Mark Androvich
00:54 (BST)
15/06/2007
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Atari losses could exceed $70 million
Delays filing its annual report
Atari Inc. has delayed filing its annual financial report because it needs time to determine the amount of a goodwill impairment charge that could increase its net losses to over USD 70 million.
Before the charge is taken into consideration, Atari said it would post a net loss of USD 17.2 million, or USD 1.28 per share, for the fiscal year ended March 31.
Sales were about USD 121.6 million for the year. The company estimates that the impairment charge will be equal to "all or a substantial portion of the USD 54.1 million of goodwill" on its books before the charge.
Atari, a subsidiary of Infogrames Entertainment SA, has been struggling. In January, it faced delisting on the Nasdaq Stock Market and had to complete a 1-for-10 reverse stock split to meet the minimum price requirements.
In May, Atari slashed its work force by 20 per cent. Later that month, parent company Infogrames saw a fall in revenues following poor US sales.
Atari plans to file its report later this month.
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