Group Journal - DYNAM JAPAN HOLDINGS Co.,Ltd.
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This is our group journal to connect
the DYNAM Japan Holdings Group and our trusted partners
Group Journal Vol. 15
Feature: Measures to Prevent COVID-19 Infections [P04-07]
Greetings from the New Chairman of the Board
& Chief Executive Officer [P02-03]
Financial Results for the Financial Year Ended 31 March 2020 [P08-09]
To Our Landowners: Thank You from the Representative Directors
of Our Companies [P10-11]
Notification from the DYJH Group [P12-15]
Greetings from the New Chairman of the Board
& Chief Executive Officer
We will aim to develop further than now
and to establish a stable management base
by continuing to take on the challenge Makoto Sakamoto
of achieving our vision. Chairman of the Board &
Chief Executive Officer
DYNAM JAPAN HOLDINGS
I would like to express my sincere gratitude to all our transition to ban smoking inside them in principle due
landowners, suppliers and other trusted partners for to a revision to the law on 1 April 2020. The DYJH
your understanding and support of the business Group considers the separation of smoking and
activities of the DYNAM Japan Holdings Group non-smoking areas in pachinko halls, the reduction in
(DYJH Group) on a daily basis. the high volatility of gaming machines and other
The DYJH Group suffered a decrease in revenue in changes in the gaming environment to be an
this consolidated financial year (1 April 2019 to 31 opportunity to acquire new users. The essence of the
March 2020). This was due to the continuation of a pachinko business is to provide a time and space that
severe business environment and the impact of the can be truly enjoyed with smiles brought to the faces of
COVID-19 infections that occurred in the second half of visiting customers by all our employees adopting the
the financial year. Nevertheless, we recorded an operating perspective of our customers. I believe that this is the
profit of 21,514 million yen by significantly decreasing mission of the DYJH Group. I would like us to achieve
costs. This was an increase of 11.2% or 2,172 million yen corporate growth by continuing to take on the
in profit compared to the previous financial year. challenge of achieving our vision: “remaking pachinko
The DYJH Group has also been greatly affected by as a truly popular entertainment that can be readily and
the impact of the COVID-19 infections that have raged comfortably enjoyed by all.”
around the world. We have seen a fall in customer Furthermore, the DYJH Group entered aircraft
numbers in our pachinko halls since the end of the leasing operations which we can expect to have
financial year. In addition, we temporarily closed and relatively stable earnings from last year. We purchased
shortened the opening hours of our pachinko halls in three narrow body aircraft that are highly popular on
some regions in response to requests to do so from local the market and started leasing them to airlines in this
governments. We are praying for an early recovery from period. I would like to continue increasing the degree to
this situation. Nevertheless, we give our highest priority which these operations contribute to our business
to our social responsibility of preventing the spread of performance in the future.
infections. Therefore, we are doing our utmost to The DYJH Group has been operating with a new
provide gaming spaces where our customers can feel team since June 2020. Despite the unprecedently severe
peace of mind. Moreover, I would like to thank all our business environment, the whole of the DYJH Group
landowners for your cooperation with the reduction, has come together and is striving to meet the
exemption and deferment of our rent expenses. expectations of our trusted partners. I ask for your
Profile: Born on January 18, 1957 (63 years old). After graduating from Waseda University, joined The Daiei, Inc. (General Manager
Meanwhile, all pachinko halls have made the continued understanding and support. of the Personnel Department in the Personnel Division in The Daiei, Inc.). After that, gained experience in a couple of companies
and then joined DYNAM Co., Ltd. in 2004. Appointed an executive officer of DYNAM JAPAN HOLDINGS Co., Ltd. in September
2013. Appointed Chief Executive Officer (current position) of DYNAM JAPAN HOLDINGS Co., Ltd. in April 2020 and then appointed
Chairman of the Board (current position) in June of the same year.
