Japanese gaming giant Sega Sammy Holdings Inc says its prospects for the 2019 fiscal year are positive despite the continuing decline of its pachinko and pachislot business resulting in an 11.8% decline in sales and a 67.7% fall in profit in the year ended 31 March 2018.
Sega Sammy reported sales of ¥323.7 billion for the year, down from ¥360.0 billion during the prior period, with sales in pachislot and pachinko falling 28.7% to ¥105.6 billion. In its financial statement, the company said that its sales schedule for the second half of the fiscal year was significantly revised due to regulatory revision, leading to overall sales of pachislot machines falling from 215,000 units in the 12 months to 31 December 2017 to just 85,000. Pachinko machine sales increased slightly from 138,000 to 140,000.
Despite the falls, Sega Sammy says it is expecting significant growth in the segment this year due to earlier preparations for the government’s strict new regulations on pachislot and pachinko payouts and the impending launch of new titles. It has also entered into a joint venture titled ZEEG Co Ltd with fellow pachislot and pachinko developer Universal Entertainment Corp – owner of Okada Manila.
“As a result of these developments, in the fiscal year ending 31 March 2019, the group expects sales of 103,000 units of pachislot machines, up 17,000 from the current fiscal year, and 201,000 units of pachinko machines, up 60,000 from the current fiscal year,” it said.
Sega Sammy is also expecting significant growth at its Korean integrated resort, Paradise City, in Incheon of which it holds a 45% stake. Pointing to the performance of Paradise City without providing detailed figures, the company said it “has served many visitors and signs of gradual improvement in profitability were seen.
“The group will continue to strive to improve the value of facilities in Paradise City where Phase 1, Stage 2 development facilities, including the club and spa, are scheduled to open in the fiscal year ending 31 March 2019.
“The group will continue to endeavor to accumulate further integrated resorts development and operational know-how through dispatching personnel to Paradise City.”
Sega Sammy’s Korean IR partner Paradise Co last week reported a 26.0% increase in revenue at its gaming properties to KRW179.5 billion of which Paradise City is its flagship.
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