Markets
BUSINESS NEWS
- Market News
- Earnings
- Recalls
- Recession Watch
- Tech News
- Financial Crisis
- Madoff Scandal
- DailyFinance
- BloggingStocks
- Luxist
- Money Videos
INVESTING
- Stock Quotes
- Stock Charts
- Stock Ticker
- Currencies
- Portfolio
- Stock Screener
- Broker Center
- Mutual Fund Center
- ETF Center
- Money
- 24/7 Wall St.
- Financial Glossary
PERSONAL FINANCE AT WALLETPOP
- Bargains
- Banking
- Budget
- Calculators
- College Finance
- Community
- Credit
- Deals
- Debt
- Economizer
- Food
- Home
- Fraud
- Insurance
- Interest Rates
- Loans
- Mortgages
- Real Estate
- Recalls
- Recession
- Retirement
- Saving
- Simplification
- Specials
- Taxes
SMALL BUSINESS
THQ Reports Fiscal 2008 Fourth Quarter Results
| -- | For the fiscal year ending March 31, 2009, THQ expects net sales in the range of approximately $1,175 million to $1,200 million and operating margins in the high single digits, resulting in earnings per diluted share in the range of approximately $0.95 to $1.05. | |
| -- | For the fiscal first quarter ending June 30, 2008, THQ expects to report net sales in the range of approximately $115 million to $125 million and a net loss per share in the range of approximately $0.38 to $0.42. The anticipated loss reflects a light product release schedule and the timing of expenses. |
| -- |
The company recently strengthened its portfolio of licensed franchises with the addition of: |
|||
|
-- a new relationship with DreamWorks Animation to publish games based on the studio's 2010 fall animated feature film; and |
||||
|
-- WWE Legends of Wrestlemania, which is scheduled for the fourth quarter of fiscal 2009. |
||||
| -- |
The company enhanced its offering of online and casual games with the addition of: |
|||
| -- a co-publishing agreement with Shanda Interactive Entertainment Limited to bring Company of Heroes Online to the Chinese market in fiscal 2009; and | ||||
|
-- the acquisition of Elephant Entertainment. |
||||
| -- |
THQ unveiled an extensive line-up of new original games designed specifically for the Nintendo Wii, including de Blob, Deadly CreaturesTM, Big Beach SportsTM and All Star CheerTM. |
|||
| -- | THQ strengthened its Studio System with the acquisition of Big Huge Games and the appointment of two new executives to help drive improved product development execution and new intellectual property creation. | |||
| -- |
THQ shipped 6 million units of WWE SmackDown vs. Raw 2008, driving THQ's third consecutive year as the #1 fighting publisher, with a 33% market share in the US, according to the NPD Group. |
|
| -- | Lifetime shipments of THQ's games based on Nickelodeon and WWE each surpassed $1 billion. | |
| -- |
THQ shipped more than 1.5 million units of the #1 off-road racing game, MX vs. ATV Untamed, bringing life-to-date franchise shipments to 6.5 million units. |
|
| -- |
THQ established two new original franchises: Frontlines: Fuel of War and Drawn to LifeTM. |
|
| -- | THQ's international net sales increased significantly, to 51% of total global net sales from 42% a year ago, as THQ continued to execute on its international growth strategy. |
During fiscal 2008, the company repurchased $54.9 million of common stock. The company currently has $28.6 million authorized and available for repurchase.
Non-GAAP Financial Measures
In addition to results determined in accordance with GAAP, THQ discloses certain non-GAAP financial measures that include deferred revenue and expenses, and exclude stock-based compensation expense and related income tax effects. The non-GAAP financial measures included in the earnings release have been reconciled to the comparable GAAP results and should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results.
Stock-Based Compensation. When evaluating the performance of its business, THQ does not consider stock-based compensation charges. Likewise, THQ excludes stock-based compensation expense from its short and long-term operating plans. In contrast, THQ’s management team is held accountable for cash-based compensation and such amounts are included in the company’s operating plans. In addition, the stock-based compensation charges are subject to significant fluctuation outside the control of management due to the variables used to estimate the fair value of a share-based payment, such as, THQ’s stock price, interest rates and the volatility of THQ’s stock price. Further, when considering the impact of equity award grants, THQ places a greater emphasis on overall shareholder dilution rather than the accounting charges associated with such grants.
Deferred Revenue/Costs. Due to the significant online functionality of Frontlines: Fuel of War, the company recognizes revenue and costs from the sale of this title over the estimated online service period. Although THQ will defer the recognition of a significant portion of its net revenue and costs, there will be no adverse impact to its operating cash flow. Internally, THQ excludes the impact of the change in deferred net revenue and costs related to packaged games in its non-GAAP financial measures when evaluating the company’s operating performance, when planning, forecasting and analyzing future periods, and when assessing the performance of its management team. The company believes that excluding the impact of the change in deferred net revenue and costs from its operating results is important to facilitate comparisons to prior periods during which the company did not publish any titles that required deferral of revenue and costs.
In the financial tables below, THQ has provided a reconciliation of the most comparable GAAP financial measure to each of the historical non-GAAP financial measures used in this press release.
