Acclaim Entertainment, Inc. Reports Profitable Results
for Second Quarter and First Six Months of FY 2001
GLEN COVE, N.Y., Apr 10, 2001 (BUSINESS WIRE) -- Acclaim Entertainment, Inc. (NASDAQ: AKLM chart, msgs), a leading video entertainment software developer, today reported profitable results of $0.5 million or $0.01 per fully diluted share on net revenues of $40.4 million for its fiscal 2001 second quarter ended March 3, 2001. For the first six months Acclaim reported net earnings of $11.3 million or $0.20 per fully diluted share on net revenues of $112.4 million.
The Company achieved profitability in the quarter on lower net revenues primarily through the reduction in its operating expenses. Operating expenses for the second quarter decreased by 48 percent from the same period one year ago. Operating expenses for the second quarter were $25.3 million vs. $48.9 million for the second quarter of the prior year, a reduction of $23.6 million, while net revenues for the three months ended March 3, 2001 were $40.4 million, compared to $65.9 million in the second quarter of the prior year, a decrease of 39 percent. Net earnings for the three months ended March 3, 2001 were $0.5 million, or $0.01 per diluted share, compared with a net loss of $18.9 million or $0.34 per diluted share for the same period in the prior year.
Profitable performance for the second quarter of fiscal 2001 was fueled by the releases of Vanishing Point for PlayStation(R) game console and Dreamcast; Ducati for PlayStation game console, Dreamcast and PC; Mary-Kate and Ashley Winners Circle for the PlayStation game console and Game Boy(R) Color; and Super Bust-A-Move for PlayStation(R)2 computer entertainment system, and the continued sell through of the catalogue. Most notable during the period were the continued strong success of Dave Mira Freestyle BMX and the Mary-Kate and Ashley brands across all formats.
The continuing positive effects of Acclaim's cost-reduction plan significantly contributed to profitability in the first six months of fiscal 2001 primarily through reducing the Company's operating expenses $46.9 million or 44 percent when compared to the same period one year ago. General and administrative expenses were reduced $10.3 million or 33 percent predominately through staff consolidation, while marketing and selling expenses declined $30.4 million or 66 percent. The majority of gross revenues by platform in the second quarter of fiscal 2001 consisted of 21 percent of 128-bit software; 49 percent of 32-bit software; 18 percent of portable cartridges; 9 percent personal computer games, and 3 percent of 64-bit software. On a geographic basis, North American operations generated 64 percent of net revenues and international 37 percent for the quarter, which compares favorably to 63 percent and 37 percent, respectively for the same period a year ago.
Moving forward the third and fourth quarters of fiscal 2001 will see the release of 18 titles -- 10 of which have been developed for PlayStation2 computer entertainment system, and four of which have been developed for PlayStation game console. The balance of the lineup will be on Game Boy(R), and PC.
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