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Funcom Q1 Losses Mount Prior To Conan Launch
by David Jenkins
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May 13, 2008
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Officials from Norwegian publisher and developer Funcom have released details of the company’s first quarter financial results, for the three months ended March 31st.
During this period the company saw an EBIT (earnings before interest and taxes) loss of $3.13 million, up from $1.21 million at the same time last year.
Earnings after tax, though, saw an improvement from a $0.22 million loss last year to a $0.92 million profit this year, primarily attributed to currency fluctuations and tax income.
Sales increased slightly from $1.64 million to $1.80 million for the three month period, with revenues resulting from existing titles Anarchy Online and the company's mobile subsidiary Plutolife described as “steady”.
With its key massively multiplayer online title Age of Conan: Hyborian Adventures yet to launch, the figures were within the company’s expectations, with EBIT in particular affected by increased sales and marketing activities in the run up to the launch.
With a cash balance of $46.99 million and low interest bearing debt, the company says it is well placed to ensure a successful launch, with over one million users having submitted beta application to the game and five million unique users visiting the website.
Nevertheless, in a list of key risks during the launch period, the company identifies the potential for technical issues related to server and client performance, as well as the difference in performance between different PC configurations.
Post launch, the company lists the quality of gameplay as a key risk, as well as the speed taken to address technical issues and possible inaccuracies in subscription level predictions based on current pre-orders.
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