Losses double at Irish arm of Gamestop
Strong sales of the best-selling game Call of Duty: Modern Warfare 3 were not enough to prevent losses more than doubling at the Irish arm of Gamestop last year.
New figures show that pre-tax losses at Gamestop Group increased by 148 per cent from €3.36 million to €8.36 million in the 12 months to the end of January 28th last year.
A major factor behind the increased losses at the Irish unit of the world’s largest game retailer was a €3.3 million fundamental organisation last year following a €556,109 cost under the same heading the previous year.
Call of Duty: Modern Warfare 3 grossed over $1 billion in sales worldwide in 2011, and contributed to Gamestop’s revenues of €57.3 million in Ireland, a 7 per cent drop on the revenues of €61.9 million in 2010.
Operating losses at the group last year were €3.4 million compared to €2 million in 2010. The fundamental organisation costs, a loss of €680,699 on the disposal of a fixed asset and interest charges of €883,416 added to the losses.
The nature of the fundamental organisation is not specified in the accounts. However, during the year under review the group exited the UK market, involving the closure of its three Northern Ireland stores in January 2012.
Gamestop Ireland has close to 50 outlets in the Republic.
According to the directors’ report: “Both the level of business and the end-year financial position were considered satisfactory in light of the current global economic downturn and the lifecycle stage of the current generation of computer consoles.”
Staff at the group last year declined from 419 to 397, with employment costs rising from €7.87 million to €8.35 million.