Konami Reports Earnings for the Six Months Ended 9-30-10, Net Income Up 87.8 Percent

1. Consolidated Results of Operations

(1) Business Overview

A difficult business climate persisted in the environment surrounding the KONAMI CORPORATION and its subsidiaries (“KONAMI”) as uncertainty over the future due to factors such as the impact of the appreciation of the yen and suppressed consumer spending.

In regard to the entertainment industry, efforts are being made in the entertainment market to create new demand. These include the exhibition – at video game trade shows held both within Japan and abroad – of new video game consoles with novel methods of operation added, which offer new ways to play games, and games that make full use of 3D video technology…

Against this backdrop, the Digital Entertainment segment of KONAMI rolled out the latest title of our highly popular METAL GEAR series, and Winning Eleven (known in the U.S. and Europe as PRO EVOLUTION SOCCER) series on multiple platforms. Those sales progressed favorably. Furthermore, as with its predecessor, the release of the latest romance simulation game LOVEPLUSPLUS received a highly positive response among Japanese consumers, which could be called a social phenomenon in Japan.

Digital Entertainment

Computer & Video Games business: METAL GEAR SOLID PEACE WALKER, the first sequel in the METAL GEAR series for the PSP, was launched worldwide. Sales of this title progressed steadily, with the game receiving favorable reviews as co-op modes, etc., which leverage the characteristic features of handheld gaming devices, are being well received by hardcore METAL GEAR fans.

Meanwhile, WORLD SOCCER Winning Eleven 2010 Aoki Samurai no Chosen was launched on multiple platforms to coincide with the once-every-four-years festivities that excite soccer fans worldwide. This title includes the „Japan Challenge Mode,‟ which has the Japanese national team competing to become No.1 in the world. Steady sales were recorded for this game in Japan.

In addition, the latest romance communication game, LOVEPLUSPLUS was released to record first week unit sales surpassing that of the previous game in the series. Furthermore, the Atami LOVEPLUS Phenomenon festival was held during the summer vacation season in Atami City, which is the location of one of the events in the game. The festival proposed a new way to play the game that links the virtual world to a real world location. Various campaigns were executed, including a tourist spot stamp rally and sales of original goods. The LOVEPLUS series was highly recognized for seeking a new way of attracting fans, resulting in the receipt of the 25th Digital Content Grand Prix „Excellence Award,‟ the Japan Game Awards 2010 „Award for Excellence,‟ etc. The content and its way of seeing the world will be further expanded, such as through the scheduled release of Project LOVEPLUS for Nintendo 3DS for Nintendo‟s new game console.

A wide-ranging lineup of other games was also released, including JIKKYO PAWAFURU PUROYAKYU 2010, the latest in the JIKKYO PAWAFURU PUROYAKYU series and the first title in the series to launch a version for the PS3 console; the realistic professional baseball game PUROYAKYU SPIRITS 2010 launched on multiple platforms; the academy romance simulation game for women TOKIMEKI MEMORIAL Girl’s Side 3rd Story; the new animated title FAIRY TAIL PORTABLE GUILD; and BUSOU SHINKI BATTLE MASTERS, a game based on the characters and world view of the BUSOU SHINKI series that is developed as a combination of an action figure line and video games for the PC.

Overseas, an undertaking in the U.S. utilizing DanceDanceRevolution to fight obesity is expanding, and sales of the series‟ titles are progressing steadily. In Europe, PES 2011 – Pro Evolution Soccer was released in September, the latest title in the Winning Eleven series and the first video game in the world to include Copa Libertadores, the soccer tournament that determines the top club team in South America.

Link to full report (pdf)

Link to slides (pdf)

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