The shock departure of Game Group's chief executive Lisa Morgan sent shares in the troubled video game retailer tumbling 12 per cent, as it reported a 27 per cent slump in underlying pre-tax profits for last year.
Ms Morgan will step down with immediate effect, meaning that non-executive director Chris Bell - the former Ladbrokes chief executive - has become interim CEO until a permanent replacement can be found. UK chief operating officer Terry Scicluna has also decided to quit.
To be fair to the departing executives, the games industry is in the midst of a cyclical downtrend, so the 15 per cent dip in like-for-like sales and resultant effect on profitability was unavoidable. However, the decline in the core UK business has accelerated since the year-end, with like-for-like sales down 20.1 per cent in the last 11 weeks. "The poor UK performance perhaps explains the management departures," said analyst Freddie George at Seymour Pierce.
Broker Execution Noble expects pre-tax profits of £71.5m and EPS of 14.6p this year (2010: £90.4m /19.2p).
| ORD PRICE: | 89p | MARKET VALUE: | £309m | |
| TOUCH: | 89-90p | 12-MONTH HIGH: | 224p | LOW: 77p |
| DIVIDEND YIELD: | 6.5% | PE RATIO: | 5 | |
| NET ASSET VALUE: | 96p* | NET CASH: | £44.9m | |
| Year to 31 Jan | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2006 | 0.65 | 5.4 | 0.8 | 2.50 |
| 2007 | 0.80 | 29.5 | 6.3 | 2.90 |
| 2008 | 1.49 | 68.0 | 13.8 | 4.40 |
| 2009 | 1.97 | 117.4 | 24.2 | 5.50 |
| 2010 | 1.77 | 84.2 | 17.5 | 5.78 |
| % change | -10 | -28 | -28 | +5 |
Ex-div:23 Jun Payment:16 Jul *Includes intangible assets of £180m, or 52p a share | ||||
