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News   Midway Announces Fiscal Results and Transition Strategy
- Posted By Michael Loewer, 09.05.2001

This one is for you hardcore investment people, as stated by Midway:

"For the fiscal year ended June 30, 2001, revenues were $168,208,000 compared with revenues of $333,865,000 in fiscal 2000. The pro-forma loss applicable to common stock for the 2001 fiscal year, excluding restructuring charges and the imputed dividend and including an income tax credit for operations after December 31, 2000 as previously discussed, was $40,441,000, $1.07 per share. Including the restructuring charges and the imputed dividend and excluding a tax credit for operations after December 31, 2000, the loss applicable to common stock for fiscal 2001 was $69,335,000, $1.84 per share."

As for the reason behind the loss of revenues (and Midway's transition strategy):

"The decrease in revenues and increase in loss applicable to common stock are a result of the Company's previously announced downsizing of, and exit from, the coin-operated games business and the home console transition strategy that was implemented in response to the difficult market conditions during the industry's transition from 32 and 64-bit consoles to the new, advanced technology consoles including PlayStation 2, GameCube and Xbox. As a result of the exit from coin-op and the home transition strategy, the Company cancelled several coin-op and 32 and 64-bit home products scheduled for release during fiscal 2001 in order to significantly increase the number of new next-generation products scheduled for release during the year ending December 31, 2002, when there is expected to be a major increase in demand for next-generation software. Canceling products resulted in decreased revenue, and the overall impact of the transition strategy on profitability was compounded by the need to increase research and development spending during fiscal 2001 in order to have top-quality products available in the year ending December 31, 2002 and beyond. The Company is now confident that the industry platform transition will soon be complete, and the benefits of this transition strategy will soon be apparent with a major increase in new next-generation product introductions and significant increases in revenues and profits. Midway now has over 45 next-generation console products scheduled for release between September 2001 and December 2002."

Midway also published their tentative release schedule for all platforms through December 31st, 2002. Look for that article soon.


Senior Editor Michael Loewer, signing off.
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