Business Operations - As of September 30, 2020, Dynam Japan Holdings operates the largest network of Japanese-style pachinko parlors with a total of 445 locations[21]. - The company offers approximately 1,000 different types of prizes in its parlors, including everyday items and special prizes[21]. - Dynam Aviation was established to enter the aircraft leasing business, focusing on operating leases for narrow-body aircraft, leveraging strong cash flow from the pachinko business[22]. - The gaming machines in the parlors include Japanese-style pachinko and slot machines, with betting amounts ranging from 0.5 to 4 yen per pachinko and 5 to 20 yen per slot machine[21]. - The company aims to enhance its service by continuously introducing new products and popular items[21]. - The company operated a total of 445 game halls as of September 30, 2020, with 176 high-stakes game halls and 269 low-stakes game halls, where low-stakes halls accounted for 60% of the total[30]. - The average proportion of low-stakes Japanese pachinko machines in the industry was 46.0%, while the company's ratio was 72.2%, significantly exceeding the industry average[32]. - The company has shifted its focus towards low-stakes games, aiming to reshape Japanese pachinko into a truly popular entertainment option for all[32]. - The company has established 16 distribution centers across Japan to manage logistics and facilitate the sharing of game machines among its halls[44]. Financial Performance - Total revenue for the six months ended September 30, 2020, was ¥45,992 million (approximately HK$3,369 million), a decrease from ¥74,052 million (approximately HK$5,378 million) in the same period of 2019, representing a decline of 37.8%[23]. - The company reported an operating profit of ¥2,781 million (approximately HK$203 million) for the six months ended September 30, 2020, compared to ¥14,042 million (approximately HK$1,020 million) in the previous year, reflecting a decrease of 80.2%[23]. - Net profit for the period was ¥689 million (approximately HK$49 million), down from ¥8,696 million (approximately HK$631 million) in the same period of 2019, a decline of 92.1%[23]. - EBITDA for the six months ended September 30, 2020, was ¥7,854 million (approximately HK$575 million), down from ¥19,638 million (approximately HK$1,426 million) in the previous year, a decrease of 60.0%[23]. - Total bets for the six months ended September 30, 2020, decreased by 42.1% to 219,663 million yen compared to 379,269 million yen in the same period last year[50]. - Revenue from the Japanese pachinko business decreased by 38.8% to 45,255 million yen (approximately 3,315 million HKD) for the six months ended September 30, 2020, down from 73,970 million yen (approximately 5,372 million HKD) in the prior period[59]. - Operating expenses for the Japanese pachinko business were 46,396 million yen (approximately 3,399 million HKD), a reduction of 24.1% from 61,134 million yen (approximately 4,516 million HKD) in the previous period[60]. - The company reported a consolidated operating profit of 2,781 million yen, which is 19.8% of the previous year's figure[53]. - The total payout for the six months ended September 30, 2020, was 174,408 million yen (approximately 12,777 million HKD), a decrease of 44.4% from 305,299 million yen (approximately 22,171 million HKD) for the same period in 2019[58]. Assets and Liabilities - Non-current assets amounted to ¥216,127 million (approximately HK$15,833 million) as of September 30, 2020, a slight decrease from ¥221,441 million (approximately HK$15,783 million) as of March 31, 2020[25]. - Current assets increased to ¥80,257 million (approximately HK$5,880 million) from ¥55,798 million (approximately HK$3,977 million) as of March 31, 2020, indicating a growth of 43.8%[25]. - The company’s total liabilities amounted to ¥164,156 million, with ¥126,382 million attributed to the total segment liabilities[151]. - Current liabilities as of September 30, 2020, were 62,683 million JPY (approximately 4,592 million HKD), compared to 44,028 million JPY (approximately 3,138 million HKD) as of March 31, 2020[76]. - The net current asset value increased to 17,574 million JPY (approximately 1,288 million HKD) as of September 30, 2020, from 11,770 million JPY (approximately 839 million HKD) as of March 31, 2020[77]. - The company’s equity attributable to owners as of September 30, 2020, was 132,228 million yen, a slight decrease from 132,357 million yen as of April 1, 2019[121]. Human Resources and Governance - The company emphasizes customer-centric management and transparency in its operations[6]. - The company has a strong focus on human resource training to foster teamwork and effective problem-solving[6]. - The management team includes both executive and independent non-executive directors, ensuring a diverse governance structure[18][19]. - The company operates under a corporate philosophy that emphasizes trust and sustainable growth[5]. - The company’s board of directors underwent significant changes, including the resignation of Kohei Sato as chairman and CEO on April 27, 2020, and the appointment of Tatsuji Fujimoto as chairman[105]. - The company has complied with all applicable provisions of the corporate governance code, with some deviations noted[101]. COVID-19 Impact and Response - Following the COVID-19 pandemic, 436 pachinko halls were temporarily closed, representing approximately 97% of the total[38]. - Operating revenue recovery for the closed pachinko halls remained between 70% to 80% of the previous fiscal year's revenue starting from July 2020[38]. - The company plans to continue reducing costs, including game machine costs and labor costs, to adapt to the decline in operating revenue[38]. - The company plans to continue implementing comprehensive preventive measures in game halls to recover business performance post-COVID-19[55]. - The company expects the performance to be negatively impacted by the COVID-19 outbreak, leading to a 10% reduction in directors' salaries from May 2020 to March 2021, with a 30% cut in June 2020 salaries[105]. Shareholder Information - As of the reporting period, key executives held a total of 444,805,120 shares, representing approximately 58.575% of the company's equity[93]. - The company has a total of 759,373,296 shares issued as of the reporting period end[100]. - The total equity held by the Sato family members amounts to 444,805,120 shares, representing 58.575% of the company's equity[98]. - The company declared an interim dividend of 6 JPY per ordinary share, amounting to approximately 2,277 million JPY (about 167 million HKD) based on 759,003,496 shares issued as of December 14, 2020[107]. - During the reporting period, the company repurchased a total of 6,951,600 shares, with the highest price per share at 9.01 HKD and the lowest at 5.50 HKD, totaling 54,022,850 HKD in costs[108]. Financial Risk Management - The company’s financial risk management focuses on minimizing potential adverse impacts on financial performance due to market unpredictability, including foreign currency, price, and interest rate risks[87][88]. - The company has implemented policies to ensure sales are made to customers with appropriate credit records, significantly reducing credit risk[89]. - The company’s policy includes regular monitoring of cash reserves and compliance with loan agreements to meet liquidity needs[90].
DYNAM JAPAN(06889) - 2021 - 中期财报