'Rigorous restructuring' for CDV
Expected losses of four million Euro have forced German publisher CDV to take action, with redundancies expected to "impact all areas of the company".
CDV Software Entertainment has announced a programme of 'rigorous restructuring measures' after it revealed that it expects to make a Q2 pre-tax loss of EUR 4 million for the three months to June 30th, despite sales of EUR 4 million comparing favourably to last year.
The four million deficits compare to just one million in the same quarter last year, and were blamed on the perennial publisher nightmare of slippage, along with certain products not performing up to expectations.
As a result, the spectre of redundancy hangs over the company, with culls expected to "impact all areas of the company" and be carried out quickly by "allowing limited work contracts to expire and also by operation-related notices of termination." It is not yet known how many staff will be affected as a result of the restructuring.
The firm blamed the expectation of much higher growth, with the soon-to-be released Heaven And Hell fingered as an underachiever, some EUR 930,000 below CDV's target. Meanwhile, Galaxy Andromeda has been canned, with an as-yet-unannounced sum taken into account in its figures.
The gloomy assessment by the CDV board continued, with the company admitting it "no longer expects a positive result for the whole of the financial year... despite the very promising product pipeline for the second half of this year". CDV made a small loss of EUR 185,000 in the 2001/2 financial year.
Shares in the company dipped dramatically after the announcement, and at the time of going to press stood at EUR 3.7, significantly down on the levels reached in June, when the price hit over EUR 5.5.