GAME Xmas sales down, prepares for challenging 2011

High Street retailer GAME has seen sales drop over Christmas compared to last year, and is preparing for an expected difficult 2011.

Total group sales for the five weeks to January 8 were down 4.1 per cent with UK and Ireland sales down 3.3 per cent. Like for like sales were down 2.1 per cent for the group, and down 0.5 per cent in the UK.

Chairman Peter Lewis blamed a "difficult" PC and videogames market as well as the adverse weather for the disappointing figures. Group sales for the 49 weeks of the financial year to January 8 are down 7.7 per cent and 12.3 per cent in the UK, with GAME expecting a profit before tax of between £37m and £39m.

Expecting another difficult year in 2011, Lewis said the company is set to evolve the business to tackle the changing retail market and adapt to digital and online distribution and social and mobile gaming - a full strategic review will be revealed on February 16.

"Game Group has a strong position in the videogames market, but it is well recognised that the market is changing," said Lewis.

"Next year will see further innovation in existing formats as well as social and mobile gaming, and a growth in digital and online distribution. Given those developments, we recognise that we need to evolve our business and deploy our strengths in new areas if we are to enhance our position as the market leader.

"Our team, led by [chief executive] Ian Shepherd, will give an insight into the strategic programmes with which we are building a seamless, customer-centred multi-channel service for gamers in the future."

At the start of the year, data from UKIE showed that the UK boxed videogame market was down 11 per cent in 2010, with sales of £2.875 billion - although this figure does not include digital, mobile, second hand or social gaming.