GAME reports record £36.4m first half profits
Group sales up 64.2 per cent as demand for home consoles outpaces previous generation
High Street specialist The Game Group has reported record first half profits of GBP 36.4 million for the period ended July 31, 2008.
Total sales across the group were up 64.2 per cent, and 17.4 per cent on a like-for-like basis. Online performance for the company was up 80 per cent, accounting for GBP 32 million in sales.
"The business has performed extremely well with both turnover and profit growth throughout the group," commented Peter Lewis, chairman.
"We deliver a compelling customer experience. Our specialist proposition is centred around customer service, our pre-owned offer, our Reward Card and our online capabilities, all of which have contributed to this success."
The retailer said supply of Xbox 360, PlayStation 3 and Wii is strong, and the installed base is far outpacing the previous generation of home consoles.
"The third generation consoles are all in good supply. Demand has continued to be strong and the installed console base now stands at over 17.3 million in the key UK market.
"This level of console ownership has been achieved in just three years compared to second generation consoles which took a seven year period from 2000 until 2007 to reach similar levels," detailed Lewis.
He added that the business is aware of the current economic uncertainty, but remains positive that videogames offer value for money, and a widening of the demographic has opened up the market.
“We recognise the extraordinarily challenging and uncertain market conditions in which we are operating today, and we cannot be immune to wider economic uncertainties.
"However, we continue to be encouraged by the ongoing demand for third generation hardware and software which is in part being driven by the broadening demographic appeal. In addition, playing games provides a more affordable alternative to many other family leisure activities and we remain committed to delivering our customers the widest choice and value for money."
Following the merger with Gamestation, the integration of the business is performing better than expected, and the company expects the Gamestation business to contribute GBP 9 million to the full year, up from GBP 7 million.
The company is also set to acquire a 19-store specialist retail chain in the Czech republic, and extend its concessions deal with Borders in the UK to 33 stores.
The company has raised its full-year guidance for like-for-like sales from 5-10 per cent to 8-12 per cent.