"I want to highlight three key competitive advantages that will allow us to build on our success and continue as the world's number one third-party video game publisher.
"First, our proven strategy of focusing on high-quality franchises, which is evident in our 2009 product line up, the best in our company's history.
"Second, our industry-leading operational capability, which has allowed us to avoid the distraction of right-sizing and restructuring.
"And third, our strong financial position, which gives us the ability to use capital as a competitive advantage. The consumer outlook remains uncertain for 2009. As always we recognised that our titles will need to perform well. We remain mindful of the many variables that can affect industry fundamentals and our own near-term market performance as there is still significant macroeconomic risk, consumer acceptance risks, and pricing risk.
"We do believe that our proven ability to focus on select franchises gives us an unparalleled competitive advantage this year. Our strategic planning process provides the consistent ability to understand which titles to pursue, those which offer the greatest near-term reward with the greatest long-term value to our audiences, as well as which titles and genres to avoid.
"We are therefore confident in launching in calendar 2009 more products than ever before, what we believe to be the strongest slate in the industry. The great majority of these are based on proven franchises, including three of the most successful franchises in the history of video games.
"A smaller minority will consist of a select few wholly owned and internally developed new intellectual properties for which we have planned conservatively, but if successful, will provide a high return on investment for the near and long term.
"We've taken even more thoughtfully, rigorous and measured approach to launching new intellectual properties than we do to long-standing franchises as the introduction of new IP is one of our industry's most difficult challenges. We conservatively manage our portfolio risk profile by generating the majority of our revenue and operating earnings from the more predictable and stable franchises that have served us well over long periods of time. We believe this strategy is in the best interest of our long-term shareholders, and has been validated by our consistent performance.
"Our proven operational capability complements our strategic focus and gives us another competitive advantage in the industry... We conservatively model costs and we aggressively manage spending. This approach allowed us to deliver industry-leading operating margins in 2008, and it should enable us to achieve a record non-GAAP operating margin in 2009. In fact, we are forecasting a 26 per cent operating margin, the highest operating margin attained by a major third-party publisher."