My 1st post on Money am, so be gentle ;)

My main holding is SCi Entertainment, a former darling pre-bubble. It like many in early 2000 had a shocker of a profit warning, but has since grown up, knuckled under and generating cash.

Its recent history speaks for itself

30 Sep 2001 (GBP)
turnover 2.05m
pre tax profit -10.48m

30 Sep 2002 (GBP)
turnover 17.71m
pre tax profit 2.21m

30 Sep 2003 (GBP)
turnover 28.48m
pre tax profit 3.52m

Everything inline for 2004, although by my research 2004 H1 well ahead.

Single digit pe and loads of growth.

However, hardly any interest by the retail investor. In fact, this looks to be the 1st thread on Money am re SEG.

So why the cold shoulder for SEG, what am I missing?

I see, I said be gentle with me, not blank me ;)

Unloved and going up, stock shortage too, I can live with that.

With the release of EMP results Friday I have been analysing all my data to see how SCi data compres with EMP. Whilst researching I was struck by a comment by Paul Scott after his return from the EMP analysts meeting.

His post on various bb's concluded:

"I wasn't bowled away by these figures, but thought they were pretty solid, importantly showing that EMP is trading around breakeven, with no blockbuster products. So the upside is clearly that they get one of more blockbuster. And the nature of the industry is that, once you have one blockbuster, you release numerous versions, to milk it for a few years. SCi Entertainment have achieved this with Desert Storm, so it can be done ! Incidentally, SCi is valued at 35m, or nearly 5 times EMP's mkt cap, and has similar turnover, so that gives you an idea of the upside if EMP do crack it."

Now Paul may have stumbled on the answer I have been looking for sometime. The question being why is there little retail interest in SCi other than longterm holders whilst as per SCi's AGM institutions are buying. His comments say to me SCi have "milked" Desert Storm and its all in the price. Well my data suggests its only just begun and very little of it is in the price. Is this why retail is not buying SCi, they think its all in the price?

Here is an attempt to show how little is in the price and how the EMP and SCi are doing at retail here and in USA.

I'll start with USA as I am able to quote actual NPD numbers. These are not what the Publishers sell to retail but what retail sells to consumers. It indicates what is selling and at what price point. It is a guide to future results and is extrapolated figures from 40% of US retail but does not include some of the larger retailers like Walmarts and Toys r us. It also does not include PC sales data or Canadian sales data which is included in the publishers results.

2002

EMPIRE

Their US distribution upto Dec'02 was through Vivendi on the EMP label. They have since moved away from the job lot scenario and seem to be distributing on a game by game basis to get the most out of a single product. Their '02 US revenue was 9.853 with over half (5.091m) in H1 despite new releases in H2.

PSX FORD RACING Jan-01 EMPIRE INTERACTIVE 39,647 514,651 $6.27 $248,404
PSX PRO PINBALL FANTASTIC Oct-00 EMPIRE INTERACTIVE 15,123 214,337 $7.59 $114,812
PSX PRO PINBALL BIG RACE Aug-00 EMPIRE INTERACTIVE 6,688 351,032 $7.35 $49,159
PS2 ANTZ EXTREME RACING Sep-02 EMPIRE INTERACTIVE 5,216 8,213 $19.61 $102,292
PSX SPEEDBALL 2100 Oct-00 EMPIRE INTERACTIVE 5,032 114,340 $8.35 $42,022
PS2 ENDGAME Jun-02 EMPIRE INTERACTIVE 3,477 20,233 $29.04 $100,986
PSX SHEEP Nov-00 EMPIRE INTERACTIVE 2,140 40,462 $6.18 $13,223
XBX ANTZ EXTREME RACING Sep-02 EMPIRE INTERACTIVE 1,888 3,512 $22.58 $42,632
PSX PIPE DREAMS 3D Oct-01 EMPIRE INTERACTIVE 1,808 121,789 $7.07 $12,778
PSX SPIN JAM Aug-00 EMPIRE INTERACTIVE 1,624 144,440 $10.13 $16,451
PS2 VICTORIOUS BOXERS Nov-01 EMPIRE INTERACTIVE 300 34,894 $20.75 $6,224
PS2 TOTAL IMMERSION RACNG Nov-02 VIVENDI UNIVERSAL 7,264 8,721 $19.79 $143,783
XBX TOTAL IMMERSION RACNG Nov-02 VIVENDI UNIVERSAL 2,179 2,838 $31.44 $68,484

So back catalogue falling away and new releases failing at retail. These sort of numbers would I'm sure have gone a long way to EMP changing US deals.

SCI ENTERTAIMENT

Firstly SCi's results do not fall nicely into calendar years so it is a little out of kilter with yearly reports. How ever much of what I have collated is monthly so can get a more precise look. Upto SEP '02 US revenue was 2.259m this was mainly the US minimum gurantee from TTWO for CDS and TIJ, since CDS was released 1st week of October. So apart from TIJ PSX and few CDS as the Sept data runs into 5th Oct there is little to show for the revenue.

