The past 15 months have been a period of unprecedented activity in the history of London, UK-based Eidos Plc. Last October the company acquired the entire issued share capital of three games companies, Domark Group Ltd, Simis Ltd and The Big Red Software Co Ltd, to complement the multimedia hardware side of its business, at a cost of 12.9m British pounds. This was followed by the acquisition of Birmingham-based Centregold Plc for 17.2m pounds in shares, funded by a rights issue (CI No 2,884). Prior to the acquisitions even Eidos described itself as merely a small research and development facility (CI No 2,884). Now Eidos has offloaded the games distribution business it picked up but didn’t want when it acquired CentreGold. The businesses , CentreSoft Ltd and PDQ Distribution Ltd were sold to their management for 7.5m pounds payable in cash on completion (CI No 2,948). Should all or part of CentreSoft and PDQ be sold within 24 months from completion at a cost that values the whole business at more that 7.5m pounds, Eidos will be entitled to 5% of any excess, to a maximum of 500,000 pounds. Due to the rapid expansion of its empire, it should come as no surprise to see the company turn in increased losses for the 15 months to March 31, but the City remained sceptical about its performance. Shares fell 27 pence to 718 pence by midday yesterday on the news that losses for the period climbed to 1.95m pounds from 108,000 pounds for the 12 months to December 1994. Forecasts made in March put pre-tax losses at 1.8m pounds. Revenue jumped to 3.7m from just 254,000 pounds before, of which 3.5m pounds was generated by its newly-acquired divisions. The company blames a percentage of the increased losses to its three-dimensional multi-player off-road racing game, Big Red Racing’s overexposure to the Internet. The company anticipated a strong sales performance from the game, but has found too many people have bypassed the conventional sales route, and downloaded it dire ctly from the Internet. During the period the Putney, London-based company was reorganized into two business divisions. Eidos Technologies will house the company’s video compression software used within the video telephony and CD-ROM publishing fields. Eidos Interactive will incorporate all the games brands. The sales and marketing divisions of US Gold and Donmark have been merged, which has resulted in eight redundancies in the US and 17 in Europe. Revenues included the first installment of 8 0,000 pounds from Oracle Corp in respect of a technology licensing agreement. The licence permits Oracle to incorporate the Eidos software compression and decompression technology in a wide range of its products. Earlier this year the company said its cut-price videophone had been delayed for further testing (CI No 2,910), but all now looks to be back on course. Eidos said the technology is now ready to be licensed to a number of interested parties. There is still much hard work to be done at Eidos, said chief executive Charles Cornwall, but he nonetheless remains optimistic about the current year. There is no dividend.
