 42.2 bln yen, while sales increased 2 pct to 459.1 bln yen.
'Sales of the DVD box featuring our original Mobile Suit Gundam TV animation series was a smash hit beyond our wild expectations, which boosted profit margin,' Namco Bandai president Takeo Takasu told a news conference.
The company's movie/music content division logged operating profit of 9.5 bln yen for the past year to March, up from 6.2 bln yen a year earlier.
Namco Bandai, Japan's second-largest video game developer, said its game segment and amusement facilities also helped, as operating income from this businesses grew 18.6 pct and 112.0 pct, respectively.
The company closed some 46 unprofitable amusement facilities during the past fiscal year and
plans to shut another 40 outlets in the current business year.
For the year to March 2008, Namco Bandai forecast slower profit growth due to the
weaker-than-expected start up of Sony''s PlayStation 3 game consoles.
The company projected a 9.3 pct rise in net profit to 26.5 bln yen, a 6.6 pct increase in operating
income to 45 bln yen and a 4.5 pct expansion in sales to 480 bln yen.
'PS3 did not make a good start, which will make the transition from the old game console to the next generation system more prolonged than we had earlier thought,' Takasu said.
'This will keep a lid on sales of our video games in the first half, although we believe that sales of
PS3 will increase in the second half (to March 2008),' he said.
Namco Bandai said it has sold only 300,000 copies of the 'Gundam Muso' game, which were released exclusively for PS3, far lower than its initial plan to sell at least 500,000 copies.
Because of sluggish sales, Namco Bandai plans to release only 23 titles for PS3 in the current fiscal year, compared to 24 games to be sold to Microsoft Corp (nasdaq: MSFT - news - people )'s Xbox360 and 37 titles to be released for Nintendo Co Ltd (other-otc: NTDOY.PK - news - people )'s Wii console.
