VideoLogic Group Plc the King’s Langley, UK-based graphics chip designer and board manufacturer, hasn’t done as well as the market was hoping for this year and the shares were down 10% to 42.5 pence at close of play on Tuesday, less than half their price this time last year. The group made net losses for the year to March 31 of 1.5m pounds, down from losses of 7.5m pounds last time on revenues that rose 9.7% to 14.9m pounds. The company refuses to predict when it will break even but analysts expect profits from the company in the current period. VideoLogic’s market has failed to take off in the way it predicted, but the company says it has kept its promises. Research and development has grown to 4.4m pounds while cost of sales and administrative expenses have been pegged back. Royalty income from sales of its graphics chips by NEC Corp came in on schedule in September and the PowerVR PCX1 and PCX2 chips were brought to market on time. The next generation of 3D chip products is due for launch in the third quarter of 1997 and VideoLogic has hitched its wagon to the Microsoft Corp Talisman standard. Its Highlander chip will include PowerVR technology providing 2D and 3D multimedia capability on a single chip as well as being fully compatible with the soon to be merged DirectX and Talisman standards proposed by Microsoft. Its philosophy is to try and follow big players while trading in a niche where Intel and Microsoft won’t bother it. It’s nice to be moving in the same direction as Microsoft, whether it’s the right direction or not, said Chairman Geoff Shingles.