Japan’s Universal Entertainment Corporation (UEC) reported a 30% decline in net revenue for fiscal 2024, driven by lower VIP play at its Manila integrated resort and decreased gaming machine sales domestically.
Tokyo-based pachinko and casino operator Universal Entertainment Corporation (UEC) reported a net loss of $102.8 million (JPY15.6 billion/£82.5 million/€99 million) for fiscal 2024, with net sales falling 29.4% to $834 million. Operating profit dropped 90.1% to $19.8 million.
The decline was driven by reduced VIP gaming activity at Okada Manila in the Philippines and a significant drop in pachinko and pachislot machine sales in Japan.
Post-pandemic adjustment
Okada Manila reported net sales of $541.4 million for fiscal 2024, a 15.4% decline from the previous year, as VIP gaming weakened. While overall visitor numbers at the integrated resort increased, gaming revenue fell 21.8% to $599.4 million.
UEC’s financial report, released on February 13, attributed the downturn to the slowdown in the junket business, which negatively impacted the overall casino market in the Philippines.
“Although mass market and gaming machine sales have steadily grown since their pre-pandemic peak in 2019, fiscal 2024 results were lower than the previous year when demand surged post-pandemic,” the company stated.
UEC also cited rising personnel costs at the resort and a foreign exchange gain due to the continued depreciation of the Japanese yen against the US dollar.
Despite these challenges, the company highlighted positive performance in its hotel and food and beverage segments, noting that guest numbers remain strong and revenue continues to rise.
A slump in gaming machine sales
In Japan, UEC’s gaming machine sales dropped 46.3% in fiscal 2024.
“Our strategy focused on launching and selling several major titles in the second half of the year,” UEC stated. However, multiple new products faced delays during testing, pushing their release to 2025. As a result, sales in the latter half of 2024 were limited to 49,000 units, bringing the total to 92,000 pachislot and pachinko machines sold.
Despite the setback, UEC remains optimistic about its near-term prospects. “Smart pachinko machines are evolving with richer game elements. The introduction of hit titles will drive market revitalization and strengthen our market share,” the company stated.
According to the Jakota Index, UEC expects to return to profitability in 2025, projecting net revenue of $990.3 million.
In the plus column
The Philippines set a new record for gross gaming revenue last year, driven largely by online gaming. The sector generated $6 billion, surpassing the government’s initial target of $5.75 billion and significantly outpacing the $4.9 billion recorded in 2023.
Adding to the positive momentum, Okada Manila secured a Forbes Travel Guide 5-star rating for the fifth consecutive year. Forbes described the resort as “the sparkling jewel in Manila’s crown,” highlighting key attractions such as The Fountain—the world’s largest multicolored dancing water display—and Cove Manila, Southeast Asia’s largest entertainment venue. The club, housed under a massive glass dome, features an 8,395-square-foot butterfly-shaped swimming pool.
According to UEC, these attractions, coupled with enhanced marketing and promotional efforts, will help draw a wider audience, including local guests from the Philippines and tourists from Japan, South Korea, and other Southeast Asian countries.
“In addition, we aim to expand our new online gaming platform for local players in the Philippines and strengthen promotions through our membership program,” UEC stated.