FORMAT DESCRIPTION GENRE INTRO DATE CORPORATE PUBLISHER UNITS SEPT 2002 UNITS LTD 95-02 AVG$ SEPT 2002
XBX CONFLICT:DESERT STORM ACTION SEP'02 TAKE 2 INTERACTIVE 17,461 17,461 $51.54
PS2 CONFLICT:DESERT STORM ACTION SEP'02 TAKE 2 INTERACTIVE 11,682 11,682 $51.55
PSX THE ITALIAN JOB COMBAT RACING APR'02 TAKE 2 INTERACTIVE 15,410 112,790 $11.33

To bring the data into line with EMP Dec '02 data looked like this.

PS2 CONFLICT:DESERT STORM Sep-02 TAKE 2 INTERACTIVE 111,250 243,721 $49.78 $5,537,832
XBX CONFLICT:DESERT STORM Sep-02 TAKE 2 INTERACTIVE 52,490 146,407 $49.33 $2,589,476
PSX THE ITALIAN JOB Apr-02 TAKE 2 INTERACTIVE 25,565 163,237 $10.21 $260,895

H1'03

EMPIRE

Now for EMP's H1 there is a large descrepency with sales data and H1 revenue. H1 revenue in the US was 7.566m yet their are hardly any sales.

PS2 VICTORIOUS BOXERS EMPIRE INTERACTIVE Nov-01 36,973 $1,729,631
PS2 ENDGAME EMPIRE INTERACTIVE Jun-02 26,601 $865,262
PS2 ANTZ EXTREME RACING EMPIRE INTERACTIVE Sep-02 11,935 $233,136
XBX ANTZ EXTREME RACING EMPIRE INTERACTIVE Sep-02 6,091 $144,275
PS2 TOTAL IMMERSION RACNG VIVENDI UNIVERSAL Nov-02 12,655 $250,134
XBX TOTAL IMMERSION RACNG VIVENDI UNIVERSAL Nov-02 5,492 $160,694

All of the above most likely would have already been accounted for so nowt there. However

PS2 BIG MUTHA TRUCKERS THQ Jun-03 16,862 $335,775
XBX BIG MUTHA TRUCKERS THQ Jun-03 7,595 $150,771

Unable to find any clues to shipout from THQI 10'q although it gets a mention

North America Net Sales

The net sales in North America for the three months ended June 30, 2003 as compared to the same period of 2002 remained relatively constant due to:

• An overall increase in the number of new titles released during the three months ended June 30, 2003 compared to the same period last year.

• The success of Finding Nemo on all platforms.

Offset by:

• An overall decrease in the weighted average selling price of our non-premium titles, in particular Big Mutha Truckers and Evil Dead: A Fistful of Boomstick for PlayStation 2 and Xbox.

• The release of WWE Wrestlemania X8 during the same period last year. We plan to release the annual installment to our WWE Wrestlemania series, WWE Wrestlemania XIX, during the three months ended September 30, 2003
*

So shippout of BMT and the only other explanation would be milestone payments from TTWO for S&H which may have tied into the PAL release date. There would have also been some PC shipouts to add to the total.

SCI ENTERTAINMENT

Since they only breakdown revenue by region in FY for the moment I will just show CDS LTD to Jun '03 inline with the above:

PS2 CONFLICT:DESERT STORM TAKE 2 INTERACTIVE Sep-02 349,455 $17,034,560
XBX CONFLICT:DESERT STORM TAKE 2 INTERACTIVE Sep-02 200,762 $9,812,909
GCN CONFLICT:DESERT STORM TAKE 2 INTERACTIVE Apr-03 9,020 $360,042

Full Year '03

EMPIRE

H2'03 revenue shows US to be 5.899m which is down on H1 NPD data shows the following:

