A significant decline in the VIP gaming segment at the company’s Philippines integrated resort Okada Manila and a massive drop in the number of pachislot and pachinko machines sold domestically have seen Japanese gaming firm Universal Entertainment Corp (UEC) suffer a loss attributable to owners of the parent of JPY15.6 billion (US$102.5 million) for the year ended 31 December 2024.
The result contrasted with net income of JPY28.4 billion (US$186.5 million) a year earlier.
In a series of filings, UEC noted that Okada Manila posted net sales of JPY82.0 billion in FY24, down 15.4% year-on-year, and Adjusted segment EBITDA of JPY19.6 billion, down 34.8% year-on-year, after the number of VIP guests continued to decline.
“The slowdown of the junket business negatively affected the overall market conditions for the casino business in the Philippines,” the company explained. “Although sales in the mass market and gaming machine category has steadily increased overall since the pre-pandemic peak sales of this business in 2019, their performance in the fiscal year 2024 was down from the previous year when demand significantly rebounded following the pandemic.”
However, it added, “In the hotel and food and beverage businesses, the number of guests is consistently high and revenue continues to increase.”
In the Amusement Equipment Business, UEC explained that its strategy in 2024 was to concentrate the release and sale of several major titles in the second half of the year but instead saw a number of releases pushed back to 2025 due to the “low percentage of the passing rate of our machines in the model test.
As a result, the number of units sold decreased from 180,632 in 2023 to 92,150 in 2024, which saw net sales decline by 46.3% to JPY43.5 billion and operating profit by 69.6% to JPY7.31 billion.
Nevertheless, UEC said it maintains a positive outlook for both its integrated resort and Amusement Equipment Business.
Okada Manila, the company explained, is recruiting and training people to strengthen marketing capabilities in the gaming business.
“These activities enable us to attract a broader range of local guests who live in the Philippines as well as tourists from Japan, South Korea and other Southeast Asian countries,” it said. “In addition, we will work to penetrate our new online gaming platform targeting the Philippine locals, which has begun operating in 2024, and conduct extra promotion through our membership program, Reward Circle.”
Likewise, UEC said the market environment of pachislot machines is favorable with the market share of smart pachislot machines increasing steadily due to their high utilization rate.
“In the Pachinko category, the game elements of the Smart Pachinko machines are to become richer, and the emergence of hit titles in the near future is expected and hence leading to the revitalization of the market,” it said.
“Universal Entertainment will continue striving to develop unique and appealing titles, contributing to the revitalization of the entire amusement equipment industry as well as expanding our market share.”
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