Financial Performance - Okura Holdings Limited reported a revenue of 1,000 million JPY for the fiscal year ending June 30, 2019, representing a 10% increase compared to the previous year[27]. - The company achieved a net profit of 150 million JPY, which is a 15% increase year-over-year[27]. - Future guidance estimates a revenue growth of 12% for the next fiscal year, projecting a total revenue of 1,120 million JPY[27]. - Total revenue decreased by approximately 6.4% from about ¥8,719 million in FY2018 to about ¥8,157 million in FY2019, primarily due to a decline in revenue from the Japanese pachinko and pachislot business[61]. - Profit before income tax increased by approximately ¥132 million, or about 15.4%, from ¥857 million in FY2018 to approximately ¥989 million in the current year[72]. - Profit attributable to shareholders decreased by approximately ¥142 million, or about 19.1%, from ¥743 million in FY2018 to approximately ¥601 million in the current year[73]. User Engagement and Market Expansion - User data indicated a growth in active users by 20%, reaching a total of 500,000 users by the end of the fiscal year[27]. - The company plans to expand its market presence in Southeast Asia, targeting a 25% increase in market share over the next two years[27]. - New product development includes the launch of a mobile application aimed at enhancing user engagement, expected to be released in Q1 2020[27]. - The company is exploring potential acquisitions to enhance its service offerings, with a focus on companies in the technology sector[27]. Operational Efficiency and Cost Management - The company has implemented new strategies to improve operational efficiency, aiming for a 5% reduction in operational costs[27]. - The total operating expenses for the pachinko parlors decreased from approximately 8,414 million yen in fiscal year 2018 to about 6,798 million yen in fiscal year 2019, a reduction of approximately 19.2%[50]. - The company has implemented cost control measures to streamline operations and reduce expenses, which included major renovations of existing parlors in fiscal year 2018[50]. - The company aims to manage its pachinko parlors more cost-effectively as a primary focus to adapt to the competitive landscape[50]. Industry Challenges - The Japanese pachinko industry continues to face challenges due to a decline in player numbers, influenced by regulatory changes that limit gaming elements[49]. - The company anticipates further contraction in the pachinko industry, with stronger operators acquiring smaller parlors to maintain financial performance[49]. - Management anticipates further revenue decline in the next fiscal year due to an increase in Japan's consumption tax from 8% to 10% starting October 1, 2019[55]. Investments and Financial Position - The company has allocated 200 million JPY for research and development in new technologies for the upcoming fiscal year[27]. - Total borrowings as of June 30, 2019, amounted to approximately ¥4,532 million, a decrease from ¥5,378 million as of June 30, 2018[77]. - Cash and cash equivalents as of June 30, 2019, were ¥2,565 million, down from ¥2,904 million as of June 30, 2018[78]. - The debt-to-equity ratio decreased to 21.9% as of June 30, 2019, from 27.0% as of June 30, 2018, primarily due to the repayment of existing borrowings[82]. - The company has established a financial and investment policy that includes avoiding low liquidity products and ensuring investments are made only with surplus cash[75]. Employee and Corporate Governance - The total employee cost for the year reached ¥1,504 million, accounting for approximately 19.5% of total operating expenses, a significant increase from ¥619 million and 7.2% in the previous fiscal year[94]. - The company employed 494 staff members as of June 30, 2019, with 435 located in Japanese pachinko halls[159]. - The average experience of executive directors and senior management in operating Japanese pachinko halls exceeds 20 years[159]. - The company has established appropriate directors' liability insurance coverage for legal actions against directors and subsidiary company directors[199]. Compliance and Regulatory Matters - The company has maintained compliance with all listing rules and is not aware of any significant non-compliance with laws and regulations affecting its operations[155]. - The company has implemented strict internal policies and procedures to manage compliance with special prize wholesalers[144]. - The company has not faced any significant claims or penalties for violations of environmental laws and regulations during the year[151]. Charitable Contributions and Community Engagement - The company made charitable donations totaling 170,000 yen during the year[170].
OKURA HOLDINGS(01655) - 2019 - 年度财报