Here's something on Eletronics Boutique plc of England (not owned by ELBO). Interesting for the comments concerning sales/unit volume
Copyright 1999 Telegraph Group Limited
THE DAILY TELEGRAPH(LONDON)
January 8, 1999, Friday
SECTION: Pg. 32
LENGTH: 300 words
HEADLINE: Questor Column: Electronic gamers zap to a higher level
BYLINE: Edited by Ben Potter
BODY:
LIKE Lara Croft, computer game retailers have to rise to challenges that would defeat ordinary mortals.
Yesterday, The Electronics Boutique produced like-for-like sales growth of 11pc for the crucial five-week Christmas period - a figure most retailers would die for. The market reaction? The shares fell almost 5pc to 79 3/4 p.
Electronics Boutique sells roughly 30pc of its consoles and computer games over Christmas, and John Steinbrecher, chief executive, was delighted with the "excellent" performance. Sales for the 11 months to 2 January are running 30pc ahead of last year, with underlying sales up 11pc.
The appetite for zappers continues to astound. In 12 months, the number of people hooked on Sony Playstations and Nintendo 64 consoles in Britain has doubled to more than 5m. That happily means twice as many people itching to get hold of Tomb Raider 3, Legend of Zelda and Fifa 99.
There is a virtuous circle here, but the big question is what happens when the growth stops. Mr Steinbrecher can see another two and a half million consoles added this year, boosted by autumn's launch of the Sega Dreamcast, which promises to take zapping to another level. It is supposed to be twice as fast as existing consoles.
Analysts are not so sure, however, and worry that growth may slow. That would affect Electronics Boutique's roll-out of about 30 stores a year. It currently has 176 outlets, including the 17 Debenhams's concessions. It also has a tough competitor in Game, which has larger stores.
Dixons has inevitably noticed the growth in the market and has plans for its own game stores. A bid for Electronics Boutique or Game would be a quick route. On prospective profits forecasts of pounds 15m this year, Electronics Boutique's forward multiple is 18 times. Hold.
LANGUAGE: ENGLISH
LOAD-DATE: January 8, 1999
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