July NPD

PS2 BIG MUTHA TRUCKERS $1,173,829 58,852
XBX BIG MUTHA TRUCKERS $421,866 21,185

EMPIRE INTERACTIVE $168,081 0.1%

August NPD

PS2 BIG MUTHA TRUCKERS $863,751 43,375
XBX BIG MUTHA TRUCKERS $323,151 16,245

EMPIRE INTERACTIVE $134,786 0.0%

September NPD

PS2 BIG MUTHA TRUCKERS $706,992 35,462
XBX BIG MUTHA TRUCKERS $230,014 11,558
GCN BIG MUTHA TRUCKERS $116,603 5,853

PS2 STARSKY & HUTCH $462,475 22,413
XBX STARSKY & HUTCH $207,958 10,057

EMPIRE INTERACTIVE $139,372 0.0%

October NPD

PS2 BIG MUTHA TRUCKERS $381,895 19,203
XBX BIG MUTHA TRUCKERS $128,877 6,475
GCN BIG MUTHA TRUCKERS $114,909 5,787

PS2 STARSKY & HUTCH $390,949 19,429
XBX STARSKY & HUTCH $138,791 6,807

PS2 FORD RACING 2 $13,579 1,339

EMPIRE INTERACTIVE $87,182 0.0%

November NPD

PS2 BIG MUTHA TRUCKERS $599,436 30,338
XBX BIG MUTHA TRUCKERS $169,341 8,577
GCN BIG MUTHA TRUCKERS $142,191 7,194

PS2 STARSKY & HUTCH $267,409 13,541
XBX STARSKY & HUTCH $89,164 4,523

PS2 FORD RACING 2 $642,291 65,966
XBX FORD RACING 2 $46,185 2,332

EMPIRE INTERACTIVE $326,176 0.0% 52,067

December NPD

PS2 BIG MUTHA TRUCKERS $1,192,808 60,317
XBX BIG MUTHA TRUCKERS $365,086 18,574
GCN BIG MUTHA TRUCKERS $310,232 15,727

PS2 STARSKY & HUTCH $555,326 27,984
XBX STARSKY & HUTCH $222,030 11,198

PS2 FORD RACING 2 $475,864 43,692
XBX FORD RACING 2 $117,588 5,944

EMPIRE INTERACTIVE $285,663 0.0%

So there is still some revenue from the old Vivendi deal but it is falling and I doubt much of it would be new revenues. The sales in the six months of their 3 main games totals $10,870,590 although a lot of the initial ship of BMT will be in H1 and maybe even S&H if under milestone agreements. Also it may be possible some of S&H and FR2 may not be in EMP H2 due to TTWO timing of 1/4 statement. Comparing to UK EMP did have higher % of PC titles than SCi so this factor may explain the descrepency in H1 when comparing to NPD data.

SCI ENTERTAINMENT

US revenue upto SEP '03 shows 5.543 which is more than double SEP '04. However due to the 1/4 royalty statements from TTWO which arrive after the accounts are finalised this figure only includes goods shipped upto July '03, so the addition to the June '03 LTD above are.

PS2 THE GREAT ESCAPE $290,829 7,302
PS2 CONFLICT:DESERT STORM $246,334 6,102
XBX CONFLICT:DESERT STORM $141,737 3,632
XBX THE GREAT ESCAPE $116,107 2,922
GCN CONFLICT:DESERT STORM $112,713 3,279
PSX THE ITALIAN JOB $52,861 5,274

The other thing that will be included in FY is the minimum gurantee for CDS II. So the following have yet to hit the accounts less the minimum gurantee of CDS II.

August '03

PS2 THE GREAT ESCAPE $463,787 11,679
PS2 CONFLICT:DESERT STORM $180,969 5,131
XBX THE GREAT ESCAPE $121,975 3,089
XBX CONFLICT:DESERT STORM $118,561 3,507
GCN CONFLICT:DESERT STORM $103,803 2,865
PSX THE ITALIAN JOB $50,710 5,042

September '03

PS2 CONFLICT:DESERT STORM $435,166 21,287
PS2 THE GREAT ESCAPE $272,742 6,863
XBX CONFLICT:DESERT STORM $205,035 9,299
XBX THE GREAT ESCAPE $73,090 1,836
GCN CONFLICT:DESERT STORM $69,837 2,673
PSX THE ITALIAN JOB $44,836 4,415

October '03

PS2 CONFLICT: DESERT II $3,192,561 64,096
XBX CONFLICT: DESERT II $2,353,912 48,345
PS2 CONFLICT:DESERT STORM $355,255 17,872
PS2 THE GREAT ESCAPE $164,228 5,184
XBX CONFLICT:DESERT STORM $144,180 7,178
GCN CONFLICT:DESERT STORM $78,704 3,752
PSX THE ITALIAN JOB $43,166 4,305
XBX THE GREAT ESCAPE $36,175 1,030

November '03

PS2 CONFLICT: DESERT II $2,106,222 44,932
XBX CONFLICT: DESERT II $964,065 19,626
PS2 CONFLICT:DESERT STORM $627,339 33,981
XBX CONFLICT:DESERT STORM $265,740 13,702
PS2 THE GREAT ESCAPE $122,192 4,474
GCN CONFLICT:DESERT STORM $85,548 4,281
PSX THE ITALIAN JOB $50,921 5,043
XBX THE GREAT ESCAPE $35,946 1,332

December '03

PS2 CONFLICT: DESERT II $3,889,057 80,254
XBX CONFLICT: DESERT II $1,830,858 38,242
PS2 CONFLICT:DESERT STORM $1,520,332 84,744
XBX CONFLICT:DESERT STORM $667,309 38,287
PS2 THE GREAT ESCAPE $276,658 13,645
PSX THE ITALIAN JOB $175,487 17,550
XBX THE GREAT ESCAPE $116,865 5,681
GCN CONFLICT:DESERT STORM $75,214 3,773

So with all the good news about CDSII selling 20% more worldwide than CDS, there is still a fair chunk of CDS yet to hit the accounts let alone CDS II. Also a clue to shipout for CDS II was given in a TTWO CC after there Q4 results. They stated shippout of CDS II was 5% of their revenue. That equates to $14m ship and little wonder SCi could state CDS II was already earning royalty despite not having received the H1 quaterly statement (Nov '03 - Jan '04).

