Ubisoft reports full-year 2009-10 results

Ubisoft® reports full-year 2009-10 results 

§ Full-year sales: €871 million § Current operating loss1: €60 million  § Net loss excluding non-recurring items and before stock-based compensation: €32 million  § Net loss: €44 million § Net cash position: €41 million

Paris, May 18, 2010 – Today, Ubisoft released its sales and earnings figures for the fiscal year ended March 31, 2010. 

Key financial data

In € millions 2009-10%2008-09%
Sales             871,0            1 057,9   
Gross Profit             512,8  58,9%            639,5  60,4%
R&D expenses –          309,4  35,5%–           246,3      23,3%
Selling expenses –          196,1  22,5%–           204,2      19,3%
General and administrative expenses –            66,9  7,7%–             60,2       5,7%
SG&A expenses –          263,0  30,2%–           264,4      25,0%
Current operating income / (loss)[1] –            59,6  -6,8%            128,7  12,2%
Net income / (loss) –            43,7  -5,0%              68,8  6,5%
Diluted earnings / (loss) per share (in €) –            0,45                 0,71   
Diluted earnings / (loss) per share beforenon-    
recurring items and stock-based compensation (in €)–            0,33                 0,87   
Cash flows from R&D investments*            353,5               330,5   
Net cash / (debt)              41,3               154,2   

* Including royalties but excluding future commitments and stock-based compensation.

Yves Guillemot, Chief Executive Officer, stated “The global economic crisis had a pronounced impact on the video game industry in 2009, which contracted by nearly 10% year-on-year. Ubisoft’s sales were hit particularly hard, falling 18% over the full year despite a stabilization in the second half of the year, when figures came in on a par with the corresponding period of 2008-09. This overall contraction in sales, combined with additional write-downs recorded for games already launched as well as for upcoming releases, led to a 60 M€ operating loss.”


Sales for the fourth quarter of 2009-10 came to €210 million, up 1.9% on the €206 million recorded for the same period of 2008-09 (up 0.5% at constant exchange rates). 

Full-year sales for fiscal 2009-10 totaled €871 million versus €1,058 million for fiscal 2008-09, representing a decrease of 17.7% (down 17.7% also at constant exchange rates).

Fourth-quarter sales were slightly higher than the guidance of around €200 million issued when Ubisoft released its sales figures for the third quarter of 2009-10. This performance reflects the combined impact of:

− The accounting restatement of around €8 million in marketing cooperation expenses. These costs were previously deducted directly from the top-line sales figure but are now included in SG&A expenses. 

− A strong increase in sales of Just Dance®, which, in the total fiscal year, sold in almost 3 million units. This performance was particularly impressive as the game was only available on a single platform – the Wii™.

− The ongoing exceptional performance delivered by Assassin’s Creed® II which sold in nearly 9 million units during the year.

− The launch of Red Steel® 2 for the Wii™, which received very good reviews and whose performance was in line with recently revised forecasts. 

 − Sales of Avatar that outstripped the most recent forecasts, notably on Wii™.

During the first four months of calendar 2010, Ubisoft’s gained market shares corresponding to 9.9% in Europe (versus 8.5% one year earlier) and 6.8% in the United States (against 5.3%).   

Main income statement items

Gross profit represented a lower percentage of sales in 2009-10, coming in at 58.9% (€512.8 million) against 60.5% (€639.5 million) in 2008-09. As previously announced, this contraction was primarily due to the sharp drop in back-catalog sales from €220 million (with a gross margin of around 50%) in 2008-09 to €110 million (with a negative gross margin of nearly 10%) in 2009-10. Back-catalog sales in 2009-10 were notably weighed down by the impact of excess inventories of DS games which the Company had to clear or write down in a very competitive environment also marked by high levels of piracy.

Gross profit also suffered from the low number of game launches for the higher-margin consoles, Xbox 360®, PlayStation®3, and PC. This was particularly the case as gross margins for Xbox 360® and PlayStation®3 games rose year to year. Gross margins remained stable for Wii™ games.

Ubisoft ended the year with a €59.6 million current operating loss before stock-based compensation, a higher figure than the previously announced guidance of around €50 million. This difference was primarily attributable to additional write-downs recorded both for games launched during the year and for upcoming releases. 

The current operating loss figure reflects the following combined factors:

  • A €126.7 million decrease in gross profit.
  • A €63.1 million increase in R&D expenses, which came to €309.4 million, representing 35.5% of sales, versus €246.3 million (23.3% of sales) in 2008-09. As previously mentioned, this rise was chiefly attributable to accelerated R&D depreciation, which amounted to nearly €60 million for the fiscal year.  
  • SG&A expenses on a par with 2008-09 in absolute value terms (€263.0 million against €264,4 million) but higher as a percentage of sales (30.2% versus 25.0%).

− Variable marketing expenses totaled €143.6 million (16.5% of sales) compared with €153.3 million (14.4% of sales) in 2008-09. 

− Structure costs stood at €119.4 million (13.7% of sales) versus €111.1 million (10.5% of sales) in 2008-09.  

Ubisoft recorded an operating loss of €72.1 million in 2009-10 compared with operating income of €113.5 million for the previous fiscal year. The 2009-10 figure includes stock-based compensation of €12.1 million (€16.9 million in 2008-09).

Net financial income came to €4.7 million (compared with net financial expense of €4.8 million in 2008-09), breaking down as follows:

  • €0.5 million in financial charges compared with financial income of €0.5 million in 2008-09.
  • €5.2 million in foreign exchange gains, against €5.3 million in foreign exchange losses in 2008-09.

