TECHNOLOGY UNDER THE TREE - Techy toys set to play a starring role in Christmas wish lists Little hands and minds will be kept busy with up to the minute techno toys that are set to dominate childrens Christmas lists this year, says the Toy Retailers Association (TRA) today. The TRAs annual Dream Toys list, the only official prediction of Christmas best-sellers, reveals a trend towards interactivity for todays increasingly techno-savvy kids. The list also reflects this years big and small screen successes, with toys inspired by Transformers the Movie, Dr Who, preschool favourite Roary the Racing Car, and game show Golden Balls.
This years Dream Dozen, in alphabetical order: Are You Smarter Than A 10 Year Old?, Hasbro (RRP 19.99) Baby Annabell, Zapf Creation (RRP 39.99) Barbie Girls, Mattel (RRP 49.99) Doctor Who Dalek Sec Hybrid Voice Changer Mask, Character Options (RRP 29.95) Flytech Dragonfly, Character Options (RRP 34.87) Golden Balls, Vivid Imaginations (RRP 19.99) GR8 Art Bindeez Super Deluxe Studio Centre, Character Options (RRP 19.95) In The Night Garden Blanket Time Igglepiggle, Hasbro (RRP 34.99) Puppy Grows and Knows Your Name, Mattel (RRP 44.99) Roary R/C Car, Vivid Imaginations (RRP 24.99) Say What?, Radica (RRP 24.99) Transformers Movie Leader:Optimus Prime, Hasbro (RRP 39.99)
Gary Grant, Chairman of the TRA, comments: This years Dream Dozen once again demonstrates the versatility of the toy industry. The technological advancements used in many of the toys we reviewed this year were quite amazing, and demonstrate how forward thinking manufacturers can be. Responding to the everchanging demands of children is what makes this industry so innovative. The result is a truly eclectic mix of toys that will appeal to young and old alike.
In the Girls category, Mattels Barbie ranges remain a firm favourite, with Barbie Princess Rosella doll, inspired by the latest Barbie DVD, making the Girls Top 12. Bratz, the dolls with a Passion for Fashion, also hit screens this year with BratzThe Movie, and enter the Girls Top 12 with the movie-inspired Funky Fashion Makeover Body. For animal lovers, the Grand Hotel from Sylvanian Families (Flair), Littlest Pet Shop Display and Play Pet Town Playset and My Little Pony Ponyville Teapot Palace (both Hasbro) will be firm favourites long after Christmas. Girls Top 12 Toys for Christmas Baby Annabell BABY born Boy with Magic Eyes Barbie Princess Rosella Doll Bratz the Movie Funky Fashion Makeover Body Grand Hotel from Sylvanian Families Flair RRP 89.95 RRP 29.95 Zapf Creation Zapf Creation Mattel Vivid Imaginations RRP 39.99 RRP 34.99 RRP 19.95 RRP 32.99
Littlest Pet Shop Display and Play Pet Hasbro Town Playset My Baby My Little Pony Ponyville Teapot Palace My Take Along Dolls House Polly Pocket Race To Mall! Puppy Grows and Knows Your Name Rose Petal Cottage Mattel Hasbro Playmobil Mattel Mattel Worlds Apart
RRP 49.95 RRP 29.95 RRP 24.95 RRP 29.99 RRP 44.99 RRP 79.99
Its an equally bumper year for Boys, with a range of TV and film-inspired toys. Hasbro brings the popular Transformers license to life with the Optimus Prime Voice Changing Helmet and Transformers Ultimate Bumblebee. Spider-Man is back to battle another day with the Spider-Man Ultimate Web Blaster (Hasbro). Ben 10 is a new addition to the boys character crowd, with the Alien Laboratory and a Watch Omnitrix F/X (both Bandai) set to keep mini scientists busy well into the New Year.
Boys Top 12 Toys for Christmas Ben 10 Alien Laboratory Bandai RRP 24.95
Ben 10 Omnitrix F/X Cars Mega Mack Playtown Creator Monster Dino

Bandai Mattel Lego

RRP 12.95 RRP 39.95 RRP 69.95 RRP 29.95
Dr Who Dalek Sec Hybrid Voice Character Options Changer Mask Dr Who Figures Assortment Spider-Man Ultimate Web Blaster Stretch Power Ranger Character Options Hasbro Character Options
RRP 6.95 RRP 39.99 RRP 14.95 RRP 39.99
Transformers Movie Leader: Optimus Hasbro Prime Transformers Optimus Prime Voice Hasbro Changer Mask Transformers Ultimate Bumblebee Hasbro

RRP 29.99

RRP 79.95 RRP 19.99
WWE Money In The Bank Ladder Match Vivid Imaginations Playset

There are plenty of treats in store for little ones too, and the Pre-School category sees some well-loved faces that will be familiar to parents as well as children. My Friend Rupert Bear (Martin Yaffe) and the Thomas and Jeremy Airport Set (Tomy) recall classic childrens favourites. Joining them are toys inspired by hit pre-school programme In the Night Garden (Talking Plush Assortment by Hasbro) and Dora the Explorer (Doras Laptop by VTech). Pre-school Top 12 Toys for Christmas Bed-time Lullaby Fifi Vivid Imaginations RRP 16.99 RRP 29.95
Bob the Builder Snap Trax Car Wash Martin Yaffe & Garage Doras Laptop Fisher-Price Smart Cycle Fisher-Price Stride to Ride Lion VTech Mattel Mattel
RRP 25.99 RRP 99.95 RRP 34.99 RRP 34.99
In The Night Garden Blanket Time Hasbro Igglepiggle In The Night Garden Talking Plush Hasbro Assortment My Friend Rupert Bear Martin Yaffe

