Mad Catz income doubles

Peripheral maker announces positive earnings, but stock prices stay put.

Mad Catz Interactive, a maker of game peripherals and accessories, reaped record sales and profit margins in the third quarter of fiscal year 2005. The company reported its earnings yesterday, revealing that third-quarter net sales were $52.8 million, up 27 percent from $42 million for the same quarter of fiscal year 2004.

Gross profits for the quarter totaled $13.4 million, compared with $9.7 million in the third quarter of fiscal year 2004. Net income was $3.8 million for the quarter, more than double the $1.6 million Mad Catz earned in the same quarter of its 2004 fiscal year.

Net sales for the nine months that ended December 31 were $90.2 million, up $81.1 million from the same period the prior year. Net income for the nine-month period was $3.7 million, compared with $400,000 for the same period of fiscal year 2004.

Last year, Mad Catz introduced three licensed accessory bundles in conjunction with The Incredibles; launched its LiveCon controllers for Xbox Live; shipped a line of accessories for the Nintendo DS; and released its debut game, MC Groovz Dance Craze, the first dance game for the Nintendo GameCube. In the coming year, it will begin creating custom NFL team controllers through a multiyear license with the football league.

"We believe Mad Catz's strong third-quarter results have validated the growth and profit initiatives implemented over the past year," said Darren Richardson, president and CEO of Mad Catz Interactive. He added that the company's long-term success will depend on broadening its portfolio while keeping a tight rein on operations and expenses.

Mad Catz Interactive's (MCZ) stock opened yesterday at $1.10, then rose to a high of $1.18 before closing at $1.09. Today, it opened at $1.13 but is currently trading at $1.09 a share.

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