I said it before, I say it again: Burn baby! Burn!
Lara Croft caught in games war crossfire
By Philippa Moreton
LONDON (Reuters) - Shares in computer games publisher Eidos (LSE: EID.L - news) , the parent of cyber-babe Lara Croft, crashed after the company warned of further financial dangers ahead due to the transition to a new generation of gaming platforms.
The company, famous for its hit Tomb Raider game starring Lara, said second half operating profits would be significantly worse than a year ago and results for the year to end March would therefore be substantially below last year.
The stock was struck down in early trading, tumbling to half the previous day's close. The shares plummeted 42 percent or 255 pence to 345p a little after 8.00 a.m.
Due to the current lower level of consumer demand, which had led to congestion in the retail channel, Eidos said it would now delay the release of certain products including Nomad Soul (Dreamcast), F1 World Grand Prix (PC), Tomb Raider (Game Boy Color) and Daikatana (PC) to the first quarter of 2001.
Eidos warned of ongoing uncertain trading conditions as the market adapts to the new battle zone of gaming platforms such as Sega Enterprises' Dreamcast, Sony Corp's Playstation 2, Microsoft Corp's X-Box and Nintendo's Dolphin.
"The company anticipates that these new more powerful gaming platforms will have a positive impact on the market in the long term," Eidos said in a statement.
"However the transition is likely to lead to a further weakening of current generation software in the near term," it said.
Eidos announced a profit warning on January 18 after disappointing Christmas sales and product delays. At the end of last month the group reported nine month operating losses of 11 million pounds and a fall in turnover to 142.6 million pounds.
The company said while the transition clearly presented a challenge to all market participants, the company would continue to focus on ensuring its cost base is brought into line with the anticipated levels of turnover.
Measures were now being taken to improve the management of the product development cycle, it said.
Separately Eidos said it would sell 1.14 million shares of its total holding of 1.47 million shares in Norwegian data storage firm Opticom which would result in exceptional pre-tax profits of around 84 million pounds. (additional reporting by David Jones)
Yeah, I said, I'll jump back into EIDSY when I see the fear in the eyes of EIDSY-investors! Today, the streets of London are soaked with the blood of the fools who long EIDSY, I'm preparing to buy...but not today, I wanna see more chaos and even more pain...3 bucks a share might be a good entry point... |
