Japan’s Sega Sammy Holdings reported a 446% increase in profit attributable to owners of the parent to JPY17.3 billion (US$121 million) in the three months to 30 June 2023, with the company crediting the performance of its pachislot and pachinko segment and its resort segment for driving recovery.
Revenue for the period grew by 63.4% year-on-year to JPY108.1 billion (US$757 million) with operating income up 712% to JPY22.6 billion (US$158 million).
Central to the strong performance was the pachislot and pachinko segment, which saw net sales grow by 383% to JPY51.0 billion (US$357 million) while income of JPY21.8 billion (US$153 million) reversed a JPY646 million (US$4.5 million) loss during the same period last year.
Sega Sammy said favorable market conditions had been driven by pachislot machines which had maintained a high utilization level due to the emergence of No. 6.5 models and smart pachislot themed around topical subjects. Pachinko machine utilization had been more sluggish but was expected to improve following the introduction of smart pachinko, which allows a wider range of game designs compared to existing pachinko machines, as of April 2023.
In the resort business, comprising the company’s 45% share in South Korean casino resort Paradise City plus domestic non-gaming holiday resort Phoenix Seagaia Resort, net sales grew by 10.2% to JPY2.92 billion (US$20.4 million) while a segment loss of JPY272 million (US$1.9 million) was narrowed from JPY1.17 billion (US$8.2 million).
Casino sales at Paradise City continued to see a recovery trend, the company explained, with the drop amounts of Japanese VIPs maintaining above pre-pandemic levels.
It also said it expects to turn a profit from its stake in Paradise City in the near future, “as casino sales are expected to be driven by strong Japanese VIP customers, and a gradual recovery in Chinese VIP customers is also expected, along with continuous recovery trend of international flights serving South Korea.”