Universal Entertainment CorporationTSE: 6425

Financial Information (FY2025.12)

Apr 30, 2026 at 7:20 AM UTC · Issued by Universal Entertainment Corporation

Financial Information as of December 31, 2025

(This is an English translation of the “Yukashouken-Houkokusho” for the year ended December 2025)

UNIVERSAL ENTERTAINMENT CORPORATION

Ariake Frontier Building Tower A,

7-26, Ariake 3-chome, Koto-ku, Tokyo

This is an English translation of the official announcement of “Yukashouken-Houkokusho” for the year ended December 2025 in Japanese that was released on March 30, 2026. The translation is prepared for the readers’ convenience only. All readers are strongly recommended to refer to the original Japanese version for complete and accurate information. Should there be any inconsistency between the translation and the official Japanese text, the latter shall prevail.

(E02452)

Contents Page

Cover

Part I Company Information.......................................................................................................................... 1

Section 1. Overview of the Company .................................................................................................................. 1

Transition of Significant Business Indicators, etc. .......................................................................... 2
The Company’s History ...................................................................................................................... 4
Description of Businesses ................................................................................................................... 7
Affiliated Companies ........................................................................................................................... 9
Employees 10

Section 2. Business 11

Management Policy, Operating Environment and Issues to Be Addressed 11
Sustainability Stance and Activities 12
Business and Other Risks 13
Management’s Analyses of Financial Status, Operating Results and Cash Flow 15
Important Contracts, etc 19
Research-and-Development Activities 20

Section 3. Facilities and Equipment 21

Overview of Capital Investments 21
Major Facilities and Equipment 21
Plans for Construction and Retirement, etc., of Facilities 22

Section 4. Situation of the Company 23

Details of Stock, etc 23
1. Total Number of Shares, etc. 23
2. Subscription Rights to Share 23
3. Exercise Status, etc., of Bonds with Subscription Rights to Share with a Clause to Revise the Exercise Price ................................................................................................................................. 23
4. Transition of Total Number of Issued Shares and Amount of Capital Stock 23
5. Shareholders by Category 24
6. Major Shareholders 24
7. Voting Rights 25
Acquisition of Treasury Shares, etc 25
Dividend Policy 26
Corporate Governance, etc 26
1. Overview of Corporate Governance 26
2. Directors and Audit & Supervisory Committee Members 33
3. Accounting Audit 37
4. Remuneration, etc. Paid to Directors and Audit & Supervisory Committee Members 39
5. Shareholding Status 41

Section 5. Accounting 42

Consolidated Financial Statements, etc 43
1. Consolidated Financial Statements 43
2. Others 84
Non-consolidated Financial Statements, etc 85
1. Non-consolidated Financial Statements 85
2. Major Assets and Liabilities 96
3. Others 96

Section 6. Outline of Stock-Related Matters of the Company 97

Section 7. Referential Information of the Company 98

Part II Information on Guarantee Companies, etc., for the Company 98

[Independent Auditor’s Reports]

Cover

Submitted document Annual Securities Report

Statutory basis Paragraph 1, Article 24 of the Financial Instruments and Exchange Act of Japan Agency receiving submission Director-General of the Kanto Local Finance Bureau

Submission date March 30, 2026

Fiscal year 53rd period (from January 1, 2025 through December 31, 2025)

Corporate name Kabushiki-gaisha Universal Entertainment

Name in English Universal Entertainment Corporation

Name and position of representative Tomohiro Okada, Representative Director and President

Location of headquarters Ariake Frontier Building Tower A, 7-26, Ariake 3-chome, Koto-ku, Tokyo Phone +81-3-5530-3055

Name of contact person Nobuki Sato, Director and CFO

Closest contact address Ariake Frontier Building Tower A, 7-26, Ariake 3-chome, Koto-ku, Tokyo Phone +81-3-5530-3055

Name of contact person Nobuki Sato, Director and CFO Place available for public inspection Tokyo Stock Exchange, Inc.

(2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)

Part I. Company InformationSection 1. Overview of the Company

(Introduction)

Effective April 1, 1998, the company submitting this report (the former Universal Technos Co., Ltd., hereinafter “the Company”) absorbed in a merger the former Universal Sales Co., Ltd., and changed its trade name to Aruze Corp. The purpose of the merger was to change the face value per share of the former Universal Sales Co., Ltd., from 500 yen to 50 yen. In addition, the change of trade name represented the Company’s prospects for further growth in anticipation of the future expansion of its businesses. Effective November 1, 2009, Aruze Corp. changed its trade name to Universal Entertainment Corporation. The change of trade name represented the Company’s prospects for further growth in anticipation of the future expansion of its businesses.

The following illustrate changes in the status of the Company since its establishment to date:

Transition of Significant Business Indicators, etc.

Consolidated Business Indicators, etc.

Term	49th Period	50th Period	51st Period	52nd Period	53rd Period
Fiscal year ended	December 2021	December 2022	December 2023	December 2024	December 2025
Net sales (Million yen)	90,435	140,998	178,995	126,328	122,827
Ordinary profit (loss) (Million yen)	(2,508)	13,933	38,080	(5,599)	(18,497)
Net income (loss) attributable (Million yen) to owners of parent	(19,052)	11,506	28,439	(15,569)	(231,425)
Comprehensive income (Million yen)	(18,657)	10,395	42,161	(12,516)	(240,043)
Net assets (Million yen)	338,919	349,315	388,388	369,731	129,687
Total assets (Million yen)	572,381	596,177	628,006	632,795	373,634
Net assets per share (Yen)	4,373.31	4,507.48	5,011.39	4,771.28	1,673.58
Net income (loss) per share (Yen)	(245.88)	148.50	367.04	(200.92)	(2,986.48)
Diluted net income per share (Yen)	-	148.49	367.00	-	-
Ratio of shareholders’ equity (%)	59.2	58.6	61.8	58.4	34.7
Ratio of net income to (%) shareholders’ equity	(5.5)	3.3	7.7	(4.1)	(92.7)
Price-earnings ratio (Times)	-	16.0	6.3	-	-
Net cash from operating (Million yen) activities	1,745	24,461	28,017	1,518	11,053
Net cash from investing (Million yen) activities	(7,037)	(8,996)	(10,124)	(13,371)	(3,923)
Net cash from financing (Million yen) activities	(1,819)	(11,246)	(11,326)	(9,798)	9,250
Cash and cash equivalents at (Million yen) the end of fiscal year	30,546	35,793	44,190	23,795	36,279
Number of employees (Persons)	6,408	6,689	6,983	7,437	7,004

Notes: 1. The Company has applied the Accounting Standard for Revenue Recognition (Accounting Standards Board of Japan (ASBJ) Statement No. 29, March 31, 2020), etc. from the beginning of the 50th period. All significant business indicators, etc. for the 50th and following periods incorporate this accounting standard.

The “Diluted net income per share” is not presented for the 49th, 52nd and 53rd periods because a net loss per share was posted despite the existence of latent shares with a dilution effect.
“Price-earnings ratio” is not presented for the 49th, 52nd and 53rd periods because a net loss per share was posted.

Non-consolidated Business Indicators, etc., of the Company

Term	49th Period	50th Period	51st Period	52nd Period	53rd Period
Fiscal year ended	December 2021	December 2022	December 2023	December 2024	December 2025
Net sales (Million yen)	56,037	70,049	83,028	45,730	58,819
Ordinary profit (loss) (Million yen)	1,211	8,479	9,527	(3,573)	(6,735)
Net income (loss) (Million yen)	(1,417)	4,749	7,374	(11,868)	(168,617)
Capital stock (Million yen)	98	98	98	98	98
Number of issued shares (Shares)	80,195,000	80,195,000	80,195,000	80,195,000	80,195,000
Net assets (Million yen)	357,514	362,261	366,516	352,335	183,724
Total assets (Million yen)	481,446	508,414	525,775	474,936	282,875
Net assets per share (Yen)	4,613.28	4,674.55	4,729.13	4,546.79	2,370.92
Dividend per share (Yen) [Interim dividend per share]	-[-]	-[-]	40 [40]	30 [30]	-[-]
Net income (loss) per share (Yen)	(18.30)	61.29	95.17	(153.16)	(2,175.97)
Diluted net income per share (Yen)	-	61.29	95.16	-	-
Ratio of shareholders’ equity (%)	74.2	71.2	69.7	74.2	64.9
Ratio of net income to (%) shareholders’ equity	(0.4)	1.3	2.0	(3.3)	(62.9)
Price-earnings ratio (Times)	-	38.8	24.2	-	-
Dividend payout ratio (%)	-	-	42.0	-	-
Number of employees (Persons)	990	976	984	998	1,000
Shareholder return (%) [Comparison with TOPIX (%) including dividends]	102.6 [112.7]	99.9 [110.0]	98.3 [141.1]	46.5 [169.9]	36.4 [213.2]
Highest share price (Yen)	2,870	2,828	3,235	2,394	1,244
Lowest share price (Yen)	2,180	1,328	1,851	972	682

Notes: 1. The Company has applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc. from the beginning of 50th period. All significant business indicators, etc. for the 50th and following periods incorporate this accounting standard.

The “Diluted net income per share” is not presented for the 49th, 52nd and 53rd periods because a net loss per share was posted despite the existence of latent shares with a dilution effect.
“Price-earnings ratio” is not presented for the 49th, 52nd and 53rd periods because a net loss per share was posted.
“Dividend payout ratio” is not presented for the 52nd period because a net loss was posted.
The highest and lowest share prices are for prices on the Tokyo Stock Exchange (Standard Market) since April 4, 2022 and for prices on the JASDAQ (Standard) market before then.

