Call Start: 03:00 January 1, 0000 4:13 AM ET

Sony Group Corporation (NYSE:SONY)

Q1 2023 Earnings Conference Call

August 09, 2023, 03:00 ET

Company Participants

Hiroki Totoki - President, COO & CFO

Sadahiko Hayakawa - General Manager, Finance Department

Hiroaki Kitano - Senior EVP & CTO, Corporate Executive Officer

Naomi Matsuoka - SVP

Conference Call Participants

Masahiro Ono - Morgan Stanley

Mikio Hirakawa - Bank of America Merrill Lynch

Junya Ayada - JPMorgan Chase & Co.

Yasuo Nakane - Mizuho Securities

Ryosuke Katsura - SMBC

Kota Ezawa - Citigroup

Unidentified Company Representative

Good afternoon, ladies and gentlemen. It is now time to start Sony Group's Q1 FY 2023 Consolidated Financial Results Presentation Meeting. I am over the Corporate Communications.

I would like to first introduce the speakers today, President, COO and CFO, Hiroki Totoki; and Senior Vice President in charge of the Corporate Planning Group DE&I promotion, also support Financial Service and Entertainment segment, Naomi Matsuoka; and then Senior Vice President in charge of Finance and IR, Sadahiko Hayakawa. So those 3 will present the Q1 FY 2023 consolidated financial results also the outlook throughout the FY 2023. And there will be a question-and-answer session, and we plan to have a 70 minutes session.

Thank you. First speaker is Mr. Totoki.

Hiroki Totoki

So the speakers today are Matsuoka and Hayakawa. And then toward the end, I'd like to make a summary comments. So first speaker, Hayakawa-san. Matsuoka and Hayakawa will present the consolidated results.

Starting from FY '23 Q1, Sony has adopted a new accounting standard, IFRS 17 new standard, pertaining to insurance contracts, the annual results for the same quarter of the previous fiscal year. And previous fiscal year that we'll show today are presented after recalculation based on the new standard. We will explain the details later in the Financial Services segment part.

Consolidated sales for the quarter increased a significant 33% compared to the same quarter of the previous fiscal year year-on-year to JPY2,963.7 billion. Consolidated operating income decreased JPY111.8 billion year-on-year to JPY253.0 billion, primarily due to an JPY84.7 billion decrease in operating income of the Financial Services segment. This decrease in operating income on Financial Services segment was primarily due to the impact of the recalculation of the previous weaker years' results, resulting from the application of the new standard and absent of a gain on the sales of real estate recorded in the same quarter of the previous fiscal year.