Japan’s Supreme Court rejects UEC appeal in shareholder lawsuit
The Court has rejected Universal Entertainment Corporation’s petition to hear a compensation claim against a shareholder for allegedly defaming the company.
Japan.- Universal Entertainment Corp (UEC) has announced that the Japanese Supreme Court has rejected its appeal in a defamation case against one of its shareholders. The claim was initially dismissed in the first instance, and the Tokyo High Court upheld that dismissal as part of the same ruling. In response, UEC filed a petition for acceptance of appeal to the Supreme Court on May 9, 2024. The Court has not accepted the appeal. UEC will have to bear its own costs.
The company said: “The impact on UEC’s business performance has not yet been determined, but will be announced as soon as there are matters that need to be disclosed.”
UEC has also reported that the Supreme Court has rejected an appeal by Jun Fujimoto, a former director of the company, against an April 2024 ruling by the Tokyo High Court, that he breached his fiducial duty or duty of loyalty as a director of the firm.
The court found Fujimoto guilty of causing the company to transfer nearly US$43.5m without adequate justification and without adhering to internal decision-making protocols. Following this ruling, Fujimoto submitted an appeal and a petition for acceptance of appeal to the Supreme Court on May 9, 2024 but it dismissed the petition.
UEC said it had preserved the right to claim compensation for damages once judgment had been finalised against Fujimoto, “by taking measures preserving the assets” owned by him, “including but not limited to his real estate, 658,000 shares” in Universal Entertainment, and “deposits, and directors’ remuneration”.
Universal Entertainment sees net sales and operating profits fall in 2024
UEC shared its financial results for the fiscal year 2024. The company posted net sales of JPY179bn (US$1.16bn), down 29.4 per cent year-on-year from JPY179bn (US$1.2bn). Operating profit was JPY3.02bn (US$19.6m), down 90.1 per cent.
The company attributed the fall in operating profits to higher selling, general and administrative costs caused by an increase in personnel expenses at Okada Manila. It posted a net loss of JPY15.57bn (US$101.1m), a decline from positive net income of JPY28.44bn (US$184.7m) in 2023.
The integrated resort business segment posted net sales of JPY81.98bn (US$532m), a decrease of 15.4 per cent year-on-year, and an operating profit of JPY2.87bn (US$19m), a decrease of 80 per cent. Adjusted segment EBITDA decreased by 34.8 per cent to JPY19.56bn (US$127m).
At Okada Manila, the number of VIP guests continued to decline as the slowdown of the junket business negatively affected overall market conditions in the Philippines. The casino operator noted that while sales in the mass market and gaming machines had steadily increased since pre-pandemic levels, performance in 2024 was lower compared to 2023. However, revenue from hotel and food and beverage continued to increase.
In the amusement equipment segment, the sales of pachislot and pachinko machines reached 92,150 units.
