Glory – a Mixed Picture Across Global Markets

Glory’s annual results, announced last month, showed a 3% drop in sales to ¥217 billion, and a 20% drop in operating income to ¥14 billion.

The company supplies a range of equipment for banknote and coin handling, as well as OEM components for ATMs, vending machines and kiosks, along with maintenance services. Sales of merchandise and finished goods were ¥138.7 billion (down 9.4% year on year), while sales from maintenance services were up by 10.7% to ¥78.6 billion.

The results were impacted by COVID, particular in the company’s US and European markets. In Asia, sales were also depressed despite the economic recovery in China. The company fared better in its home market of Japan.

But the company has also benefited from the sharp increase in demand for contact-free and self-service devices, as well as the maintenance services required to modify systems as a result of the impending introduction of the new 500 yen coin.

Glory’s business is organised into four groups.

In the Financial market segment – which covers equipment and services to financial institutions, OEM clients and others in Japan – sales of the main products, open teller systems and coin and banknote recyclers, were strong. In addition, as noted above, sales from maintenance services increased sharply.

As a result, net sales in this segment increased by 18% YOY to ¥49.8 billion and operating income was up by 197.5% to ¥9.8 billion.

In the Retail and Transportation market segment – which covers retailers, transport companies, CIT companies and government authorities in Japan – sales from maintenance services also increased due to the new 500 yen coin. However, sales of coin and banknote recyclers for cashiers were sluggish as a rebound from large-lot demand of the previous year, while sales of ticket vending machines were also sluggish due to a decrease in demand at restaurants and leisure facilities.

On the positive side, business negotiations for self-service coin and banknote recyclers for cashiers and self-service medical payment kiosks progressed at a faster pace than expected in response to labour shortages and changes in lifestyles.

Net sales in this segment were ¥48.8 billion (down 7%) and operating income was ¥2.8 billion (down 44.5%).

Sales of the Amusement market segment’s main products – including card systems and pachinko prize dispensing machines – were down 47% to ¥11 billion and it recorded an operating loss of ¥290 million (vs. operating income of ¥2 billion the previous year).

In the Overseas segment, sales of banknote recyclers (the RBG series) to financial institutes in North American and Europe were slow, but those of deposit machines (the CI series) for the retail industry were favourable. In Asia, sales of banknote sorters (the UW series) were on a par with the previous year. Net sales in this segment were up 1.1% to ¥104.7 billion, although operating income fell by 60.8% to ¥3.8 billion.

Glory is forecasting an increase in sales to ¥225 billion in 2021/22, but a further drop in operating income to ¥10 billion. In terms of business expansion, it has formed alliances with AdInte, which provides customer and behaviour analysis services to retail businesses, and Showcase Gig, which operates a mobile ordering service business.

It is also focusing on the commercialisation of its biometric and image recognition technologies to expand into new markets such as medical care and education, while in 2019 it invested in the Singapore fintech SoCash, which offers an app-based virtual ATM solution.