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Exchange rates pull Ubisoft from profit to £32m loss

Rob Crossley
Exchange rates pull Ubisoft from profit to £32m loss

Paris headquartered publisher Ubisoft has reported a £32m loss for the first half of the financial year, despite preventative measures to curb expenditure.

Revenues for the most recent three months, ending September 30th, were positive. Ubisoft sold £125m of goods for this period, up by about 40 million year-on-year and way ahead of the £85m that the publisher had expected.

But the publisher also recorded into this the £15m made from early shipments of Just Dance 3 in the US, despite the game launching outside the financial period, in early October.

Second quarter revenues were boosted by releases such as Driver San Francisco, The Smurfs (Facebook) and the digital game From Dust. But the first quarter had not matched this success, with total half-year sales at £213m and representing a 4.6 per cent contraction compared to the year prior. 

Ubisoft trades in Euros and is more susceptible than its rivals to market fears sweeping through the Eurozone. The publisher points out that, had exchange been fixed for the half-year term, it would have recorded a small profit. Yet the company points out that it made an even bigger loss in the first half of the previous financial year, where it was down £55m for the six months ending September 2010.

About £10m was saved in development costs compared to last year, Ubisoft added.

The publisher’s CEO, Yves Guillemot, said sales for one of its key games, Driver San Francisco, finished ahead of targets. The Online segment saw a 132 per cent surge in sales too, due to the success of Facebook game the Smurfs and the XBLA/PSN title From Dust.

The full year results were unchanged, with revenue projected at about £900m, and operating income at £50m.

"Our line-up for the second half of the fiscal year includes established franchises for both hardcore and casual gamers,” Guillemot added.

"Our games will target the high definition platforms - which are seeing continued progress - as well as the high-growth online segment and the high-potential categories in the casual segment. Thanks to the potential of those titles, combined with our significantly enhanced quality levels and solid first-half performance, we are confident that we will be able to achieve our targets for full-year 2011-12."

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Tags: Ubisoft , 2011 , loss , fiscal , financials , results , h1 , £42m , First half

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