NCsoft full-year revs rise 5%

Guild Wars publisher sees growing sales during 2008, profits drop 40% on marketing spend; Aion exceeds expectations in Korea.

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In an economic climate where "well enough" is more than a lot of companies can say, NCsoft today turned in decidedly decent results for its full fiscal year. Through December, the massively multiplayer online gaming company saw revenues rise 5 percent year-over-year to KRW 346.6 billion ($247 million). Unfortunately, the Korean publisher saw a significant dip in profits, which fell 40 percent during the fiscal year to KRW 27.2 billion ($19.4 million).

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NCsoft attributed its profit shortfall to the November launch of Aion: Tower of Eternity in Korea, saying that the MMOG had not been on the market long enough to recoup marketing spend on the game. The publisher did say, however, that the title has exceeded its internal expectations, which, along with Lineage's strong performance in Japan and a favorable exchange rate, helped grow revenues.

For the fourth quarter alone, NCsoft pulled in KRW 8 billion ($5.7 million) in profit on revenue of KRW 99 billion ($70.6 million). Lineage and Lineage 2 accounted for the bulk of NCsoft's sales during the period, bringing in a respective 29 percent and 42 percent of quarterly sales. The recently launched Aion amounted to 10 percent of that breakdown, followed by City of Heroes/City of Villains with 7 percent and Guild Wars with 5 percent.

The year has been fraught with turbulence for NCsoft. NCsoft fired one of the opening shots in what would turn out to be a game-industry-wide reckoning, canceling Spacetime Studios' unannounced MMOG in January. Along with several others, the publisher opted to skip the 2008 E3 Media & Business Summit, exiting the Entertainment Software Association entirely in December. NCsoft also reorganized its Western operations under the NCsoft West label in September and saw the departure of celebrity game designer Richard Garriott after the publisher pulled the plug on his sci-fi MMOG, Tabula Rasa.

Looking to its next fiscal year, NCsoft expects to grow revenues by 36 percent to 44 percent, realizing sales of KRW 470 billion ($335 million) to KRW 500 billion ($356 million). The publisher gave no estimate on net income but did say it expects operating profit to spike 137 percent on the year to KRW 100 billion ($71.3 million). "We anticipate full scale growth in 2009 based on the successful launch of Aion in Korea and the upcoming launch of the product in territories worldwide," NCsoft's CFO Jaeho Lee said in a statement.

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