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Technology Stocks : eidos--maker of Tomb Raider -- Ignore unavailable to you. Want to Upgrade?

To: Bleeker who wrote (1249)	8/19/1998 5:34:00 AM
From: hl	Read Replies (1) \| Respond to of 1773

I finally got the annual report from EIDSY and must say that the fundamentals are nearly perfect (perhaps the report is in short supply, because unlike last year it has Lara Croft on the cover ;-)) I'm currently reviewing the annual reports of several publicly traded gaming companies (especially Rage and SCi Entertainment in the UK) in order to find a possible aquisition target for EIDSY. SCi (traded on the London AIM (Alternative Investment Market) has a market cap of 10 mill. GBP). Their upcoming hit product Carmageddon II should fit in well in the portfolio of any major game company, and hey this company is profitable (over 1.4 mill. GBP last year). The bad thing is that the founder Mrs. Cavagnah holds almost 69 % of the shares privatly, so a hostile bid isn't possible. Regarding EIDSY annual report, bsides their very good pipeline and strong earnings, I'm not pleased about two facts: 1) Regarding the salary of the board of directors, the sum tripled from just 1 mill. GBP in 97 to 3 mill. GBP this year (mostly due to a 1.6 mill. GBP bonus to the managing director of Core Design Mr. Heath-Smith (Quote:"Regarding the enourmous contribution Core made to the groups profits")) I agree with that, but this guy hasn't invented Lara Croft and her huge group of fans, so is this salary justified? 2) EIDSY sold the maker of flight simulations Simis for just 100.000 GBP (they bought it for 2 mill. GBP in 95). This company has now with a helicopter sim called Team Apache a good product with nice reviews in the market (this game is now published my Mindscape), so the selling price of Simis seem a bit low. EIDSY said they want to move away from flight Sims, but why do they keep their shareholding in the Norwegian company Innerloop (maker of Joint Strike Fighter) and continue to sell this product in their budget label called "Premier Collection"? In my opinion EIDSY should really put a focus at cost control (just look at their personal costs rising form 13 mill. to 20 mill. GBP) to maximise it's profit. The board must really do something for the shareprice in order to fend of possible bidders. In my opinion the Lara Croft franchise is worth more than the current valuation of the entire company (the high cash levels and lucrative publishing deals are just a bonus for any bidder). We shareholders take the risk of this companys products, so we deserve a higher part of the cash flow coming out of this products in order to boost the share price. By the way: Commandos is the top selling game in Germany for the fourth straight week right now. Strong sales in the U.S. for Commandos are also very likely. Kai