Revenue for the period, which includes publishing and distribution revenue, more than doubled to $81.7 million versus $39.6 million in the comparable year-earlier quarter. Publishing revenue soared 126% to $61.9 million from $27.4 million in the prior-year first quarter. Distribution revenue of $19.8 million posted a 62% increase from distribution revenue of $12.2 million in the first quarter of 2001. The Company reported a net profit of $552,000, or $.01 per share, for the first quarter of 2002, a dramatic improvement from a net loss of $32.7 million, or $1.58 per share, in the comparable year-earlier period. EBITDA (earnings before interest, taxes, depreciation and amortization) for the quarter ended September 30, also vastly improved, rising to $4.5 million, or $.06 per share, from a loss of $22.6 million, or $1.09 per share, in the first quarter of 2001.
The Company’s financial results for both reported periods include the effect of its merger with Infogrames North America (Infogrames NA), which closed on October 2, 2000. Since the Company and Infogrames NA were under the common control of parent company Infogrames Entertainment, SA prior to their merger, U.S. GAAP (Generally Accepted Accounting Principles) requires the Company to report its financial results as if the merger took place at the time common control began, December 16, 1999.
Effective July 1, 2001, the Company elected the early adoption of Statement of Financial Accounting Standards 142, which discontinued the amortization of goodwill. Accordingly, while goodwill amortization of $2.9 million was reported in the quarter ended September 30, 2000, no goodwill amortization was reported during the quarter ended September 30, 2001.
Our turnaround is nearing completion and we are beginning to see the results of our efforts, said Bruno Bonnell, Chairman and CEO of Infogrames, Inc. These first quarter results validate the logic behind our strategic acquisitions, our emphasis on games for the mass entertainment audience, and our continued support of all platforms, including legacy platforms such as the PC and PlayStation. During the quarter we also demonstrated our ongoing dedication to next-generation consoles, announcing five holiday releases for the PlayStation 2 and three launch titles for Microsoft’s Xbox. The next-gen console products will also include our inaugural Atari titles, Splashdown, MXrider and Transworld Surf. Our message is simple: Infogrames is meeting the demand for top-quality interactive entertainment and is delivering it to every platform available.
Mr. Bonnell continued, As to the current economic uncertainties, the gaming sector has typically prevailed in tough economic times, and so far this season appears to be bearing that out. The sector remains vibrant, customer demand is strong, and the upcoming launches of new consoles can only create more interest and drive more traffic to retail outlets. With everything we know and see today, we remain bullish about the potential success of Infogrames’ holiday line-up, and should the current trends in our industry hold or improve, we expect that this will be the first of several consecutive profitable quarters for us.
The substantial increase in publishing revenue during the quarter was primarily attributable to the inclusion of product from Infogrames Interactive, Inc. (formerly Hasbro Interactive), including: Monopoly Tycoon, which the Company expects to be one of the strongest selling PC titles this holiday season; Looney Tunes Sheep Raider (PSone), an extension of the popular Warner Bros. license; the *NSYNC Hotline Fantasy Phone & CD ROM, the first product from the exclusive license with the world’s most popular band; and Roller Coaster Tycoon, which has ranked among the top 10 PC games since it debuted in 1999, selling more than 2.5 million units to date.
Significant publishing revenue during the period was also generated by new and continuing titles from the Company’s other publishing studios, including Test Drive Off Road — Wide Open, the hotly anticipated racing game for PlayStation 2; Driver 2 Greatest Hits (PSone), the most current expansion of the Driver franchise which has sold a combined 2.8 million units to date; and Deer Hunter 5, the latest version of the popular PC franchise. The increase in distribution revenue was the result of additional profitable third-party and affiliate distribution deals, including the Company’s recently announced agreement with Codemasters for whom the Company distributed the popular Operation Flashpoint during the quarter.
Infogrames’ holiday line-up features the following key titles: For the PC, Survivor: The Interactive Game, Civilization III, Monopoly Tycoon, and Backyard Basketball; for the PlayStation 2, Splashdown, MXrider, Test Drive Off-Road Wide Open, NASCAR Heat 2002, and Le Mans 24 Hours; for the PlayStation, Looney Tunes Sheep Raider, Men In Black: The Series Crashdown and Nicktoons Racing; and for the Xbox, NASCAR Heat 2002, Test Drive Off-Road Wide Open, and Transworld Surf.
