Operator News

Japan – Decline in pachislot sales dampens Okada Manila’s bounceback for Universal

By Phil - 15 May 2023

A decline in pachislot sales saw Universal Entertainment Corp’s profit fall by 71 per cent compared to last year’s first quarter to JPY2.95bn (US$21.7m), although the company’s Okada Manila resort in the Philippines saw revenue increase by 113.7 per cent year on year.

Operating profit was 4,760m yen, up 104.7 per cent from the first quarter of 2022, ordinary profit was 3,159m yen, down 71 per cent from the first quarter of 2022, and net profit attributable to owners of parent was 2,946m yen, down 64.8 per cent from the first quarter of 2022.

The Integrated Resort Business posted net sales of 24,117m yen (an increase of 113.7 per cent year on year) and an operating profit of 4,134m yen (compared with an operating loss of 498m yen in the in the same period of 2022) in the first quarter of 2023. Adjusted segment EBITDA in the Integrated Resort Business was 7,925m yen in the first quarter of 2023 (an increase of 226.2 per cent year on year).

The company said: “At Okada Manila, an integrated resort owned and operated by the Universal Entertainment Group, operations have remained in response to the Philippine Government’s regulations and mitigation of COVID-19 countermeasures. In the first quarter, there was a gradual increase in the number of visitors not only within the Philippines but also from other countries and business performance has remained strong. We have made progress in attracting popular restaurants in the Philippines, which has created synergy with restaurants directly operated by Okada Manila such as Red Spice and Kappou Imamura rather than competing with them, contributing to the increase in the number of guests visiting the resort.”

“To continue to attract an even broader range of local visitors in the gaming business, one priority is increasing the scale of online games that can be played within the Philippines. This includes measures to target gaming demand in areas of the Philippines other than Luzon Island, where Manila is located,” it added. “To attract more foreign tourists, we are also conducting a large volume of marketing activities in Japan, South Korea, Thailand and other Asian countries.”

The recovery in the number of visitors from other countries is expected to continue in 2023 as the impact of the pandemic on travel and other activities declines. However, the Philippine Department of Tourism’s 2023 goal of about 4.8 million foreign tourists is well below the approximately 8.26 million foreign tourists who visited the Philippines in 2019.

In the first quarter of 2023, the Amusement Equipments Business posted net sales of 11,145m yen (a decrease of 31.4 per cent year on year) and an operating profit of 3,102m yen (a decrease of 41.3 per cent year on year). The number of units sold decreased by 12,836 from one year earlier to 24,903 units. During the first quarter, the performance of Pachislot machines that comply with the new 6.5 standard and smart Pachislot machines continued to meet the expectations of pachinko hall operators as these machines made a big contribution to raising utilization rates. Replacements of machines at pachinko halls are shifting from primarily Pachinko machines to primarily Pachislot machines, resulting in a steady recovery of the Pachislot market following a prolonged slump.

Production and sales increased for “Okidoki Gold and Pachislot Shin Onimusha 2,” which are very popular and successful titles. In the Pachinko category, sales of two new titles started: “P Shin Basilisk: The Kouga Ninja Scrolls.

The company added: “The markets for Pachislot and Pachinko machines are expected to continue to grow. In the Pachislot sector, new machines complying with the new 6.5 standard and smart machines are popular among many categories of users. In the Pachinko sector, demand is increasing because of the full-scale launch of smart Pachinko machines that have an even broader range of game playing characteristics and for other reasons.

“In the second quarter, deliveries are starting for “ANOTHER GOD HADES: TOKIHANATARESHI SOUGEKI ver.,” which complies with the new 6.5 standard and is the first GOD series Pachislot title based on standard 6. In addition, sales are starting for “SLOT MADE IN ABYSS,” a Pachislot title incorporating the worldview of the popular anime “Made in Abyss,” and the Pachinko title “P YAJIKITA DOCHUKI.” Interest at pachinko halls is high in all three titles and orders are strong.”