Japanese gaming firm Universal Entertainment Corporation (UEC) expects to end the year with a loss, partly due to the weak VIP market hounding its Philippine integrated resort, Okada Manila, and other casinos operating in the country.
In a disclosure to the Tokyo Stock Exchange, UEC said that based on the recent performance of its businesses, it has revised its full-year consolidated business results forecast for 2024, which was announced last Feb. 14, 2024.
The firm said it expects its net sales to reach JPY 126 billion, down 37 percent from its earlier forecast of JPY 200 billion and lower than the JPY 179 billion generated in 2023.
Because of this, the firm expects a JPY 18.3 billion attributable loss, compared to the earlier expected JPY 19.6 billion attributable profit for 2024. The firm posted an attributable profit of JPY 28.44 billion in 2023.
“For the Integrated Resort Business, the uncertain situation caused by the possibility of a continuing decline in VIP customers across the entire casino market in the Philippines is expected to continue," UEC said.
It added, "For the Amusement Equipment Business, our strategy was to focus on releasing and selling multiple major titles in the second half of the year, but delays in the release of these major titles occurred."
Due to these factors, UEC said the progress of its strategic plan had fallen significantly behind the full-year consolidated business result forecast announced on February 14, 2024.
"Considering the shortfall in net sales and irreducible fixed costs, all kinds of profit were lower than expected. We have, therefore, revised the full-year consolidated business results forecast for the fiscal year ending December 2024 downward," it added.
UEC said it has also "regretfully decided to revise the year-end dividend forecast downward in line with the revision of the business results forecast.
"The year-end dividend forecast is revised from 30 yen per share in the last announcement to zero yen per share, resulting in a total annual dividend forecast of 30 yen per share," it noted.
Earlier this month, UEC's Philippine unit, Tiger Resort Asia Limited (TRAL), divested its majority stake in publicly-listed Asiabest Group International Inc. (ABG), dashing hopes for the backdoor listing and follow-on offering of integrated resort Okada Manila.
ABG said, "We were informed by our major stockholder, Tiger Resort Asia Limited, which owns 66.67 percent of the total outstanding capital stock of Asiabest Group International, Inc., that it had entered into a share purchase agreement with a consortium led by PremiumLands Corp. (PLC) today, December 5, 2024."
The agreement is for the sale and purchase of 200 million common shares of ABG, representing all shares owned by TRAL in ABG. The transaction price was not disclosed.