The Company’s History

Month & Year	Events
Month & Year	Universal Entertainment Corporation Former company name: Aruze Corp. (Universal Sales Co., Ltd. and Universal Technos Co., Ltd.)	Universal Co., Ltd.
December 1969		Established Universal Lease Co., Ltd., for the purpose of leasing jukeboxes in Oyama, Tochigi Prefecture.
July 1970		Established a factory at the same place and started producing amusement machines.
October 1971		Changed trade name to Universal Co., Ltd.
June 1972		Purchased land adjacent to the factory and built a new factory.
June 1973	Spun off Sales Division of Universal Co., Ltd. from the company and established Universal Giken Co., Ltd., as an independent company and began its operation.
May 1975	Relocated the Head Office of Universal Giken Co., Ltd., to Ueno, Taito-ku, Tokyo, and changed the trade name to Universal Sales Co., Ltd.
September 1975	Established the Osaka Sales Office in Suita, Osaka Prefecture.	Built a new factory in Oyama, Tochigi Prefecture. Hereafter, this factory began full-scale production of various game machines as a base.
November 1976	Established the Nagoya Sales Office in Nagoya, Aichi Prefecture.
April 1978	Built the Universal Building in Nihombashi Horidomecho, Chuo-ku, Tokyo, and relocated the Head Office of Universal Sales Co., Ltd.
December 1979	Spun off the Development Division of Universal Co., Ltd. from the company and established Universal Technos Co., Ltd., as an independent company, and began its operation.
March 1980		Constructed a new factory located in the third industrial park in Oyama, Tochigi Prefecture (Oyama Second Factory) and moved there. Expanded from production of game machines into Pachislot machines for the entertainment and amusement industry.
January 1981	Established the Fukuoka Sales Office (currently Kyushu Sales Office) in Fukuoka, Fukuoka Prefecture.
May 1982	Established the Hokkaido Sales Office in Sapporo, Hokkaido.
February 1983	Established the Sendai Sales Office in Sendai, Miyagi Prefecture, and the Kagoshima Sales Office (currently Minami-kyushu Sales Office) in Kagoshima, Kagoshima Prefecture.
August 1983	Established the Niigata Sales Office in Niigata, Niigata Prefecture.
June 1985	Established the Shikoku Sales Office in Takamatsu,
	Kagawa Prefecture, and the Kobe Sales Offices in Kobe,
	Hyogo Prefecture.
July 1985	Established the Hiroshima Sales Office in Hiroshima, Hiroshima Prefecture, and the Okayama Sub-Branch (currently Okayama Sales Office) in Okayama, Okayama Prefecture.
October 1985	Established the Kitakanto Sales Office in Utsunomiya, Tochigi Prefecture.
July 1986	Procured the head office building of Universal Technos Co., Ltd. in Nihombashi Hamacho, Chuo-ku, Tokyo, and moved there.
April 1988	Constructed the head office building of Universal Sales Co., Ltd. in Takanawa, Minato-ku, Tokyo.	Procured a factory in Yonago, Tottori Prefecture, as a new manufacturing base and started production of amusement machines.
May 1988	Established the Shizuoka Sales Office in Shizuoka, Shizuoka Prefecture.

Month & Year	Events
	Universal Entertainment Corporation Former company name: Aruze Corp. (Universal Sales Co., Ltd. and Universal Technos Co., Ltd.)	Universal Co., Ltd.
July 1990	Established the Kanazawa Sub-Branch (currently Kanazawa Sales Office) in Kanazawa, Ishikawa Prefecture.	Dissolved as a result of a merger with Universal Sales Co., Ltd.
July 1992	Established the Saitama Sales Office in Omiya, Saitama Prefecture, and the Kanagawa Sales Office (currently Yokohama Sales Office) in Yokohama, Kanagawa Prefecture.
April 1993	Universal Sales Co., Ltd. absorbed Universal Co., Ltd. in a merger.
July 1993	Moved the Head Office to the head office building of Universal Co., Ltd. in Takanawa, Minato-ku, Tokyo.
October 1994	Established the Morioka Sub-Branch (currently Morioka Sales Office) in Morioka, Iwate Prefecture.
April 1998	Universal Technos Co., Ltd. absorbed Universal Sales Co., Ltd. in a merger and changed the trade name to Aruze Corp. Moved the Head Office to Ariake, Koto-ku, Tokyo.
September 1998	Registered its shares on the over-the-counter market of the Japan Securities Dealers Association.
August 1999	Built a new factory in Yotsukaido, Chiba Prefecture (current Pachislot and Pachinko machine manufacturing site).
October 2000	Acquired shares of Aruze USA, Inc. (currently a consolidated subsidiary).
February 2001	Established Yotsukaido Techno Center in Yotsukaido, Chiba Prefecture.
November 2002	Acquired shares of Nautilus Inc. (trade name was changed to Aruze Global Trading Corporation).
June 2004	Obtained a gaming machine manufacturer’s license and an approval for stock acquisition of Universal Distributing of Nevada, Inc. (currently Aruze Gaming America, Inc.), in the State of Nevada, U.S.A.
December 2004	Cancelled over-the-counter registration with the Japan Securities Dealers Association and listed the Company’s shares on JASDAQ Securities Exchange.
December 2004	Obtained a gaming machine manufacturer’s license and an approval for stock acquisition of Universal Distributing of Nevada, Inc., in the State of Mississippi, U.S.A.
January 2005	Acquired shares of Universal Distributing of Nevada, Inc., which had subsidiaries in Australia and South Africa, and made the three companies consolidated subsidiaries.
May 2006	Established Aruze Preparatory Corporation.
July 2006	Obtained a gaming machine manufacturer’s license, which is renewable without limitation, in the State of Nevada, U.S.A.
April 2007	Transferred gaming machine business for overseas casinos to Aruze Gaming America, Inc.
	Established ARUZE MEDIA NET CORP. for mobile web site operation business through a company split.
September 2007	Acquired shares of Japan Rental Service, Ltd. (trade name was changed to Aruze Rental Service Corporation).
October 2007	Transferred the Sales Division of the Pachislot/Pachinko Business to Aruze Marketing Japan Corporation (formerly known as System Staff Co., Ltd.) and the Development Division thereof to Seven Works Corporation (formerly known as Aruze Preparatory Corporation) through company splits.
February 2008	Established Aruze Investment Co., Ltd. (currently a consolidated subsidiary).
June 2008	Transitioned to a company with committees.
August 2008	Acquired a provisional license to operate a casino resort in the Philippines.
	Aruze Gaming America, Inc. implemented an allocation of new shares to a third party and the shares of Aruze Gaming America owned by the Company were partially transferred.
February 2009	Aruze Global Trading Corporation, Aruze Rental Service Corporation and Seven Works Corporation were merged to Aruze Marketing Japan Corporation by an absorption-type merger with Aruze Marketing Japan to act as the surviving company.
March 2009	Transferred all the shares of Aruze Gaming America, Inc. owned by the Company.

Month & Year	Events
Month & Year	Universal Entertainment Corporation Former company name: Aruze Corp. (Universal Sales Co., Ltd. and Universal Technos Co., Ltd.)
June 2009	The Company merged Aruze Marketing Japan Corporation in an absorption-type merger with the Company to act as the surviving company.
November 2009	Changed the trade name to Universal Entertainment Corporation.
March 2010	A casino project of the Universal Entertainment Group (Manila Bay Resorts) obtained the designation as a special economic zone and the foreign capital restrictions for casino businesses were removed in the Philippines.
April 2010	The Company’s stock was listed on the JASDAQ market of the Osaka Securities Exchange, in accordance with the merger of the JASDAQ Securities Exchange and the Osaka Securities Exchange.
June 2010	Transitioned to a company with an Audit & Supervisory Board.
October 2011	The Company merged ARUZE MEDIA NET CORP. in an absorption-type merger with the Company to act as the surviving company.
January 2012	Manila Bay Resorts Project’s groundbreaking ceremony held in Manila.
July 2013	The Company’s stock was listed on the JASDAQ (Standard) market of the Tokyo Stock Exchange, in accordance with the integration of the Tokyo Stock Exchange and the Osaka Securities Exchange.
October 2013	Opened Okada Museum of Art in Hakone-machi, Ashigarashimo-gun, Kanagawa Prefecture.
March 2016	Established joint venture “ZEEG Co. Ltd” (currently ZEEG LLC.) with Sammy Corporation.
July 2016	The casino resort project in the Philippines was officially named OKADA MANILA.
December 2016	OKADA MANILA received permission to operate a casino and resort facility in the Philippines.
	Casino operations started.
March 2017	Completed construction of the world’s largest multi-color fountain “The Fountain” at OKADA MANILA.
December 2017	Cove Manila, covered by an enormous glass dome, started operating at OKADA MANILA.
December 2018	Completed construction of Tower A (PEARL WING) at OKADA MANILA.
July 2019	Started selling the Multi Currency System, an automated foreign exchange system for casino equipment, and the Slot Program Play System, customer special benefit system created exclusively for casino slot machines.
November 2021	Completed construction of Tower B (CORAL WING) at OKADA MANILA.
April 2022	The stock listing was moved from the Tokyo Stock Exchange JASDAQ (Standard) market to the Tokyo Stock Exchange Standard Market, in accordance with the revision of the market classification of the Tokyo Stock Exchange.
July 2025	Transitioned to a company with an Audit & Supervisory Committee.

Description of Businesses

The corporate group of the Company is composed of the Company, 19 subsidiaries and 3 affiliates. The main businesses are the research, development, manufacture and sales of Pachislot and Pachinko machines and peripheral equipment thereof, as well as the Integrated Resort Business and the Media Content Business, etc.

Indicated below are the businesses of the Company’s corporate group, the Company and each company’s relative position in the business and the relationship with the segments (as of December 31, 2025).