UK SALES

This data is far more in depth than NPD as it also cover PC, CT data claims to cover 85% of retail but they are copyrighted and I am unable to disclose numbers. However using EMP results it is possible to compare and contrast.

EMP results show UK revenue 7.191m for 2003.
Empires UK CT sales by value are broken up as follows:

FP = Full Price i.e. PS2,XBX,GCN,PC,GBA > 20
BP = Budget Price i.e. PS2,XBX,GCN,PC,GBA < 20

FP = 49.9%
BP = 16.9%
Xplosive = 33.2%

Empire in their results stated "As a result,
the revenues of this business grew over 50% in 2003, to #5m." So when you take their UK and European revenues 33.2% = 5.4m so the CT figures are in the right ball park when comparing to actual.

SCi's UK revenue for Oct '02 - Sep '03 = 11.244m so again the yearly data is out of kilter with SCi's results.

Firstly just to compare and contrast some EMP data with SCi data which may suprise a few peeps.

Half of EMP revenue comes from FP titles as shown above, SCi on the other hand is broken down thus:

FP 82%
BP 18%

When looking at units

EMP

FP 20.7%
BP (inc XP) 79.3%

SCi

FP 63%
BP 37%

These numbers alone go a long way to show why SCi is more profitable than EMP on lower revenue. The higher the price the higher the profit margin.

Half of EMP sales are at FP this is broken down by value as follows.

PC 41.3%
PS2 40.4%
XBX 10.2%
GBA 7.6%
GCN 0.5%

and by units

PC 44%
PS2 36.9%
GBA 9.4%
XBX 9.1%
GCN 0.6%

SCi's FP sales are broken down thus by value:

PS2 69%
XBX 22.5%
PC 6%
GCN 2.5%

and by units:

PS2 67.3%
XBX 22%
PC 8.1%
GCN 2.6%

The above shows how highly geared SCi are to console rather than PC.

Comparing some SCi games to EMP units

PC 44%
PS2 36.9% (The Great Escape and Futurama on PS2 sold 25% more units than all of EMP FP PS2 units)
GBA 9.4%
XBX 9.1% (The Great Escape and Futurama on XBX sold 39% more units than all of EMP FP XBX units)
GCN 0.6% (Rally Championship on GCN sold 99% more units than all of EMP GCN units)

One last comparison EMP largest seller by units all formats and prices was Starsky and Hutch on PS2, GBA, XBX, PC and GCN, SCi's The Italian Job on PSX and PC sold 5% more units last year.

Oh I forgot to mention CDS, in 2003 CDS and CDS II sold 29%more units at FP than all of EMP FP sales.

Now looking at SC's FY with CT we also get some eyeopeners. Bearing in mind 82% of SCi's sale are FP and of that 82%, 69% of those sales were PS2. This can then be broken down as follows by units as follows:

CDS II 46.9%
TGE 23%
CDS 16.9%
Futurama 11.5%
Rolling 1.7%

Now of those sales after SCi's year end (Sept)

CDS II 74.3%
TGE 53.5%
CDS 6% (went BP just after SCi YE)
Futurama 53%
Rolling 100% (Released after SCi's YE)

That all equates to SCi's FP sales after YE are 55.8%. Now obviously a lot of this would have been shipped prior to YE but it does show far behind SCi's results are to actual sales.

A clue to how much is yet to come can be found here http://www.gamesinvestor.com/Companies/SCi/SCi_News_03_04/sci_news_03_04.html where they state the following figures:

"C:DS has now sold in excess of 2m units to date and was the principal contributor to SCi's record back catalogue sales of 6.5m during the period. C:DS2 is already up to 1.2m units (it generated 11.3m in sales during the year with the US release falling in FY04) and is on course to surpass the original title. The Great Escape hit 500,000 units (7.1m in sales) during the period."

