Infogrames halves losses
Atari parent company sees slight dip in full-year revenue to $450 million, but losses trimmed significantly to $79 million.
Closing out last week, Atari gave the industry its first look at the tangible impact that its extensive shake-up has had on the company. Said reorganization has included the addition of big names such as Phil Harrison, Jim Wilson, and David Gardner to the highest ranks of both it and its parent company Infogrames. For its full fiscal year, Atari's efforts showed signs of traction, with the publisher trimming losses to $23.6 million, but at the cost of reducing annual revenues to just $80.1 million.
Today, Infogrames released its own full-year and fourth-quarter earnings statement, and the French company saw trends similar to its subsidiary. For the year ended March 31, 2008, Infogrames saw revenues decline to €290.7 million ($450 million) from €305.3 million ($473 million) the year before. Despite shrinking revenues, Infogrames managed to halve its losses for the year, posting a net-income loss of €51.1 million ($79 million) compared to €103.1 million ($160 million) from the previous year.
"Last year has been a difficult but crucial period for the Group," commented CEO David Gardner. "During that period, Infogrames has carried out an intensive restructuring of its capital base, leading to an improved financial situation and has initiated an important reorganization of its global distribution network and management structures. In the months ahead, we will capitalize on the value of the Atari brand and implement the new strategy, with the clear objective of refocusing on profitability while ensuring growth."
Breaking out performance by region, Infogrames noted that the European and Asian markets accounted for 82 percent of total sales, with the US constituting the remaining 18 percent. Namco Bandai-developed games led Infogrames' publishing efforts, with Dragon Ball Z Tenkaichi 3 on the PlayStation 3, DBZ Tenkaichi on the Wii, and Naruto Ultimate Ninja on the PlayStation 2 selling more than 3.5 million units. Other top performers included CD Projekt Red's The Witcher, which has sold more than 420,000 units, and Etranges Libellule's Asterix at the Olympic Games moving 530,000 units across the PS2, Wii, DS, and PC.
Looking ahead, Infogrames expects to grow revenues by 12 to 18 percent during its 2008-2009 fiscal year, thanks in large part to the extensive steps that it has taken to "transform" Atari. Those steps included the purchase of all outstanding stock in Atari so as to take the company private, as well as the reduction of expenses incurred from outstanding debt with the issuance of €150 million ($233 million) in convertible bonds.
Infogrames plans to continue honing its Atari strategy by reducing head count from 540 to 460, as well as consolidating its global business into five large, regional units as a way to increase efficiency. The publisher also reinforced Harrison's statements from last month, saying it would be funneling a substantial portion of its research and development budget into developing its online strategy. The publisher expects to turn a profit within 18 months.
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