Namco Bandai buffered by stock buyback

Namco Bandai's earnings outlook has taken to bouncing around like all the pachinko machines that were displaced by the game purveyor's Japanese arcade extermination last month. In February, the arcade operator and home-gaming publishing house amended its full-year fiscal forecast to reflect net sales of ¥465 billion ($4.6 billion), a rise of 1.3 percent, with operating income precipitously falling 19.5 percent to ¥34 billion ($341 million) and net income freefalling 32 percent to ¥16.5 billion ($165 million).

However, that was yesterday, and today is today. After the close of the Tokyo Stock Exchange yesterday, Namco Bandai announced it would spend ¥12 billion ($120 million) to buy back 3.14 percent of its outstanding shares, and that it would also be raising its annual profit forecast by 88 percent, reports the Bloomberg news service.

According to Bloomberg, a primary cause for the publisher's dramatic reversal of fortunes was ¥16.7 billion ($167 million) gained from selling real estate in Tokyo. The publisher now expects net income to rise 28 percent to ¥31 billion ($311 million) in its full fiscal year ended March 31.

Following its 27 percent slide on the announcement in February that it would be closing 50 arcades in Japan, Namco Bandai's stock rose 5 percent to ¥1,312 ($13.15) on the Tokyo Stock Exchange, as reported by Bloomberg. The rise was the single largest for the publisher since February 13, and significantly outpaced the Nikkei 225 Stock Average, which lost 1.5 percent on the same day.