RRP 14.95

RRP 29.95
Peppa Pig Campervan Playset Roary R/C Car Thomas & Jeremy Airport Set V-Smile Learning System
Character Options Vivid Tomy Vtech
RRP 19.95 RRP 24.99 RRP 39.95 RRP 49.99
The post-lunch Christmas afternoon will fly by with this years Games selection. TV gameshows still feature heavily, and Drumond Parks Family Fortunes game makes it into the Games Top 12. Tween favourite High School Musical also makes an appearance with Hasbros Mystery Date game. Mattels Ratatouille Kitchen Quake is a high-energy fun fest to liven up Christmas parties. Old favourites get a new look with Monopoly Here & Now UK Edition and Game of Life Twists and Turns (both Hasbro). Games Top 12 Toys for Christmas 20Q Handheld Radica RRP 8.99 RRP 19.99
Are You Smarter Than A 10 Year Hasbro Old? Eternity II Family Fortunes Game of Life Twists and Turns Golden Balls High School Musical Mystery Date Monopoly Here & Now UK Edition Ratatouille Kitchen Quake Game Rubiks Revo Say What ? Splashy the Whale Game Tomy Drumond Park Hasbro Vivid Hasbro Hasbro Mattel Drumond Park Radica Character Options
RRP 34.95 RRP 24.99 RRP 29.95 RRP 19.99 RRP 14.95 RRP 19.99 RRP 19.99 RRP 14.99 RRP 24.99 RRP 14.95
The Hip n Kool category, covering the latest must-haves for funky kids, is as exciting as ever. This Christmas will be getting off to a flying start as two brands go head to head with the latest indoor flight technology. Dragonfly by Character Options will be battling it out with Silverlits PicooZ R/C Helicopter for a space under the tree. Theres plenty in this category for girls as well, with the Pixel Chix Roomies House (Mattel) and the Girl Tech Video Journal (Radica) both Christmas must-haves for young fashionistas.

Hip n Kool Top 12 Toys for Christmas
Amazing Lexie Barbie Girls Digi Makeover Eye Clops Flytech Dragonfly FurReal Squawkers McCaw Girl Tech Video Journal Nintendog Trick Trainers PicooZ R/C Helicopter Pixel Chix Roomies House Tamagotchi Connexion Jinsei Plus (V4) U.B. Funkeys
Mattel Mattel Radica Vivid Imaginations Character Options Hasbro Radica Tomy Silverlit Mattel Bandai Radica
RRP 99.95 RRP 49.99 RRP 59.95 RRP 39.99 RRP 34.87 RRP 69.95 RRP 39.99 RRP 9.95 RRP 19.91 RRP 44.95 RRP 12.95 RRP 19.99
The Creative Top 12 will be keeping minds and hands busy well into 2008 with a range of inspiring new play sets. Spinmasters Lil Luvables Fluffy Factory and Tomys Cinderella Aquadraw are sure to be firm favourites with little girls, while Marvins Freaky Body Illusions (Marvins Magic) will be a hit with boys with a taste for the gruesome! The classic Crayola set returns in a new guise with the Crayola Illumination Station (Vivid Imaginations). Creative Top 12 Toys for Christmas Aqua Beads Cinderella Aquadraw Cordz Crayola Illumination Station Dora the Explorer Draw & Drive Golden Coin Maker Flair Leisure Tomy Flair Leisure Vivid Imaginations Golden Bear John Adams Toys RRP 14.95 RRP 29.95 RRP 19.95 RRP 19.99 RRP 24.99 RRP 14.95 RRP 19.95
GR8 Art Bindeez Super Deluxe Studio Character Options Centre GR8 Scrapheap Welder Lil Luvables Fluffy Factory Marvins Freaky Body Illusions Moon Sand Castle Super Grafix Character Options Spinmaster Marvins Magic Box Spinmaster John Adams Toys
RRP 19.95 RRP 24.99 RRP 24.95 RRP 19.95 RRP 19.95
The TRA revealed its predictions for the official Top Toys for Christmas at the Dream Toys 2007 media preview. This was held at St Marys Church, Bryanston Square, Wyndham Place, Marylebone London on 10 October 2007.
-ENDSFor further press information contact the Dream Toys Press Office at Grayling on 1100.
Notes to Editors 1. Dream Toys is a media only event organised by the Toy Retailers Association and the British Toy and Hobby Association. 2. This is the 41st year that the Toy Retailers Association has announced the Top Toys for Christmas. The Media Preview includes the latest new toys in the market as well as the Top 12. 3. The TRA has around 400 members accounting for 75% of toy retailers, while the British Toy and Hobby Association represents over 148 members accounting for over 90% of toys sold in the UK market. 4. The independent predictions are based on the Toy Retailers Associations 50 years experience as the voice of retailers and take into account what consumers are requesting, what excites children and the latest trends in new products.

