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Interim Results

GAME Digital pre-tax profits fall

23 March 2016 08:31

GAME Digital posts pre-tax profits of GBP22.5m for the 26 weeks to 23 January - 32.2% down on a year ago.

Revenues fell byu 6.3% to GBP549.2m and the interim dividend of 1.67p oper share is down from 7.35p last time.

Adjusted EBITDA of GBP33.1 million was down 23% on a year ago but,ahead of cGBP30 million guidance provided in January.

Chief executive Martyn Gibbs said: "Operating in the fast-paced video games industry continues to present both opportunities and challenges to our business. Market dynamics in the UK were challenging during our peak trading period, although sales trends improved in the last week of December and first three weeks of January.

"In January we launched a review of the UK business and are committed to rapidly implementing measures to respond to current market trends. As well as pursuing commercial opportunities we are focussed on driving improvements in the consumer proposition and realising operational efficiencies to improve our performance. In Spain the Group delivered another strong performance in the first half, with increased sales, profits and market share.

"I remain confident in the prospects for the Group. We are making good progress driving retail and business diversification, with strong growth delivered in higher margin categories such as preowned phones and tablets, PC accessories and licensed merchandise. In addition, sales of digital content were up almost 10% and our customer engagement metrics remain positive. At the same time we expect the impact of falling legacy software sales to lessen in the future.

"Increasing engagement with gaming communities and broadening our offer, both within and beyond retail, sits at the heart of our strategy. We are committed to investing in our teams and core foundations to support our plans for the business. The development of our competitive gaming, eSports and gaming events continue to progress rapidly at Multiplay, and we are looking to develop similar activities in Spain through the acquisition of SocialNAT. I also believe that the potential for Clanforge, our consumer and enterprise server management software, will continue to grow as we engage with our broad supplier base. I remain excited by our plans for the business and the opportunities ahead of us."

At 8:31am: (LON:GMD) Game Digital share price was -2.75p at 123.75p

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