Chairman and CEO (Representative Director)
The Pachislot and Pachinko Machine Business will continue generating the majority of the SEGA SAMMY Group’s earnings.
However, the outlook does not warrant optimism given market contraction as the player population declines and the introduction of a series of voluntary regulations. Similarly, the amusement machine sales and amusement center operations areas of the Entertainment Contents Business are unlikely to see significant market growth.
Rather than relying on marked sales growth in these businesses, we will focus on establishing highly efficient business structures, improving profit margins, and generating stable earnings. The Pachislot and Pachinko Machine Business will ensure that it prevails in the struggle for survival as the contrast between winners and losers becomes even more pronounced among manufacturers. In the packaged game, amusement machine sales, and amusement center operations areas, we are steadily strengthening earnings structures. Without slackening the pace, we will continue reform aimed at generating stable earnings.
By investing cash earned through core businesses in a prioritized manner, we intend to expand growth businesses. We will expand the digital game area as a driver of medium-term growth. Meanwhile, we will develop the Resort Business, which is at the prior investment stage, into a driver of long-term growth. We expect integrated resorts in Japan to become a mainstay of this business segment. In preparation for this, the Group is accumulating expertise in the development and administration of integrated resorts through Phoenix Seagaia Resort and a joint venture in South Korea with the Paradise Group.
In the 13 years since management integration in October 2004, the Group has overcome many challenges by its tireless efforts to reform business structures. Finally, we are poised to enter a phase that will be strongly focused on earnings growth.
We will meet the expectations of all of our stakeholders by implementing strategies decisively and taking far-sighted measures to realize long-term, sustained enhancement of corporate value. As we advance into a new phase, we would like to ask our stakeholders for their continued support.
President and COO (Representative Director)
The Group has important issues that it must tackle. Since management integration in October 2004, SEGA SAMMY HOLDINGS INC. has overcome difficult business conditions, and each operating company has established a solid presence in its business field. Meanwhile, the employees of Sammy Corporation, the SEGA Group, and other operating companies have a strong attachment to their operating companies. Unfortunately, however, there is not a sufficiently robust sense of shared values in the SEGA SAMMY Group as a whole. To ensure the Group returns to a growth trajectory, all of its employees must share a common commitment. Based on a strong awareness of this issue, I decided that, in tandem with the implementation of strategies, we should encourage a change of mindset. Accordingly, we embedded Road to 2020,which covers fiscal 2018 through fiscal 2020, into a mission pyramid that comprises the unchanging components of our DNA: a value, a mission (raison d’être), a vision (ideal self), and a goal (specific target).
For fiscal 2020, its final fiscal year, Road to 2020 sets targets of 15% for the operating margin and 5% for ROA.
Based on its long-term vision, the Group will generate stable earnings through core businesses while strengthening the digital game area and increasing the area’s contribution to net sales and operating income. We have established a roadmap showing how the Pachislot and Pachinko Machine Business will grow earnings significantly in the third year of Road to 2020. This may seem an ambitious goal. However, having made progress in strengthening our earnings structure, we are already taking a range of different measures based on a long-term viewpoint.
These measures include developing the product lineup. Therefore, I believe we can achieve a “jump” in performance in fiscal 2020.
In the 2018, we consolidate the Group’s offices with a view to reforming work styles. The goals of this reorganization are to promote efficient management of the Group, create collaborations and synergies between businesses, and encourage interaction among personnel. A further important goal is to heighten employees’ sense of belonging to the Group.
I believe the SEGA SAMMY Group has a bright future. Our employees will pursue moving experiences and unite as we move forward decisively to reach the goals of Road to 2020.