Images For access to the online image gallery at www.ToyRetailersAssociation.co.uk/Gallery please contact the Dream Toys Press Office on 1100 for a User ID and Password. Please note these will be case sensitive.

Game Contents Business The Game Contents Business overall fared poorly due to a failure to respond quickly to changes in the home video games market environment, with steep underperformance of franchise titles launched globally such as Soul Caliber III compared with its predecessor. In Japan, however, sales of Tamagotchi Connection: Corner Shop for the Nintendo DS topped one million units alongside other titles, such as Dragon Ball Z Sparking! for the PlayStation 2, which proved popular and contributed to results. Additionally, for new hardware applications, Ridge Racer 6 went on sale for the Xbox360. Sales of coin-operated game machines in Japan were good for the globally launched Mario Kart Arcade GP. Additionally, Hana-fubuki and Tekken 5 Dark Resurrection did well in Japan, Ms. Pacman/Galaga did well in the U.S., and The Fast and The Furious (RAW THRILLS INC.) performed well in Europe. Contents distribution services operated by NAMCO LIMITED for users of mobile phones and other portable devices performed well in Japan with paying subscribers reaching 1.03 million (up 7.0% year-on-year) thanks to the launch of Tales of Commons, a site geared at NTT DoCoMo users, and Tales of the Abyss: Myuus Adventure, featuring content based on home video games. Contents distribution services fared well in the U.S., but performance was weak in Europe due to a delay in the launch of new services. Due to the above, the Game Contents Business recorded net sales of 104,904 million and operating income of 12,909 million.
Network Business In the Network Business operated by Bandai Networks Co., Ltd., the number of paying subscribers fell 5.4% year-on-year to 4.06 million. This was due to a drop in subscribers for standby and ringer tones, reflecting a change in the market environment for mobile contents distribution service for mobile phones. However, thanks to strong performance on high added-value content such as the Mobile Suit Gundam simulation game Gundam Network Online Mobile and entertainment contents One Piece Mobile Jack, average charges per subscriber increased, with beneficial effects on earning power. Moreover, contributions to earnings continued to come from new technology offerings for mobile phones, such as animation display-enabling 2D Vector Engine and character image-generating 3D Engine, as well as from solutions for corporations and web content. Due to the above, the Network Business recorded net sales of 9,389 million and operating income of 1,439million. Visual & Music Content Business The Visual & Music Content Business benefited from TV broadcasts of Mobile Suit Gundam SEED DESTINY initiated last year and the highly successful box office results and DVD release of Mobile Suit Z Gundam a New Translation: Heirs to the Stars premiered in cinemas in May 2005, with strong group synergy effects coming from the Mobile Suit Gundam series, of which these offerings are a part. Sales of rental DVD video products were also favorable and contributed to results. By contrast, overseas performance was weak as returns increased amid slack market conditions in the U.S. Due to the above, the Visual & Music Content Business recorded net sales of 33,453 million and operating income of 6,128 million. Affiliated Business In this business, the logistics business performed well by boosting further efficiency. New business initiatives include the inception in December 2005 of coin-operated game machines website The Idol M@ster featuring The Idol M@ster Official Goods Shop. This site is engaged in design and sales of proprietary goods as a Total Entertainment Service that interrelates coin-operated game machines and home computer under the concept of Entertainment Network Services. Due to the above, Affiliated Business recorded net sales of 17,209 million and operating income of 68 million.

II. Financial Position Cash flows Cash and cash equivalents at December 31, 2005 totaled 110,996 million, a decrease of 13,927 million compared to the beginning of the current fiscal year. Cash flows for the nine months ended were as follows: Cash flows from operating activities Operating activities provided net cash of 14,249 million. This mainly reflected income before income taxes of 37,454 million, an increase in trade receivables of 9,828 million, and income taxes paid of 13,108 million. Cash flows from investment activities Investing activities used net cash of 8,142 million. This was chiefly attributable to cash outflows of 10,433 million for the acquisition of tangible and intangible fixed assets, 1,946 million for the acquisition of investment shares in People Co., Ltd., and 1,819 million for the acquisition of shares in VIBE Inc. and other subsidiaries, despite cash of 5,499 million from the sale of shares in Italian Tomato Ltd. and Nikkatsu Corporation. Cash flows from financing activities Financing activities used net cash of 20,235 million. This primarily reflected 10,548 million from the purchase of treasury stock and dividends paid of 4,415 million, alongside 3,097 million in cash payments upon the share-for share exchange and the repayment of long-term debt of 1,658 million. III. Full-Year Outlook Japans economic outlook calls for a gradual, sustained recovery supported mainly by improving corporate earnings and higher capital expenditures, although the revaluation of Chinas currency will have some impact on the economy. Furthermore, the operating environment surrounding the BANDAI NAMCO Group will be shaped by diversifying customer preferences in the toy market, and dramatic shifts in the game industry in anticipation of the launch of next-generation game consoles. The outlook for the Groups operating environment thus remains surrounded in uncertainty. In this setting, the Toys & Hobby Business of the BANDAI NAMCO Group has enjoyed worldwide popularity surrounding the Tamagotchi Plus series, while in the domestic realm, the Visual & Music Content Business is performing well, benefiting from animation contents such as the Mobile Suit Gundam series.
However, in the Game Contents Business with its home video games and the Amusement Facility Business which operates amusement facilities, performance has suffered due to failure to quickly adjust to changing market environments and shifting customer needs. At the same time, an increase in returns of DVD software has contributed to a poor performance in the Visual & Music Content Business in the U.S. Taking these conditions into account, and including expectations for a sustained harsh market environment, the Company further tightened valuation standards for inventory assets surrounding home video games and others, and booked a 6.0 billion valuation loss. Furthermore, in light of weak performance in the U.S. and from a cautionary viewpoint, the Company will book a deferred tax asset valuation allowance of 1.8 billion relative to deferred tax assets booked at the beginning of the period. Due to the above, results projections announced on November 22, 2005 for the full fiscal year have been revised as shown below. The Company will launch a three-year medium-term management plan beginning in April 2006, which aims to enhance profitability by reviewing target strategies and implementing structural reform of the product development for home video games operations. Moreover, in the U.S., the Company will work to accomplish a shift to high profitability by introducing a regional holding company structure that separates management and operations, and optimizes the allocation of regional management resources, and establish a stable business basis. Consolidated Projections for Fiscal Year ending March 2006 (April 1, 2005 March 31, 2006) Net sales