Name of Segment	Main Business	Company Name
Amusement Equipments Business	Research, development, manufacture and sales of Pachislot/Pachinko machines and peripheral equipment; procurement of units consisting of parts and materials	Universal Entertainment Corporation
Amusement Equipments Business	Manufacture of Pachislot and Pachinko machines	Macy Co., Ltd., Eleco Ltd., Mizuho Corp., Across Corp. and Universal Bros. Corp.
Integrated Resort Business	Gaming, hotel, food and beverage, retail and leasing, entertainment and real estate development businesses	TIGER RESORT, LEISURE AND ENTERTAINMENT, INC.
Other	Media Content Business	Universal Entertainment Corporation

* In addition to the companies listed above, there are 5 consolidated subsidiaries, 8 non-consolidated subsidiaries not accounted for by the equity method, 2 affiliates accounted for by the equity method, and 1 affiliate not accounted for by the equity method.

The business linkage of the above status is shown in the diagram below (as of December 31, 2025):

Affiliated Companies

Name of Company	Location	Capital Stock	Main Line of Business	Holding/Held Ratio of Voting Rights (%)	Relationship
(Parent company) Okada Holdings Limited	Hong Kong, China	9,362,968 [1,000 HKD]	Investments in securities, etc.	Held 70.2
(Consolidated subsidiary) Macy Co., Ltd. (Note 1)	Koto-ku, Tokyo	20 [Million yen]	Manufacture of amusement machines	100.0	Note 6 Note 7
Eleco Ltd. (Note 1)	Koto-ku, Tokyo	10 [Million yen]	Manufacture of amusement machines	100.0	Note 6 Note 7
Mizuho Corp. (Note 1)	Koto-ku, Tokyo	10 [Million yen]	Manufacture of amusement machines	100.0	Note 6 Note 7
Across Corp.	Koto-ku, Tokyo	5 [Million yen]	Manufacture of amusement machines	100.0	Note 6 Note 7
Universal Bros. Corp.	Koto-ku, Tokyo	5 [Million yen]	Manufacture of amusement machines	100.0	Note 6 Note 7
TIGER RESORT, LEISURE AND ENTERTAINMENT, INC. (Note 1) (Note 2)	Manila, Philippines	9,499,745 [1,000 PHP]	Integrated Resort Business	99.9 (99.9)	Note 4 Note 5
Tiger Resort Asia Limited (Note 1)	Hong Kong, China	18,598,663 [1,000 HKD]	Overseas business operations	100.0	Note 4 Note 5
Brontia Limited (Note 1) (Note 2)	Hong Kong, China	1,280,191 [1,000 HKD]	Investment in land holding company	100.0 (100.0)	Note 4
Aruze USA, Inc.	Nevada, USA	10 [USD]	Investment management business, licensing management of gaming equipment	100.0	Note 5
ARUZE Investment Co., Ltd. (Note 2)	Phnom Penh, Cambodia	4,000 [1,000 Riels]	Tourism operations	49.0 (49.0)	Note 5
UE RESORTS INTERNATIONAL, INC.	Manila, Philippines	12,501 [1,000 PHP]	Integrated Resort Business	99.9	Note 4 Note 5
(Equity-method affiliate) ZEEG LLC.	Shinagawa-ku, Tokyo	25 [Million yen]	Manufacture of amusement machines	50.0	Note 5 Note 7
EAGLE I LANDHOLDINGS, INC. (Note 2)	Manila, Philippines	480,000 [1,000 PHP]	Land holding	40.0 (40.0)	Note 4 Note 5

Notes: 1. These companies are specified subsidiaries.

“Holding/Held Ratio of Voting Rights” is rounded down to the nearest second decimal place. Figures in parentheses represent the percentage of indirectly held votes.
With the exception of TIGER RESORT, LEISURE AND ENTERTAINMENT, INC., no important earnings information, etc. is presented about the consolidated subsidiaries in this table because the sales (after eliminating sales to and from other consolidated companies) of each subsidiary are not more than 10% of total consolidated sales.
The sales of TIGER RESORT, LEISURE AND ENTERTAINMENT, INC. (after eliminating sales to and from other consolidated companies) are more than 10% of total consolidated sales. However, no important earnings information, etc. about this company is presented because the sales of this company (including inter-segment sales and transfers) accounted for more than 90% of the sales of the Integrated Resort Business in the current fiscal year.
Director and Audit & Supervisory Committee Members of the Company hold concurrent positions at these affiliated companies.
Receiving financial support from the Company
Manufacture of the Group’s amusement machines
Supplies parts and materials to the Company

Employees

Employees on a Consolidated Basis
As of December 31, 2025
Name of Segment
Number of Employees
Amusement Equipments Business
788
Integrated Resort Business
5,995
Reportable segment total
6,783
Others
25
Corporate (unallocated)
196
Total
7,004
Note: The number of employees in the “Corporate (unallocated)” segment represents those employees employed by the administrative division.
Employees of the Company
As of December 31, 2025
Number of Employees
Average Age
Average Number of Years Employed
Average Annual Salary (Yen)
1,000
45 years and 4 months
13 years and 0 month
7,410,286
Name of Segment
Number of Employees
Amusement Equipments Business
779
Integrated Resort Business
-
Reportable segment total
779
Others
25
Corporate (unallocated)
196
Total
1,000
Notes: 1. Average annual salary includes bonuses and surplus wages.
2. The number of employees in the “Corporate (unallocated)” segment represents those employees employed by the administrative division.
Labor Union
Although a labor union has not been formed, the Company has maintained sound labor-management relations.

Percentage of female workers in managerial positions, percentage of male workers taking childcare leave, and gender wage gap

The Company

Current Fiscal Year
Percentage of female workers in managerial positions (%) (Note 1)	Percentage of male workers taking childcare leave (%) (Note 2)	Gender wage gap (%) (Note 1)
		All workers	Full time workers	Part time and contract workers
4.2	83.3	61.1	65.8	58.6

Notes: 1. The percentages are calculated in accordance with the “Act on the Promotion of Women’s Active Engagement in Professional Life” (Act No. 64 of 2015).

2. Percentage of workers taking childcare leave is stipulated in Article 71-6, paragraph (1) of the “Ordinance for Enforcement of the Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfare of Workers Caring for Children or Other Family Members” (Ordinance of the Ministry of Labor No. 25, 1991), and calculated in accordance with the “Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfare of Workers Caring for Children or Other Family Members” (Act No. 76 of 1991).

Consolidated subsidiaries

Omitted because this information is not subject to the obligation for publication stipulated in the “Act on the Promotion of Women’s Active Engagement in Professional Life” (Act No. 64 of 2015) and the “Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfare of Workers Caring for Children or Other Family Members” (Act No. 76 of 1991).

Section 2. Business

Management Policy, Operating Environment and Issues to Be Addressed
This section explains the Company group’s (“the Group”) management policy, operating environment and issues to be addressed.
Statements involving the future in this section are based on judgments by the Group as of the end of 2025.
1. Management Policy
  The basic management policy of the Group is to create enjoyment as a total global entertainment company and to participate in the forming of a society with dreams.
  Specifically, as a manufacturer engaged in the research, development, manufacture and sales of Pachislot and Pachinko machines and peripheral equipment, the Group is offering enjoyment for all players. At the same time, by operating OKADA MANILA, an integrated resort in Manila, Philippines, the Group is dedicated to becoming a source of enjoyment for people worldwide as a provider of comprehensive entertainment that gives large numbers of customers’ memorable experiences.
2. Business Strategy
  The Japanese amusement equipments industry is continuing to shrink slowly because of a downturn in the number of customers and utilization rates caused by the declining birth rate, diversification of leisure activities and decrease in the number of players. The number of amusement machines installed and sold is decreasing as the number of stores falls. In the Pachislot category, utilization rates remain high as installations of smart Pachislot machines continue. These machines are expected to capture an even larger market share. Although sales of the Group’s machines decreased briefly when regulations were tightened, the Group remains a leader in this market category due to the development of revolutionary systems and highly appealing products. The Group will continue to use its content and technological strengths to develop machines that are attractive as a source of fun for players. In addition, there will be measures to lower costs by developing technologies and manufacturing products even more efficiently with the goal of maintaining the stability of results of operations and achieving more growth.
  OKADA MANILA, an integrated resort in the Manila Bay region of the Philippines, is the only integrated resort in the Philippines that has received a five-star Forbes Travel Guide rating. The resort is now the standard for the development of large integrated resort hospitality in the country. Located on a 30-hectare site in the Entertainment City district, OKADA MANILA operates a unified and integrated resort which has gaming, hotel, food and beverage, retail, wellness and large-scale event facilities. The resort’s design concept and policy for operations combine the Japanese attention to detail with the warmth of people in the Philippines. The combination of these strengths enables guests to enjoy experiences during their stay that create value and is an integral part of the services provided by the staff of the resort.
3. Operating Environment
  In the amusement equipments industry, there are measures to enhance game playing characteristics and many activities for increasing the use of smart Pachislot and Pachinko machines, which include functions for the prevention of fraud and addiction issues. In the Pachislot category, most of the new titles recently sold by manufacturers are smart Pachislot machines. In the Pachinko category, the number of smart Pachinko machines in use is increasing slowly and the market share is climbing. This shift in the Pachislot and Pachinko market created new sales opportunities by using revolutionary systems, upgrading content and software, and utilizing advanced technologies, and ultimately resulted in an increase in market share. We have responded with speedy and flexible manner to these shifts in the market and development conditions in order to develop and sell highly appealing machines that help pachinko parlors to attract more players. These accomplishments demonstrated the superiority of the Group’s Pachislot and Pachinko machines. Furthermore, the Group’s highly appealing machines are playing a role in energizing the entire amusement machine industry in Japan.
  The Integrated Resort Business has been growing rapidly due to a business climate in the gaming market of the Philippines that is better than in other countries because of low taxation, including a low gaming tax rate and an income tax exemption, and low cost of labor. A growing number of mass market customers in the Philippines and an increase in visitors from other countries have also contributed to the growth of this business. However, due to a sharp drop in sales in the VIP category, competition among all integrated resorts in the Philippines to attract mass market customers in the Philippines is becoming more heated.
4. Priority businesses and financial issues
  1. Amusement Equipments Business
    The business climate for this business remains challenging because of the declining number of players and utilization rates at Pachinko parlors. Market conditions have been improving because of the strong performance of smart Pachislot machines. However, the number of Pachislot and Pachinko players are decreasing because of Japan’s declining birth rate and increasing diversity of leisure activities. The Group will continue to supply amusement machines that make a big contribution to the operations of pachinko parlors through developing unique and appealing titles and leveraging its manufacturing capabilities, and thereby will strive to increase its market share while invigorating the market.
  2. Patent Strategy
    The Group has long been aware of the importance of creating and protecting intellectual property, and has worked towards the establishment of a system that enables it to acquire patent rights for superior inventions through standardization of patent applications. Also, the Group has been working to improve the quality of its patent applications and improve the ratio of patent registrations to submitted applications, by establishing a structure whereby individual inventions are categorized into different technical fields and applications for patents are filed for a group of inventions in each technical field. The technologies which the Group has acquired or applied for patents are considerably more effective and commercially viable than those of its competitors. The Company intends to fully apply these technologies in the development of its products to improve the value of said products, thereby differentiating them from the competition in terms of technology. The Company believes this will enable it to achieve a competitive advantage. Also, in order to secure license revenue from its patents, the Company will move forward vigorously with strategies for both patent utilization and the protection of its patent rights when said rights are violated.
  3. Integrated Resort Business
    OKADA MANILA, an integrated resort facility operated by the Group, was created to meet the expectations of customers, whether from the Philippines or other countries. This resort has a luxurious hotel, fine dining with cuisine of many countries, high-end shopping facility, The Fountain (a multi-color fountain that is one of the largest of its type in the world), and Cove Manila, an all-weather dome that has a beach club. Everyone at this resort is dedicated to providing guests with exceptional hospitality and experiences of the highest quality. To attract an even larger number of guests, OKADA MANILA plans to expand the gaming area for serving different customer segments and open more stores and restaurants.
5. Objective Indicators Used to Determine Progress Concerning Performance Targets
In the Amusement Equipments Business, the Group will gather information from the market and further reinforce the sales framework in order to capture the No. 1 market share position by securing unit sales through the provision of Pachislot and Pachinko machines that match diversifying market needs. Additionally, the Group will build a lean management framework by improving operational efficiency, and strive to forge a stable and profitable management structure.
In the Integrated Resort Business in the Philippines, the main performance indicator is the adjusted segment EBITDA.

