Virtuality Group Plc, the Leicester-based virtual reality systems builder duly delivered losses of under ú1.5m as it had predicted – just. Pre-tax losses were ú1.4m, up from a ú365,000 loss last year. It also announced an expansion of its alliance with Atari Corp, adding a software licensing agreement under which Virtuality will develop immersive virtual reality games and software for Atari’s 64-bit Jaguar entertainment system, for which it is already designing headsets. Virtuality floated back in October 1993, and its start-up costs are the principal reason for the the losses. Development costs last year were ú1.8m, against ú1.2m in 1993, and turnover was above expectations, up 82% to ú9.6m. No dividend will be paid this time round. Chairman David Payne described 1994 as the year when the VR entertainment business really came of age, and the company claims it has around 80% of the worldwide immersive virtual reality market. Virtuality launched its Series 2000 unit at the beginning of the year (CI No 2,349), and its sales of 371 units were 100% up on unit sales in 1993. The installed base at the year-end was more than 800 units in 27 countries; seven of the countries are newcomers. A sales office was opened in Dallas, Texas during the year, and the US is already by far the largest market for the company, contributing 48% of group turnover this year. The UK contributes around 9% of its business, according to chief executive Jon Waldern. The office in Tokyo, also opened last year, houses a software development team as well as sales staff, and a development base is also due to be set up in California later this year. During the year the company signed agreements with IBM Corp (CI No 2,458) and Atari (CI No 2,530). The former is for the Elysium personal computer-based virtual reality system to which Virtuality supplies the keyboard, visor and Virtuality board. Payne describes it as a marvellous opportunity to embed our standard in the professional software developer community.
Christmas
Last October’s agreement with Atari was for Virtuality to develop a low-cost head-mounted display for Atari’s 64-bit Jaguar games machine. This is reported to be on schedule for Atari to have the systems in the shops for Christmas 1995, at less than $200 each. The new agreement with Atari announced yesterday is for Atari to part-fund Virtuality’s development of two immersive virtual reality games to run on the Jaguar system. The games are scheduled for delivery before Christmas 1995. The British company will also develop a security code so that only approved software companies can develop games for the Jaguar system. The contract – along with others ones signed since the year-end, but yet to be disclosed – will provide Virtuality with more than ú1m in development funds. The company retained the intellectual property rights to its development tools under the agreement with IBM, and Atari has also asked for a low-cost version of Virtuality’s V-space immersive development tool to run on the Jaguar system. The company has enough left over from its initial offering to preclude the need for any rights issue this year, according to Warne. The company is predicting first profits in 1995, and analysts are envisaging a year of continued growth and earnings of around ú500,000.
