February 10, 2009

ＦＬＡＳＨ ＲＥＰＯＲＴ
CONSOLIDATED FINANCIAL STATEMENTS
9 Months Ended December 31, 2008
Name of the Company :
SEGA SAMMY HOLDINGS INC.
Code number :

6460
(URL http://www.segasammy.co.jp/ )
Representative:
Hajime Satomi
Chairman of the Board and Chief Executive Officer
Any inquiry to :
Shunichi Shimizu
General Manager, Accounting and Financial Department Shiodome Sumitomo Building 21F, 1-9-2 Higashi Shimbashi, Minato-ku, Tokyo
Tel (03) 6215-9955
Filing of Quarterly Report: February 13, 2009 (plan)
(Amounts below one million yen are rounded down)
1. Consolidated Operating Results for the 9 Months Ended December 31, 2008 (1)

RESULTS OF CONSOLIDATED OPERATIONS
(Percentage for net sales, operating income and net income represent change from the prior period)

Net sales
Operating income
Net income

Millions of Yen
%
Millions of Yen
%
Millions of Yen
%
For 9 months ended December 31, 2008
309,018
－
(2,757)
－
(10,840)
－
For 9 months ended December 31, 2007
342,092 (15.4)
(1,528) －
(15,766)
－
Net income
per share
Net income per
share (Diluted)
Yen
Yen
For 9 months ended December 31, 2008
(43.03)
－
For 9 months ended December 31, 2007
(62.58)
－

(2) CONSOLIDATED FINANCIAL POSITION

Total assets
Net assets
Equity ratio
Net assets per share

Millions of Yen
Millions of Yen
%
Yen
December 31, 2008
449,050
254,358
52.2
929.90
March 31,2008
469,642
281,627
55.3
1,030.09
(Reference) Shareholders’ equity:
December 31, 2008

: ¥234,267 million
March 31, 2008

: ¥259,519 million
1

2. Cash Dividends
Cash dividends per share

First
quarter
Second
quarter
Third
quarter
Year-end
For the year
Yen
Yen
Yen
Yen Yen
Year ended
March 31, 2008
－
30.00
－
15.00 45.00
Year ended
March 31, 2009
－
15.00
－
―
―
Year ended March
31, 2009 (plan)
―
―
―

15.00
30.00
(Note) Revision of the forecast in the third quarter of the year ended March 31, 2009: No 3. Projection for Consolidated Results for the Year ended March 31, 2009
(Percentage for net sales, operating income and net income represent change from the prior year)

Net sales
Operating income
Net income
Net income
per share

Millions of Yen
%
Millions of Yen
%
Millions of Yen
%
Yen
Entire – year
435,000
(5.2)
2,500
－
(21,500)
－
(85.34)
(Note) Revision of the projection in the third quarter of the year ended March 31, 2009: Yes
4. Other (1) Significant changes in subsidiaries (scope of consolidation) during period: No (2) Adoption of the simplified method of accounting as well as specific accounting for preparing the quarterly
consolidated financial statements: Yes

(3)

Changes in accounting principles, procedures, disclosure methods, etc., for preparing the quarterly consolidated
financial statements:
1. Changes associated with revision in accounting standards: Yes 2. Other changes: Yes (4)

Number of shares outstanding (common stock)
1. Number of shares outstanding at the end of the period (including treasury stock) December 31, 2008 : 283,229,476
March 31, 2008

: 283,229,476

2. Number of treasury stock at the end of the period
December 31, 2008 : 31,302,189
March 31, 2008

: 31,292,007
3. Average number of shares during the period (cumulative from the beginning of the fiscal year)
For 9 months ended December 31, 2008: 251,932,752

For 9 months ended December 31, 2007: 251,945,273

2

[Caution With Regard to Operating Results Outlook]
- Commencing with the current period, the “Accounting Standard for Quarterly Financial Reporting” (Accounting Standards Board of Japan (ASBJ) Statement No. 12) and the “Guidance on Accounting Standard for Quarterly Financial Reporting” (ASBJ Guidance No. 14) are applied. Also, the quarterly consolidated financial statements are prepared in accordance with the “Regulation for Quarterly Consolidated Financial Statements.” - Statements in this report pertaining to market projections and the outlook for operating results reflect the assumptions and judgment of the Company’s management based on the most accurate information available at the time of release. Such statements carry inherent risks and uncertainties. Factors that may affect operating results include, but are not limited to, those discussed in the projections and outlook. Readers are cautioned that changes in a variety of factors could cause actual results to differ substantially from the aforementioned projections and outlook.