Previous projection (A) Latest projection (B)
Recurring income million 44,100 33,000
Net income million 24,400 11,000

million 470,000 450,000

Change (amount B-A) (20,000) (11,100) Rate of change (%) (4.3%) (25.2%) (Reference) Projected net earnings per share (full-year): 41.59 Forward-looking statements

(13,400) (54.9%)

This document contains forward-looking statements obtained from information currently available to the Company and Group, and as such, include inherent risks and uncertainties. Actual results may differ materially from projections for a variety of reasons, including changes in the Company and Groups operating environment, market trends and exchange rate fluctuations.
Consolidated Financial Statement for the Nine Month-Period Ended December 31, 2005
(1) Consolidated Balance Sheet As of December 31, 2005 Millions of yen (Assets) I Current assets: 1. Cash and time deposits 2. Trade receivables 3. Short-term investments 4. Inventories 5. Deferred tax assets 6. Other current assets Allowance for doubtful receivables Total current assets II Fixed assets l. Property, plant and equipment (1) Buildings and structures (2) Amusement facilities and machines (3) Land (4) Other property, plant and equipment 2. Intangible assets (1) Consolidated adjustment accounts (2) Other intangible assets 3. Investments and other assets (1) Investment securities (2) Guarantee money deposited (3) Deferred tax assets (4) Other investments and assets Allowance for doubtful receivables Total fixed assets Total assets 23,267 25,196 3,892 4,801 (1,053) 56,104 143,171 400,379 35.8 100.8,926 8,984 16,540 22,746 24,082 14,712 78,082 104,038 84,318 8,895 32,523 3,716 25,232 (1,517) 257,208 64.2 Share (%)
As of December 31, 2005 Millions of yen (Liabilities) I Current Liabilities 1. Trade payables 2. Short-term borrowings 3.Bondscurrent portion 4. Accounts payableother 5. Accrued income taxes 6. Other current liabilities Total current liabilities II Long-term Liabilities 1. Bonds 2. Long-term debt 3.Deferred tax liabilities, land revaluation difference 4. Accrued retirement and severance benefits 5. Directors' and auditors' retirement and severance benefits 6. Other long-term liabilities Total long-term liabilities Total liabilities (Minority Interests) Minority Interests (Stockholders' Equity) I Common stock II Additional paid-in capital Ill Retained earnings IV Land revaluation difference V Other securities valuation difference VI Translation adjustment VII Treasury stock Total stockholder's equity Total liabilities, minority interests and stockholders' equity 10,000 92,430 167,762 (21,246) 4,499 1,000 (11,144) 243,301 400,379 2.5 23.1 41.9 (5.3) 1.1 0.3 (2.8) 60.8 100.0 21,059 5.2 15,000 2,2,10,062 31,630 136,018 7.9 34.0 46,576 4,456 10,000 17,812 9,902 15,639 104,388 26.1 Share (%)

(2) Consolidated Statements of Income Nine months ended December 31, 2005 Millions of yen I Net sales II Cost of sales Gross profit Ill Selling, general and administrative expenses Operating income IV Non-operating income 1. Interest income 2. Dividend income 3. Rental income 4. Foreign exchange gain 5. Operation consignment income 6. Equity in earnings of affiliated companies 7. Other non-operating income V Non-operating expenses 1. Interest expense 2. Amortization of goodwill 3. Other non-operating expenses Recurring income VI Extraordinary income 1. Gain on sale of property, plant and equipment 2. Gain on sale of investment securities 3. Gain on sale of investments in affiliated companies 4. Reversal of allowance for doubtful receivables 5. Other extraordinary income 2,4 3,328 0.851 36,801 0.2 10.2,051 0.6 345,396 220,874 124,521 88,920 35,600 Share (%) 100.0 63.9 36.1 25.8 10.3
Nine months ended December 31, 2005 Millions of yen VII Extraordinary loss 1. Loss on sale of property, plant and equipment 2. Loss on disposal of property, plant and equipment 3. Loss on impairment of property, plant and equipment 4. Loss on business restructuring 5. Loss on valuation of investment securities
6. Loss on valuation of investments in affiliated companies