Investor Conference Call
THQ will host a conference call to discuss fiscal fourth quarter results today at 2:00 p.m. Pacific/5:00 p.m. Eastern. Please dial 877.356.8075 or 706.902.0203, conference ID 44843020 to listen to the call or visit the THQ Inc. Investor Relations Home page at http://investor.thq.com. The online archive of the broadcast will be available approximately two hours after the live call ends. In addition, a telephonic replay of the conference call will be provided approximately two hours after the live call ends through May 8, 2008, by dialing 800.642.1687 or 706.645.9291, conference ID 44843020.
About THQ
THQ Inc. (NASDAQ: THQI) is a leading worldwide developer and publisher of interactive entertainment software. Headquartered in Los Angeles County, California, THQ sells product through its global network of offices located throughout North America, Europe and Asia Pacific. More information about THQ and its products may be found at www.thq.com and www.thqwireless.com. THQ, THQ Wireless, Big Huge Games, All Star Cheer, Big Beach Sports, Darksiders, de Blob, Deadly Creatures, Drawn to Life, Frontlines: Fuel of War, MX vs. ATV Untamed, Red Faction: Guerrilla, Saints Row 2 and their respective logos are trademarks and/or registered trademarks of THQ Inc.
All other trademarks are trademarks or registered trademarks of their respective owners.
This press release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, the company’s expectations for revenue and earnings per share for the quarter ending June 30, 2008, and the fiscal year ending March 31, 2009, and for the company’s product releases and financial performance in future periods. These forward-looking statements are based on current expectations, estimates and projections about the business of THQ Inc. and its subsidiaries (collectively referred to as “THQ”) and are based upon management’s beliefs and certain assumptions made by management. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements, including, but not limited to, economic, competitive and technological factors affecting the operations, markets, products, services and pricing of THQ. Unless otherwise required by law, THQ disclaims any obligation to update its view on any such risks or uncertainties or to revise or publicly release the results of any revision to these forward-looking statements. Readers should carefully review the risk factors and the information that could materially affect THQ’s financial results, described in other documents that THQ files from time to time with the Securities and Exchange Commission, including its Quarterly Reports on Form 10-Q and its Annual Report on Form 10-K for the fiscal period ended March 31, 2007, and particularly the discussion of risk factors that may affect results of operations set forth therein. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.
| THQ Inc. and Subsidiaries | ||||||||||||
| Unaudited Consolidated Statements of Operations | ||||||||||||
|
(In thousands, except per share data) |
||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||
| March 31, | March 31, | |||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||
| Net sales | $ | 187,024 | $ | 172,089 | $ | 1,030,467 | $ | 1,026,856 | ||||
| Costs and expenses: | ||||||||||||
| Cost of sales – product costs | 82,365 | 63,332 | 389,097 | 351,449 | ||||||||
| Cost of sales – software amortization and royalties | 54,621 | 25,098 | 231,800 | 165,462 | ||||||||
| Cost of sales – license amortization and royalties | 13,274 | 12,630 | 99,524 | 99,533 | ||||||||
| Cost of sales – venture partner expense | 2,815 | 1,745 | 24,056 | 16,730 | ||||||||
| Product development | 34,365 | 23,271 | 128,869 | 97,105 | ||||||||
| Selling and marketing | 39,793 | 23,109 | 175,288 | 139,958 | ||||||||
| General and administrative | 17,632 | 19,142 | 69,901 | 78,413 | ||||||||
| Total costs and expenses | 244,865 | 168,327 | 1,118,535 | 948,650 | ||||||||
| Income (loss) from continuing operations | (57,841 | ) | 3,762 | (88,068 | ) | 78,206 | ||||||
| Interest and other income, net | 2,096 | 3,751 | 15,433 | 12,822 | ||||||||
| Income (loss) from continuing operations before income taxes and minority interest | (55,745 | ) | 7,513 | (72,635 | ) | 91,028 | ||||||
| Income taxes | (21,214 | ) | 1,991 | (35,785 | ) | 26,206 | ||||||
| Income (loss) from continuing operations before minority interest | (34,531 | ) | 5,522 | (36,850 | ) | 64,822 | ||||||
| Minority interest | ─ | ─ | ─ | 136 | ||||||||
| Income (loss) from continuing operations | (34,531 | ) | 5,522 | (36,850 | ) | 64,958 | ||||||
| Gain on sale of discontinued operations, net of tax | ─ | 973 | 1,513 | 3,080 | ||||||||
| Net income (loss) | $ | (34,531 | ) | $ | 6,495 | $ | (35,337 | ) | $ | 68,038 | ||
| Earnings (loss) per share – basic: | ||||||||||||
| Continuing operations | $ | (0.52 | ) | $ | 0.08 | $ | (0.55 | ) | $ | 1.00 | ||
| Discontinued operations | ─ | 0.02 | 0.02 | 0.05 | ||||||||
| Earnings (loss) per share – basic | $ | (0.52 | ) | $ | 0.10 | $ | (0.53 | ) | $ | 1.05 | ||
| Shares used in per share calculation – basic | 66,392 | 66,052 | 66,475 | 65,039 | ||||||||
| Earnings (loss) per share – diluted: | ||||||||||||
| Continuing operations | $ | (0.52 | ) | $ | 0.08 | $ | (0.55 | ) | $ | 0.96 | ||
| Discontinued operations | ─ | 0.01 | 0.02 | 0.05 | ||||||||
| Earnings (loss) per share – diluted | $ | (0.52 | ) | $ | 0.09 | $ | (0.53 | ) | $ | 1.01 | ||
 Latest Money News
Picks & More From Jim CramerTop Money Features | ||||||||||||