Sustainability Stance and Activities

This section explains the stance and activities of the Group about sustainability.

Statements involving the future in this section are based on judgments by the Group as of the end of 2025.

Governance and risk management concerning sustainability
The Group believes that a world in which people are physically and spiritually healthy and there is a sound natural environment is essential for the enjoyment of various forms of entertainment. We consider the measures concerning climate change due to GHG emissions and other environmental problems, social issues involving respect for diversity, human resources and other matters, and other issues as the Group’s important management objectives. In addition, the Group is dedicated to providing consideration for customers, business partners, shareholders, employees, the public and all other stakeholders and to working with these people in order to contribute to the creation of a sustainable society. The Board of Directors oversees all aspects of sustainability and Representative Director and President is responsible for making final management decisions about these issues. The goal is to build a framework for taking actions concerning sustainability issues, establishing a basic policy for sustainability, and reinforcing initiatives for progress involving sustainability.
Activities to address climate change
The Company has many energy conservation activities, including the use of LED lights at the head office and factories and the use of hybrid vehicles for the entire corporate fleet. In addition, the core Amusement Equipments Business uses operating units and components that are compatible with many models for the purpose of reducing industrial waste. There are also many activities centered on the three R’s (reduce, reuse, recycle) to lower the Group’s environmental impact. The following table shows the recycling rate of this business.
2022
2023
2024
2025
Recycling rate (%)
98.7
98.6
97.3
97.5
Note:Recycling rate information is reported based on the calendar year, which is the period used for financial statements, beginning with 2024.
2024-2025: January 1 to December 31
2023: April 1 to December 31 (for the nine-month period) 2022: April 1 to March 31 of the following year
Activities concerning human resources
1. Strategy
  The Company positions employees as important assets and one of its most valuable operating capitals.
  The Company recognizes that securing human resources is an important issue with regard to sustainability programs and there are numerous activities for retaining current employees and recruiting skilled people.
  To increase employee satisfaction, our offerings include competitive salaries, numerous benefits, measures for proper work-life balance, flexible working formats to match requirements involving major life events, and other measures. Recruitments and promotions are based on respect for diversity concerning gender, age, nationality, race and other characteristics. A system of fair performance evaluations also contributes to the ability to retain people.
2. Indicators and goals

As part of these measures for a sound workplace environment and diversity, the following goals have been established for the percentage of female workers in management positions, the percentage of people hired after previous work experience in management positions, and the utilization rate of child care leave by male workers.

Indicators	Current (December 31, 2025)	Goals (December 31, 2027)
Female managers (%)	4.2	5.0
Managers hired after previous work experience (%)	82.5	Maintain at least 80.0
Percentage of male workers taking childcare leave (%)	83.3	40.0

Business and Other Risks
This section explains the major risk factors, from among items involving business operations and financial soundness as stated in this Securities Registration Report, that management believes may have a significant effect on the consolidated financial condition, results of operations and cash flows. The Group recognizes the possibility that these problems may occur and is taking appropriate preventive actions. No information about the magnitude or timing of the potential problems associated with these risk factors is provided because of the difficulty of determining reliable predictions. Statements involving the future in this section are based on judgments by the Group as of the end of 2025.
1. Amusement Equipments Business
  According to the “Act Concerning Regulation and Proper Operation of Businesses Affecting Public Morals,” Pachislot and Pachinko machines need to meet the “technical standards” defined in the National Public Safety Commission’s rules (Regulations Concerning Authorization and Model Approval for Amusement Machines). Each type of machine must pass the model test conducted by the designated testing organization (Security Communications Association/ GLI Japan I.S.H.) and the model inspection conducted by the Public Safety Commission of the applicable prefecture. In case these laws or standards are amended or abolished, the Group will analyze industry trends and the application status of other companies, and make new applications for new machines in a structured and strategic fashion. However, if major changes need to be made due to administrative direction or voluntary restriction by the industry, the business results of the Group would be materially impacted. In addition, business results of the Group may be adversely affected by changing preferences in the market, as well as economic trends in Japan that include income levels. Furthermore, there may be a change in manufacturing and sales plans because of shortages of semiconductors and other components used in amusement machines.
2. Integrated Resort Business
  The Group operates OKADA MANILA, an integrated resort facility in the Philippines. The business results of the Group may be affected by changes in the business climate or other items associated with the following risk factors.
  1. Competition risks
    In addition to the local competition in the Philippines and the international competition in the Asian region, there is a risk that additional licenses to conduct gaming operations issued by the Philippine government could further intensify competition, or that OKADA MANILA may not be able to gain or maintain market share. Moreover, there is a risk of increasing competition for maintaining a relationship with a quality gaming promoter, resulting in difficulty attracting VIP players who make a big contribution to earnings according to the policies of the governments of various countries.
  2. Information security risks
    There is a risk of fines, penalties or other administrative actions as well as the associated damage to OKADA MANILA’s reputation among customers or loss of trust caused by a security violation, leak or other problem involving the personal information of hotel guests, gaming players, special circle members, employees or others. There is also a risk of negative effects on business operations, earnings or the reputation of OKADA MANILA, as well as an effect on its license, caused by leaks or other problems involving information due to a defective or malfunctioning IT or security system or an attack or other unauthorized access.
  3. Risks associated with the Philippine gaming business
    In the Integrated Resort Business in the Philippines, the gaming business is operated under a license issued by the Philippine Amusement and Gaming Corporation (PAGCOR). There is a risk that revisions may result in even more demanding terms and requirements for maintaining this license. To continue receiving special tax treatment in the Philippine Economic Zone Authority, OKADA MANILA must continue to comply with terms of the registration contract and any future laws and regulations, which, if not complied with, may create risks. There is also a risk if taxation privileges received by PAGCOR and its licensees are revised by the Congress of the Philippines, OKADA MANILA may be required to pay a separate corporate income tax.
  4. Other
    OKADA MANILA may be exposed to economic factors such as a slower economic growth in the Philippines and a decline in the credit rating of OKADA MANILA; political factors such as political instability or terrorism in the Philippines, or a territorial dispute in the South China Sea; and external factors such as typhoons, volcanic activity, and other natural disasters and epidemics.
3. Other Risks
  1. Litigation
    The Group has several pending lawsuits, and their outcomes may have an impact on the business results of the Group. Although the Group makes every effort to eliminate litigation risk, there is always a possibility that third parties may file new cases against the Group, with the rulings in these cases having the potential to affect business results of the Group.
  2. Risk caused by the spread of pandemic
    If there is a global increase in the severity of the COVID-19 pandemic or other major pandemic or such pandemic continues for many years, business operations may be temporarily suspended and there may be disruptions in development, manufacturing, sales and other business activities. These problems may affect the business results and financial position of the Group. The safety of customers, employees and business partners is the highest priority of the Group. The Group continues to operate in compliance with the directives of the applicable governments while using staggered working hours, remote work, Internet conferences and other measures for safety during pandemic.
  3. Risks of natural disasters, etc. that may significantly affect the business operations of the head office and major operating companies (bases)
    There is a business continuity risk for the operations of major operating companies if the head office and major operating companies (bases) are damaged by earthquakes, tsunamis, tornadoes, typhoons, or other natural disasters, war, terrorism, or social disorder caused by other factors, which paralyzes the head office and administrative functions of the management system.
    In the event of a disaster or other damage, we will establish a disaster response headquarters to ensure that important functions are not interrupted as much as possible and, in the event they are interrupted, to restore operations as quickly as possible. However, a disaster may affect the Group’s business results and financial position.
  4. Impairment losses on non-current assets
    A decline in profitability or a change in the purpose of use may result in a deterioration of future cash flows, and there may be a need to recognize an impairment loss on non-current assets.
  5. Reversal of deferred tax assets
    The recognition of deferred tax assets is based on estimates of future taxable income. There may be a need to recognize deferred income taxes because of a loss carried forward for tax purposes or a decrease in the outlook for the recovery of a tax reduction due to temporary differences between figures on the consolidated financial statements and figures used to determine taxes.
  6. Impairment loss on investment securities
    There may be a need for an impairment loss on investment securities due to a decline in the actual value of the securities.
  7. Foreign exchange risks
    Exchange rate movements involving Group assets and liabilities denominated in foreign currencies and the foreign currencies of overseas affiliates may have an effect on consolidated net assets due to a change in the foreign currency translation adjustment. Furthermore, due to interest received on foreign currency-denominated bonds held by the Company and to the business activities of affiliates, foreign exchange rate movements may have an effect on earnings on the consolidated income statement due to the recognition of foreign exchange gains or losses.

