Sega Sammy back to profit through June as video gaming, pachinko segments show improvement

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Japanese gaming giant Sega Sammy Holdings returned to profit in the three months to 30 June 2021, announcing income attributable to owners of the parent of JPY2.94 billion (US$26.7 million) despite the ongoing impact of the COVID-19 pandemic.

The positive result, which reverses a loss of JPY3.30 billion (US$29.9 million) recorded during the same period last year, was primarily driven by increased volumes in both the companys pachinko and pachislot segment and its entertainment contents business.

Sega Sammy is a producer of both in-home video games and arcade games, a leading supplier of pachinko and pachislot titles, operates non-gaming resort Phoenix Seagaia Resort and holds a 45% stake in integrated resort Paradise City in Incheon, Korea. It is also part of a consortium led by Genting Singapore that is bidding to win an IR license in Yokohama.

According to the groups quarterly financial results, published Friday, revenue increased 22.9% year-on-year to JP59.45 billion (US$539.3 million), of which JPY47.44 billion (US$430.4 million) was generated by the entertainment contents business.

Net sales in the pachislot and pachinko segment increased 283% to JPY10.36 billion (US$94.0 million), including the sale of 9,000 pachislot units and 15,000 pachinko units versus just 485 units and 117 units respectively during the same period last year. Segment loss was JPY1.49 billion (US$13.5 million) versus a prior year loss of JPY8.53 billion (US$77.4 million).

The resort business also saw a 234% increase in sales to JPY1.55 billion (US$14.1 million) with a loss of JPY1.96 billion (US$17.8 million) versus a loss of JPY2.14 billion (US$19.4 million) in the June quarter of 2020.

Sega Sammy said it will continue to work to strengthen efforts to acquire guests for its resorts business, mainly focusing on demand from individual customers.

However, for Paradise City, although it was assumed that travel restrictions would be relaxed in or after July 2021, the impact on results will need to be determined if travel restrictions would be prolonged.