Copyright 2004 Eidos Press Release

[ September 15th 2004 ]

Eidos has posted a 2.9 million pound year-end net loss after sales slumped, but its shares have jumped as the video game maker says discussions on a possible sale of the firm are progressing well. Eidos EID.L , Britain's largest independent video games company and creator of the "Tomb Raider" video games franchise, said on Wednesday sales for the year to June 30 fell 11.6 percent to 133.9 million pounds. The company was hit particularly hard by weaker sales in its top market, the United States, it said.

The once high-flying Eidos is feeling the pinch of a brutally competitive market. The $30 billion video games industry continues to grow at record levels, but competition for shelf space is getting exceedingly difficult. A year of missed sales targets has forced a host of mid-sized developers to sell out to larger rivals, a prospect that Eidos is now exploring. Last month, Eidos confirmed it had received expressions of interest from a number of firms.

"Discussions, which relate to a possible sale of the company, are progressing well, although there can be no certainty at this stage as to whether or not they will lead to an offer being made for the company," Eidos said in a statement. A host of rivals ranging from France's Ubi Soft to American heavyweights Electronic Arts and Microsoft have been tipped as potential buyers. At 9:19 a.m., shares in Eidos were trading up 3.3 percent at 110 pence. The company said the decision to push back the release date of "Shellshock: 'Nam 67" from June to September meant the expected turnover would be deferred to the current fiscal year, ending June 30, 2005.


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