Management’s Analyses of Financial Status, Operating Results and Cash Flow

Overview of Operating Results, etc.

Operating Results
During Fiscal Year 2025, the Japanese economy showed signs of a gradual recovery with improvements in both the employment and income environment and demand created by foreign tourists. However, the global economic outlook remains uncertain, reflecting concerns over increased U.S. tariffs, prolonged conflicts in Eastern Europe and the Middle East, and the slowdown in the Chinese economy.
Against this backdrop, volatility in exchange rates as well as resource and raw material prices impacted corporate earnings. In an environment of heightened uncertainty, the Group must pursue flexible and prudent management decisions. Furthermore, the Group recognizes the importance of addressing environmental and social issues and strengthening corporate governance as part of its efforts to achieve sustainable growth in corporate value, and continues to implement various initiatives in these areas. The Group also implements risk management measures by anticipating the potential impact of natural disasters and unforeseen events on its operations.
In the Amusement Equipments Business, the Pachislot market remained solid, reflecting steady progress in expanding the market share of smart Pachislot and the introduction of new machines featuring Bonus Trigger (BT) functions aimed at diversifying gameplay. In the Pachinko machine segment, the rollout of smart Pachinko featuring Lucky Trigger (LT) 3.0 Plus continues to expand. During Fiscal Year 2025, the Group introduced 8 Pachislot titles and 8 pachinko titles, resulting in total sales volume of 115,000 units.
In the Integrated Resort Business, the Philippine gaming market as a whole faced structural headwind due to a contraction in the VIP market, and the Group was significantly impacted. Additionally, temporary factors such as a decrease in visitor numbers due to inclement weather and political instability compounded the situation, resulting in gaming revenue falling below the previous year's level.
As a result, sales in Fiscal Year 2025 totaled 122,827 million yen, decreased by 2.8% year on year. Operating loss was 3,228 million yen (compared with operating profit of 3,024 million yen in Fiscal Year 2024) partly due to the increase in selling, general, and administrative expenses including the depreciation at OKADA MANILA. Foreign exchange losses were recognized due to appreciation of the Japanese yen against the U.S. dollar as in Fiscal Year 2025. As a result, ordinary loss was 18,497 million yen (compared with ordinary loss of 5,599 million yen in Fiscal Year 2024). Net loss attributable to owners of parent was 231,425 million yen (compared with net loss attributable to owners of parent of 15,569 million yen in Fiscal Year 2024) mainly due to impairment losses incurred at OKADA MANILA. Business segment performance is as follows. The figures are prior to adjustments for inter-segment sales or transfers.
1. Amusement Equipments Business
  In Fiscal Year 2025, the Amusement Equipments Business posted net sales of 56,708 million yen (increased by 30.4% year on year) and an operating profit of 10,662 million yen (increased by 45.8% year on year).
  In the amusement equipments industry, adoption of smart Pachislot machines continued to progress steadily, coming to account for the majority of new machine sales. This high popularity has driven growth across the Pachislot market, and market conditions remain favorable. In the Pachinko machine segment, the rollout of smart Pachinko machines equipped with Lucky Trigger (LT) 3.0 Plus contributed to the accelerated adoption of smart Pachinko machines.
  Under these circumstances, UEC released titles such as the latest Madoka Magica series installment, “SMART PACHISLOT Magia Record: Puella Magi Madoka Magica Side Story,” A PROJECT's first smart Pachislot title, “AREX BRIGHT,” and “SMART PACHISLOT OKIDOKI! DUO ENCORE,” the highest-specifications in the OKIDOKI! series. In the Pachinko sector, sales included “P HANEMONO Family Stadium,” a motif of the popular baseball game from Bandai Namco Entertainment Inc., as well as the Group 's first smart Pachinko machines equipped with LT 3.0 Plus: “e SHAMAN KING” and “e SHAMAN KING Dekkeena Ver.”
2. Integrated Resort Business
  The Integrated Resort Business posted net sales(1) of 65,409 million yen (decrease by 20.2% year on year) and an operating loss of 7,114 million yen (operating profit was 2,871 million yen in 2024) in Fiscal Year 2025. Adjusted segment EBITDA(2) was 10,282 million yen (decrease by 47.4% year on year).
  The gaming market in Manila’s Entertainment City is facing ongoing correction. Amidst a contraction in the overall market, OKADA MANILA's performance fell below the previous year's level due to factors including the temporary impact of visitor numbers affected by inclement weather and political instability.
  Despite facing challenges in the gaming revenue sector, OKADA MANILA demonstrated notable resilience and growth across key business metrics including significant improvements in membership and participation. New sign-ups for REWARD CIRCLE loyalty program surged to 102,000, reflecting a strong increase from 79,000 in the previous year—a growth rate of approximately 29%. Furthermore, the number of unique active members per month showed a modest increase of 0.8%, indicating stable engagement among our customer base.
  Our marketing initiatives, particularly through the REWARD CIRCLE loyalty program, focused on fostering customer engagement and loyalty. Key events included a successful four-leg VIP Tournament Series, exclusive concerts during significant cultural festivities, and the transformation of our annual “Christmas Village” into a vibrant “Christmas Carnival,” which engaged an average of 7,400 participants per day.
  Moreover, new attractions were introduced, culminating in the launch of a Fountain program featuring “Dynamite” by BTS, further enhancing guest experiences and drawing new visitors to the resort.
  In summary, while we navigated challenges, our focus on customer engagement, innovative marketing strategies, and market adaptability has positioned OKADA MANILA for continued growth and success in an evolving landscape.
  We remain committed to strengthening our brand and ensuring an exceptional experience for our valued guests.
  1. Net sales are defined as gross revenues minus gaming taxes and jackpots.
  2. Adjusted segment EBITDA = Operating profit/loss + Depreciation + Other adjustments
3. Other
  Other Business posted net sales of 534 million yen (increased by 12.1% year on year), and an operating profit of 113 million yen (operating loss was 198 million yen in Fiscal Year 2024) in Fiscal Year 2025.
  In the Media Content Business, we have launched simulator applications for “OKIDOKI! GORGEOUS” and “AREX BRIGHT” on App Store and Google Play. Sales of “AREX BRIGHT” have been strong as it ranks in the top 10 in the paid game category. For “Universal Kingdom,” the subscription-based application, and “Slots Street,” the free-to-play social casino game, we are constantly holding in-game events to acquire new users and enhance user satisfaction.
  For digital music distribution, eight titles, including the “SMART PACHISLOT OKIDOKI! DUO ENCORE Original Soundtrack,” were released on 24 platforms, including major sites such as Apple Music, Spotify and YouTube Music.
  Note that both net sales and operating profit for the Other segment are presented on a net basis after eliminating inter-segment transactions.

Production, Order Entry and Sales

Production
Production performance in each segment in the current fiscal year is as follows:
Name of Segment
Current Fiscal Year (January 1 to December 31, 2025)
Year-on-Year Comparison (%)
Amusement Equipments Business (Million yen)
57,516
174.1
Total (Million yen)
57,516
174.1
Notes: 1. The amounts are based on sales price.
2. The Integrated Resort Business and other businesses are not included in the production performance table because the services provided by these businesses do not involve production activities.

Orders Received

The status of orders received in each segment in the current fiscal year is as follows:

Name of Segment

Number of Orders Received

(Million yen)

Year-on-Year Comparison (%)

Balance of Orders

Received (Million yen)

Year-on-Year Comparison (%)

Amusement Equipments Business

58,729

146.4

2,233

575.6

Total

58,729

146.4

2,233

575.6

Notes: 1. The amounts are based on sales price.

2. The Integrated Resort Business and other businesses are not included in the order status table because the services provided by these businesses do not involve receipt of orders.

Sales Performance

The sales performance in each segment in the current fiscal year is as follows:

Name of Segment	Current Fiscal Year (January 1 to December 31, 2025)	Year-on-Year Comparison (%)
Amusement Equipments Business (Million yen)	56,708	130.4
Integrated Resort Business (Million yen)	65,409	79.8
Others (Million yen)	534	112.1
Total (Million yen)	122,653	97.4

Notes: 1. Transactions between segments are eliminated by offsets.

No single entity accounted for 10% or more of total sales.
In addition to the sales in this table, there were sales of 174 million yen that could not be allocated to any segment.

Analysis of Financial Status, Operating Results and Cash Flow
The following analysis of financial status and operating results regarding the Group are based on the data presented in the consolidated financial statements, in principle. Statements involving the future in this section are based on judgments by the Group as of the submission date of this report.
1. Significant Accounting Policies and Estimates
  The consolidated financial statements are prepared based on generally accepted accounting principles in Japan. Estimation and assumption that were considered necessary to prepare these consolidated financial statements have been conducted in accordance with reasonable principles. However, figures based on these estimates and assumptions may differ from actual results.
  Significant estimates and assumptions used to prepare the consolidated financial statements are listed in “Section

Accounting, 1. Consolidated Financial Statements, etc., (1) Consolidated Financial Statements [Notes] Significant Accounting Estimates.”

