Atari Reports Fiscal 2005 Second Quarter and Six-Month Financial Results; Quarterly Net Revenue Up 18% Year-Over-Year; Publishing Net Revenue Up 29%.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Atari, Inc. (Nasdaq: ATAR), a leader in interactive entertainment, today announced financial results for the fiscal 2005 second quarter and six-month period ended September 30, 2004. Net revenue for the second quarter ended September 30, 2004, increased 18% to $71.4 million compared to $60.6 million in the comparable year-earlier period. Publishing net revenue was up 29% to $58.0 million compared to $45.0 million in the prior September quarter, while distribution revenue was $13.4 million compared to $15.6 million in the comparable year-earlier quarter. Increased revenue for the period was driven by higher unit volume, better average selling prices The average sales price of goods or commodities. Especially used in the retail sector and technology distribution. and an increase in sales of higher priced console products. Additionally, sales were supported by the launch of Test Drive: Eve of Destruction (PS2 and Xbox), Dragon Ball Z “DBZ” redirects here. For the meteorological term, see dBZ (meteorology). Dragon Ball Z (ドラゴンボールZ : Buu's Fury (GBA GBA Game Boy Advance (Nintendo 32-Bit Game Boy) GBA Gran Buenos Aires (Argentina) GBA God Bless America GBA Gundam Battle Assault (video game) GBA Alderney ), Terminator (1) A character that ends a string of alphanumeric characters. (2) A hardware component that is connected to the last peripheral device in a series or the last node in a network. 3: The Redemption (PS2, Xbox and GameCube), Demon demon, supernatural being, generally malevolent in character. In general, the more civilized pagan societies came to consider demons as powerful, supernatural beings who lacked the dignity of gods and who, depending on the circumstance, might be either benevolent or Stone (PS2) and Yu Yu Hakusho: Dark Tournament (PS2), as well as continued sales of DRIV3R (PS2 and Xbox), launched in the previous quarter. Net loss for the quarter was $16.9 million, or $0.14 per share, compared with a net loss of $28.7 million, or $0.38 per share, in the year earlier period, before a $39.4 million, or $0.52 per share, one-time non-cash dividend relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's September 2003 recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. and public offering. Including the $39.4 million dividend, loss attributable to common shareholders for the second quarter ended September 30, 2003, was $68.1 million, or $0.90 per share. Net revenue for the six-month period ended September 30, 2004, was $181.7 million versus $211.9 million in the comparable year-earlier period. Publishing net revenue was $157.7 million versus $180.6 million in the prior six-month period, while distribution revenue was $24.0 million versus $31.3 million in the comparable year-earlier period. Net loss for the six-month period was $4.8 million, or $0.04 per share, compared to net loss of $4.9 million, or $0.07 per share, in the year-earlier period, before the one-time non-cash dividend relating to the Company's September 2003 recapitalization and public offering. Including the $39.4 million dividend, or $0.54 per share, loss attributable to common shareholders for the six-month period ended September 30, 2003, was $44.3 million, or $0.61 per share. Atari's product lineup A criminal investigation technique in which the police arrange a number of individuals in a row before a witness to a crime and ask the witness to identify which, if any, of the individuals committed the crime. for the remainder of fiscal 2005 is expected to include the following key releases, among many others: --For the third quarter ending December 31, 2004: Axis & Allies (PC), Atari Anthology Atari Anthology is a collection of over 80 Atari games released in 2003 for Windows PC's, and in 2004 for Xbox and Playstation 2. It reproduces both Atari arcade games and titles for the Atari 2600 games console. (PS2 and Xbox), Backyard Basketball (GBA), Dragon Ball Z: Budokai 3 (PS2), Dragon Ball Z: Budokai 2 (GameCube), Duel Masters Duel Masters (デュエルマスターズ Dyueru Masutāzu) is a franchise based on a manga, anime and a trading card game. (PS2), Duel Masters 2: Kaijudo Showdown (GBA), Demon Stone (Xbox and PC), Godzilla: Save The Earth (PS2 and Xbox), RollerCoaster Tycoon 3 (PC), Sid Meier's Pirates This is a list of known pirates, buccaneers, corsairs, privateers, and others involved in piracy. This list includes both captains and prominent crew members. See also: pirates, wokou, buccaneers, corsairs, and privateers Ancient World --For the fourth quarter ending March 31, 2005: Act of War: Direct Action (PC), Backyard Baseball Backyard Baseball is a highly acclaimed series of kid's video games for the Game Boy Advance, PlayStation 2, GameCube and the PC. Currently all the games in the series have been developed by Humongous Entertainment and published by Atari. 2006 (GBA), Dragon Ball Z: Sagas (PS2, Xbox and GameCube), and Dragonshard (PC). "Our goal for the remainder of Fiscal 2005 is to focus on profitability through the strategic management of our catalogue of establish franchises, while keeping an eye toward the future growth of the industry," stated Bruno Bonnell Bruno Bonnell is one of the founders of Infogrames Entertainment SA. A qualified chemical engineer, Bonnell received a degree in economics at the Université Paris IX. He began his long career on the Thomson TO7, one of the earliest French-produced home computers, before founding , Chairman, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. and Chief Creative Officer of Atari. "We are poised for expansion on to new platforms such as the Nintendo DS “NDS” redirects here. For other uses, see NDS (disambiguation). The Nintendo DS (sometimes abbreviated NDS or DS) is a handheld game console developed and manufactured by Nintendo, which was released in 2004 in Canada, U.S., and Japan. and Sony's PlayStation Portable, as well as the next generation of consoles from Sony, Microsoft and Nintendo. With a strong foothold foot·hold n. 1. A place providing support for the foot in climbing or standing. 