Share (%)

1,317 2,675 37,454 14,819 3,281 18,101 1,640 17,711 5.2 0.5 5.1 0.8 10.8
7. Loss on valuation of guarantee money deposited 8. Loss on change in equity interests 9. Provision for allowance for doubtful receivables Net income before income taxes and minority interests Corporate income, inhabitant and enterprise taxes Tax adjustments Minority interests Net income
(3) Consolidated Statements of Cash Flows Nine months ended December 31, 2005 Millions of yen I Cash Flows from Operating Activities Income before income taxes and minority interests Depreciation and amortization Loss on impairment of property, plant and equipment Amortization of consolidated adjustment accounts Increase in allowance for doubtful receivables Increase in accrued retirement and severance benefits Decrease in directors' and auditors' retirement and severance benefits Interest and dividend income Interest expense Foreign exchange gain Equity in earnings of affiliated companies Loss on disposal of property, plant and equipment Gain on sale of property, plant and equipment Loss on disposal of amusement facilities and machines Gain on sale of investment securities Loss on valuation of investment securities Increase in trade receivables Increase in inventories Investment in amusement facilities and machines Increase in trade payables Decrease in trade payableother Increase in income tax refunds receivable Bonuses to directors and corporate auditors Other Subtotal Interest and dividends received Interest paid Income taxes paid Net cash provided by operating activities 37,454 13,783 1,(94) (802) 212 (80) (79) 220 (145) 813 (3,082) 223 (9,828) (793) (8,258) 3,833 (3,122) (5,130) (627) (229) 26,514 1,019 (176) (13,108) 14,249

Nine months ended December 31, 2005 Millions of yen II Cash Flows from Investing Activities Payments for deposit in time deposits Proceeds from withdrawal from time deposits Proceeds from sales of short-term investments Purchases of property, plant and equipment Proceeds from sales of property, plant and equipment Purchases of intangible assets Purchases of investment securities Sales of investment securities Acquisition of shares in consolidated subsidiaries, net of cash acquired Proceeds from sales of shares in consolidated subsidiaries Purchase of subsidiary shares related to changes in scope of consolidation Proceeds from sales of subsidiary shares related to changes in scope of consolidation Proceeds from decrease in capital at non-consolidated subsidiaries Advances of loans receivable Collection of loans receivable Guarantee money deposited Proceeds from collection of guarantee money deposited Payments for succession of business Other Net cash used in investing activities Ill Cash Flows from Financing Activities Net increase in short-term borrowings Repayment of long-term debt Repayment of bonds Proceeds from issuance of shares Proceeds from capital paid by minority interests Purchases of treasury stock Dividends paid Cash payments upon the share-for-share exchange Dividends paid to minority interests Net cash used in financing activities IV Effect of exchange rate changes on cash and cash equivalents V Net decrease in cash and cash equivalents VI Cash and cash equivalents at beginning of period VII Net Increase in cash and cash equivalents from newly consolidated VIII Net decrease in cash and cash equivalents due to elimination from consolidation IX Cash and cash equivalents at end of period (915) (8,019) 703 (2,414) (1,946) 768 (38) 313 (1,780) 5,(366) 482 (581) 1,091 (1,500) (286) (8,142) 493 (1,658) (1,000) (10,548) (4,415) (3,097) (426) (20,235) 1,051 (13,076) 124,(860) 110,996
(4). Segment Information 1. By Business Segment ( million) Nine Months Ended December 31, 2005 (April 1, 2005 to December 31, 2005)
Toys & Hobby Business Amusement Facility Business Game Contents Business Network Business Visual & Music Content Business Affiliated Business Total Eliminations and Corporate Consolidated

Net sales

(1) To external customers (2) transfers
Total Operating expenses Operating income (loss) Intersegment sales and

131,882 2,828 134,710 116,617 18,093

59,60,166 58,328 1,837

102,114 2,790 104,904 91,995 12,909

9,9,389 7,950 1,439

32,33,453 27,325 6,128
9,684 7,524 17,209 17,140 68
345,396 14,438 359,834 319,357 40,477
(14,438) (14,438) (9,562) (4,876)
345,396 345,396 309,795 35,600
Notes: 1. Business segment classifications are in accordance with classifications adopted for internal management purposes. 2. Principal products and operations in each business segment:
(1) Toys & Hobby Business (2) Amusement Facility Business (3) Game Contents Business (4) Network Business (5) Visual & Music Content Business Toys, candy toys, products for vending machines, cards, plastic models, apparel, sundries, stationary and other products Amusement facility operations and other operations Software for home video games, coin-operated game machines, prizes for coin-operated game machines and other products Mobile content and other products Video titles, visual software, on-demand video distribution and other products and services Transportation and warehousing of products, leasing, real estate management, printing, licensing, restaurant management, human services and nursing care facilities, development and sale of environmental equipment and other activities

(6) Affiliated Business

3. Operating expenses include an unallocatable amount of 5,314 million under eliminations and corporate. This figure primarily consists of expenses related to management divisions at NAMCO BANDAI Holdings, Inc., Bandai Co., Ltd. and NAMCO LIMITED.
2. By Geographic Segment ( million) Nine Months Ended December 31, 2005 (April 1, 2005 to December 31, 2005)
Eliminations Japan Americas Europe Asia Total and Corporate Consolidated