Operating Results and Financial Position

(1) Overview
During the first three quarters of the fiscal year ending March 31, 2009, the Japanese economy faced more severe hardships as pressure on corporate earnings from the ongoing and sharp rise in the yen, the country’s worsening job picture, and other factors amid continued turmoil in the global financial markets, raised concerns that the real economy would slow further. In this environment, the momentum in the pachislot and pachinko industry to replace older pachinko machines with models offering more diverse gameplay remained strong as the industry responds to recent revisions to regulations pertaining to the Entertainment Establishments Control Law of Japan. Meanwhile, the partial amendment in March 2008 of Standards for Interpretation of Technical Specifications is expected to invigorate the pachislot machine market by stimulating the development and supply of highly original pachislot machines with an emphasis on outstanding gameplay. In the amusement center industry, fueled by economic uncertainty, the market continues to confront an increasingly harsh business environment due mainly to sluggish individual consumption. The market awaits the appearance of new game machines that will lead the market by meeting a wide range of customer needs, including those of families and casual players. In the home video game software industry, while the demand growth for software has leveled off in Japan, reflecting the widespread purchase of the current generation of game platforms, demand continues to hold firm in Europe and North America. As a result, consolidated net sales totaled ¥309,018 million during the first three quarters of the current fiscal year. The Company posted an operating loss for the first three quarters of ¥2,757 million, and a net loss of ¥10,840 million for the first three quarters, due to such factors as the sales of noncurrent assets, and the amortization of goodwill. Results by business segment were as follows. 《Pachislot and Pachinko Machines》 In the pachinko machine business, the Company continued to sell its major title for the year, “Pachinko CR Hokuto No Ken,” released in the second quarter under the Sammy brand, selling a cumulative total of more than 180 thousand units, and bringing overall pachinko machine sales to 237 thousand units for the period. In the pachislot machine business, reflecting improved gameplay enabled by partial amendment of Standards for Interpretation of Technical Specifications, the Company launched well-received machines that included “Pachislot Hard Boiled” under the Sammy brand and “KAIDOU-MOKUSHIROKU KAIJI 2” under the RODEO brand. Consequently, overall pachislot machine sales amounted to 108 thousand units for the period. As a result, the segment recorded net sales of ¥106,951 million and operating income of ¥5,292 million for the period under review.
3

《Amusement Machine Sales》 In the amusement machine sales business, the Company continued to sell major titles released for the year that included “WORLD CLUB Champion Football Intercontinental Clubs 2006-2007
,
” a trading card game and
“GALILEO FACTORY,” a large medal game. The segment recorded net sales of ¥52,798 million, and operating income of ¥6,221 million. 《Amusement Center Operations》 In amusement center operations, fueled by economic uncertainty, same-store sales, particularly in suburban areas, were hit by sluggish personal consumption, and performed at a lower level in year-on-year terms. While the Company has closed 22 amusement centers in Japan that have shown low profitability and low prospects for improvement, as a result of 6 new amusement center openings, the number of amusement centers totaled 347 at the end of the period. Consequently, segment net sales were ¥54,422 million with an operating loss of ¥4,970 million. 《Consumer Business》 In the consumer business, overseas home video game software sales were firm thanks to favorable year-end sales of major titles released for the fiscal year, such as “Sonic Unleashed” and “Football Manager 2009,” as well as titles such as “Mario & Sonic at the Olympic Games” released in the previous year. In contrast, sales of titles in Japan were sluggish during the year-end selling season. Consequently, the segment recorded total video game sales of 21,090 thousand copies for the period, with 8,820 thousand copies sold in the U.S., 9,130 thousand copies sold in Europe, and 3,130 thousand copies sold in Japan and other regions. As a result of the foregoing, net sales in the segment amounted to ¥96,216 million, with an operating loss of ¥5,647 million. (2) Consolidated Financial Position Total assets as of December 31, 2008 were ¥449,050 million, a decrease of ¥20,592 million from the prior fiscal year-end. This was primarily attributable to a decrease of ¥41,896 million in noncurrent assets, mainly due to a decrease in intangible assets such as goodwill, and property, plant and equipment such as land, despite an increase in current assets due to an increase of ¥24,701 million in short-term investment securities, such factors as negotiable certificates of deposit. Net assets were ¥254,358 million, a decrease of ¥27,269 million from the prior fiscal year-end, largely due to a net loss, the payment of dividends, and a decrease in foreign currency translation adjustment due to fluctuations in the currency market. The current ratio remained at a high level of 271.5%, up 64.5 points from the prior fiscal year-end. As a result, the equity ratio was 52.2%, down 3.1 points from the prior fiscal year-end.

(3) Projection for Consolidated Results Full-year consolidated forecasts for the current fiscal year are as announced in the “Notice of Adjustment to the Forecast of Whole-Year Consolidated Operating Results for the Year Ending March 31, 2009” on February 10, 2009.
4

CONSOLIDATED FINANCIAL STATEMENTS

SEGA SAMMY HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2008 AND MARCH 31, 2008
（Unit：Millions of Yen）
Current period
(As of December 31,2008)
Prior year
(As of March 31,2008)

Amount Amount
（
A
s
s
e
t
s
）
Ⅰ Current Assets

Cash and deposits

103,796
101,539
Notes and accounts receivable – trade

76,576
72,541
Allowance for doubtful accounts

(639)
(571)
Short-term investment securities

27,197
2,495
Merchandise and finished goods

10,271
13,727
Work in process

4,397
3,181
Raw materials and supplies

31,766
34,526
Other

42,975
47,597
Total current assets

296,342
275,038
Ⅱ Noncurrent assets

Property, plant and equipment

Land

23,473
48,810
Other

52,117
55,218
Total property, plant and equipment

75,590
104,029
Intangible assets

Goodwill

6,909
13,524
Other

6,838
6,692
Total intangible assets

13,747
20,217
Investments and other assets

Investment securities

32,962
35,608
Other

38,342
42,180
Allowance for doubtful accounts

(7,935)
(7,430)
Total investments and other assets

63,369
70,358
Total noncurrent assets

152,708
194,604
Total assets

449,050
469,642
5