Japanese pachinko hall operator Okura Holdings Limited revealed Tuesday it will shut down another of its halls, located in Ofuna in Kanagawa Prefecture, due to poor performance.
“Big Apple. Ofuna” hall will cease operations from 7 May 2023 with management citing its “deteriorating operating and financial performance since the outbreak of [COVID-19] in Japan in January 2020 and the resulting low overall customer traffic since early 2020.
“The management considered that although BA Ofuna gradually managed to regain customer traffic in the six months ended 31 December 2022, as compared with some of the Group’s other pachinko halls, the recovery of customer traffic at BA Ofuna is still at a slow pace despite the Group’s continuous effort and accordingly this pachinko hall [continued] to record losses from its business operations.
“Taking into account the general adverse operating landscape, the intense competition in the pachinko industry and the increasing competition from other forms of entertainment in Japan, the management considered that it will be more beneficial for the Group to focus its resources on the other more promising pachinko halls by enhancing customer experience there and minimise further losses from business operations by closing down pachinko halls with weaker performance.”
The hall in question contributed revenue of JPY170.5 million (US$1.25 million) in 2022, representing 5.5% of group-wide revenue, but fell to a loss of JPY28.5 million (US$209,000).
The Directors believe that the streamlining of resources and operations by closing down BA Ofuna will help stabilize and improve the Group’s financial performance in the long run, and is in the best interests of the Group and the Shareholders as a whole.
The closure of “Big Apple. Ofuna” will see Okura operating 11 pachinko halls in the Kyushu, Kanto, Kansai and Chugoku regions of Japan. The company previously shuttered two halls in May 2021 and another three in September 2021.
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