2. A firm or secure position that provides a base for further advancement. foothold Noun 1. among the mass-audience and hardcore gamers Hardcore gamer is a term used to describe a type of video game player whose leisure time is largely devoted to playing or reading about video games. This type of gamer prefers to take significant time and practice on games, in contrast to a casual gamer. , Atari will continue to be an innovator in the entertainment industry and remains on track to grow profits, ultimately creating greater shareholder value." For the 2005 fiscal third quarter ending December 31, 2004, Atari anticipates net revenue between $160 million and $175 million. The Company expects to report net income in the range of $15 million to $20 million, or $0.12 to $0.17 per share. For the fiscal year ending March 31, 2005, Atari anticipates full-year net revenue between $450 million and $470 million. The Company anticipates net income and earnings per share in the range of $25 million to $30 million, or $0.20 to $0.25 per share, in line with its prior guidance. On November 3, 2004, a subsidiary of IESA IESA Infogrames Entertainment SA IESA International Executive Security Association IESA Illinois Elementary Sports Association IESA Integrated Equiangular Spiral Antenna issued to Atari a secured note relating to royalty and other payments that were due to Atari by IESA or its subsidiaries during the period ended September 30, 2004. The secured note has a principal amount of $23.1 million, bears interest at market rate and will mature on March 31, 2005. Atari will reduce the sums due under the note by applying royalties and other amounts that become due by Atari to IESA or its subsidiaries, which will result in the prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. of most if not all of the note prior to maturity. Atari will host a teleconference with a simultaneous webcast at 4:45 p.m. Eastern Time today to discuss the Company's second quarter and six-month results. To access the teleconference, please dial 1-800-299-0148 (domestic) or 1-617-801-9711 (international), access code 96651539, or listen to it live via the Internet by accessing the Company's Web site (www.atari.com). For those unable to listen to the live broadcast, a replay will be available on the Company's Web site or by dialing 1-888-286-8010 (domestic) or 1-617-801-6888 (international), playback Playback could mean:
About Atari New York-based Atari, Inc. (Nasdaq: ATAR) develops interactive games for all platforms and is one of the largest third-party publishers of interactive entertainment software in the U.S. The Company's 1,000+ titles include hard-core, genre-defining games such as DRIV3R(TM), Enter the Matrix(TM), Neverwinter Nights This article is about the 2002 computer role-playing game. For the AOL MMORPG, see Neverwinter Nights (AOL game). Neverwinter Nights (NWN), produced by BioWare and published by Infogrames (now Atari), is a third-person perspective computer role-playing (TM), Stuntman stunt·man n. A man who substitutes for a performer in scenes requiring physical daring or involving physical risk. stuntman n → especialista m stuntman (TM), Test Drive(R), Unreal(R) Tournament 2004, and Unreal(R) Championship; and mass-market and children's games such as Backyard Sports(TM), Nickelodeon's Blue's Clues Blue's Clues is a children's show about a dog named Blue. It features live action one on one on paper-cutout animation. The series follows a dog named Blue through her everyday life, providing small children with fun and education. The show airs on both Nick Jr. and Noggin. (TM) and Dora the Explorer Dora the Explorer is an animated television series that is carried on the Nickelodeon cable television network. A pilot episode for the series aired in 1999, and Dora the Explorer became a regular series in 2000. (TM), Civilization civilization, culture with a relatively high degree of elaboration and technical development. The term civilization also designates that complex of cultural elements that first appeared in human history between 8,000 and 6,000 years ago. (R), Dragon Ball Z(R) and RollerCoaster Tycoon(R). Atari, Inc. is a majority-owned subsidiary majority-owned subsidiary A firm in which more than 50% of outstanding voting stock is owned by the parent company. of France-based Infogrames Entertainment SA (Euronext - ISIN Isin (ĭs`ĭn), capital of an ancient Semitic kingdom of N Babylonia. The city became important after the third dynasty of Ur fell to the Elamites and the Amorites (c.2025 B.C.). The phase from c.2025–c.1763 B.C. : FR-0000052573), the largest interactive games publisher in Europe. For more information, visit www.atari.com. