NCsoft net profit down 43% on write-off

NCsoft has announced first quarter financial results, with net profit down 43 per cent year over year due to a one time write-off expense for development costs.

Sales for Q1 2008 were KRM 88.1 billion (USD 84.3 million). Net profits were KRW 8.1 billion (USD 7.7 million).

NCsoft chose to write-off expenses for development costs associated with the Spacetime Studios project. However, excluding the write-off expenses, net profit would have been KRW 15.2 billion (USD 14.5 million) - an increase of 48 per cent from the prior quarter and an increase of 8 per cent from Q1 2007.

"As proven once again in the Q1 financial results, we strongly believe our key franchise products, such as Lineage and Guild Wars, will meet our sales target with a strong customer base and continued content updates going forward," said NCsoft CFO Jaeho Lee.

"We plan to ensure the smooth launch of many new products in the next two to three years, which will strengthen our position as a global leader in online games."

Lineage II, released in 2003, reached record-high sales in Q1 2008 according to NCsoft. Sales of the game came to KRW 35.7 billion (USD 34.1 million) which accounted for 43 per cent of the company's overall game sales.

South Korea remains the most profitable region for NCsoft, with sales of KRW 49.8 billion (USD 47.7 million) - compared to North American sales of KRW 10.9 billion (USD 10.4 million) and European sales of KRW 8.9 billion (USD 8.5 million). In Japan, the company saw sales of KRW 9.6 billion (USD 9.2 million).

NCsoft said that it plans to launch its third closed beta test of Aion this summer before formally launching the product later in the year.