(1) (2) Total

To external customers Intersegment sales and transfers
283,483 6,821 290,304 251,761 38,542

33,34,337 37,355 (3,018)

20,20,040 16,838 3,201
8,428 15,645 24,073 22,025 2,048
345,396 23,358 368,755 327,980 40,774
(23,358) (23,358) (18,185) (5,173)
Operating expenses Operating income (loss) Notes:
1. Methods for classifying geographic segments and principal countries and regions
(1) The Company classifies geographic segments by such factors as geographic closeness, similarities in economic activities, mutual relationship of business activities. (2) Principal countries and regions belonging to each geographic segment (i) Americas (ii) Europe (iii) Asia: U.S.A. and Canada France, U.K. and Spain Hong Kong, Thailand and South Korea

2. Operating expenses include an unallocatable amount of 5,314 million under eliminations and corporate. This figure primarily consists of expenses related to management divisions at NAMCO BANDAI Holdings, Inc., Bandai Co., Ltd. and NAMCO LIMITED.
NAMCO BANDAI Holdings Inc. (Bandai Co. Ltd) Code Number: 7832 Listed exchange: TSE 1st section Registered Business Location: Tokyo (URL: http://www.bandainamco.co.jp/) February 23, 2006 Consolidated Earnings Report for the Nine Month-Period Ended December 31, 2005

Contact Telephone

Keiji Tanaka, Director +81 (03) 5783-5500
1. Matters concerning the basis of preparation of quarterly financial statements (i) Application of simplified accounting methods: YES Corporation income taxes are calculated based on a simplified method, by application of the effective statutory tax rate. (ii) Change in accounting methods compared with the consolidated financial statements for the fiscal year ended March 31, 2005: YES Business segment classifications used in the segment information by business category have been changed. The accounting treatment of gains and losses from changes in shareholder stakes has been changed to treatment as extraordinary gains and losses. (iii) Change in the scope of consolidation and application of the equity method: YES Newly consolidated subsidiaries: 2 companies (VIBE Inc., Bandai Games Inc.) Formerly consolidated subsidiaries: 2 companies* (PALBOX Co., Ltd., BanPocket Co., Ltd.) Affiliates newly accounted for under the equity method: 1 company: (People Co., Ltd.) Affiliates formerly accounted for under the equity method: None* *Due to corporate separation instituted December 1, 2005, subsidiary and equity-method affiliate administrative operations were partly assumed by NAMCO BANDAI Holdings Inc. from Bandai Co., Ltd. As a result, effective December 31, 2005, Bandai Co., Ltd. relinquished 22 consolidated subsidiaries and 4 equity-method affiliates. These 26 entities are not included in the above-stated formerly consolidated subsidiaries and affiliates formerly accounted for under the equity method as the financial results of these entities are included in the consolidated financial statements of Bandai Co., Ltd. 2. Consolidated Business Results for the Nine Month-Period Ended December 31, 2005 (April 1, 2005 to December 31, 2005) (1) Consolidated Business Results Net Sales million

Nine months ended December 31, 2005 Nine months ended December 31, 2004 Fiscal Year Ended March 31, 2005 218,974 192,691 269,945 % 13.6 (0.2)
( million, %) Operating income million
33,985 18,452 24,398 % 84.2 (25.9)

Recurring income million

35,172 19,183 25,723 % 83.4 (21.7)

Net income million

16,115 9,451 11,225 % 70.5 (25.5)
Nine months ended December 31, 2005 Nine months ended December 31, 2004 Fiscal Year Ended March 31, 2005 163.04 95.92 111.13

163.01 95.77 110.99

(1) Consolidated Statements of Income
Nine months ended December 31, 2005 Nine months ended December 31, 2004 Fiscal Year ended March 31, 2005

Change

Millions of Share yen I Net sales II Cost of sales Gross profit III Selling, general and administrative expenses Operating income IV Non-operating income 1. Interest income 2. Equity in earnings of affiliated companies 3. Other non-operating income V Non-operating expenses 1. Interest expense 2. Equity in losses of affiliated companies 3. Other non-operating expenses Recurring income VI Extraordinary income 1. Gain on sale of property, plant and equipment 2. Gain on sale of investment securities 3. Other extraordinary income VII Extraordinary loss 1. Loss on sale of property, plant and equipment 2. Loss on impairment of property, plant and equipment 3. Expense of special depreciation of property, plant, and equipment 4. Amortization of goodwill 5. Loss on business restructuring 6. Loss on valuation of investment securities 7. Loss on valuation of guarantee money deposited 8. Loss on change in equity interests 9. Payment for compromise 10. Provision for allowance for doubtful receivables Net income before income taxes and minority interests Corporate income, inhabitant and enterprise taxes Minority interests Net income 317 33,056 15,196 1,744 16,115 15.1 6.9 0.8 7.4 218,974 121,941 97,033 63,047 33,985 1,131 35,85 2,1,644 1.2 16.1 0.2 0.1 (%) 100.0 55.7 44.3 28.8 15.5 0.7

(iii) Asia: Hong Kong, Thailand and South Korea 2. Operating expenses include an unallocatable amount under eliminations and corporate of 1,758 million for the nine months ended December 31, 2005, 1,429 million for the nine months ended December 31, 2004, and 1,873 million for the fiscal year ended March 31, 2005.These figures primarily consist of expenses related to management divisions at the Company.

