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for Shareholders and Investors Online Report

* Updated in August 2022

This section includes the message from the president to shareholders and investors and summarizes information including the details of company activities.
Past annual reports and notices to shareholders are also listed here.

Message from the President

Earnings Results for FY2021

Representative Director, CEO
Katsumi Kuroiwa

In the fiscal year ended March 2022, the Group set itself two missions, establish a revenue structure that does not depend on a recovery of the live concert market and move into the global and new technology markets. To establish a new earnings structure, the Group signed new contracts with artists, celebrities, personalities, and creative professionals popular among young people. In addition, we engaged in content production, launched a paid distribution service for online live performances and expanded the market for a music streaming service. The Group also pursued initiatives aimed at the future possibilities of entertainment in the global and new technology markets, including the development and launch of new artists targeting the global market and the sales of NFT content in the virtual world known as the "metaverse."

In addition, the Company relocated its head office in March 2022 and gathered various companies and divisions from the Avex Group at the largest one-floor working space (approx. 750 seats) in Tokyo to promote teamwork and active communication. The Group also promoted hybrid working styles allowing employees to select more accessible flexible working styles using approximately 400 new co-working spaces.

In addition to these activities, an increase in the number of live events thanks to the gradual easing of restrictions on live events and strong sales of music packaged products resulted in year-on-year growth in sales. As a result, net sales amounted to 98,437 million yen (up 20.7% year on year) with an operating income of 2,582 million yen (up from an operating loss of 6,278 million yen in the previous period), marking a period of increase to both sales and profit. Profit attributable to owners of parent fell 919 million yen (down 92.8% year on year) due to the posting of significant extraordinary income, including gain on the sale of noncurrent assets in the preceding period.

Business Environment

In the domestic music market, the market for packaged music has been on the decline since peaking in 2000, but in recent years the decline has eased. I believe that one of the factors behind this is that demand for high unit-value products has risen due to Japan's high-quality packaged goods being offered in a format that enhances their value to fans. Meanwhile, the digitalization of the online distribution market has steadily expanded. Streaming, in particular, has continued strong growth, with the size of the market increasing around 1.3 times the previous year, and is expected to overtake the package market within the next several years.
The global music market, as with Japan, has seen a declining trend in the market for packaged music, but the decline has been covered through streaming and other digital formats, transforming into a growth market around 2014. Particularly in the Asian market, excluding Japan, sales have been growing to around 1.3 times the previous year.

In this way, the music industry is a global growth industry, and even by its size, I believe the Japanese market can also change into an extremely promising one.

Digitalization has changed the environment for monetization, boosting the value of the intellectual property. We will shift away from temporary monetization focused on expanding the range of sales at a given time, like packaged product sales, enabling ongoing monetization through streaming and online distribution. In fact, looking at total revenue for the top five artists in the world, steaming and rights-based revenue already far exceeds packaged music sales.

For the animation and video market, despite a temporary downturn in the domestic market due to the COVID-19 pandemic in 2020, recently the size of the overseas animation market exceeded that of the domestic animation market for the first time.

With digital video distribution platforms exhibiting continued growth, there are more opportunities where Japanese animation is being demanded overseas, and progress has been made in reaching agreements with overseas entities for many animations and video titles. This expansion, in terms of both area and recognition, has led to ongoing growth in the number of participants related to animation and video IPs.

Formulating the avex vision 2027 Medium-term Management Plan

To clarify the purpose of its corporate activities and the social significance of its presence in light of these changes to the market environment, Avex defined a new corporate philosophy and formulated the avex vision 2027 Medium-term Management Plan, with the fiscal year ending March 2027 as its final year.

Check here for an overview of the Medium-term Management Plan

Forecast for the Fiscal Year Ending March 2023 and Shareholder Return

Although we expect a reduced impact from the COVID-19 pandemic, we will make investments in IPs to achieve the goals of the Medium-term Management Plan, As a result, we forecast operating income of 1 billion yen (down 61.3% year on year) and profit attributable to owners of parent of 400 million yen (down 56.5% year on year) for our forecast for the fiscal year ending March 2023.

We have a payout policy of maintaining a consolidated payout ratio of at least 35% and paying an annual dividend of at least 50 yen per share. For the fiscal year ended March 2022, we offered an annual dividend of 50 yen per share. For the fiscal year ending March 2023, we plan to pay an annual dividend of 50 yen per share in accordance with this policy.

