Ubisoft reports first-half 2009-10 results

Ubisoft® reports first-quarter 2009-10 sales

  • First-quarter sales down 51% to €83 million, coming in below target.
  • Update on games release schedule. 
  • Guidance for 2009-10 revised downward.

Paris, July 27, 2009 – Today, Ubisoft reported its sales for the first fiscal quarter ended June 30, 2009. 

Sales

Sales for the first quarter of 2009-10 came to €83 million, down 50.6%, or 50.8% at constant exchange rates, compared with the €169 million recorded for the same period of 2008-09.

First-quarter sales for 2009-10 came in 12.6% below the guidance (approximately €95 million) issued when Ubisoft released its sales figures for fourth-quarter 2008-09. This was due to:

− A slowdown in sales of Nintendo DS™ games in Europe and the United States was more pronounced than expected, impacting back-catalog sales as well as new launches. 

− Significantly lower back-catalog sales of titles for PLAYSTATION® 3 and Xbox360® than in the first quarter of 2008-09.

− Poorer-than-anticipated market conditions. 

From a positive perspective, the period under review saw:

− The launches of Call of Juarez® and Anno®, which were in line with expectations; with Anno® receiving solid ratings for the PC, Wii™ and Nintendo DS™ versions of the game.

− Significant market share gains on the Wii™ since the start of the calendar year (7.2% market share in Europe versus 4.6% one year earlier, and 4.5% in the United States compared with 2.7%).

Outlook

Second quarter 2009-10 sales target revised downward

The second quarter of fiscal 2009-10 will see only a few game releases, including: 

− Teenage Mutant Ninja Turtles™ for Wii™ and PlayStation® 2

− Cloudy with a Chance of Meatballs for Wii™, Nintendo DS™, Xbox360®, PLAYSTATION® 3, PSP™, and PC.

− Academy of Champions™, which will be released for Wii™ in the UK, the Nordic countries, and Australia.  − New casual titles for Nintendo DS™ and Wii™.

Sales for the second quarter of 2009-10 are expected to come in at around €80 million, representing a 54% decrease on the second quarter of 2008-09. This guidance is lower than the €130 million announced when Ubisoft released its sales figures for fourth-quarter 2008-09, for the same reasons as mentioned above.

Update on the games release schedule 

Splinter Cell Conviction™ and Red Steel® 2, whose releases were previously planned for the third fiscal quarter, will now be released in the fourth fiscal quarter. 

Ghost Recon® and I am Alive™, which were previously scheduled for release in the fourth fiscal quarter, will now strengthen the line-up for fiscal 2010-11.

Full-year 2009-10 targets revised downward

Today, the Company has revised its targets for full-year 2009-10 downward. Sales are now expected to come in at approximately €1.040 billion, with current operating income before stock-based compensation representing at least 7% of sales, compared with the previous guidance of around €1.1 billion and at least 11% of sales.

The revised targets mainly incorporate the negative impact of the first half of the year. The sales target of approximately 23% growth for the second half is being maintained, with the impact of the announced postponements of releases partly factored into previously issued guidance and partly offset by higher sales assumptions for Assassin’s Creed® 2 following the very warm response received at the E3 trade show. 

Yves Guillemot, Chief Executive Officer, stated: “We are currently experiencing a very sharp slowdown in our sales for Nintendo DS as well as sales of back-catalog titles, in the context of a market that is tougher than anticipated. This will have a significant impact on our first-half showing. Against this backdrop, the solid performance of our Wii titles combined with the successful launches of Anno and Call of Juarez are points of satisfaction and demonstrate that good products are continuing to sell well. We are disappointed that we have to postpone the release of several major games but we consider that this choice is the best one in the long-term interests of Ubisoft. Lastly, we are having to adjust our full-year targets to take into account the fall in business over the first half. The excellent response to our games at E3, as well as the high buzz generated for titles such as Assassin’s Creed 2, Splinter Cell Conviction, and Avatar, reinforce our belief that the company can achieve strong growth in the second half of the fiscal year.”

Recent highlights

Market share: In the first six months of calendar 2009, Ubisoft was the number 5 independent publisher in the United States with 4.8% market share (compared with number 5 and 5.6% one year earlier); number 3 in Europe with 8.0% market share (compared with number 4 and 8.4%); number 3 in France with 7.7% market share (compared with number 3 and 7.3%); number 3 in the United Kingdom with 8.3% market share (compared with number 4 and 8.9%); and number 3 in Germany with 7.8% market share (compared with number 3 and

7.7%).

Opening of a new studio in Toronto: Ubisoft has announced that it will be opening a full development studio in Toronto, Ontario – a first for the company in the province. This is expected to result in the creation of 800 net new jobs within the province over the next decade. The government of Ontario is investing CA$ 263 million over ten years in the company.

Financial calendar

ReleaseDate
Second-quarter 2009-10 salesOctober 29, 2009

This date is subject to change and will be confirmed at a later stage.

Contact

Investor relations                                                               

Jean-Benoît Roquette

Head of Investor Relations

+ 33 1 48 18 52 39

Jean-benoit.roquette@ubisoft.com 

Disclaimer

This statement may contain estimated financial data, information on future projects and transactions, and future business results/performance. Such forward-looking data are provided for estimation purposes only. They are subject to market risks and uncertainties and may vary significantly compared with the actual results that will be published. The estimated financial data have been presented to the Board of Directors and have not been audited by the Statutory Auditors. (Additional information is specified in the most recent Ubisoft Registration Document filed on July 1st, 2009 with the French Financial Markets Authority (l’Autorité des marchés financiers)).

About Ubisoft

Ubisoft is a leading producer, publisher and distributor of interactive entertainment products worldwide and has grown considerably through a strong and diversified line-up of products and partnerships. Ubisoft has offices in 28 countries and sales in 55 countries around the globe. It is committed to delivering high-quality, cutting-edge video game titles to consumers. Ubisoft generated sales of €1 058 million for the 2008-09 fiscal year. To learn more, please visit www.ubisoftgroup.com

© 2009 Ubisoft Entertainment. All Rights Reserved. Assassin’s Creed, Play Zone, Imagine, Petz, I AM ALIVE, Rayman, Far Cry, Splinter Cell Conviction, Ghost Recon, Academy of Champions, My Fitness Coach, Red Steel, Ubisoft, ubi.com, and the Ubisoft logo are trademarks of Ubisoft Entertainment in the U.S. and/or other countries. Based on Crytek’s original Far Cry directed by Cevat Yerli. Anno is a trademark of Sunflowers GmbH in the U.S. and/or other countries.

Sunflowers GmbH is a Ubisoft Entertainment company.  

© 2009 Mirage Studios, Inc. Game © 2009 Ubisoft Entertainment. All Rights Reserved.

Cloudy with a Chance of Meatballs TM & © 2009 Sony Pictures Animation Inc.  All rights reserved. Game Software excluding Sony Elements: © 2009 Ubisoft Entertainment. All rights reserved. 

SCRABBLE® and associated trademarks and trade dress are owned by, and used under license from, J.W. Spears & Sons Limited, a subsidiary of Mattel, Inc. © 2009 Mattel, Inc. All Rights Reserved. © 2009 Ubisoft Entertainment.

Developed by Wizarbox. All rights reserved. Published by Ubisoft Entertainment under license from Mattel, Inc

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