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Thursday November 12 2009
The Irish arm of US video game retail chain Gamestop posted a 12pc decline in operating profits to €4.5m in the 12 months to the end of last January, even as turnover jumped 5.5pc to €81.3m.
The company is one of many retailers hoping to cash in on the phenomenal hype surrounding this week's release of the latest blockbuster video game, 'Call of Duty: Modern Warfare 2'.
The game, developed by Activision Blizzard and available for consoles such as Sony's PS3 and Microsoft's Xbox, is expected to sell between 11 million and 13 million copies around the world by the end of this year.
It's been estimated by one analyst that 7.8 million copies of the game will be sold this week alone, with a retail value of about $569m (€380m).
The game, whose soundtrack is produced by Hans Zimmer, composer of music for blockbuster movies such as 'Gladiator' and 'The Lion King', is the most pre-ordered video game ever at Gamestop.
The Irish unit of Gamestop originally started life as Gamesworld, when it was established in 1994 by Kevin Neary and Michael Finucane. They sold a controlling stake in the business to Texas-based Gamestop in 2003 for $3.1m. Last year, the two men, and the Irish arm's financial director Paul Hennessy, sold a further combined 16pc stake in the Irish business to Gamestop for $27.4m (€19.4m at the time) and in July, Gamestop paid the founders a further $4.6m (€3.1m) for an additional 16pc stake, bringing its total holding in the Irish business to 84pc.
In accounts just filed for Gamestop's Irish unit, which operates almost 60 outlets, the directors note that in the last financial year the company exceeded its sales and profitability targets and opened seven new stores during the period. However, they also say that given the changes in the economic environment, the group will concentrate on meeting sales and profitability targets in the current year and focus less on "aggressive growth".
- john mulligan
Irish Independent
