THQ reports FY net loss of $35.3m

THQ has reported full year losses of $35.3 million for the 12 months to March 31st, with sales up slightly to $1.03 billion.

That compares to the $68 million profit reported in its previous fiscal year, and $1.026 billion in sales.

For its fourth quarter, the company also saw sales rise – up to $187 million from $172.1 million year-on-year – but losses reached $34.5 million, compared to Q4 profits of $6.5 million in 2006-2007.

Sales were led by Frontlines: Fuel of War, MX vs. ATV Untamed and WWE SmackDown vs. Raw 2008. The two latter titles exceeded expectations, while Frontlines met its goals. However, THQ said it saw ‘weaker-than-expected sell through’ of its catalogue titles.

THQ president and CEO Brian Farrell said in a company release:

In fiscal 2008, we did not achieve our revenue and profit targets and we are taking aggressive steps to ensure that we significantly improve execution in fiscal 2009 and beyond.

Going forward, we are focused on three key initiatives. We are rolling out a stronger slate of products. We have put in place and are executing against initiatives to improve our product quality and competitiveness.

"We are also realigning our cost structure to generate significant operating leverage in fiscal 2009. We believe these initiatives will restore profitable growth and improve value for shareholders.”

However, the publisher expects to post a net loss in its fiscal first quarter ending June 30th, with sales between $115 and $125 million, reflecting a ‘light product release schedule and the timing of expenses’.

For the full year 2008-2009, the firm has said it expects sales to reach between $1.175 and $1.2 billion.

We believe our stronger fiscal 2009 product line-up is positioned to take advantage of the expanding demographic on the growing installed base of new gaming systems,” added Farrell.

Our line-up is anchored by Saints Row 2 and Red Faction Guerrilla, sequels to two of our most successful original franchises. We have a strong slate of new original titles developed specifically for the Nintendo Wii platform.

We are introducing two new promising original brands, de Blob and Darksiders. And we plan to launch new games based on our proven annual franchises: WWE SmackDown vs. Raw 2009, Disney/Pixar’s Wall-E and a portfolio of Nickelodeon titles.”

Farrell continued, As part of our strategy of managing some of the biggest brands in entertainment in the video game category, we are thrilled with our new relationship with DreamWorks Animation.

DreamWorks Animation is one of the most proven brands in entertainment based on their exceptional creative talent and box office success.

"We’re also excited about launching our first games based on the Ultimate Fighting Championship in spring of next year in conjunction with a prime UFC event. And importantly, the new WWE Legends of Wrestlemania game next March is a great addition to our portfolio.”