DYNAM Care
Response of the DYJH Group to Temporary Business Closure Requests
Measures to Prevent COVID-19 Infections DYJH Group’s Approach to Temporary Business Closure Requests
(1) In principle, we will temporarily close our pachinko halls in regions where requests have been
by the DYJH Group
made by local governments to close businesses in specified types of industries
(2) We will also reopen our pachinko halls with the clear standard of the cancelation by local
governments of their requests to temporarily close businesses
The spread of COVID-19 infections, which became
apparent from around January 2020, has had various A declaration of a state of emergency was issued based on the Act on Special Measures for Pandemic
impacts on economic activities in Japan. There was also a Influenza and New Infectious Diseases Preparedness and Response on 7 April. Since then, the DYJH Group
severe situation in the pachinko hall industry which is a has been complying with requests to temporarily close businesses specific to pachinko hall operations in
form of business involving frequent contact with the prefectures of Japan. We temporarily closed all our pachinko halls in the concerned regions from the
customers. For example, the government and local specified date. Moreover, we have been exchanging chodama (pachinko balls left in our care) in all our
governments one after another asked people to avoid pachinko halls while they were temporarily closed in consideration of the perspective of our visiting customers.
going outside and requested the temporary closure of Our approach as to when to reopen our pachinko halls has also been the same. We have promptly
businesses. Nevertheless, the DYJH Group believes the reopened our pachinko halls upon thoroughly taking the measures to prevent infections requested by local
most important thing is to continue business upon governments when they cancelled their temporary business closure requests.
ensuring safety to contribute to local communities by Temporary Pachinko Hall Closures in the DYJH Group
protecting lives and the economy under our clear vision. 448 (Total number of pachinko halls)
We introduce the response of our group to the spread
of COVID-19 infections in this issue.
Basic Policy of the DYJH Group
The DYJH Group considers the lives and safety of our customers and employees to be our
highest priority. Under this belief, we will aim to achieve compatibility with business activities
(the economy) by providing gaming services as normal to our customers upon taking thorough
7/4 17 18 19 20 21 22 23 24 25 27 28 29 2/5 7 11 12 15 16 18 20
measures to prevent infections.
7 April 16 April 7 May 14 May 21 May
Seven prefectures All prefectures in Some local governments The declaration of a state The declaration of a state
Measures to Prevent Infections That declare a state Japan declare a state relax their temporary of emergency is cancelled of emergency is cancelled
We Have Taken Based on Our Basic Policy of emergency of emergency business closure requests in 39 prefectures in Osaka, Kyoto and Hyogo
We temporarily closed 436 pachinko halls – equivalent to 97% of our 448 pachinko halls – at the peak of the crisis.
Response However, we reopened all the pachinko halls in the DYJH Group by 29 May in line with the cancelation of the tempo-
1 in Our Pachinko rary business closure requests.
Halls
• We have made it obligatory for our employees to wear
masks and disinfect their hands with alcohol
Comments from Customers Received by Customer Service
• We are wiping gaming machines with alcohol
• We have increased the ventilation frequency
(We are implementing many other efforts. We
introduce the details of these from P6.)
Thanks for your I was waiting
sensible response for you to reopen!
2 Changes in Our Work Style
3
• We have introduced staggered working hours to
avoid transportation congestion Changes in Our Business Style
Thank you for temporarily closing your pachinko halls I was wondering with expectation when you would
• We are proactively implementing work on • We have banned large internal meetings ahead of others in the industry despite the big losses you reopen your halls because I wanted to play at DYNAM
Saturdays, Sundays and public holidays (10 or more people) will suffer from COVID-19. I also like playing the slot as soon as possible. I think it is also very important to
• We are proactively implementing working at home • We have banned business negotiations and machines. However, I was anxious about customers drive the economy with pachinko. Therefore, I
with a focus on teleworking discussions in meetings with suppliers crossing the border from other prefectures to visit support your position to reopen your pachinko halls
(Implemented by 94% of employees in our • We are encouraging meetings from remote pachinko halls during this period when we are being at the same time as the cancelation of the requests to
headquarters in Tokyo) locations asked to avoid going outside. The neighbourhood avoid going outside. Social distancing is being
residents were also worried about that. You immediately maintained with the installation of boards between
made the decision to temporarily close your pachinko machines in your pachinko halls. Accordingly, I have a
halls. Accordingly, I think that you are a pachinko good feeling that there is a high awareness of the
operator that we can trust. Please continue to lead the need to take measures to prevent infections. I will
industry from a sensible position in the future. continue to visit DYNAM to play pachinko in the future.
DYNAM Care
When reopening our pachinko halls, we thoroughly comply with the measures to prevent
Thorough Measures to Prevent Infections infections being promoted by each prefecture. In this way, all our employees are working to
ensure that our customers can visit our pachinko halls with peace of mind. We introduce here
in Our Pachinko Halls specific measures we are taking to prevent infections in our halls.
