Business Operations - As of September 30, 2022, DYNAM JAPAN HOLDINGS operates the largest network of Japanese-style pachinko parlors with a total of 433 locations[18]. - The core business of DYNAM JAPAN HOLDINGS is managing the largest chain of Japanese-style pachinko parlors in Japan, which is a popular form of entertainment[18]. - The company aims to leverage strong cash flow from its pachinko business to drive stable growth in its newly established aircraft leasing business, Dynam Aviation[19]. - DYNAM JAPAN HOLDINGS directly controls 8 subsidiaries, including the largest operator of Japanese-style pachinko parlors, Dynam[13]. - The company has established 16 distribution centers across Japan to manage logistics for 20 to 30 game halls, optimizing the use of second-hand gaming machines[29]. Financial Performance - Total revenue for the six months ended September 30, 2022, was ¥56,195 million (approximately HK$3,048 million), an increase from ¥50,897 million (approximately HK$3,540 million) in the previous year, representing a growth of 10.5%[20]. - Operating profit decreased to ¥3,881 million (approximately HK$210 million) from ¥6,714 million (approximately HK$467 million) in the previous year, reflecting a decline of 42.5%[20]. - The company reported a net profit of ¥1,183 million (approximately HK$64 million) for the period, down from ¥3,416 million (approximately HK$238 million) in the same period last year, a decrease of 65.4%[20]. - The EBITDA for the six months was ¥7,896 million (approximately HK$428 million), compared to ¥11,187 million (approximately HK$778 million) in the previous year, indicating a decline of 29.5%[20]. - Revenue from the Japanese pachinko business increased by 10.0% to 55,150 million yen (approximately 2,991 million HKD) from 50,139 million yen (approximately 3,487 million HKD) in the previous year[35]. Cash Flow and Liquidity - Net cash generated from operating activities was 26,755 million yen (approximately 1,450 million HKD) for the six months ended September 30, 2022, compared to 10,519 million yen (approximately 732 million HKD) in the previous year[50]. - Cash and cash equivalents increased by 419 million yen (approximately 23 million HKD) to 56,927 million yen (approximately 3,087 million HKD) as of September 30, 2022, from 56,508 million yen (approximately 3,064 million HKD) at the beginning of the period[51]. - Operating cash flow for the six months ended September 30, 2022, was 26,755 million JPY (approximately 1,450 million HKD), a significant increase from 10,519 million JPY (732 million HKD) in the same period of 2021[54]. - The company's current assets as of September 30, 2022, totaled 66,028 million JPY (approximately 3,581 million HKD), while current liabilities were 49,555 million JPY (approximately 2,688 million HKD), resulting in a net current asset value of 16,473 million JPY (approximately 893 million HKD)[57]. Investments and Expenditures - Capital expenditures for new Japanese-style pachinko and slot machines amounted to 14,339 million JPY (approximately 778 million HKD) for the six months ended September 30, 2022, compared to 25,332 million JPY (approximately 1,762 million HKD) in the same period of 2021[59]. - The company has committed to purchasing 2 new aircraft for a total amount of 17,088 million yen[33]. - The company plans to launch smart slot machines in November 2022 and smart pachinko machines in spring 2023 to enhance profitability[24]. Shareholder Information - As of the reporting period, the total number of issued shares was 717,477,696, with significant ownership by key executives, including Mr. Sato Yoji holding 61.996% of the company's shares[74][75]. - The major shareholder SAC holds 273,632,560 shares, representing 38.138% of the company's equity[79]. - The interim dividend declared is 2.5 JPY per ordinary share, amounting to approximately 1,792 million JPY (about 97 million HKD) based on 716,601,696 shares issued[85]. Corporate Governance - The company has complied with all applicable corporate governance code provisions, except for the chairman and CEO being held by the same individual[81]. - The audit committee reviewed the unaudited interim consolidated financial statements during the reporting period[84]. - The company has adopted a standard code for preventing insider trading, which has been confirmed by all directors to be followed during the reporting period[83]. Risk Management - The group has established foreign currency hedging policies to manage foreign currency risks associated with transactions, assets, and liabilities denominated in HKD, USD, and EUR[68]. - Credit risk arises from the possibility of customers failing to meet their payment obligations, with the group implementing policies to ensure sales are made to customers with appropriate credit records[70]. - The group regularly monitors its current and expected liquidity needs to maintain sufficient cash reserves and liquid securities to meet short-term and long-term liquidity requirements[71]. Market Outlook - The operating environment remains uncertain due to concerns over inflation and the impact of new COVID-19 variants, despite a gradual return to normalcy in social and economic activities[24]. - The estimated revenue growth rate post-COVID-19 is projected to be between 7.5% and 8.4%[125]. - The company plans to continue expanding its market presence and investing in new technologies to enhance its competitive edge in the industry[98].
DYNAM JAPAN(06889) - 2023 - 中期财报