Now the 1.2m units for CDS II equates to sales 10 weeks after SCi's YE but the generated revenue in YE is 11.3m. Now of that we have the TTWO min gurantee which has been said to be similar to CDS. Now if we look at US sales in 2002 this is more or less the CDS minimum 2.259m. So being conservative let say 2m that leaves 9.2m shipped out across PAL. SCi's accounts show over 50% of PAL is UK, but this may be skewed to the success of The Great Escape in the UK so maybe 45/55% split could apply although that may be too conservative. Wholesale price for CDS II is over 22 and remainder of PAL over 17 but being conservative use 21 and 16 this would give units shipped approx UK 190k and PAL 320k. This gives a total of 510k units which is 10k more than Peels have forecasted for C:V which is supposed to be the same as CDS II.

So in the accounts to date are 500k CDS II, 2m units of CDS, 500k units TGE plus TTWO minimum gurantee.

Now the point of the post, SCi are milking the Conflict brand its there for all to see. In fact it was stated at the AGM, Pivotal (The developers of CDS and TGE) have developed games for SCi that have sold 4.7m units worldwide. The fact is the accounts are way behind the sales trend. As of the AGM I estimate nearly 1.5m units need to be accounted for but is growing daily. I could also mention SCi will now be retaining 25% of Pivotal royalties within the group since the purchase of Pivotal, but thats a whole different subject.

Well all that researched paid off with last weeks RNS confirming sales above expectations.

Here's some more research which will provide another RNS which is not in forecasts.

"Galleon will be released in Europe this June and will be published by SCi, but currently the title doesn’t have a North American publisher (we’ve been told they’re close to sealing a deal)"

http://www.gameinformer.com/News/Story/200404/N04.0402.1543.42370.htm

Wonder how long we will have to wait for this RNS ;)

Given the first review of Galleon in C+VG, which gave it 92% and a Gold rating, then i would expect someone in the USA to pick this up.

If that review score is reflected in the sales, then Galleon could sell quite a few more than i expected (i had it down as about the futurama level -i.e. profitable, but not mind blowing).

Down 9p earlier on now up 10p, What a star outfit these are.

One of the few tiddlers I touch.

Now up 19.5p just look at them go.

Bit of an early pull back today by the looks of things.

Finished up just under 10% today.

Can't remember seing such volume.

That time of year stan ,for these type of stocks.

Will try to get In If they drop the price again.

Bought some more, but they've shortened the market size..so short of stock.

Which only means one thing of course.

Stan one hell of a run in the last 20 months,some nice titles in there stable,if i had any seg,,which i dont ,,i would be looking at a 3 month period before i sold out at around 3.00,i have held eidos,but got fed up with it,so pulled out,,but now looking again,,remember its that time of year again for the game industry ,,

Goodluck.

Yep, I think there's a lot In what you say.


SCI Entertainment Group PLC
10 December 2004


SCi Entertainment Group plc ('the Company')

Holding in Company

On 10 December 2004 the Company received notification that as at 9 December
2004, Cantor Fitzgerald Europe has an interest in and is the registered holder
of 2,185,500 ordinary shares of 5p each in the Company amounting to 7.64 per
cent. of the current issued ordinary share capital.



This information is provided by RNS
The company news service from the London Stock Exchange

CF seem to have the same Idea Dave (just released).

Keep the faith stan,i wonder if it will rub off on eidos !!

Stan did here a whisper last week about this news,post 10,{time of year & christmas bonus},,but if you say to much on these boards & people in the know change there minds,,for what ever reason,,,you look a fool,be lucky stan.

I am looking at eidos again cheers dave.

Dave,I don't know much about the games business, but one thing I do know Is that SEG are publishers of the titles and not the makers of software which puts them In a strong position.

So can't say about Eidos, but believe that SEG are a better bet In the games sector.

Also I think Eidos have had their fair share of profit warnings In the past, but might be wrong In saying that, be carefull with them I would say

Stan,it will only be a short on eid,3 months max or 12%,,i think i will dig out the italian job tonight for the play station,off out now.

Hi Guys,

Well at last SCi are getting noticed amd all my research is paying off, haven't sold a single share in my core holding but have traded it up to add to the core holding. Its all rather exciting at the moment and there is lots more to come and the SP should more than double again on a twelve month view.

Whilst you have mentioned EID they are a terribly run company but am currently long for a possible takeover/mbo, may see a quid if were lucky but don't bank on it.

Now whilst everyone has been getting excited about SEG I have also been building up quite a holding in BIT. The reason is simple, SCi's buisness model works and at last the city has woken up to this fact. What the city has missed, whilst it works for SCi it also works for their developers. Constantine is SCi's next big release and BIT will benifit by having royalties guranteed as soon as the game is shipped to market. The amount obviously depends on the continued sales of the game but BIT will recieve approx 2 for every game sold over 300k units. With SCi's buisness model it quite likely the initial ship will be a minimum of 500k i.e. 400k straight to BIT bottom line, however Enter the Matrix has shipped in excess of 5m units so the scope for additional revenue is high. SCi have not capped BIT royalty, so if the game ships 1m that would be 1.4m to BIT, 1.5m would be 2.4m etc. etc.