Measures to Prevent Infections During Play Measures to Prevent Infections in Our Halls
Installation of Panels
Installation of Plastic Sheets
between Machines to
Prevent Droplet Infections
We have installed plastic sheets at our prize
exchange counters to prevent droplet
We have installed panels between machines to infections. Moreover, we are preventing
prevent close contact between players and to contact infections by using trays and baskets
prevent droplet infections. when exchanging prizes.
Thorough Face Mask Policies Maintaining a Distance
among Employees of 1.5 to 2 Meters
We are thoroughly ensuring that all our employees
wear masks. At the same, we are also distributing We are maintaining social distancing by marking
masks for free to our customers. These are where customers should stand while waiting in
measures to prevent customers and employees line at our counters to prevent close contact
from becoming infected. The Headquarters between them. In addition, we are also taking
Purchasing Department has secured the masks
separate measures (e.g., distributing tickets to
necessary to open our pachinko halls and is
delivering them to those pachinko halls (total call customers in turn) during busy times.
shipment: more than 2 million masks).
Disinfection of Social Distancing
Gaming Machines in Smoking Areas
We are spraying disinfectant centred on handles We are limiting the number of people who can
and the areas around machines that come into enter smoking areas at any one time to ensure
contact with customers in particular to prevent
social distancing of 1 meter between customers
contact infections. We have set up signs indicating
that disinfection has been completed so in them. We have put up signs to give a guideline
that our customers know disinfectant of this distance in the smoking areas.
has been sprayed.
Minimized Volume Between fingers
back of hands
Broadcasting of
of Our Gaming Machines
Hand Washing Videos
We have minimized the volume of our gaming
We are broadcasting videos that provide a
machines so that there is no need to talk in loud
model guide to hand washing in front of areas
voices. This is a measure to prevent droplet
infections. Moreover, we have stopped where our employees and customers wash
playing background music in our their hands in restrooms to reduce the risk of
pachinko halls in principle. infection.
*We are implementing these items according to guidance from prefectures, so our response differs by each pachinko hall.
Consolidated Statement of Financial Position (IFRS)
Financial Information
(Unit: Million yen)
End of the Previous Period End of This Period Increase/ Main Breakdown at the End of This Period and Increase/
(Ended 31 March 2019) (Ended 31 March 2020) (decrease) [Decrease] from the Previous Period
for the Financial Year Ended 31 March 2020 Property, plant and equipment 105,206
Right-of-use assets 79,048
Financial Information
Total assets 185,332 277,239 91,907 Cash and cash equivalents 41,810
We report below the financial information of the DYJH Group for the financial year ended 31 March 2020 (1 April
2019 to 31 March 2020). In conformity with the listing rules of the Hong Kong Stock Exchange, our financial reports Deferred tax assets 14,706
are based on the International Financial Reporting Standards (IFRS).
Finance lease receivables 7,615
Consolidated Statement of Income (IFRS) (Unit: Million yen)
Lease liabilities 93,796
Previous Period This Period Increase/
Supplementary Explanation Total liabilities 43,532 142,507 98,975 Arrears and accrued expenses 14,801
(Ended 31 March 2019) (Ended 31 March 2020) (decrease)
Halls with high playing cost machine: 69,619 (-3,495) Interest-bearing liabilities 13,228
Revenue 146,371 141,919 (4,452) Halls with low playing cost machines: 72,300 (-957)
Commission from Share capital 15,000 15,000 –
vending machines 4,633 4,729 96
Machine expenses: +2,433 Personnel expenses: (-2,011) Net profit for this period +12,747
Operating Decrease in hall operating expenses: (4,451)
expenses 133,047 126,932 (6,115)
Amount of impact from the new accounting standards for leases: Dividend payments
(2,086) (Rent) in the previous period (9,192)
Insurance pay-out revenue relating to disasters in the previous period: (470) Reserves etc. 126,800 119,732 (7,068)
Other income 4,338 4,281 (57) Amount of impact from the new
Aircraft leasing revenue: +564 accounting standards for leases
(9,443)
Other operating Disaster losses in the previous period: (616)
expenses 2,953 2,483 (470) Aircraft lease costs: 399 Other comprehensive income (1,180)
Operating profit 19,342 21,514 2,172 111.2% compared to the previous period Total capital 141,800 134,732 (7,068) Consolidated capital-to-asset ratio 48.6%
Finance income 471 461 (10) Total liabilities and capital 185,332 277,239 91,907
Amount of impact from the new accounting standards for leases:
Finance expenses 444 2,469 2,025 +1,880 (leasing interest expenses)
Note: Application of the new accounting standards for leases (IFRS16): We have on-balanced the present value of the future total rent of our open pachinko halls to assets and liabilities from this period.
