Osaka based game company Capcom has released its financial statement for the nine month period ending December 31, 2008. So, how’s Capcom doing?

Net sales dipped 8.6 percent to ¥47,223 million, and net income dropped 95 percent to ¥179 million. Capcom explains that the reason for this performance is that the company’s flagship titles like Resident Evil 5 haven’t been released yet this financial year and the dramatic rise of the yen — as well as the foreign exchange loss.

Sales were powered by Monster Hunter Freedom 2G, Capcom reports.

Net arcade sales were up 4.8 percent, and net arcade game sales were up a whopping 120.6 percent thanks to titles such as Street Fighter IV and Tatsunoko VS. Capcom.

Monster Hunter Freedom 2G sales have been “skyrocketing”, according to Capcom, since its March 27, 2008 release. The company also said the game broke Japanese PSP sales records, with 2 million units sold.

On the downside, the company’s arcade business is struggling, though the impact to Capcom is mitigated by its home software performance.

As we reported last night, the company saw 16,352 million yen ($US 153.2 million) in net sales for its fiscal first quarter, an increase of 14.5 percent over the same period last year. The company’s overall revenues took a 43.5 percent jump to 2,978 yen ($US 27.6 million), and profits were up 60.1% to 4,024 million yen ($US 37.2 million).