World’s Largest Producer of Martial Arts Gear Will Punch Up Its Marketing Programs With Microsoft Dynamics CRM
REDMOND, Wash., June 19 /PRNewswire-FirstCall/ — Microsoft Corp. today
announced that Century Martial Arts Supply, the world’s largest
manufacturer of martial arts, mixed martial arts, boxing and fitness
equipment, has selected Microsoft Dynamics CRM 4.0 to provide customer
information on a more detailed level than was available with its previous
systems. Century’s customers include thousands of martial arts schools
globally for which the company supplies equipment, curriculum programs,
trade-show events and customized products. Read more
iWin’s Jewel Quest III Promises Match-3 Fun and Real Diamonds, Rubies and Sapphires!
SAN FRANCISCO, June 13 /PRNewswire/ — iWin, Inc., a leading developer
and publisher of online casual games, today announced the launch of Jewel
Quest(R) III, the 3rd installment of one of the most popular casual game
franchises ever, Jewel Quest(R). iWin also announced one of the most
exciting giveaways in casual games: the Jewel Quest(R) III Sweepstakes,
with six straight weeks of glittery and glamorous real jewels as prizes.
Read more
Gameloft Named Top Mobile Game Publisher Worldwide
LONDON, June 12 /PRNewswire-FirstCall/ — Gameloft(R), a leading
developer and publisher of games for mobile phones and consoles, today
announced they were named “Best-Ranked Mobile Game Publisher” in an
independent study conducted by Pocket Gamer. Read more
Gameloft Brings the Nostalgia of the Oregon Trail to Mobile Gamers; Available Now
NEW YORK, June 10 /PRNewswire-FirstCall/ — Gameloft(R), a leading
publisher and developer of video games for mobile phones and consoles,
announced today the launch of the award-winning title, the Oregon Trail, to
mobile handsets. In partnership with The Learning Company, this marks the
first re-make of the educational title which has previously only been
available on PCs. Read more
Atari’s Dragon Ball Z: Burst Limit Explodes Into Stores on Xbox 360 and PLAYSTATION 3 System
NEW YORK, June 10 /PRNewswire-FirstCall/ — Atari, Inc. (OTC Pink
Sheets: ATAR), one of the world’s most recognized brands and a third-party
video game publisher and distributor, today announced that Dragon Ball
Z(R): Burst Limit, the first game in the blockbuster series developed for
next-generation systems, has shipped to retailers in North America for the
Xbox 360(R) video game and entertainment system from Microsoft and
PLAYSTATION(R)3 computer entertainment system. Bringing a dazzling new
extreme of DBZ(R) intensity to fans with spectacular next-gen graphics,
online gameplay and adrenaline-soaked high-velocity action, Dragon Ball
Z(R): Burst Limit is rated T for Teen and is available for a suggested
retail price of $59.99. Read more
Take-Two Interactive Software, Inc. Reports Strong Second Quarter Fiscal 2008 Financial Results
Top and Bottom Line Results Exceed High End of Guidance
Company Raises Fiscal 2008 Guidance Significantly and Provides Third and Fourth Quarter Guidance
NEW YORK–(BUSINESS WIRE)–Take-Two Interactive Software, Inc. (NASDAQ:TTWO) today announced financial results for its second quarter ended April 30, 2008.
Net revenue for the second fiscal quarter was $539.8 million, compared to $205.4 million for the same quarter of fiscal 2007. Second quarter sales were led by the blockbuster, critically acclaimed Grand Theft Auto IV for Xbox 360® video game and entertainment system and PLAYSTATION®3 computer entertainment system.
Net income for the second quarter was $98.2 million or $1.29 per share, compared to a net loss of $51.2 million or $0.71 per share in the second quarter of fiscal 2007.
The second quarter results include $12.4 million in stock-based compensation expense ($0.16 per share); $3.8 million in professional fees and legal expenses, primarily related to Electronic Arts’ unsolicited tender offer ($0.05 per share) and $0.9 million in business reorganization costs ($0.01 per share). Results for the second quarter of 2007 included $16.3 million of business reorganization and related costs due to the Company’s management and board changes, legal expenses and other professional fees associated with the investigation of stock option grants, responses to the New York County District Attorney’s subpoenas, and other legal matters ($0.22 per share), as well as $5.8 million in stock-based compensation expense ($0.08 per share).
