Universal Entertainment, Okada Manila, 3Q21 results continued to be impacted by pandemic

Okada Manila
Okada Manila

Universal Entertainment Corp, the parent company behind Okada Manila, recorded a widened net loss of JPY17.4 billion in 3Q21, driven by sluggish pachinko machine sales and restrictions placed on its Okada Manila integrated resorts business. 

In a filing, Universal Entertainment noted that sales in its integrated resorts business was down slightly in 3Q21 compared to the prior year period, given gaming operations at Okada Manila was limited to 50 percent total capacity during the quarter.

The company reported that net sales of its integrated resorts business increased 5.6 percent year-on-year to JPY21.7 billion in the nine months ended September 30, whilst operating loss came in at JPY2.5 billion, narrowed from an operating loss of JPY7.6 million in the prior year period. Adjusted segment EBITDA was JPY1.9 billion in the nine-month period, up from a loss of JPY2.8 billion. 

The company also noted that a reduction in workforce at Okada Manila led to more than 20 percent lower personnel expenses, whilst selling, general and administrative expenses also declined as a result of restricted operations. 

On August 5, 2021, the Philippines government placed Metro Manila under Enhanced Community Quarantine, the country’s highest level of restrictions, and announced the temporary suspension of numerous economic activities.

On September 16, 2021 the government’s new Covid-19 Response Alert System came into place, with Metro Manila placed on level 4, the second highest alert level until the end of September. 

This caused casinos to operate only at 50 percent venue capacity, and also imposed a 10 percent limit on the use of indoor restaurant seats, though this was raised to 30 percent at Okada Manila at restaurants with sanitation certification. Meanwhile, outdoor dine-in was given 30 percent seated capacity, whilst those with sanitation certification was allowed up to 40 percent. Furthermore, hotels were not allowed to accept general guests. 

These restrictions eased on October 16, as the government reduced the pandemic alert from four to three, and then reduced the alert from three to two on November 5.

Okada Manila is now allowed a 90 percent capacity limit in its casino venue, and 80 and 100 percent limits on its indoor and outdoor restaurants, and has also now opened its hotel to general guests.