February 23, 2006

NAMCO BANDAI Holdings Inc. (NAMCO LIMITED) Code Number: 7832 Listed exchange: TSE 1st section Registered business location: Tokyo (URL: http://www.bandainamco.co.jp/)
Consolidated Earnings Report for the Nine Months Ended December 31, 2005
1. Matters concerning the basis of preparation of quarterly financial statements (i) Application of simplified accounting methods: YES Corporation income taxes are calculated based on a simplified method, by application of the effective statutory tax rate. (ii) Change in accounting methods compared with the consolidated financial statements for the fiscal year ended March 31, 2005: NO (iii) Change in the scope of consolidation and application of the equity method: YES New consolidated subsidiary: 1 company (NAMCO SPA RESORT LTD.) Formerly consolidated subsidiaries: 2 companies* (Italian Tomato Ltd., Nikkatsu Corporation) Affiliates newly accounted for under the equity method: 1 company (Italian Tomato Ltd.) *Due to corporate division instituted December 1, 2005, subsidiary and equity-method affiliate administrative operations were partly assumed by NAMCO BANDAI Holdings Inc. from NAMCO LIMITED. As a result, effective 31 December, 2005, NAMCO LIMITED relinquished 12 consolidated subsidiaries. These 12 entities are not included in the number of formerly consolidated subsidiaries stated above as their financial results are included in the consolidated financial statements of NAMCO LIMITED.
2. Consolidated Business Results for the Nine Month-Period Ended December 31, 2005 (April 1, 2005 to December 31, 2005) (1) Consolidated Business Results ( million, %)

million % (2.9) (1.9)

Operating income
million 2,769 10,803 15,085 % (74.4) (26.4)

million 2,875 10,371 14,588 % (72.3) (25.2)
million 2,512 6,603 9,464 % (62.0) (0.2)
Nine months ended December 31, 2005 Nine months ended December 31, 2004 Fiscal Year Ended March 31, 2005

128,148 132,024 178,551

Nine months ended December 31, 2005 Nine months ended December 31, 2004 Fiscal Year Ended March 31, 2005 22.86 60.17 83.63
Notes: 1. Percentage figures accompanying net sales, operating income, etc. represent changes compared with the corresponding period a year earlier. 2. Effective November 19, 2004, a stock split at the ratio of 1:2 per share of common stock was implemented. Net earnings per share for the fiscal year ended March 31, 2005 and for the nine months ended December 31, 2004, have been calculated assuming that the stock split was implemented at the beginning of the fiscal year. 3. Owing to an absence of dilutive instruments, diluted net earnings per share are not stated for the nine months ended December 31, 2005.
Consolidated Statements of Income
Nine months ended December 31, 2004 Share (%) Millions of yen
Nine months ended December 31, 2005 Share Millions of yen (%)
128,148 99,709 28,439 100.0 77.8 22.2
Fiscal Year ended March 31, 2005 Share Millions of yen (%)
178,551 130,996 47,555 100.0 73.4 26.6
Net sales Cost of sales Gross profit Selling, general and administrative expenses 1 Advertising 2 Salaries and allowances 3 Depreciation 4 R&D expenses 5 Other selling, general and administrative expenses Operating income Non-operating income 1 Interest income 2 Dividend income 3 Store closing indemnity 4 Foreign exchange gain 5 Other non-operating income Non-operating expenses 1 Interest expense 2 Amortization of goodwill 3 Disposal of fixed assets 4 Provision for doubtful receivables 5 Foreign exchange loss 6 Other non-operating expenses Recurring income Extraordinary income 1 Gain on sale of investment securities 2 Reversal of allowance for doubtful receivables 3 Gain on change in equity interests 4 Gain on sale of equity in subsidiaries 5 Gain on collection on written-off claims 6 Other extraordinary income Extraordinary loss 1 Loss on valuation of inventories 2 Loss on impairment of property, plant and equipment 3 Other extraordinary losses Net income before income taxes and minority interests

132,024 97,168 34,856

100.0 73.6 26.4
4,508 6,4,899 7,640 24,052 10,803 18.2 8.2
4,418 6,5,126 8,915 25,670 2,769 20.0 2.2
5,760 8,6,781 10,348 32,469 15,085 18.2 8.4

364 0.2

690 10,371 0.5 7.9

2,875 0.4 2.2

14,588 0.5 8.2

196 2,2,811 2.2

515 1,030 0.6

10,550

15,540
Corporate income, inhabitant and enterprise taxes Minority interests Net income

3,6,603

2.9 0.0 5.0

3,226 (51) 2,512

2.5 (0.0) 2.0

5,9,464

3.4 0.1 5.3
Segment Information (1) By Business Segment Nine Months Ended December 31, 2004 (April 1, 2004 to December 31, 2004)
Coin-operated Game Machines Home Video Game Software Amusement Facility Operations Restaurant Operations Movies & Graphics Other Total Elimination or Corporate Items Consolidated

( million)