Non-GAAP net income was $115.4 million or $1.52 per share in the second quarter, compared to a net loss of $29.2 million or $0.41 per share in the second quarter of 2007. (Please refer to Non-GAAP Financial Measures and reconciliation tables included later in this release for additional information and details on non-GAAP items.)
For the six months ended April 30, 2008, net revenues were $780.3 million, compared to $482.8 million for the same period a year ago. Net income for the first half of fiscal 2008 was $60.2 million or $0.80 per share, compared to a loss of $72.8 million or $1.02 for the 2007 period. Results for the first six months of fiscal 2008 include $18.5 million in stock-based compensation expense ($0.25 per share); $5.3 million in professional fees and legal expenses, with the majority related to Electronic Arts’ unsolicited tender offer ($0.07 per share) and $1.1 million in business reorganization costs ($0.01 per share). Results for the first six months of fiscal 2007 included $23.5 million of business reorganization and related costs due to the Company’s management and board changes, legal expenses and other professional fees associated with the investigation of stock option grants, responses to the New York County District Attorney’s subpoenas, and other legal matters ($0.33 per share), as well as $9.8 million in stock-based compensation expense ($0.14 per share).
Non-GAAP net income was $85.1 million or $1.14 per share in the first six months of 2008, versus a net loss of $39.5 million or $0.55 per share in the comparable period of 2007. (Please refer to Non-GAAP Financial Measures and reconciliation information included later in this release.)
Business Highlights
Among the significant recent business developments, Take-Two noted the following:
- Rockstar Games released the highly anticipated Grand Theft Auto IV on April 29, 2008. The title surpassed all-time entertainment records for day one and week one sales, with approximately 6 million units sold through globally in the first week at an estimated retail value of more than $500 million. As of May 31, 2008, over 11 million units have been sold in to retailers and approximately 8.5 million units have been sold through to consumers.
- BioShock®, a wholly owned and internally developed title for Xbox 360 and Games for Windows® shipped over 2.2 million units since its debut in late August. 2K Games will be bringing this popular title to the PLAYSTATION®3 this fall, and Universal Pictures is developing a feature film based on BioShock to be directed by Gore Verbinski, director of the Pirates of the Caribbean trilogy.
- Rockstar Games announced the acquisition of Mad Doc Software, one of the premier independent development studios in North America. The studio, renamed Rockstar New England, most recently worked with Rockstar on the Xbox 360 version of the critically acclaimed Bully: Scholarship Edition.
- Hubert Larenaudie was named President for Asia to head Take-Two’s growth initiatives in the Asia Pacific region including expanding distribution of the Company’s interactive entertainment products; developing a strong presence in Japan; and working to establish an online game operation, especially in China and Korea. He had previously served in senior roles at Electronic Arts and Vivendi.
“Take-Two’s performance has exceeded expectations through the first half of fiscal 2008, clearly demonstrating the creative, operational and financial strength of our business,” noted Strauss Zelnick, Chairman of Take-Two. “Our results reflected the extraordinary success of Grand Theft Auto IV, the value of our catalog of titles, and our ongoing initiatives to improve the efficiency of our operations. We look forward to continuing to enhance stockholder value by building on our broad portfolio of internally developed and owned interactive entertainment brands, leveraging the opportunities in the current industry cycle, and operating our business in an effective manner.”
Ben Feder, Chief Executive Officer of Take-Two, added, “Based on the Company’s stronger than expected results, we have increased our financial guidance for fiscal 2008 and are confident in our ability to continue to perform for the balance of the year. Furthermore, Take-Two is extremely well positioned in an industry that is experiencing explosive growth. We believe that our exceptional creative talent, diverse range of hit products, and the proven global demand for our titles will be the drivers of increasing value over time.”