Check detailed information about our business results and financial situation here
Check the IR library here

TOPICS

Music

Japanese Dance & Vocal Group Da-iCE Becomes First to Have a Song Reach 100 million Streams on a Subscription Platform

CITRUS was released in November 2020, and the song gained attention from a wide audience as the theme song for a popular TV drama and later went on to become the first song in Japanese history from a dance & vocal group to reach 100,000,000 streams on a subscription platform (*over 200 million as of March 2022). Not only that, but the song also received the 63rd Japan Record Award!


Avex Organizes World Tour of "FASHION FREAK SHOW" Musical with Involvement of World-Renowned Fashion Designer Jean Paul Gaultier

Avex Entertainment Inc. will be staging the world tour of FASHION FREAK SHOW, a musical that features involvement of world-renowned fashion designer Jean Paul Gaultier. The world tour kicks off in London in July 2022, and is scheduled to continue in 15 countries in regions worldwide including Europe, Asia, Oceania, and North America. The tour is scheduled to arrive in Japan around spring 2023.

Management

Marie Iitoyo Stars in Chimudondon, a 2022 Serialized NHK TV Drama

Marie Iitoyo stars as the former girlfriend of Kazuhiko, the childhood friend of heroine Nobuko in Chimudondon, a serialized NHK TV drama which began airing in April 2022.


Meru Nukumi is Active as a Model, Talent, and Actress

Meru Nukumi, also known as Meruru, was ranked first in the 2021 TV Commercial Surge Ranking announced by M Data Co., Ltd., and her TV commercial appearances have increased eight more than the previous year, 2020.
My Boyfriend in Orange, the first film in which Meru starred as the heroine, also was ranked first in Japanese film rankings after its release in July. She is active as a model, talent, and actress.

Global

Jeddah Season 2022 Opens in Saudi Arabia, Hosting a Gathering of Popular Anime in the Anime Village within the City Walk Area

At Jeddah Season 2022, a local Saudi Arabian event, Avex will be producing Anime Village, an experience-based event area with popular Japanese content and intellectual property, from Thursday, May 19 to Saturday, July 2, 2022.


A Group of Contracted Avex USA Music Publishing Writers Were Nominated for the 64th GRAMMY Awards in 10 Categories

The group of writers at Avex USA Inc. includes Harv, a songwriter and a producer from California that worked on Peaches ft. Daniel Caesar, Giveon, a global hit by Justin Bieber that topped The Billboard Hot 100, the Billboard Global 200, etc., in March and April of this year.
Harv was nominated in five categories for the 64th GRAMMY Awards in 2022 by writing and producing Justin Bieber's Peaches ft. Daniel Caesar, Giveon, and the album this song is featured on, Justice.

Anime & Visual Content

TV Anime Ya Boy Kongming! is Well Received!

© Yuto Yotsuba, Ryo Ogawa, and KODANSHA/
Ya Boy Kongming! Production Committee

Ya Boy Kongming!, a TV anime that began airing in April 2022, has been ranked highly by various media outlets and users, with the intro video, featuring special unit QUEENDOM's cover of party king Jolly's Ciki Ciki Bam Bam, reaching 11 million views on YouTube. The end credits video with Kibun Jyojyo reached 4.2 million views, and the special music video for Be Crazy For Me from the anime reached 7.6 million views, attracting attention from many angles.


1.1 Million Tickets Sold for the Osomatsu-san Movie, with Box Office Revenue Reaching 1.5 Billion JPY
Live-action Performance by Snow Man

©Osomatsu-san Theatrical Version Production Committee 2022

The popular Japanese idol group, Snow Man, stars in Osomatsu-san, the first live-action movie in the Osomatsu-san series, which began airing in 2015. The movie was released nationwide in Japan on Friday, March 25, 2022. The film gained momentum on the release day, with "Osomatsu-san movie" becoming a trend on social media and box office revenue reaching 1.5 billion JPY. The movie will be available on Blu-ray & DVD on October 26, 2022.

Corporate

"avex vision 2027" Medium-term Management Plan Announced

To clarify the aim of a corporation’s activities and the social significance of a corporation's presence, Avex defined its Corporate Philosophy and has established the "avex vision 2027" Medium-term Management Plan. The plan offers to seek to discover and develop "beloved" intellectual property in many different regions and fields as a key strategy based on the Corporate Philosophy.


Shift to the Prime Market of the Tokyo Stock Exchange on April 4, 2022

Avex shifted from the First Section to the Prime Market of the Tokyo Stock Exchange on April 4, 2022. Avex aims to further improve its corporate value through dialogue with the capital market while also strengthening its corporate governance systems.

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