Ubisoft ended fiscal 2009-10 with a €43.7 million net loss, representing a diluted loss per share of €0.45, versus net income of €68.8 million and diluted earnings per share of €0.71 in 2008-09. 

Excluding non-recurring items and before stock-based compensation, the net loss figure would have amounted to €31.6 million, representing a diluted loss per share of €0.33, versus net income of €84.7 million and earnings per share of €0.87 for 2008-09.

Main cash flow statement and balance sheet items

Cash flows from operating activities came to a negative €90.1 million (versus a positive €27.8 million in 2008-09), reflecting cash flows from operations of negative €56.7 million (€26.1 million in 2008-09) and a €33.4 million increase in working capital requirement (compared with a €1.7 million decrease in 2008-09). This increase was due to a €74.5 million rise in tax items, which was partly offset by a €29.3 million improvement in trade receivables, inventory and trade payables. 

On March 31, 2010, Ubisoft had a net cash position of €41.3 million versus €154.2 million on March 31, 2009. The year-on-year change reflects the following main movements in 2009-10: 

  • The above-mentioned €90.1 million net cash outflow from operating activities. 
  • €19.1 million in purchases of tangible and intangible assets. 
  • Acquisitions totaling €9.1 million.
  • Proceeds from the issue of capital amounting to €4.8 million following employee rights issues and the exercise of stock options.
  • A €0.6 million effect from exchange rate fluctuations. 


Yves Guillemot stated, “We forecast a return to profitable growth in 2010-11 with positive cash flow generation, driven by a games line-up that is more closely tailored to growth segments and based on strong franchises. We also expect to see the first concrete results from our investments in online games and services. Lastly, the upcoming launches of new consoles, including Natal and Sony Move, should enable us to capitalize on the technology investments that we have undertaken in recent years and re-energize the casual games segment. At the same time, we will continue to reorganize our studios and enhance our development teams’ productivity. These reorganizational moves will enable us to release new iterations of our major franchises on a more regular basis, and guarantee high-quality levels. This will allow us to secure a level of highly profitable recurring sales while continuing to tap the new growth opportunities in our industry.”  

Sales for the first quarter of 2010-11 

The first three months of 2010-11 will see the following main releases: 

  • Splinter Cell Conviction™ for Xbox 360® and PC
  • Prince of Persia The Forgotten Sands™ for Xbox 360®, PlayStation®3, Wii™, PC, Nintendo DSi, and PSP™
  • Pure Futbol™ for Xbox 360® and PlayStation®3.

The Group expects first-quarter 2010-11 sales to come in at around €145 million, approximately 75% higher than in the first quarter of 2009-10.

Full-year 2010-11

Ubisoft confirms that it expects to return to profitable growth and positive cash flow from operating activities in fiscal 2010-11.  

Significant events of 2009-10

Market share: In the first four months of calendar 2010, Ubisoft was the number 3 independent publisher in the United States with 6.8% market share (compared with number 4 and 5.3% one year earlier); number 2 in Europe with 9.9% market share (compared with number 3 and 8.5%); number 3 in France with 9.7% market share (compared with number 3 and 8.3%); number 2 in the United Kingdom with 12.1% market share (compared with number 3 and 9.3%); and number 2 in Germany with 9.4% market share (compared with number 3 and 7.7%).

Opening of a new studio in Toronto: During the year Ubisoft opened 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 plans to invest CA$ 263 million over ten years in the company.

Acquisition of Nadeo: Set up in 2000 in Paris, the Nadeo studio has won acclaim for the quality of its multiplayer technology which offers one of the best available on-line game experiences and has already notched up 10 million registered players. Its flagship game – TrackMania® – has 700,000 unique players a month and is a pioneer in the sharing of creations (almost 15 million custom tracks created since 2008). It is also the first eSport franchise for racing games.

Launch of Uplay: In late 2009 Ubisoft launched Uplay – a portal for gamers that is set to become the online hub for Ubisoft games.

Financial Calendar

Annual General Meeting July 2, 2010


Investor Relations                                                                   

Jean-Benoît Roquette

Head of Investor Relations

+ 33 1 48 18 52 39



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 1, 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 €871 million for the 2009-10 fiscal year. To learn more, please visit www.ubisoftgroup.com

© 2009-2010 Ubisoft Entertainment. All Rights Reserved. Assassin’s Creed, Just Dance, Pure Football, Splinter Cell Conviction, Uplay Logo, Red Steel, Ubisoft, Ubi.com, and the Ubisoft logo are trademarks of Ubisoft Entertainment in the U.S. and/or other countries.

James Cameron’s Avatar: The Game © 2009 Twentieth Century Fox Film Corporation.  Game Software excluding Twentieth Century Fox Film Corporation elements: © 2009 Ubisoft Entertainment.  All Rights Reserved. James Cameron’s Avatar: The Game, James Cameron’s Avatar and the Twentieth Century Fox logo are trademarks of Twentieth Century Fox Film Corporation.  Licensed to Ubisoft Entertainment by Twentieth Century Fox Film Corporation.  Ubisoft and the Ubisoft logo are trademarks of Ubisoft Entertainment in the U.S. and/or other countries.  The Lightstorm Entertainment logo is a trademark of Lightstorm Entertainment, Inc.

“PlayStation”, “PSP” are registered trademarks and “PS3” is a trademark of Sony Computer Entertainment Inc. Nintendo DS, Nintendo DSi and Wii are trademarks of Nintendo. © 2006-2009 Nintendo. Microsoft, Xbox, Xbox 360, Xbox

LIVE, and the Xbox logos are trademarks of the Microsoft group of companies and are used under license from Microsoft.

[1] Before stock-based compensation.

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