GGRAsia – Strong yen hurts Konami slot profits 1H fiscal 2017

Strong yen hurts Konami slot profits 1H fiscal 2017

Oct 28, 2016 Newsdesk Japan, Latest News, Top of the deck, World

Konami Holdings Corp’s gaming and systems division on Friday reported profit of approximately JPY1.59 billion (US$15.1 million) for the six months ended September 30, which it said was down 8.3 percent from a year earlier.

The firm said a strengthening of Japan’s currency the yen had a negative impact on those of its divisional earnings that are denominated in U.S. dollars.

The group noted that – with effect from the latest reporting period under discussion – it now reports its business in four segments: digital entertainment; health and fitness; gaming and systems; and amusement.

“Figures for the six months ended September 30, 2015 have been reclassified under the new segment classification, and compared with those for the six months ended September 30, 2016,” it stated.

During the latest reporting period – which represents Konami Holdings’ first half for the financial year 2017 – the gaming and systems division produced revenue of JPY13.79 billion, which it said was down 7.9 percent from a year earlier.

The group declared an interim dividend of JPY17.00 per share for the financial year ending March 31, 2017, with the commencement date for payment being November 18.

“The North American market environment saw harsh conditions due to the entry of European manufacturers and the resulting intensified competition, and increasingly prudent investments by casino operators when purchasing machines,” stated the group in its earnings announcement.

The firm added: “In the Asian and Oceanian markets, we developed a richly diverse product line-up, including Concerto the new cabinet and the Podium series.” The latter was a reference to a range of game cabinets.

It further stated of its gaming and systems division: “For the six months ended September 30, 2016, this business was strong mainly in the North American market, and total revenue and segment profit in local currency basis increased. In Japanese yen… however, total revenue and segment profit decreased due to the effect of exchange rate changes by the rising yen.”

Konami Holdings added in a presentation to investors accompanying the first half fiscal results: “With the business restructuring of group companies effective November 1, 2016, the arcade games division, formerly under the digital entertainment business, has integrated with the former pachislot and pachinko machines business to change its business domain to the amusement business commencing the second quarter.”

It continued: “This business restructuring was also planned… in anticipation of handling the research and development of gaming machines for the Asian market.”

Konami Holdings is listed on the Tokyo Stock Exchange and the London Stock Exchange.