Majesco Q4 revs spike
Cooking Mama publisher tallies solid sales, trims full-year losses as well. Execs say focus on DS, Wii, and "affordable, mass-market games" will turn the tide.
Aided by solid sales of Jaws Unleashed, distribution deals with both Valve and Trymedia, and the critical success of the DS title Cooking Mama, Majesco reported a balance sheet that company officials say holds signs of a turnaround.
Majesco president and interim CEO Jesse Sutton said that the company was in the midst of a new approach toward the marketplace that has already served the company well over the past year.
"In 2006...we have taken great strides to transition our business away from big-budget console games to a more balanced product portfolio comprised mainly of quality, easy-to-play, affordable games for the mass market," Sutton said today in a statement
For the fourth quarter ending October 31, 2006, the company reported a loss of $2.9 million, far below the $34.2 million loss for the same quarter a year ago. Full-year stats saw Majesco reduce its loss from $72.0 million to $5.4 million.
Those losses are against revenues of $21.5 million for the quarter (up from $4.6 million a year ago) and $66.7 million for the year, up from $59.7 million a year ago.
The company touted sales of nearly 600,000 units worldwide for its Jaws Unleashed title (for the Xbox and PS2).
"With [these] notable successes," Sutton said, "we are optimistic that our refined strategy is working."
Majesco CFO John Gross also addressed the company's new apprach, saying, "We have transitioned away from the big-budget games and dramatically decreased our development costs and operating expenses, thereby significantly reducing our use and loss of cash."
Still, the outlook for the fiscal year isn't without its challenges. Sutton added that although 2007 will be the first year that company revenue will be derived "from a majority of products developed in line with this strategy," Majesco is still expecting losses ahead. "Based solely on our current release schedule," Sutton said, "we expect fiscal 2007 revenue to decline approximately 10 percent to 15 percent as compared to fiscal 2006 revenue."
Even with expected revenue shortfalls, industry analyst Michael Pachter saw signs of hope for the company. In a memo distributed to investors today, Pachter said, "We note that Majesco's FY:07 lineup of budget titles including 5 DS games and 3 Wii games should provide relatively modest revenue at a modest cost. Should any of these games sell in excess of 100,000 units, we believe that Majesco is well-positioned to generate upside...We think that the company’s performance over the last four quarters demonstrates its resolve to turn its fortunes around."