Universal Entertainment may only have nine months of sales data available to them at this point this year, but executives at the company have to be thrilled with the numbers they are seeing.
The Japanese-based company reported a 39.5% increase in net sales over those nine months, in comparison to the same period in 2018. This comes on the heels of the positive performance of its combined operations at the Philippines integrated resort Okada Manila and in its pachinko and pachislot business.
Total net sales through the first nine months of this year reached JPY93.48 billion ($1.84 billion). It appears that the company was greatly helped by the redemption of its Wynn Stock which occurred after the resolution of a legal dispute in 2018. The company declared a loss of JPY5.74 billion ($113.1 million) through September compared with the income of JPY167.97 billion ($1.54 billion) last year.
One positive number the company has to be extremely excited about is that the adjusted segment EBITDA increased by a dramatic 938% to a total of JPY21.04 billion ($414 million). The Okada Manila resort also saw a dramatic turnaround, as net sales increased 46.7% over that of the same period of time in 2018. They moved from a loss of JPY4.78 billion ($44 million)in 2018 to a profit of JPY1.84 billion (US$36.2 million) this year.
Universal had to revise its sales forecast in 2018 as sales were not expected to reach anywhere near the projections the company had hoped for. In December 2018, the company forecast a net sales of JPY92.7 billion ($82.3 million), a 37.8% decrease in the JPY149 billion that was expected.
To try to gain greater control of the company, they began a multimillion-dollar buyback of their shares a month later. In a filing with the Jasdaq Securities Exchange, the company explained that they were looking to buyback 600,000 shares of common stock at a price totaling around $18.5 million. Stock is purchased through the end of June.
As the year progressed, Universal Entertainment began to see significant gains. In September, the company announced a 72% increase in gross gaming revenue for August of this year. That resulted in a total gross revenue of Php3.86 billion ($75 million).
It is the Okada Manila resort that is expected to Garner most of the attention of the company. In a statement, Universal Entertainment explained that they are “positioning the Integrated Resort Business for continued growth, in part by enabling the resort to host large group events and foreign tour groups.” They added, “At Okada Manila, the highest priority is to continue adding attractions and amenities.”
As a result of Universal’s good news, Union Gaming (UG) have made some revisions to their forecasts for the operator. “We are raising our 4Q20 Adjusted Segment EBITDA to ¥9.5bn [$87 million] (from ¥8.5bn) [$78 million) and our 2020 estimate to ¥43.7bn [$400 million] (from ¥40.8bn) [$370 million],” they wrote, explaining that the change was based on improvement in Universal’s amusement business, as well as 500 new rooms opening at Okada Manila.