If you take a look at BIT market cap, you may realise where I'm coming from.

Conclusion
SCi's track record over the last 7 years has been mixed. Record years had been followed by periods of heavy loss whilst accounting policy changes and non-games investments have not helped even out the Company's performance. However, many of the more fundamental problems experienced by SCi have been symptomatic of those experienced by nearly all small publishers with limited capital. With typical 18 month development cycles (and a further 3 months before cash tends to be received on any given product) and 1m-2m average development costs and further pre-release manufacturing and promotional costs, it is very difficult for smaller publishers, with limited working capital, to maintain a consistent flow of high quality product. In such situations, publishers tend to focus on niche or lower quality/cost products (difficult to get right and limited upside) or make a conscious decision to pursue an inconsistent release schedule in order to focus on high quality products. Whatever the strategy adopted, small publishers can often find themselves stuck in cash-flow rut and unable to grow either rapidly or consistently.
The 20m fund-raising in November 99 was a critical turning point for SCi. It has allowed the Company to increase its product investment and release momentum to a level which allows at least 3-4 major new titles to be released each year (thus considerably increasing the chance of a hit ) with the consequent cash flows allowing this momentum to be maintained in subsequent years even with average sales. The first fruits of this investment were felt during the Company's FY02 in which the Company established its first new 1m unit-selling franchise, Conflict, since Carmageddon and recorded record sales and profits. Since then the Company has not put a foot wrong and reported sales and profit increases in FY03 and are expecting further growth for FY04. The Company consolidated its high quality development focus in late 2003 with the acquisition of Conflict developer Pivotal in what should be regarded as one of the best games M&A deals of recent years. Although the purchase flies in the face of the Company's stated strategy of using third-party developers only, the consideration of 2.4m will be recouped within a year if not sooner and ensures the uninterrupted continuation of SCi's biggest franchise.

Vivendi Universal Games has denied that it has any interest in SCI Entertainment.

An article published in The Business earlier this week had suggested SCI, which recently acquired fellow UK publisher Eidos, might find itself the target of a takeover bid, and a list of potential suitors quickly grew to include Vivendi.

However, in a terse press release issued yesterday afternoon, the Paris-based games published refuted any such claim. "In view of articles published in the UK press, Vivendi Universal denies any interest in Sci Entertainment and also denies having made any offer," the statement read.

One company put forward as a potential buyer by analyst Nick Gibson in the Business piece was Midway Games. Gibson said of a potential match between Midway and SCI, "they both would benefit from the synergies of being put together".

Midway was anticipating a massive loss of $95 million for the full fiscal year. The charges outlined in its SEC filing could make the situation even worse

Massive selling today...dropping by 40p to 485p

time to take a new look at this computer programme publisher ..... sp has now surged through a pretty stubborn resistance at 500 and has plenty of steam ....... volumes tend to be modest at +/-600k and have already shot past that today ..... Perhaps more importantly, price tracked back to test 200 dma and bounced firmly back up with seeming impetus behind it.




Green line = 200 dma
Red line = 50 dma

i'm nuts! ... or at least i think i must be, for i still hold this stock, though the chart is VILE ..... strange thing is, the company seems to have done nothing wrong, comes out with a positive announcement this morning, yet sp tanks ..... there are some indications of a resistance just below the current level (see longer range chart), but hope i resist the temptation to average down .... after all, i tell everyone else not to!

This one usually comes good in the second half of the year if my memory serves me right.

it needs to perform the lazarus trick!

I was amazed to see the shares falling further. I firmly believe this company is on the right track and with them managing to secure the advertising rights of the new hit series called Heroes on Sci Fi then i thought it was the right time to back them. Heroes, is making huge Impact in the states and seemingly in the new "Lost". Great progamme if your into that sort of thing. I'm in for the long haul!

very good bounce today, but am still glad i resisted the temptation of averaging down, for i know that is the route to perdition

Shot up to 350p (over 16%) from 2pm to now.

Large volume but no news out yet.

And here's the reason why http://www.moneyam.com/action/news/show/Article?id=2222640up another 14%.

Up another 11% as two more bids come in

http://www.moneyam.com/action/news/showArticle?id=2273789

Sliding today to 275p, likely Mr Tchenguiz has sold out of it to pay up for SBRY misery.

Closed at 248p today

not often that a company that is a t/o target dives to the depths .... story is that the company is worth bugger all and that is all they will get for it

Another short opportunity yet to come probably.

I totally agree, Greyhound. If there is a takeover, the price will be reduced anyway. If there is no takeover, the sp will crash. Win-win situation.

Made a small profit now...218p now...likely to go down further

Predicted rightly...down it goes...closed at 199p.

