GAME sales down in first half of 2009
Like-for-likes drop over 15%, but increased software sales expected later in year
Sales for specialist retailer GAME were down 9.1 per cent in the first half of the year, with like-for-like sales dropping 15.4 per cent.
The results were in line with expectations said the company, compared to the same period last year which included blockbuster releases such as Grand Theft Auto IV, Mario Kart and Wii Fit.
Sales for the UK and Ireland business were down 12.4 per cent, with like-for-likes down 15.8 per cent, while the International business saw a marginal decrease of 1.1 per cent and a like-for-like drop of 14.4 per cent.
However, due to an established installed base which now tops 24 million in the UK, the retailer expects strong sales of both pre-owned and new software in the latter part of the year, as consumers look for value and returning franchises.
"Whilst we remain mindful of the significant challenges in the wider economic environment, our full year performance will be driven by the increased ownership of consoles which will increase demand for software," said Peter Lewis, chairman of GAME.
Titles highlighted by the company for anticipated strong sales were Wii Fit Plus, DJ Hero, Mario and Sonic at the Winter Olympics, Professor Layton and Pandora’s Box, Assassins Creed 2, Forza Motorsport 3, Singstar: Take That and Halo ODST, along with annual sequels including Call of Duty Modern Warfare 2, FIFA 2010, Pro Evolution Soccer 2010, Need for Speed and Splinter Cell.
Despite the muted half year, Lewis did point out that "we have seen good gross margin growth due to higher margin software and accessory sales being a larger part of the sales mix and our preowned proposition continuing to perform well."
The company expects first half profits of between GBP 13 and GBP 16 million, compared to the GBP 36.4 million for the same period last year.
"The profit performance last half year was exceptional and this half year should be viewed in the context of our seasonal business, when customarily all Group profits are made in the second half," said Lewis.
The retailer has a total of 1367 stores, with plans to open another 50 – 60 before the key Christmas trading period, the majority of which will be in the International business.