Game losses double

Sales crash, but the games retailer is hoping to win an extra life at Christmas...

by Elizabeth Anderson
Last Updated: 27 Sep 2011
After a ‘very tough year’ for Game Group, like-for-like sales fell 10.5% to £558.8m in the first half of the year. At the same time, the group made a pre-tax loss of £51.5m – more than double the £21.5m loss made during the same period last year.

Game said the video games market as a whole had seen a slowdown this year, as the consumer spending squeeze continued to bite. The retailer also blamed a lack of major titles being released this year, with only detective game LA Noire proving popular with game enthusiasts and achieving sales of more than £20m in the UK.

It’s been a troubled year for Game. The retailer has struggled to compete with online competitors, while consumers tighten their belts when it comes to spending on the high streets. To avoid going the same way as other specialist retailers such as HMV, it’s been cutting back on store numbers and concentrating on its online business. Even so, that hasn’t been enough to restore full confidence amongst investors – Game’s shares have lost two-thirds of their value over the last year.   

But the group, which sells games, consoles and accessories from about 1,300 stores in Europe and Australia, is hoping sales will pick up again over the Christmas period. Game’s profits usually bounce back in the second half of the year thanks to the Christmas trading boost:  the next 10 weeks alone account for some 40% of annual revenues, the group said.  

Game is also counting on a number of high-profile games that are launching in the run-up to Christmas, including Call of Duty: Modern Warfare 3, FIFA 12 and Legend of Zelda: Skyward Sword. That might be enough to keep the ‘Game Over’ sign at bay – for now.    

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