Capcom has reported favorable results in its Q1 2008 financial statement, citing the Japanese release of Monster Hunter Freedom 2G as a primary sales driver for the company.

Capcom announced that its sales for the quarter ending June 30, 2008 totaled 16,352 million yen (about US$151 million), up 14.5% from the same period last year. Operating income was up 43.5%, from 2,075 million yen to 2,978 million yen ($US27.61 million). Net income increased 60.1%, totaling 2,382 million yen (US$22 million) compared to 1,130 million yen the previous year.

Capcom credited most of the growth to the record-breaking release of Monster Hunter Freedom 2G in Japan—the game sold 2.4 million copies, becoming the first Japanese PSP software title to break the two million unit sales barrier. Secondary factors to the company’s growth included growing sales of catalog titles and spin-offs, the success of the Ace Attorney franchise on mobile phones, and a 124.6% increase in the operating income of Capcom’s character licensing royalty business.

All wasn’t rosy at the company however, as the publisher’s efforts in the amusement category were down from all angles. Citing both the increasingly popularity of home game systems and the rising cost of gasoline as factors, the arcade operations division recorded a 73 million yen operating loss. The arcade game production division also recorded a dramatically increased operating loss of 245 million yen compared to the previous year’s 167 million yen loss. This was despite a 46.5% increase in sales, and was attributed to the high cost of developing Sengoku Basara Cross and Fate/Unlimited Codes for the Japanese market. The Pachislot business was also down. While the company expects to open three new arcades in Japan this year, it also expects to close down five.

Capcom’s forecast for the mid-term period is an 1,800 million net income on 34.7 billion yen worth of sales, and an operating income of 3,300 million yen. For the full fiscal year the company predicts it will generate 95.3 billion yen in sales, for an operating income of 14.6 billion yen and a net income of 8.6 billion yen.