Significant estimates and assumptions used to prepare the non-consolidated financial statements are listed in “Section 5. Accounting, 2. Non-consolidated Financial Statements, etc., (1) Non-consolidated Financial Statements [Notes] Significant Accounting Estimates.”

Analysis of Financial Status
Total assets at the end of Fiscal Year 2025 amounted to 373,634 million yen, a decrease of 259,161 million yen over the end of Fiscal Year 2024. This decrease was due to reductions in fixed assets resulting from the recognition of impairment losses and a decrease in work in progress due to amortization, despite increases in cash and deposits, notes and accounts receivable.
Total liabilities at the end of Fiscal Year 2025 amounted to 243,947 million yen, a decrease of 19,117 million yen over the end of Fiscal Year 2024. This decrease was due to repayments of long-term borrowings and new borrowings at consolidated subsidiaries, a decrease in deferred tax liabilities, a decrease in long-term deposits received from subsidiaries and associates, and a decrease in lease obligations due to the appreciation of the Japanese yen against the Philippine peso.
Total net assets at the end of Fiscal Year 2025 amounted to 129,687 million yen, a decrease of 240,043 million yen from the end of Fiscal Year 2024. This was the result of a decrease in retained earnings due to net loss attributable to owners of parent.
Analysis of Operating Results Net sales and cost of sales
The Group posted a total net sales of 122,827 million yen (a decrease of 2.8% year on year).
In the Amusement Equipments Business, new products were primarily based on major titles as the use of smart Pachislot machines increases and the speed of the adoption of smart Pachinko machines increases. Overall, Fiscal Year 2025 sales of Pachislot and Pachinko machines increased from 92,150 in Fiscal Year 2024 to 115,000 units and net sales increased by 30.4%.
In the Integrated Resort Business, net sales were down 20.2% in part because of the declining size of the VIP market in the Philippines, a structural challenge, and a brief decline in the number of guests caused by unfavorable weather and political instability.
The total cost of sales was 50,846 million yen (a decrease of 0.7% year on year) (breakdown: an increase of 36.6% in the Amusement Equipments Business, and a decrease of 31.3% in the Integrated Resort Business).
Selling, general and administrative expenses
Selling, general and administrative expenses were 75,208 million yen (an increase of 4.3% year on year).
Major changes in these expenses were an increase in depreciation in the Amusement Equipments Business and the Integrated Resort Business.
Non-operating income and expenses
Non-operating income was 5,884 million yen (a decrease of 54.6% year on year). Non-operating expenses were 21,154 million yen (a decrease of 2.0% year on year).
This was mainly because of gain on extinguishment of borrowings of 2,692 million yen, share of profit of entities accounted for using equity method of 2,027 million yen and interest expenses and interest expenses on bonds of 15,719 million yen. In addition, there was a large foreign exchange gain in 2024 but a foreign exchange loss in Fiscal Year 2025 due to depreciation of the Japanese yen against the U.S. dollar.
Extraordinary income and losses and income taxes
Extraordinary income amounted to 6,530 million yen (compared with extraordinary income of 156 million yen in Fiscal Year 2024). The extraordinary losses amounted to 230,304 million yen (compared with extraordinary losses of 1,399 million yen in Fiscal Year 2024). This was mainly because of compensation income of 3,512 million yen, gain on sales of non-current assets of 3,010 million yen and impairment loss of 229,115 million yen.
For these reasons, net loss attributable to owners of parent was 231,425 million yen (compared with net loss attributable to owners of parent of 15,569 million yen in Fiscal Year 2024), and net loss per share was 2,986.48 yen (compared with net loss per share of 200.92 yen in Fiscal Year 2024).
Analysis of Cash Flows

As of the end of Fiscal Year 2025, cash and cash equivalents totaled 36,279 million yen, an increase of 12,483 million yen compared to the end of Fiscal Year 2024. The primary reasons for increases/decreases in each cash flow category in Fiscal Year 2025 are as follows:

Operating cash flows for Fiscal Year 2025 was positive 11,053 million yen. This was primarily due to the recording of a net income before income taxes (excluding depreciation, impairment losses, foreign exchange loss and increase in allowance for doubtful accounts) of 10,341 million yen.

The investing cash flows for Fiscal Year 2025 was negative 3,923 million yen. This was primarily due to proceeds from the sale of property, plant, and equipment of 3,371 million yen, proceeds from the sale of shares of subsidiaries of 1,345 million yen, and expenditures for the acquisition of property, plant, and equipment and intangible assets of 9,255 million yen.

Financing cash flows for Fiscal Year 2025 was positive 9,250 million yen. This is primarily due to proceeds from long-term borrowings of 71,990 million yen and repayments of long-term borrowings of 62,633 million yen.

The following section explains sources of capital and liquidity for the Group.

The demands for capital mainly consist of construction expenses at OKADA MANILA, expenses for materials and the cost of manufacturing in the Amusement Equipments Business, selling, general and administrative expenses, and other expenses for business operations, and research and development expenditures. Major sources of funds to meet this demand for capital are internal resources, private placement bonds and loans from financial institutions. At the end of 2025, bonds payable, loans payable (excluding lease obligations) and other interest-bearing liabilities totaled 133,417 million yen and cash and cash equivalents totaled 36,279 million yen.

Factors that Could Have a Material Impact on Operating Results As stated in “3. Business and Other Risks.”
Current Situation and Outlook of Business Strategy
1. Amusement Equipments Business
  In the amusement equipments industry, smart Pachislot machines are steadily gaining market share, backed by its solid utilization. Furthermore, the wider adoption of machines featuring Bonus Trigger (BT) functions aimed at diversifying gameplay has led to the emergence of successful models, contributing to continued growth of the Pachislot market. Although the utilization of Pachinko machines remains somewhat sluggish overall, manufacturers continue to introduce smart Pachinko machines equipped with Lucky Trigger (LT) 3.0 Plus. The continued introduction of LT 3.0 Plus-featured models with enhanced game elements is expected to drive higher smart Pachinko utilization and support market revitalization.
  In Fiscal Year 2026, the Group released its first smart Pachislot in the Hanabi series, “SMART PACHISLOT HANABI,” and began sales of “SMART PACHISLOT MILLION GOD: KAMIGAMI NO KISEKI” from the GOD
  series, which enjoys overwhelming popularity in the Pachislot industry. Additionally, in the Pachinko machine segment, the Group began sales of the LT-featured model “P ETOTAMA 2 KAMIFESU ETOAMA” and “e Ragnador Ayashiki koutei to shuuen no yashahime.”
  UEC will continue striving to develop unique and appealing titles, contribute to the revitalization of the entire amusement equipments industry as a whole, while striving to expand its market share.
2. Integrated Resort Business
  The Philippine gaming market is expected to become increasingly competitive going forward. OKADA MANILA will continue to focus on acquiring mass-market customers and aims to increase its customer base through its loyalty marketing program. Furthermore, OKADA MANILA will promote collaboration with travel agencies and other partners across Asia to attract international customers. It also aims to establish marketing offices in key countries to build its international brand presence.
  In the non-gaming business, the Pearl Wing room renovation program progressed and additional two floors are scheduled for completion in 2026. To enhance guest in-room experience, tablet upgrades and refreshed guest-experience training programs are planned for rollout.
  OKADA MANILA will continue to focus on introducing new gaming products and driving innovation in the market. Our commitment is to deliver fresh and exciting experiences that elevate the gaming landscape and keep our offerings dynamic and engaging for our guests.
3. Other
  In the Media Content Business, we will continue to distribute high quality simulator applications on App Store and Google Play. For “Universal Kingdom,” the subscription-based application, and “Slots Street,” the free-to-play social casino game, we will continue enhancing services to increase user satisfaction.

Analysis of Sources of Capital and Liquidity of Funds

Status of cash flow
The status of cash flow is stated in “Section 2. Business, 4. Management’s Analyses of Financial Status, Operating Results and Cash Flow, (3) Analysis of Financial Status, Operating Results and Cash Flow, iv. Analysis of Cash Flows.” Trends of cash flow-related indicators are as follows:

Trends of cash flow-related indicators

	Fiscal Year Ended December 31, 2021	Fiscal Year Ended December 31, 2022	Fiscal Year Ended December 31, 2023	Fiscal Year Ended December 31, 2024	Fiscal Year Ended December 31, 2025
Ratio of shareholders’ equity (%)	59.2	58.6	61.8	58.4	34.7
Ratio of shareholders’ equity on market value basis (%)	33.0	30.9	28.4	12.7	16.5
Ratio of interest-bearing liabilities to cash flow (Years)	62.8	4.7	4.2	83.0	12.1
Interest coverage ratio (Times)	0.3	2.7	2.0	0.1	1.0

Ratio of shareholders’ equity = Shareholders’ equity/Total assets

Ratio of shareholders’ equity on market value basis = Total market value of shares/Total assets Ratio of interest-bearing liabilities to cash flow = Interest-bearing liabilities/Cash flow

Interest coverage ratio = Cash flow/Interest paid

Notes: 1. All figures are calculated based on consolidated financial values.

The total market value of shares is calculated based on the number of issued shares minus treasury shares.
Cash flow is represented by operating cash flow.
Interest-bearing liabilities include bonds and loans recorded on the consolidated balance sheet.

Management’s Awareness on Issues and Their Policy for Future Business

As stated in “1. Management Policy, Operating Environment and Issues to Be Addressed.”

Important Contracts, etc.