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement With the exception of the historical information contained in this release, the matters described herein contain certain "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Forward-looking statements in this release are not promises or guarantees and are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated. These statements are based on management's current expectations and assumptions and are naturally subject to uncertainty and changes in circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or . We caution you not to place undue reliance upon any such forward-looking statements. Actual results may vary materially from those expressed or implied by the statements herein. Some of the factors which could cause our results to differ materially include the following: the loss of key customers, such as Wal-Mart, Best Buy and Target; fluctuations in the Company's quarterly net revenues and results of operations based on the seasonality of our industry; delays in product development and related product release schedules; maintaining relationships with leading independent video game software developers; adapting to the rapidly changing industry technology, including new console technology; maintaining or acquiring licenses to intellectual property; the termination or modification of our agreements with hardware manufacturers; and other factors described in our SEC filings, including our Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended March 31, 2004 and our quarterly reports on Form 10-Q Form 10-Q See 10-Q. . The Company undertakes no duty to update any forward-looking statements to conform the statement to actual results or changes in the Company's expectations. (Tables to Follow)
ATARI, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
For the Three Months For the Six Months
Ended September 30, Ended September 30,
------------------------- -------------------------
2003 2004 2003 2004
------------ ------------ ------------ ------------
(unaudited) (unaudited) (unaudited) (unaudited)
Net revenues $60,575 $71,391 $211,933 $181,687
Cost of goods sold 37,950 41,013 108,796 92,881
------------ ------------ ------------ ------------
Gross profit 22,625 30,378 103,137 88,806
Selling and
distribution
expenses 13,804 15,356 33,932 33,008
General and
administrative
expenses 8,840 10,098 17,309 18,156
Research and
development 23,576 18,914 45,805 36,046
Depreciation and
amortization 1,996 2,615 3,946 5,381
------------ ------------ ------------ ------------
Operating
(loss)
income (25,591) (16,605) 2,145 (3,785)
Interest expense,
net 3,716 527 6,762 701
Other (expense)
income (379) 14 (340) 33
------------ ------------ ------------ ------------
Loss before
(benefit
from)
provision
for income
taxes (29,686) (17,118) (4,957) (4,453)
(Benefit from)
provision for
income taxes (955) (227) (18) 382
------------ ------------ ------------ ------------
Net loss $(28,731) $(16,891) $(4,939) $(4,835)
Dividend to parent (39,351) - (39,351) -
------------ ------------ ------------ ------------
Loss attributable
to common
stockholders $(68,082) $(16,891) $(44,290) $(4,835)
============ ============ ============ ============
Basic and diluted
loss attributable
to common
stockholders
per share $(0.90) $(0.14) $(0.61) $(0.04)
============ ============ ============ ============
Basic and diluted
weighted average
shares
outstanding 75,594 121,277 72,800 121,263
============ ============ ============ ============
ATARI, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
September
March 31, 30,
2004 2004
--------- -----------
(unaudited)
ASSETS
Current assets:
Cash $9,621 $992
Receivables, net 37,707 43,848
Inventories, net 27,520 22,081
Income taxes receivable 2,320 1,412
Due from related parties 4,175 16,750
Prepaid expenses and other current assets 12,465 11,834
Related party notes receivables 8,571 7,254
--------- -----------
Total current assets 102,379 104,171
Property and equipment, net 13,267 10,892
Goodwill, net of accumulated amortization of
$26,116 in both periods 70,224 70,224
Other intangible assets, net of accumulated
amortization of $1,294 and $1,632, at March 31,
2004 and September 30, 2004, respectively 1,406 1,068
Other assets 6,680 4,390
--------- -----------
Total assets $193,956 $190,745
========= ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $37,837 $39,013
Accrued liabilities 15,886 20,978
Royalties payable 14,481 13,723
Income taxes payable 450 600
Short-term deferred income 2,107 77
Due to related parties 6,704 5,656
--------- -----------
Total current liabilities 77,465 80,047
Deferred income 555 516
Other long-term liabilities 873 765
--------- -----------
Total liabilities 78,893 81,328
--------- -----------
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value, 5,000 shares
authorized, none issued or outstanding -- --
Common stock, $0.01 par value, 300,000 shares
authorized, 121,231 and 121,279 shares
issued and outstanding at March 31, 2004
and September 30, 2004, respectively 1,212 1,213
Additional paid-in capital 735,964 736,017
Accumulated deficit (625,436) (630,271)
Accumulated other comprehensive income 3,323 2,458
--------- -----------
Total stockholders' equity 115,063 109,417
--------- -----------
Total liabilities and stockholders'
equity $193,956 $190,745
========= ===========
Supplemental Table
Three Months Ended
September 30,
---------------------------------
2003 2004
-------------- -----------------
Publishing Revenue Mix
PC 38.5 % 27.2 %
PlayStation 2 19.8 % 36.2 %
PlayStation 6.1 % 1.8 %
Xbox 12.9 % 11.8 %
Game Boy 13.7 % 19.0 %
Game Cube 9.0 % 4.0 %
Supplemental Table
Six Months Ended
September 30,
---------------------------------
2003 2004
-------------- -----------------
Publishing Revenue Mix
PC 26.8 % 20.5 %
PlayStation 2 32.0 % 42.7 %
PlayStation 4.5 % 1.5 %
Xbox 17.7 % 18.1 %
Game Boy 9.3 % 14.5 %
Game Cube 9.7 % 2.7 %
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