Midway Games Widens Loss - TheStreet

Game publisher

Midway Games


widened its quarterly loss amid a flurry of charges, as it continues to get its house in order.

The once-mighty publisher of legendary favorites



Spy Hunter

lost $25 million, or 54 cents a share, compared with a loss of $2.7 million, or 7 cents a share, in the year-ago period.

Excluding charges related from write-downs, income tax expenses and restructuring charges, the company lost $6.2 million, or 13 cents a share.

Sales grew 83% in the quarter to $80.2 million from $43.7 million in the prior year. But several key titles suffered lackluster sales, including a remake of the classic



Wall Street analysts had expected the company to turn in a 7 cent-a-share loss on sales of $76.87 million, according to Thomson Financial/First Call. The company slashed its own guidance in late December, saying it would lose $15 million to $40 million, on sales of $78 million to $83 million.

For the full year, Midway lost $73.6 million, or $1.61 a share, compared with a loss of $66.8 million, or $1.75 a share, in 2001. Excluding more than $25 million in income tax and preferred stock charges, the company lost $36.9 million.

Sales improved 65% to $191.9 million from $116 million in the prior year.

Looking ahead, the company expects to lose $3 million to $5.5 million on a pretax basis in the first quarter, on sales of $40 million to $45 million. It also expects to incur restructuring charges of $6.2 million as it consolidates several California development studios.

For the full year, it expects to return to profitability on a pretax basis of $20 million to $30 million, excluding restructuring charges. Sales for 2003 are projected to be $250 million to $275 million.

Ahead of the report, Midway ended the day down 8 cents, or 2.4%, at $3.29.