Universal Entertainment Corporation privately placed bonds due 2029

Issue date	July 26, 2024
Balance at end of period	62,999 million yen [402 million USD]
Redemption date	August 1, 2029
Collateral	Yes
Guarantor	Tiger Resort Asia Limited Pursuant to the Guarantee and Collateral Agreement, the Company and Tiger Resort Asia Limited will provide security for the guarantor’s obligations, and our subsidiaries that meet certain criteria will assume additional guarantee obligations.
Details of the collateral	The guaranteed obligations incurred by the guarantor under the guarantee and security agreement are secured by collateral provided under said agreement. The principal collateral assets are as follows:
Financial covenants	None

All shares of Tiger Resort Asia Limited
All shares of Brontia Limited hold by Tiger Resort Asia Limited

Note: The amount shown in [ ] is denominated in foreign currency.

TIGER RESORT, LEISURE AND ENTERTAINMENT, INC. bank loan due 2031

Borrower	TIGER RESORT, LEISURE AND ENTERTAINMENT, INC.
Borrower’s address	New Seaside Drive, Entertainment City, Barangay Tambo, Parañaque City, Metro Manila 1701, Philippines
Representative of the borrower	Nobuki Sato
Date of borrowing	August 2, 2024
Lender	China Banking Corporation
Balance at the end of the period	57,118 million yen [21,472 million PHP]
Repayment due date	August 1, 2031
Collateral	Yes
Details of the collateral	INC. hold by Tiger Resort Asia Limited
Financial covenants

Real estate held / leased by TIGER RESORT, LEISURE AND ENTERTAINMENT, INC.
All shares of TIGER RESORT, LEISURE AND ENTERTAINMENT,

Debt-equity ratio of no more than 2.33
Debt service coverage ratio of no less than 1.20

Note 1: The amount shown in [ ] is denominated in foreign currency.

Note 2: As effective July 30, 2025, the U.S. dollar-denominated loan was converted into a Philippine peso-denominated loan.

TIGER RESORT, LEISURE AND ENTERTAINMENT, INC. bank loan due 2031

Borrower	TIGER RESORT, LEISURE AND ENTERTAINMENT, INC.
Borrower’s address	New Seaside Drive, Entertainment City, Barangay Tambo, Parañaque City, Metro Manila 1701, Philippines
Representative of the borrower	Nobuki Sato
Date of borrowing	November 12, 2025
Lender	Asia United Bank Corporation
Balance at the end of the period	13,300 million yen [5,000 million PHP]
Repayment due date	August 1, 2031
Collateral	Yes
Details of the collateral
Financial covenants

Real estate leased by TIGER RESORT, LEISURE AND ENTERTAINMENT, INC.

Debt-equity ratio of no more than 2.33
Debt service coverage ratio of no less than 1.20

Note: The amount shown in [ ] is denominated in foreign currency.

Research-and-Development Activities

The amount spent for research and development of the whole group for Fiscal Year 2025 totaled 6,973 million yen. The status of the research-and-development activities of the Group is as follows.

Amusement Equipments Business
In the Amusement Equipments Business, the Company is striving to offer machines with attractive capabilities as to the joy of games and payout performance that are acceptable in the market within the scope of current laws, regulations and standards. The research-and-development expenses for the Amusement Equipments Business amounted to 6,973 million yen.
Integrated Resort Business
There are no research-and-development expenses for the Integrated Resort Business.
Others

There are no research-and-development expenses for other businesses.

Section 3. Facilities and Equipment

Overview of Capital Investments
In the current fiscal year, the Company invested 4,418 million yen for construction works, etc., of the integrated resort project in the Philippines.

Major Facilities and Equipment

The major facilities and equipment of the Group are as follows:

The Company As of December 31, 2025

Name of Business Place (Location)	Name of Segment	Purpose of Facility and Equipment	Book Value (Million yen)					Number of Employees (Persons)
Name of Business Place (Location)	Name of Segment	Purpose of Facility and Equipment	Buildings and Structures	Machinery, Equipment and Vehicles	Land (Square meters)	Others	Total	Number of Employees (Persons)
Head Office (Koto-ku, Tokyo)	Amusement Equipments Business, Other	Development and overall business management	331	20	-	779	1,131	714
Yotsukaido Factory (Yotsukaido, Chiba)	Amusement Equipments Business, Other	Manufacturing	2,215	534	5,197 (61,030)	2,376	10,322	117
Oyama Factory (Oyama, Tochigi)	Amusement Equipments Business	Manufacturing	140	-	361 (9,520)	-	501	-
Tokyo Sales Office (Koto-ku, Tokyo) and 18 other locations	Amusement Equipments Business	Sales	118	0	256 (603)	5	379	141
Okada Museum of Art (Hakone-machi, Ashigarashimo-gun, Kanagawa)	Other	Art museum	0	0	-	0	0	15

Notes: 1. “Others” under “Book value” mainly represent tools, furniture and fixtures. It does not include construction in progress.

2. Major rental and lease facilities and equipment other than those mentioned above are as follows:

As of December 31, 2025

Name of Business Place (Location)

Name of Segment

Purpose of Facility and Equipment

Number of Employees

(Persons)

Square

Measure of Land

Annual Rent and Lease Payment

(Million yen)

Head Office (Koto-ku, Tokyo)

Amusement Equipments Business, Other

Development and overall business management

(leased)

714

319

Domestic Subsidiaries
There are no major facilities and equipment.
Overseas Subsidiary As of December 31, 2025

Company Name	Name of Business Place (Location)	Name of Segment	Purpose of Facility and Equipment	Book Value (Million yen)					Number of Employees (Persons)
Company Name	Name of Business Place (Location)	Name of Segment	Purpose of Facility and Equipment	Buildings and Structures	Machinery, Equipment and Vehicles	Construction in progress	Others	Total	Number of Employees (Persons)
TIGER RESORT, LEISURE AND ENTERTAINMENT, INC.	Head Office (Manila)	Integrated Resort Business	Integrated resort facility	149,978	10,203	4,388	19,243	183,814	6,107

Note: “Others” under “Book Value” mainly represent tools, furniture and fixtures, and leased assets.

Plans for Construction and Retirement, etc. of Facilities

The Group determines capital investments considering the business forecast, industry trends, and investment efficiency in total. In addition, preparation of system infrastructure is being promoted to improve the efficiency of business management. In principle, investment proposals are evaluated by each of the consolidated companies.

Name of Company or Business Place

Location

Name of Segment

Purpose of Facility and Equipment

Planned Investment

Funding Measures

Planned Timing of Launch and

Completion

Increased Capacity on Completion

Total (Million

yen)

Paid in (Million

yen)

Launch

Completion

Yotsukaido Factory of the Company

Yotsukaido, Chiba

Amusement Equipments Business

Machinery and Equipment for manufacture,

etc.

2,185

Own funds and borrowings

January 2026

December 2026

The new major facilities investment plans as of the end of the current fiscal year are as follows: Construction of New Major Facilities

Notes: 1. The facilities investment plans of the consolidated group are aggregated in each area at the above business place.

2. Description of “Increased Capacity on Completion” is omitted as a reasonable calculation of the relevant figure is difficult.

Section 4. Situation of the Company

Details of Stock, etc.

Total Number of Shares, etc.

Total Number of Shares
Classification
Total Number of Authorized Shares
Common stock
324,820,000 shares
Preferred shares
40,000,000 shares
Total
324,820,000 shares
Note: The total numbers of authorized shares are the authorized shares for each class in the Articles of Incorporation.

Number of Issued Shares

Classification

Number of Issued Shares as of the End of the Current Fiscal Year (December 31, 2025)

Number of Issued Shares as of the Submission Date of This Report

(March 30, 2026)

Name of Listed Financial Instruments Exchange Market or Authorized Financial Instruments Firms Association

Remarks

Common stock

80,195,000 shares

Tokyo Stock Exchange Standard Market

Number of shares for one unit: 100

Total

80,195,000 shares

Note: The shares issued upon the exercise of share acquisition rights from March 1, 2026 through the submission date of this Annual Securities Report are not included in “Number of Issued Shares as of the Submission Date of This Report.”

Subscription Rights to Shares
1. Stock Options
  There is no applicable information.
2. Rights Plan
  There is no applicable information.
3. Other Subscription Rights to Shares, etc.
  There is no applicable information.
Exercise Status, etc., of Bonds with Subscription Rights to Shares with a Clause to Revise the Exercise Price
There is no applicable information.

Transition of Total Number of Issued Shares and Amount of Capital Stock

Date

Change in

Total Number of Issued

Shares (Shares)

Balance of

Total Number of Issued

Shares (Shares)

Change in Capital Stock (Million yen)

Balance of Capital Stock (Million yen)

Change in Legal Capital Surplus (Million yen)

Balance of Legal Capital Surplus (Million yen)

July 23, 2011

(Note)

80,195,000

(3,348)

7,503

Note: Pursuant to the resolution adopted by the Annual Shareholders’ Meeting held on June 21, 2011, the Company’s capital stock was reduced by 3,348 million yen to 98 million yen through a capital reduction without compensation (ratio of capital reduction: 97.1%) as of July 23, 2011. Said 3,348 million yen was transferred to other capital surplus.

Shareholders by Category

As of December 31, 2025

Category	Details of Shareholders (one unit share represents 100 shares)								Number of Shares Less Than One Unit Share (Shares)
	Government Agencies and Public Institutions	Financial Institutions	Financial Instruments Traders	Other Entities	Foreign Entities, etc.		Individuals and Others	Total
	Government Agencies and Public Institutions	Financial Institutions	Financial Instruments Traders	Other Entities	Other Than Individuals	Individuals	Individuals and Others	Total
Number of shareholders (Persons)	-	5	27	149	87	177	17,709	18,154	-
Number of shares held (Units)	-	1,372	17,949	19,566	595,921	1,482	165,198	801,488	46,200
Shareholding percentage (%)	-	0.17	2.24	2.44	74.35	0.19	20.61	100.00	-

Notes: 1. Treasury shares of 2,704,139 shares are included in “Individuals and Others” and “Number of Shares Less Than One Unit Share” in terms of 27,041 units and 39 shares, respectively.

4 units of shares under the name of Japan Securities Depository Center, Inc., are included in “Other Entities.”