Financial Guidance
The Company is providing guidance for the third fiscal quarter ending July 31, 2008 and fourth fiscal quarter ending October 31, 2008 and is raising its guidance for the fiscal year ending October 31, 2008 as detailed below. Fiscal 2008 guidance reflects the release of the first installment of episodic content for Grand Theft Auto IV for Xbox 360 in the first quarter of fiscal 2009 instead of the fourth quarter of fiscal 2008 in order to provide a better balance in Take-Two’s release schedule.
| Revenue* | Non-GAAP EPS (a)(b) | |||
| Third quarter ending
7/31/2008 |
$325 to $375 | $0.45 to $0.55 | ||
| Fourth quarter ending
10/31/2008 |
$300 to $350 | $0.10 to $0.20 | ||
| Fiscal year ending
10/31/2008 |
$1,400 to $1,500 | $1.65 to $1.85 | ||
|
* In millions |
||||
|
(a) The Company’s non-GAAP EPS estimates for the third quarter ending July 31, 2008, and fourth quarter and fiscal year ending October 31, 2008 exclude approximately $0.17, $0.18 and $0.59 per share, respectively, of stock-based compensation expense; and approximately $0.13, $0.01 and $0.23 per share, respectively, of professional fees and legal expenses related to unusual matters, including the Electronic Arts tender offer, and business reorganization costs. The Company’s stock-based compensation expense for the third and fourth quarters and fiscal 2008 reflects the cost of approximately two million stock options issued to ZelnickMedia that are subject to variable accounting. Actual expense to be recorded in connection with these options is dependent upon several factors, including future changes in Take-Two’s stock price. |
||||
|
(b) EPS estimates reflect tax expense primarily for international operations. |
||||
Key assumptions and dependencies underlying the Company’s guidance include continued consumer acceptance of the Xbox 360® video game and entertainment system from Microsoft, PLAYSTATION®3 computer entertainment system and Wii™ home video game system from Nintendo; the ability to develop and publish products that capture market share for these current generation systems while continuing to leverage opportunities on prior generation platforms; as well as the timely delivery of the titles detailed in this release.
Product Pipeline
The following titles shipped during the second quarter of fiscal 2008:
| Title | Platform | |
| Bully: Scholarship Edition | Xbox 360, Wii | |
| Dora the Explorer: Dora Saves the Mermaids™ | PS2 | |
| Go, Diego, Go!: Safari Rescue™ | Wii, PS2 | |
| Grand Theft Auto IV | Xbox 360, PS3 | |
| Major League Baseball® 2K8 | Xbox 360, PS3, Wii, PSP, PS2 | |
| Major League Baseball® 2K8 Fantasy All-Stars | DS |
Take-Two’s lineup announced to date for the remainder of fiscal 2008 includes the following titles:
| Title | Platform | |
| BioShock® | PS3 | |
| Carnival Games™ | DS | |
| Carnival Games: Mini-Golf™ | Wii | |
| Don King Presents: Prizefighter | Xbox 360, Wii, DS | |
| Midnight Club: Los Angeles | Xbox 360, PS3 | |
| Midnight Club: LA Remix | PSP | |
| MLB ® Power Pros 2008 | Wii, PS2, DS | |
| NBA® 2K9 | Multiple platforms | |
| NHL® 2K9 | Multiple platforms | |
| Sid Meier’s Civilization® Revolution™ | Xbox 360, PS3, DS | |
| Top Spin 3 | Xbox 360, PS3, Wii, DS |
Non-GAAP Financial Measures
In addition to reporting financial results in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses non-GAAP measures of financial performance that exclude certain non-recurring or non-cash items. Non-GAAP gross profit, income (loss) from operations, net income (loss) and earnings (loss) per share are measures that exclude certain non-recurring or non-cash items and should be considered in addition to results prepared in accordance with GAAP. They are not intended to be considered in isolation from, as a substitute for, or superior to, GAAP results. These non-GAAP financial measures may be different from similarly titled measures used by other companies.
The non-GAAP measures exclude the following items from the Company’s statements of operations:
- Business reorganization, restructuring and related expenses
- Stock-based compensation
- Professional fees and expenses associated with the tender offer by Electronic Arts Inc., the Company’s stock options investigation and certain other unusual regulatory and legal matters
- Income tax effects of the items listed above
In addition, the Company may consider whether other significant non-recurring items that arise in the future should also be excluded from the non-GAAP financial measures it uses.
