Midway Reports Q2 Financials
PRESS RELEASE posted on 5 AUG 2008 by Jim Zabek
The bottom line: they lost money.
Midway Games Inc. (NYSE:MWY) today announced results of operations for the three month period ended June 30, 2008. The Company also provided revenue and earnings guidance for the third quarter ending September 30, 2008.
SECOND QUARTER RESULTS
Net revenues for the 2008 second quarter were $23.4 million, compared to the 2007 second quarter net revenues of $31.8 million and ahead of prior guidance of approximately $18 million. The 2008 second quarter net loss was $34.8 million, or a loss of $0.38 per basic and diluted share, compared with a 2007 second quarter net loss of $14.3 million, or a loss of $0.16 per basic and diluted share.
On a non-GAAP basis, excluding the impact of stock-option expenses and other non-cash items, the 2008 second quarter loss was $26.4 million or a loss of $0.29 per basic and diluted share, compared to the Company’s previous non-GAAP guidance of a loss of approximately $0.28 per basic and diluted share. For the 2007 second quarter, on a non-GAAP basis, the Company reported a loss of $11 million, or a loss of $0.12 per basic and diluted share. A reconciliation of non-GAAP results to GAAP results is provided at the end of this press release.
Other recent operating highlights include:
* During the second quarter, Midway released NBA Ballers: Chosen One for Xbox 360 worldwide and for PS3 in North America, and Unreal Tournament III for Xbox 360 in Europe.
* Several of Midway’s games shown at this year’s E3 Media & Business Summit received awards and critical praise including Mortal Kombat vs. DC Universe, which was named as one of the best fighting games of E3 by numerous publications.
* Midway announced new casual titles such as the sequel to the million-plus unit selling game, Game Party 2, as well as Touchmaster 2, Mechanic Master, and a new casual games portal, MidwayArcade.com. In addition, Midway announced the next installment of its million-plus unit selling football franchise, Blitz: The League II.
OUTLOOK
During the third quarter, the Company has released Unreal Tournament III for Xbox 360 in North America, and expects to release TNA iMPACT! wrestling game for Xbox 360, PS3, PS2, and Wii worldwide. For the third quarter ending September 30, 2008, Midway expects the following:
* Net revenues of approximately $52 million, with a net loss of approximately $0.37 per basic and diluted share.
* On a non-GAAP basis, Midway expects a second quarter loss of approximately $0.27 per basic and diluted share, which excludes approximately $0.10 of non-cash convertible debt interest expense, stock option expense, and deferred income tax expense related to goodwill.
Matt Booty, interim president and CEO, commented, “At E3 this year, Midway showed that we have possibly our strongest holiday line-up in recent years, which we plan to kick off in September with TNA iMPACT!, a game that is garnering substantial buzz as a formidable competitor to other wrestling franchises. Following that, we expect the releases of Blitz: The League II and Mortal Kombat vs. DC Universe to expand the audience beyond their core fan bases.”
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