Major Shareholders

As of December 31, 2025

Name	Address	Number of Shares Held (Thousand shares)	Ratio of Shares Held (Excluding treasury shares) (%)
Okada Holdings Limited (Standing proxy: SMBC Nikko Securities Inc.)	6TH FLOOR, ALEXANDRA HOUSE, 18 CHATER ROAD, CENTRAL, HONG KONG (5-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo)	54,452	70.26
Hiroko Yokotsuka	Shinagawa-ku, Tokyo	2,045	2.63
STATE STREET BANK AND TRUST CLIENT OMNIBUS ACCOUNT OM02 505002 (Standing proxy: Mizuho Bank, Ltd., Settlement Division)	ONE CONGRESS STREET, SUITE 1, BOSTON, MASSACHUSETTS (15-1, Konan 2-chome, Minato-ku, Tokyo)	1,785	2.30
Universal Entertainment Employees’ Stock Ownership Plan	7-26, Ariake 3-chome, Koto-ku, Tokyo	752	0.97
Ueda Yagi Tanshi Co., Ltd.	4-2, Koraibashi 2-chome, Chuo-ku, Osaka-shi, Osaka	645	0.83
JP JPMSE LUX RE BARCLAYS CAPITAL SEC LTD EQ CO (Standing proxy: MUFG Bank, Ltd.)	1 CHURCHILL PLACE LONDON - NORTH OF THE THAMES UNITED KINGDOM E14 5HP (4-5, Marunouchi 1-chome, Chiyoda-ku, Tokyo)	513	0.66
HOKUTO.CO., LTD.	1044-1, Akaboriimaicho 2-chome, Isesaki-shi, Gunma	470	0.60
SBI Securities Co., Ltd.	6-1 Roppongi 1-chome, Minato-ku, Tokyo	425	0.54
Nomura Securities Co., Ltd.	13-1, Nihombashi 1-chome, Chuo-ku, Tokyo	392	0.50
STATE STREET BANK AND TRUST COMPANY 505025 (Standing proxy: Mizuho Bank, Ltd., Settlement Division)	ONE CONGRESS STREET, SUITE 1, BOSTON, MASSACHUSETTS (15-1, Konan 2-chome, Minato-ku, Tokyo)	333	0.42
Total	-	61,812	79.76

Note: The Company holds 2,704,139 treasury shares, which is excluded from the above table of major shareholders.

Voting Rights i.Issued Shares

As of December 31, 2025

Classification of Shares	Number of Shares (Shares)	Number of Voting Rights (Units)	Remarks
Shares without voting rights	-	-	-
Shares with limited voting rights (treasury shares, etc.)	-	-	-
Shares with limited voting rights (others)	-	-	-
Shares with full voting rights (treasury shares, etc.)	Common 2,704,100 stock	-	-
Shares with full voting rights (others)	Common 77,444,700 stock	774,447	-
Shares less than one unit share	Common 46,200 stock	-	-
Total number of issued shares	80,195,000	-	-
Voting rights of total shareholders	-	774,447	-

Note: The common stock indicated in “Shares with full voting rights (others)” includes 400 shares of unknown holders’ stock registered under the name of Japan Securities Depository Center, Inc.

The “Number of Voting Rights” includes 4 units of voting rights related to such shares with full voting rights under the name of Japan Securities Depository Center, Inc.

ii. Treasury Shares, etc.

As of December 31, 2025

Owner’s Name or Title

Owner’s Address

Number of Treasury Shares

in Own Name (Shares)

Number of Treasury Shares

in the Names of Others (Shares)

Total Number of Shares Owned (Shares)

Holding Ratio to Total Number of Issued Shares (%)

Universal Entertainment Corporation

Ariake Frontier Building Tower A, 7-26, Ariake 3-chome, Koto-ku, Tokyo

2,704,100

3.37

Total

2,704,100

3.37

Acquisition of Treasury Shares, etc.

[Class of Stock, etc.]

Acquisition of common stock that falls under the provisions of Item 7, Article 155 of the Companies Act

Status of Acquisitions of Treasury Shares Based on Resolutions at Shareholders’ Meetings There is no applicable information.
Status of Acquisitions of Treasury Shares Based on Resolutions at the Board of Directors Meetings There is no applicable information.
Details of Acquisitions of Treasury Shares Not Based on Resolutions at Shareholders’ Meetings or the Board of Directors Meetings
Acquisition based on the provision of Item 7, Article 155 of the Companies Act
Classification of Shares
Number of Shares (Shares)
Total Value (Yen)
Treasury shares acquired in 2025
43
46,397
Treasury shares acquired during the period for acquisition
-
-
Note: The treasury shares acquired during the period do not include shares resulting from purchases of less than one unit of shares from March 1, 2026 to the submission date of this Annual Securities Report.
Status of Disposal and Holding of Treasury Shares

Classification	Current Fiscal Year		Period for Acquisition
Classification	Number of Shares (Shares)	Total Amount of Disposition (Yen)	Number of Shares (Shares)	Total Amount of Disposition (Yen)
Treasury shares offered for acquisition	-	-	-	-
Treasury shares canceled for disposition	-	-	-	-
Transferred treasury shares in connection with merger, share exchange, share issuance or company split	-	-	-	-
Others (Exercise of stock options)	-	-	-	-
Number of treasury shares held	2,704,139	-	2,704,139	-

Notes: 1. The treasury shares disposed of during the period for acquisition do not include shares resulting from additional purchases of less than one unit of shares or shares by the exercise of share acquisition rights from March 1, 2026 to the submission date of this Annual Securities Report.

2. The number of treasury shares held during the period for acquisition does not include shares resulting from purchases and additional purchases of less than one unit of shares, the exercise of share acquisition rights or purchases based on a resolution by the Board of Directors from March 1, 2026 to the submission date of this Annual Securities Report.

Dividend Policy
The Group considers the return of profits to shareholders to be one of the highest priorities.
The Group’s basic capital policy is to use capital with even greater efficiency and maintain financial soundness in order to consistently increase corporate value and maintain a solid base for sustained growth. For the dividend, the basic policy is to make stable and consistent payments that reflect results of operations.
It is the Group’s basic policy to maintain the internal reserve at appropriate levels to ensure a healthy financial base and to strengthen the foundation for business operations as well as to invest necessary funds efficiently in promising businesses.
Stock repurchases will be made after carefully considering all applicable factors and for the purpose of taking actions concerning equity with speed and flexibility that reflect changes in the business climate.
The Group regretfully announces no dividend for Fiscal Year 2025 based on its consolidation that stabilizing the financial base to be an urgent priority for earnings recovery, as there was a significant loss recognized in Fiscal Year 2025.
The Group apologizes that we also anticipate no dividend payment for Fiscal Year 2026. Despite the challenging business environment, the Group is committed to improving business performance in order to provide stable dividends. We kindly ask for the continued support and understanding of our shareholders and investors.
The Articles of Incorporation of the Company state that it can distribute an interim dividend pursuant to Article 454, Paragraph 5 of the Companies Act.
Corporate Governance, etc.

Overview of Corporate Governance
1. Basic Philosophy Regarding Corporate Governance
  Improving corporate governance is one of the Company’s highest priorities. There are many activities for making management more efficient, speeding up decision making and further strengthening the management oversight function based on lessons learned in prior years.
  In addition, in accordance with the Basic Policy for the Establishment of an Internal Control System, there will be activities to establish and maintain the corporate governance structure needed for more growth of corporate value and ensuring the soundness and transparency of management.
2. Outline of Corporate Governance Structure and Reason for the Adoption of the Structure
  1. Outline of Corporate Governance Structure

Following approval of the resolution to revise the Articles of Incorporation at an Extraordinary Shareholders Meeting held on July 23, 2025, the Company transitioned to a Company with an Audit & Supervisory Committee effective the same date.

Because the Company recognizes that the transparency of its entire business management and the reinforcement of its monitoring system on management operations are critical to continuously enhance the corporate value, it strives for improvements of corporate governance functions.

The Board of Directors of the Company is composed of 6 Directors (excluding Directors who are members of the Audit & Supervisory Committee) (including 2 Non-executive Directors) and 3 Directors who are Members of the Audit & Supervisory Committee (including 3 Non-executive Directors) with Mr. Tomohiro Okada, Representative Director and President, serving as the Chairman and holds regular monthly meetings and extraordinary meetings as necessary to report and determine important matters concerning the management of the Group. The Audit & Supervisory Committee is composed of 3 Directors who are Members of the Audit & Supervisory Committee (including 3 Non-executive Directors) with Mr. Kuninobu Okuda, a full-time Audit & Supervisory Committee

Member, serving as the Chairman. Audit & Supervisory Committee Members conduct appropriate and lawful audits in cooperation with the Accounting Auditors and the Internal Audit Office. The Nomination and Remuneration Committee is composed of 3 Directors (excluding Directors who are members of the Audit and Supervisory Committee)(including 2 Non-executive Directors), and 1 Director who is a member of the Audit and Supervisory Committee(including 1 Non-executive Director). Tomohiro Okada, the Representative Director and President, serves as the Chairman. The Nomination and Remuneration Committee was established as a voluntary advisory body to the Board of Directors to enhance the fairness, transparency, and objectivity of procedures related to the nomination and compensation of directors, and to further strengthen the corporate governance framework.

The corporate governance structure of the Company is as follows.

Earlier from Universal Entertainment

All Universal Entertainment news releases

Number of Employees	Average Age	Average Number of Years Employed	Average Annual Salary (Yen)
1,000	45 years and 4 months	13 years and 0 month	7,410,286

Classification	Total Number of Authorized Shares
Common stock	324,820,000 shares
Preferred shares	40,000,000 shares
Total	324,820,000 shares

Classification of Shares	Number of Shares (Shares)	Total Value (Yen)
Treasury shares acquired in 2025	43	46,397
Treasury shares acquired during the period for acquisition	-	-