The rumour-mill continues: article in the FT today (not had time to look for details), as mentioned in MoneyAM's Press Roundup:

'Electronic Arts bid speculation lifts Sci Entertainment '

SEG going to slide down from now... 173p

Spot on

62p now...got it right.


SCI Entertainment terminates offer talks; forecasts opg loss for FY 2008 - AFX

LONDON (Thomson Financial) - SCI Entertainment Group PLC said it has terminated offer talks it has been holding since last September as it has concluded that it is unlikely a sale of the company at its full value will be achieved.

The company also said it now expects to report an operating loss for full year 2008 after it decided to move the release date of four titles into the fourth quarter. The most significant of these titles is the next Tomb Raider game, Tomb Raider: Underworld.

The group will now launch this game on six platforms rather than the previously planned three and it said that, although the delay will mean the company incurring a loss at full year, simultaneous multi-platform launches in the key buying period at Christmas time will bring the best value from these franchises over the long term.

SCI also commented on Christmas trading for 2007 which it said it was pleased with, particularly the performance of Kane and Lynch, which was launched on Nov 13 in the US and Nov 23 in Europe.

SCI also said Pony Friends, first launched in May 2007, has also continued to perform well with life-to-date sell through now exceeding 600,000 units on NDS alone.

As part of the decision to make these changes to the platform and release schedule, the company has reviewed the impact this may have on its working capital needs and said it has identified sources of additional working capital which may be required.

The group is also exploring and progressing certain commercial and strategic opportunities which emerged from the aborted offer talks.

tf.TFN-Europe_newsdesk@thomson.com

is this likely to recover at all in the coming weeks???

After forecasting a loss for 2008 what do you think?

Long term looks good, being shorted at the moment by EK. Undervalue.

From Times Online - February 29, 2008

Lara Croft developer SCI to cut 25% of staff as losses worsen - Robin Pagnamenta


SCI Entertainment, the developer behind gaming adventuress Lara Croft, will slash 25 per cent of its workforce as part of a revised strategy that could cost up to 75 million to implement after interim losses leapt by 78 per cent.

The computer games group now expects to make a loss for the full year after losses for the six months to December 31, 2007 slumped from 17.9 million to 81.4 million on sales down from 74.5 million to 73 million.

The loss widened mainly due to a 79.6 million charge which includes the cost of aborted projects, research and development on new projects and costs being booked as development instead of research.

SCI, now operating under new management since an extensive board clear out in January, said this morning it will scrap 14 of its ongoing projects to concentrate on its "cornerstone" games including Tomb Raider, Hitman and Championship Manager.

The company is currently in negotiations with its main lending bank, Lloyds TSB, to extend its 20 million overdraft facility, with the remainder of the new strategy costs to be financed through issuing new shares as well as seeking investment from third parties.

Last year, SCI was in talks about an outright sale of the business. Although these discussions did not result in a takeover of SCI, it is understood that some parties who previously engaged in discussions may be interested in investing in the group.

Phil Rogers, previously chief financial officer at SCI who was appointed chief executive in January, denied the group was in danger of breaching its banking covenants. He said: "We have a great relationship with our banks. That is not a risk I see right now."

In a statement this morning, Mr Rogers said: "As illustrated by today's interim results...our quality has slipped below acceptable standards and, through disappointing game development and working within an ineffective operating structure, we are failing to realise the commercial return our creative ability and our shareholders demand.

"Our infrastructure is too big and expensive for the scale of the business."

Mr Rogers said SCI's business will be refocused on game development in its studios, with production, branding and PR all working together "in one time zone", while its product testing facility will now be based in Canada. SCI said that while it is no longer in takeover talks, it would not rule out a deal in the future.

Shares in SCI fell by 14.2 per cent to 45.25p - a 93 per cent fall from a five-high of 615p in January 2006.

In January, SCI replaced its top management team after takeover talks last year collapsed.

Jane Cavanagh, chief executive, Bill Ennis, managing director of publishing and Rob Murray, in charge of studios, all left the business with immediate effect after chairman, Tim Ryan, spoke with SCI's top 20 investors who represented 50 per cent of the group.

I haven't seen many people playing Tomb Raider anymore...time has certainly change.

thought tomb raiders was an aphorsim for new investors in dud companies like SEO .... heaven forbid one should link SEG to that one!

Brother used to work for these going back a few years, when Eidos (remember them?!) were main competitors.... sorry to see their demise

is this the last bit of dicline,looks cheap from here any one

no, not cheap definitely considering its poor product line...read above.

so down to 5p or less in the coming weeks than

20-30p likely in the coming weeks.

