Japanese pachinko hall operator Okura Holdings has issued a profit warning in which it reveals an expected 83% fall in profit before income tax for the 11 months to 31 May 2020 due to the impact of COVID-19.
In a filing, Okura said the decrease was “mainly attributable to the drop in revenue as a result of the temporary closure of all 17 pachinko halls of the Group during various periods between April and May 2020 due to the outbreak of COVID-19 in Japan.”
The company had originally flagged its intention to continue operating all 17 of its pachinko halls even after Japanese Prime Minister Shinzo Abe declared a state of emergency on Tuesday 7 April. It later suspended operations at its halls in Tokyo and Kanagawa and reduced the operating hours of those in Hyogo and Fukuoka, before eventually shuttering all 17 halls in mid-April.
On Tuesday, Okura added, “Depending on the Group’s financial and operating results for June 2020 which may affect the extent of impairment losses to be recognized, the Group’s financial performance for the year ending 30 June 2020 may deteriorate further, and the Directors anticipate that the Group’s performance for FY2020 will decline significantly as compared with that for the year ended 30 June 2019. The Company is still assessing the amount of impairment losses.”
Okura recorded a profit before tax for the 12 months to 30 June 2019 of JPY989 million (US$9.2 million), a 15.4% increase on FY18.
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