Acclaim Entertainment Inc., a leading worldwide developer, publisher and
mass marketer of software for use with interactive entertainment, reported
its results for the first quarter of fiscal 2000 ended November 30, 1999.
Net revenues for the quarter were $101.2 million, compared with $104.8
million in the first quarter of the prior year. Net earnings for the
quarter were $0.4 million, or $0.01 per diluted share, compared with net
earnings of $10.3 million or $0.16 per diluted share for the same period in
the prior year. The quarter results were effected by the shifting of
certain product launches to the second quarter, US$6 million in royalty
expenses to extend the WWF license through November 2000 and slower than
expected sales of certain products. During the quarter, Acclaim introduced
multiple titles for the Sega Dreamcast, and introduce its first two titles
under its new brand, Club Acclaim, which targets a younger audience and
included Acclaim's Mary-Kate & Ashley titles for both Color Game Boy and
PC. Hoping to boost sales in the second quarter, Acclaim will release 13
new titles, led by the launch of ECW HARDCORE REVOLUTION, which capitalizes
on Acclaim's proven expertise in wrestling games, and SOUTH PARK RALLY,
which translates the humor of SOUTH PARK into a kart-style racing game.
Other key releases for the second fiscal quarter include SHADOW MAN and
RE-VOLT for Sega Dreamcast, ARMORINES for Nintendo 64, and two more
Mary-Kate & Ashley titles. Looking to the future, Acclaim is developing a
broad range of new titles for new and existing platforms. Key products in
development include: FURFIGHTERS for Sega Dreamcast; VANISHING POINT, a
road-rally game featuring more than two dozen licensed road cars for
PlayStation; DAVE MIRRA FREESTYLE BMX, an extreme sports title co-developed
by and featuring X-Games stars Dave Mirra and Ryan Nyquist; a sequel to
Acclaim's multi-million selling TUROK franchise; new additions to Acclaim
Sports' popular JEREMY MCGRATH SUPERCROSS, ALL-STAR BASEBALL, NBA JAM and
NFL QUARTERBACK CLUB brands; and new racing games based on both the Ferrari
and Ducati licenses. For the upcoming PlayStation 2, the company plans to
have a minimum of three titles available during the initial launch. Acclaim
also anticipates growth in its increasing investment in the Internet. A key
element of Acclaim's Internet development capability is its proprietary
NetSpine technology, which will allow the company to build games faster,
more cost-effectively and with superior functionality across multiple
platforms. Using NetSpine, Acclaim intends to make one of its core brands
the first truly Internet-playable product. Acclaim is also looking at
potential acquisitions of on-line development studios, and has initiated
discussions regarding partnership opportunities with major Internet
players. Acclaim On-line already boasts a consumer base of approximately
500,000, with traffic increasing 25% in December alone. "As the interactive
marketplace evolves, we are focused on strategic initiatives designed to
build our business for the future," said Gregory Fischbach, Co-Chairman and
CEO of Acclaim. "We have enhanced our in-house development capability to
take advantage of the growth in the industry as a result of the launch of
the next generation console systems. In addition, we are putting in place a
brand development structure that increases our responsiveness to consumers
and are expanding our on-line initiatives to take advantage of our
proprietary NetSpine Internet technology."