The Company believes that these non-GAAP financial measures, when taken into consideration with the corresponding GAAP financial measures, are important in gaining an understanding of the Company’s ongoing business. These non-GAAP financial measures also provide for comparative results from period to period. Therefore, the Company believes it is appropriate to exclude certain items as follows:
Business reorganization, restructuring and related expenses
In March 2007, the Company’s stockholders elected a new slate of members to Take-Two’s Board of Directors, who immediately removed the Company’s former President and Chief Executive Officer. Subsequently, the Company’s former Chief Financial Officer resigned. As a result of these actions and the implementation of a business reorganization plan, the Company incurred significant costs in the year ended October 31, 2007 to reduce headcount, relocate employees and consolidate sales and operational functions.
The Company recorded additional business reorganization costs in the three and six months ended April 30, 2008, and expects that additional business reorganization, restructuring and related costs will be recorded in the remainder of the 2008 fiscal year. Such costs are expected to relate to severance, asset write-offs and associated professional fees. The Company does not engage in reorganization activities on a regular basis and therefore believes it is appropriate to exclude business reorganization expenses from its non-GAAP financial measures.
Stock-based compensation
The Company does not consider stock-based compensation charges when evaluating business performance and management does not contemplate stock-based compensation expense in their short and long-term operating plans. Furthermore, executive and management incentive compensation plans are generally based on measures that exclude the impact of stock-based compensation. The Company places greater emphasis on stockholder dilution than accounting charges when assessing the impact of stock-based equity awards.
Professional fees and expenses associated with the tender offer by Electronic Arts Inc., the Company’s stock options investigation and certain other unusual regulatory and legal matters
The Company has incurred significant legal and investment banking expenses related to the tender offer launched by Electronic Arts Inc. on March 13, 2008 to acquire all of the Company’s outstanding shares. Additionally, the Company has realized significant legal and other professional fees associated with both the investigation of stock option grants and the Company’s responses to the New York County District Attorney’s subpoenas. One of management’s primary objectives is to bring conclusion to its regulatory matters. The Company continues to incur expenses for professional fees and has accrued for legal settlements that are outside its ordinary course of business. As a result, the Company has excluded such expenses from its non-GAAP financial measures.
EBITDA and Adjusted EBITDA
Earnings (loss) before interest, taxes, depreciation and amortization (“EBITDA”) is a financial measure not calculated and presented in accordance with accounting principles generally accepted in the United States. Management uses EBITDA adjusted for business reorganization and related expenses (“Adjusted EBITDA”), among other measures, in evaluating the performance of the Company’s business units. Adjusted EBITDA is also a significant component of the Company’s incentive compensation plans. Adjusted EBITDA should not be considered in isolation from, or as a substitute for, net income/(loss) prepared in accordance with GAAP.
Reclassifications
Certain prior year amounts have been reclassified to conform to current year presentation.
About Take-Two Interactive Software
Headquartered in New York City, Take-Two Interactive Software, Inc., is a global developer, marketer, distributor and publisher of interactive entertainment software games for the PC, PLAYSTATION®3 and PlayStation®2 computer entertainment systems, PSP® (PlayStation®Portable) system, Xbox 360® and Xbox® video game and entertainment systems from Microsoft, Wii™, Nintendo GameCube™, Nintendo DS™ and Game Boy® Advance. The Company publishes and develops products through its wholly owned labels Rockstar Games, 2K Games, 2K Sports and 2K Play, and distributes software, hardware and accessories in North America through its Jack of All Games subsidiary. Take-Two’s common stock is publicly traded on NASDAQ under the symbol TTWO. For more corporate and product information please visit our website at www.take2games.com.
All trademarks and copyrights contained herein are the property of their respective holders.
Microsoft, Windows, the Windows Vista Start button, Xbox, Xbox 360, Xbox LIVE, and the Xbox logos are trademarks of the Microsoft group of companies, and ‘Games for Windows’ and the Windows Vista Start button logo are used under license from Microsoft.
“PlayStation”, “PLAYSTATION”, and “PS” Family logo are registered trademarks of Sony Computer Entertainment Inc.
Wii and Nintendo DS are trademarks of Nintendo. © 2006 Nintendo.
