|
Empire's half-year results show a marked decline attributed to
seasonal product release variances between 2003 and 2004. 2003's restated (see full-year results above) £18.8m sales came from an uncharacteristically strong first half release schedule (62% of turnover) whilst the
2004 release schedule is expected to be more second half-weighted. The Company's major hope is racing game Flat Out which has received favourable pre-release publicity but which is launching during the most
competitive point in the European market, in November and will be fighting for retail visibility with several high profile driving games from larger publishers. The US launch is being held back until early 2005.
With development costs (£4.8m) and admin costs £0.4m) broadly the same as in 1H03, the Company's return to operating loss is entirely attributable to its lower turnover and the Company still expects a strong
conclusion to the financial year and a return to profit. The Company will also be hoping for an improvement to its cashflow as well. It continues to sail close to the wind with cash of just £7k, an overdraft of
£122k and overall net liabilities of £0.5m. To support its continued operations, Empire has extended its bank facility to £1.7m and continues to manage its working capital prudently. These are clearly risky times
for the Company.
01/02/05 Empire responds to market speculation
Empire
sought to prevent a mass stock sell-off following a sharp fall in its share price. The Company revealed that the price depreciation had been caused by one major shareholder selling its stake in what has become a
highly illiquid market. The Company claimed that its results for the year ended 31/12/04 were being finalised and, assuming it received console manufacturer approval for one of its products, they would be in line
with expectation. The Company did not expect to encounter any problems with the approval.
27/04/05 Hello Kitty licence acquired
Empire continues to
re-position itself as a budget and mid-priced publisher of mass-market product with the licensing of the Hello Kitty brand for games use in the UK, Europe and Australasia. The title, developed in Japan, will be
published at a mid price point under the Xplosiv label. Hello Kitty is a Japanese cartoon series (now in its 31st year) aimed at teen and pre-teen girls. The game will be released on all major formats in September
of this year.
13/05/05 Prelims
With a marginal reduction in revenues
and profits over 2003, Empire's 2004 results were broadly in line with expectation. Operating expenses were reduced by £2.1m to £14.8m but the Company still recorded a modest slip in PBT from £0.6m
to £0.4m. With immaterial cash levels, the Company continues to rely upon short-term debt facilities to finance the business although, as at the year-end, the Company was only using £0.35m of a £1.7m facility. This picture is partly a product of timing as Empire has £4.4m in debtors (£3.9m in creditors) mostly monies owed by retail and distribution partners for products released at the end of the year.
The Company continues to reinvent itself as a mid and budget price point publisher, announcing ambitious plans to take its Xplosiv budget label into the US and its intentions to continue developing for current
generation platforms long after the launch of next-generation consoles starting this Christmas. Clearly, this is a decision that has been forced upon them by their precarious cash position but even with cash, it is
difficult to see a publisher of the size of Empire being able to compete effectively with the major publishers in the full-price next-generation software market without a substantial change in management and
development strategies. In addition, there is no reason to believe that the mid-price and budget markets will suffer over the next few years. Indeed, there are many good reasons to believe that they will blossom
during that period as the major publishers shift their focus onto next-generation markets and top tier product pricing jumps for next-generation titles. However, these lower-level markets are becoming increasingly
competitive so Empire will have its work cut out for it if it is to grow at anything other than a modest rate.
29/09/05 VUG deal announced
Empire has once again
teamed up with VUG in the North American market. VUG will distribute a variety of Empire's back catalogue and more recent titles through its value publishing label (Value Line Publishing). The deal comprises both
console and PC titles which, curiously, are being described as "casual" games but which contain several hard-core games such as Mashed, Bad Boys 2 and Victorious Boxers. These, it would appear, will be "casual" in
price alone..
30/09/05 Interims
|