Profit before
income taxes 19,369 19,506 137 100.7% compared to the previous period Consolidated Interest-bearing Liabilities (Unit: Million yen)
Net profit for End of the Previous Period End of This Period
the year 12,591 12,747 156 101.2% compared to the previous period (Ended 31 March 2019) Percentage (Ended 31 March 2020) Percentage
EBITDA 31,136 33,151 2,015 Cash and cash equivalents 47,537 25.7% 41,810 15.1%
Interest-bearing liabilities
Note: EBITDA is calculated by adding finance expenses, taxes, depreciation expenses and foreign currency-denominated asset conversion gains/losses to the net profit for this period.
(Pachinko operations) 2,626 1.4% 2,007 0.7%
Interest-bearing liabilities
(Aircraft leasing operations) – – 11,221 4.0%
Outlook on the Financial Results Total assets 185,332 100.0% 277,239 100.0%
In the financial year ended 31 March 2020 in DYNAM JAPAN HOLDINGS Co., Ltd., our revenue decreased while our Notes: 1. We are continuing with substantially debt-free management.
profit increased. Our operating revenue was 141,919 million yen (down 3.0% year on year), our net profit for this 2. Our purchases of aircraft are roughly 30% self-financed and 70% financed by bank loans. (We purchased three aircraft in this period.)
period before income tax was 19,506 million yen and our net profit for this period was 12,747 million yen (up 1.2%
year on year).
Consolidated Capital-to-asset Ratio (Unit: Million yen)
End of the Previous Period End of This Period
The operating rates for both pachinko and pachislot are decreasing in the pachinko hall industry. This is due to Percentage Percentage
(Ended 31 March 2019) (Ended 31 March 2020)
the increase in machines under the new standards that are compliant with the revised gaming machine Share capital 15,000 8.1% 15,000 5.4%
regulations enforced in February 2018. In addition, we have been directly affected by the impact of the spread of
COVID-19 infections since the end of February. This resulted in a significant decrease in revenue due to a fall in Reserves etc. 126,800 68.4% 119,732 43.2%
customer numbers in March. Net assets 141,800 76.5% 134,732 *48.6%
Total assets 185,332 100.0% 277,239 100.0%
Future Outlook *The calculation under the previous accounting standards is 74.6%.
The DYJH Group temporarily closed up to 436 of our pachinko halls – equivalent to approximately 97% of all Dividends
our pachinko halls – due to the declaration of the state of emergency issued in April. We suffered a sharp
Our policy is to continue paying a stable dividend to enhance shareholder value and ensure our group continues to grow.
decline in revenue in April and May. Against this backdrop, we reopened all our pachinko halls by 29 May.
End of Financial Year Dividend Interim Dividend Annual Dividend
Nevertheless, customer numbers have remained sluggish even after that.
The impact of COVID-19 is expected to continue in the future. However, the whole of our group is coming Dividend record date 8 June 2020 9 December 2019 –
together as one to restore our business performance while developing and providing an environment in
Dividends per share ¥3.00 ¥6.00 ¥9.00
which customers can play with peace of mind. For example, we are working to thoroughly prevent infections
in our pachinko halls. Total dividends ¥2,298 million ¥4,596 million ¥6,894 million
Dividend payment date 24 June 2020 10 January 2020 –
To Our Landowners
© DYJH 2015
The pachinko business is a type of business made possible by customers visiting pachinko
halls. We have taken measures to prevent infections by preparing an environment in which
our customers can visit and play in our pachinko halls with peace of mind as far as
We would like to express our heartfelt gratitude to our landowners for
possible (e.g., we are distributing masks for free, taking temperature measurements and
your tremendous support and cooperation in the operations of the disinfecting gaming machines). With this, we are welcoming customers to our pachinko
companies in the DYJH Group. In addition, we would like to give our halls. The impact of COVID-19 is expected to continue in the future. However, the executive
management and all employees of the companies in the DYJH Group have come together
sincere apologies to all our landowners in Japan for requesting in
as one and will not be negligent in preparing for COVID-19. This will allow many customers
writing reductions and exemptions in our contract rent due to the to trust and to visit the pachinko halls of the DYJH Group every day. We believe that our
impact of COVID-19. activities will lead to a feature pachinko industry that includes the DYJH Group. Under this
belief, we will do our best so that we can welcome our customers with smiles on our faces.