Important Legal Information
In connection with the tender offer commenced by Electronic Arts Inc., the Company has filed with the Securities Exchange Commission a Solicitation/Recommendation Statement on Schedule 14D-9. The Company’s stockholders should read carefully the Solicitation/Recommendation Statement on Schedule 14D-9 (including any amendments or supplements thereto) prior to making any decisions with respect to Electronic Arts’ tender offer because it contains important information. Free copies of the Solicitation/Recommendation Statement on Schedule 14D-9 and the related amendments or supplements thereto that the Company has filed with the SEC are available at the SEC’s website at www.sec.gov. This communication does not constitute an offer to sell or invitation to purchase any securities or the solicitation of an offer to buy any securities, pursuant to Electronic Arts’ tender offer or otherwise.
This press release may contain forward-looking statements made in reliance upon the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The statements contained herein which are not historical facts are considered forward-looking statements under federal securities laws. Such forward-looking statements are based on the beliefs of our management as well as assumptions made by and information currently available to them. The Company has no obligation to update such forward-looking statements. Actual results may vary significantly from these forward-looking statements based on a variety of factors. These risks and uncertainties include the matters relating to the Special Committee’s investigation of the Company’s stock option grants and the restatement of our consolidated financial statements. The investigation and conclusions of the Special Committee may result in claims and proceedings relating to such matters, including previously disclosed shareholder and derivative litigation and actions by the Securities and Exchange Commission and/or other governmental agencies and negative tax or other implications for the Company resulting from any accounting adjustments or other factors. Further risks and uncertainties associated with Electronic Arts’ tender offer to acquire the Company’s outstanding shares are as follows: the risk that key employees may pursue other employment opportunities due to concerns as to their employment security with the Company; the risk that the acquisition proposal will make it more difficult for the Company to execute its strategic plan and pursue other strategic opportunities; the risk that the future trading price of our common stock is likely to be volatile and could be subject to wide price fluctuations; and the risk that stockholder litigation in connection with Electronic Arts’ tender offer, or otherwise, may result in significant costs of defense, indemnification and liability. Other important factors are described in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2007, in the section entitled “Risk Factors,” as updated in the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended January 31, 2008, in the section entitled “Risk Factors.” All forward-looking statements are qualified by these cautionary statements and are made only as of the date they are made.
Gaming: NinjaBee Studio hires 20 new employees - all 3 feet tall
Orem, Utah - June 4, 2008 - NinjaBee, a leading independent developer of Xbox LIVE® Arcade titles, announced today it has hired 20 Keflings to help around the office. Featured in their newest Xbox LIVE Arcade Title, A Kingdom for Keflings, the Keflings are short, happy beings who aren’t afraid of a bit of hard work. Once production slowed on the studio’s newest city-building game, the Keflings became aimless without constant direction.
Top PLAYSTATION(R)3 Videogames Developer Insomniac Games Expands to North Carolina
BURBANK, Calif., June 4 /PRNewswire/ — Insomniac Games, a 28.5-million
unit selling independent console videogames developer ranked among the top
10 best small companies to work for nationally and locally, announced today
it is opening a North Carolina-based development studio. Read more
A New Team of Superspies Rocks Wii(TM) With Capcom’s Spyborgs(TM)
SAN MATEO, Calif., June 3 /PRNewswire/ — Capcom(R) Entertainment, a
leading worldwide developer and publisher of video games, today announced
Spyborgs(TM), a new action game coming exclusively to the Wii(TM) home
video game system from Nintendo. In Spyborgs, players take on the role of a
diverse team of five bionic superspies in a fight to save the world from a
group of dastardly villains. Wii gamers will be set to save the world when
the game launches in 2009. Read more
Corsair and Dell Usher in 1600MHz Memory for Extreme Gaming Performance
FREMONT, Calif., June 3 /PRNewswire/ — Corsair(R)
http://www.corsair.com, a worldwide leader in high performance computer and
flash memory products, announced today that 4GB of overclocked DDR3 memory
is now officially ready for prime time. Using Corsair’s DOMINATOR memory
modules, Dell’s XPS 730 gaming desktop runs with rock-solid stability at
the overclocked memory frequency of 1600 MHz. Read more