Net sales (1) To external customers (2) Intersegment sales and transfers Total Operating expenses Operating income (loss)
24,24,772 17,934 6,838 31,31,343 27,196 4,147 60,60,686 56,422 4,264 3,3,832 3,7,7,396 7,569 (173) 4,5,146 5,542 (395) 132,024 1,153 133,178 118,497 14,681 (1,153) (1,153) 2,724 (3,877) 132,024 132,024 121,221 10,803
Nine Months Ended December 31, 2005 (April 1, 2005 to December 31, 2005)
Coin-operated Game Machines Home Video Game Software Amusement Facility Operations Movies & Graphics Other Total Elimination or Corporate Items Consolidated
24,24,988 19,048 5,939 36,36,161 35,56,57,048 55,041 2,006 5,5,787 6,152 (364) 4,5,190 6,068 (877) 128,148 1,028 129,177 122,254 6,923 (1,028) (1,028) 3,125 (4,154) 128,148 128,148 125,379 2,769
Fiscal Year Ended March 31, 2005 (April 1, 2004 to March 31, 2005)
27,771 47,488 81,788 5,110 10,189 10,10,191 6,050 178,551 178,551

250 28,021 21,329 6,691

0 47,488 39,600 7,888

252 82,040 75,953 6,086

62 5,172 5,146 25

737 6,787 7,347 (560)

1,491 180,043 159,719 20,323
(1,491) (1,491) 3,746 (5,237)

178,551 163,466 15,085

Notes: 1. Methods for classifying operations Due to a partial stock transfer of its equity on April 15, 2005, the status of former consolidated subsidiary Italian Tomato Ltd. changed to that of an equity method subsidiary. As a result, the segment Restaurant Operations ceases to appear in segment information by type of business beginning with the term under review. Due to a partial stock transfer of its equity on September 28, 2005, former consolidated subsidiary Nikkatsu Corporation was excluded from consolidation on financial statements for the six-month interim period to September 30, 2005. Business results of this entity for the period until September 30, 2005, are included in Movies & Graphics operations. 2. Principal products and operations of business segments are unchanged except for Restaurant Operations and Movies & Graphics business segments. 3. Unallocatable operating expense amounts included in Eliminations and Corporate Items related to administrative divisions are as follows. Nine months ended December 31, 2004 Nine months ended December 31, 2005 Fiscal year ended March 31, 2005 3,885 million 4,201 million 5,257 million

(2) By Geographic Segment Nine Months Ended December 31, 2004 (April 1, 2004 to December 31, 2004)
Japan North America Europe Asia Total Eliminations and Corporate

Consolidated

104,985 3,461 108,447 94,343 14,103 22,22,132 21,4,4,599 4,132,024 3,529 135,554 120,703 14,851 (3,529) (3,529) 517 (4,047) 132,024 132,024 121,221 10,803
( million) Nine Months Ended December 31, 2005 (April 1, 2005 to December 31, 2005)
Japan North America Europe Asia Total Eliminations and Corporate Consolidated
Net sales (1) To external customers Intersegment sales and transfers
101,940 21,268 4,128,148 128,148

(2) Total

1,977 103,918 95,825 8,092
133 21,402 22,726 (1,324)

4,457 4,470 (12)

2,111 130,259 123,415 6,844
(2,111) (2,111) 1,963 (4,075)

128,148 125,379 2,769

140,606 31,343 6,178,551 178,551
4,580 145,187 127,050 18,136

69 31,412 29,259 2,153

0 6,082 6,004 77
4,650 183,202 162,786 20,415
(4,650) (4,650) 679 (5,329)
Notes: 1. Methods are unchanged for classifying geographic segments and principal countries and regions. 2. Constituent principal countries and regions of each segment are unchanged. 3. Unallocatable operating expense amounts included in eliminations and corporate related to administrative divisions are as follows. Nine months ended December 31, 2004 3,885 million Nine months ended December 31, 2005 4,201 million Fiscal year ended March 31, 2005 5,257 million

(3) Overseas Sales

Nine Months Ended December 31, 2004 (April 1,2004 to December 31, 2004) North America Europe I Overseas Sales ( million) II Consolidated Sales ( million) III Overseas sales as a ratio of consolidated sales (%) 16.9 6.4 1.0 22,313 8,471 Asia/Oceania 1,254 Total 32,039 132,024 24.3
Nine Months Ended December 31, 2005 (April 1,2005 to December 31, 2005) North America Europe I Overseas Sales ( million) II Consolidated Sales ( million) III Overseas sales as a ratio of consolidated sales (%) 17.4 10.7 22,263 13,717

Asia/Oceania 1,662

Total 37,643 128,148 1.3 29.4
Fiscal Year Ended March 31, 2005 (Fiscal Year from April 1, 2004 to March 31, 2005) North America Europe I Overseas Sales ( million) II Consolidated Sales ( million) III Overseas sales as a ratio of consolidated sales (%) 17.9 6.5 31,974 11,618

Asia/Oceania 2,105

Total 45,699 178,551 1.2 25.6
Notes: 1. Methods are unchanged for classifying geographic segments and principal countries and regions. 2. Constituent principal countries and regions of each segment are unchanged. 3. Overseas Sales are net sales that occur in countries or regions other than that of the Company or affiliated subsidiaries.