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Game Group PLC (GMG)

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Tuesday 10 January, 2012

Game Group PLC

Christmas Trading Statement

RNS Number : 2583V
Game Group PLC
10 January 2012
 



 

10 January 2012

 

The GAME Group plc: Christmas Trading Statement

 

 The GAME Group plc ('GAME' or 'the Group') is today providing an update on its trading performance over the Christmas period and for the 49 weeks to 7 January 2012.

 

8 weeks to 7 January 2012

49 weeks to 7 January 2012

Total sales (%)

Lfl sales (%)

Total sales (%)

Lfl sales (%)

Group

-14.7%

-12.9

-11.9

-10.0

  UK & Eire stores

-17.6

-15.2

-14.5

-12.0

  International stores

-12.0

-11.4

-9.5

-8.2

  Group Online

3.9

3.9

1.3

1.3

 

·      Our performance was ahead of the overall games market, which was -13.1% for the 49 weeks. Full year Group
      like for like (lfl) sales are now expected to be no better than -10.3%.

 

·      In response to challenging market conditions, promotional activity impacted gross margins over Christmas and full year gross margins will now be down by approximately 190 basis points.

 

·      Cost control has been maintained and full year operating costs will be £8-10m lower than last year, as previously stated.

 

·      Strong working capital disciplines have supported operating cashflow. The Group expects to have a year-end cash position similar to last year (2011: £120m).

 

·      The Group currently remains compliant with its loan covenants. However, the difficult market conditions raise the likelihood that it will not meet its EBITDA covenants (fixed charge coverage and leverage) when they are tested on 27 February 2012 for the period to 31 January 2012.  Given the year-end cash position, the debt service covenant should be met satisfactorily. The Group continues to be in regular and constructive dialogue with its lenders, who remain supportive.

 

·      The PlayStation Vita will launch in Europe on 22 February, and the Nintendo Wii U is scheduled to launch later in the year. GAME expects to be the European market leader for each launch.

 

Ian Shepherd, GAME CEO said: "Our industry had an incredibly tough 2011, and so did we. We remain the market leader and have a clear strategy which will return the business to growth. We are adapting to the changing market and are well prepared for the next hardware cycle."

 

-     ENDS -

Notes:

1)   The GAME Group management team will host an analyst conference call at 9.30am on 10 January 2012. For further details contact Brunswick on 020 7404 5959.

 

2)   Strategic KPI progress:

-     Store closure programme on track: net 39 stores closed this year; on target to have circa 550 UK stores by 2013. Short average lease lengths allow this programme to be accelerated if necessary.

-     Expansion of digital offer: digital sales growth over 40% year-on-year.

-     Customer loyalty: half a million new customers joined the Group's loyalty schemes in the 8 weeks since 16th November, taking the total to 19.8m.

-     Innovative retail: following launch of GAMEwallet, 12 new games added to the service.

-     Multichannel development: e-commerce market share holding firm in competitive market.

 

3)   Store numbers:

 

7 January 2012

31 January 2011

Number

Number

Company owned and concessions

UK and Ireland:

610

639

- GAME - stores

368

381

- GAME - concessions

10

11

- Gamestation

232

247

France

193

197

Iberia

291

287

Scandinavia

57

65

Czech Republic

30

31

Total Continental Europe

571

580

Australia

92

93

Total International

663

673

Total owned and concessions

1,273

1,312

Franchises

Australia

1

1

Total franchises

1

1

Total operational outlets

1,274

1,313

 

 

Contact:

GAME Group plc

 

Ian Shepherd, Group CEO

Ben White, Group Finance Director

Simon Soffe, Communications & Investor Relations Director

+44 1256 784176

Brunswick  Group

Jonathan Glass

James Olley

Natalia Marisova

+44 207 404 5959

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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