We normally send a small gift to mark the middle of the year with a feeling of
gratitude and a desire for future friendship. However, we will not do that this year in light
of the current situation.
A great many pachinko halls – with just a few exceptions – temporarily closed in line with
temporary business closure requests from prefectural governors in our pachinko industry Finally, we received words of encouragement from many landowners at the same
due to the declaration of a state of emergency. The DYJH Group temporarily closed up to time as you agreed to a partial reduction or exemption in our rent. We would like to take
436 of our pachinko halls; this is equivalent to 97% of all our pachinko halls. this space to thank you with all our hearts for that.
We recorded a decrease in revenue but an increase in profit in the previous financial Akira Hosaka,
year (the financial year ended 31 March 2020). Nevertheless, we received no revenue for Representative Director
DYNAM Co., Ltd.
approximately one month due to this temporary closure of our pachinko halls. This meant
Hidenori Kato,
we lost the majority of our profits to various expenses. In addition, although we steadily Representative Director
resumed business from the end of the Golden Week holidays in the beginning of May and Yume Corporation Co., Ltd.
To the Future
reopened all our pachinko halls by 29 May, the return of customers to our pachinko halls Masaaki Horiguchi,
Representative Director
that have reopened is still sluggish. The DYJH Group is confronting this predicament while Cabin Plaza Co., Ltd.
employees deal with the temporary closure of our pachinko halls, while we have Toshiyuki Shibukawa,
completely cut all the bonuses and some remuneration of our officers, while we have cut Representative Director
DYNAM Business Support Co., Ltd.
some of the bonuses and salaries of executives, and while taking all other measures to
cut expenses.
Tatsuji Fujimoto retired as Representative Director at DYNAM Co., Ltd. and we then appointed Akira Hosaka in
The companies in the DYJH Group are in a business situation that we have never his place. Yasuo Ikemura retired as Representative Director at DYNAM Business Support Co., Ltd. And we
then appointed Toshiyuki Shibukawa in his place.
experienced before. We have a strong sense of crisis for the future.
The Asset Management Department in DYNAM Business Support Co., Ltd. is handling the reduction and
exemption of our rent. If you have any questions or inquiries, please contact us using the contact details below.
Asset Management Department in DYNAM Business Support Co., Ltd.
Inquiries
Counter TEL: 03-5850- 3662
Available: 9:30 a.m. to 5:30 p.m. on weekdays (Mondays to Fridays)
DYNAM Group Journal Vol. 15
Publisher: Corporate Communication Department, DYNAM Co., Ltd. 2-27-5 Nishinippori, Arakawa-ku, Tokyo, 116-8580
About the Group Journal
DYJH Group corporate philosophy is “A centurial commitment to building trust and encouraging dreams”. We can
pursue our business when we earn the trust of our partners. We want to continue communicating with our
trusted partners and strengthen our bonds with them. Therefore, we publish this journal as a booklet to regularly
deliver our corporate information.
INFORMATION
DYJH Group
Contact information
We welcome your comments and requests about our group.
Please feel free to call us on the numbers below.
For Landowners For Customers
Landowner Support
Asset Management Department Customer Service Desk
DYNAM Business Support Co., Ltd. DYNAM Co., Ltd.
03-5850-3679 0120-887-351
Inquiries for the Land for
For New Graduates Developing into Halls
Recruitment Support Human Site Support
Resource Development Department Facility Management Department
DYNAM Co., Ltd. DYNAM Business Support Co., Ltd.
0120-33-8197 03-5850-3674
chance@dynam.co.jp Please contact us if you know of
any land, buildings, shopping centres,
We are waiting to hear from new or vacant lots that may be available.
graduates looking to join our company.
Seeking New Graduates!
Please tell us if you graduate and are thinking of joining our company in FY2021.
Land Sought for New Halls!
DYJH Group, operator of pachinko halls throughout Japan, seeks land suitable for
building new pachinko halls. If you are a landowner hoping to make the best use of
your land, or a real estate professional or other person who knows of suitable land,
please contact us.
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