Next Numbers are due next month under the NEW regime

Trading Statement may be made sometime around 17th to 24th July based on previous years. Financial Year end is 30th June 2008. Extracts from recent statements:-
--------------------------------------
From Interims 29th February 08:

The Group made a loss from operations of 81.4m in the six months to 31 December 2007; the Board now expects the Group will make an operating loss for the full financial year 2008.
--------------------------------------
From Placing and Open Offer 9th May 08:

Current trading is in line with expectations and the Company is on track to deliver cost savings of 14m from its rationalisation programme at a cost of 7m, as announced in February.: Whereas historically the Company has seen the majority of its revenue generated in the second half of its financial year, with changes to the platform and product line-up this is not expected to be the case for the 2008 financial year, and as such, the Group announced on 10 January 2008 that the Board expected that the Company would make an operating loss for the 2008 financial year.

During the three months to 31 March 2008 the Group traded broadly in line with the Board's expectations and the Board continues to expect that the Company will make an operating loss in the current financial year ending 30 June 2008. During the quarter, 2.4 million units of sales were shipped in, compared to 2.5 million
in the same quarter in the 2007 financial year.

The main new release in the quarter was Conflict: Denied Ops which has sold in over 500,000 units in the two months since release, compared to just under
500,000 units of Battlestations: Midway sold in the same quarter last year.
Gross margin for this quarter was 48 per cent, which was in line with plan and comparable to 46 per cent. in the third quarter of the 2007 financial year.

The cost reduction plan previously announced, to reduce operating costs by 14
million has commenced and is expected to be completed by 30 June 2008.

Following a review of its 2008 platform and product line-up, the Group decided
to move the release date of four titles into the 2009 financial year.
--------------------------------------
BROKERS predict year end loss of 117 million (second half loss 36 million) BUT NEXT YEAR profit of 36 million (this may be revised upwards).

There are no AAA games in the last quarter of 07/08 and Age of Conan plus summer releases of Casual Games may be too late to change things. I expect 2007/08 results to be kitchen sinked. FORECAST and OUTLOOK for 2008/09 is the KEY.

There are 4 AAA games in first half of the year with TOMB RAIDER their major project. Sales from Age of Conan plus summer releases of Casual Games will continue. Cost base will have been reduced. Phil Rogers first full half year after the January coup looks set up to be a good one first half of 2008/09 should look good.

New releases due in the Summer and Autumn from the GAME.co.uk web site. They are mainly in Quarter 1 of the financial year 2008/9.

The Olympics seems to be well covered. A selection of games for the summer holidays and then the AAA games are released in the Autumn. Just Cause 2 now seems to be due on 1st January 2009.

I cut, pasted, and edited this list from a complex web site and I apologize for any errors in advance.

JulyQ1
_1 Riding Star (PlayStation 2) ... Release date: 18/07/2008 24.99

Trading statement 22nd July

AugustQ1
_2 Mister Slime (DS) ... Release date: 08/08/2008 24.99
_3 Riding Star (PC Games) ... Release date: 08/08/2008 17.99
_4 Riding Star (DS) ... Release date: 08/08/2008 24.99
_5 Summer Athletics (Xbox 360) ... Release date: 15/08/2008 24.99
_6 Summer Athletics (PC Games) ... Release date: 15/08/2008 12.99
_7 Summer Athletics (Wii) ... Release date: 15/08/2008 24.99
_8 Think (DS) ... Release date: 15/08/2008 24.99
_9 Woodleys Summer Sport (DS) ... Release date: 15/08/2008 24.99
10 Gauntlet (DS) ... Release date: 29/08/2008 24.99
11 My Pet Hotel (DS) ... Release date: 29/08/2008 24.99
12 My Pet Hotel 2 (PC Games) ... Release date: 29/08/2008 17.99

SeptemberQ1
13 Blastworks (Wii) ... Release date: 26/09/2008 39.99

Prelim Results 15th September

OctoberQ2
14 Shellshock 2 (Xbox 360) ... Release date: 01/10/2008
15 Highlander (Xbox 360) ... Release date: 01/10/2008 39.99
16 My Little Baby (DS) ... Release date: 03/10/2008 24.99

NovemberQ2
17 Tomb Raider: Underworld (Xbox 360) ... Release date: 21/11/2008 39.99
18 Tomb Raider: Underworld (PC Games) ... Release date: 21/11/2008 24.99


These are entries from GAMESTOP.com in the US for AAA games and versions not shown above:-

NovemberQ2
US1 Tomb Raider: Underworld (Playstation 3) ... Release date: 18/11/2008 $59.99
US2 Tomb Raider: Underworld (Nintendo Wii) ... Release date: 18/11/2008 $39.99

JanuaryQ3
US3 Shellshock 2 : Blood Trails (Playstation 3) ... Release date: 01/01/2009 $59.99
US4 Shellshock 2 : Blood Trails (PC) ... Release date: 01/01/2009 $49.99
US5 Highlander: (Playstation 3) ... Release date: 01/01/2009 $59.99
US6 Highlander: (PC) ... Release date: 01/01/2009 $49.99
US7 Just Cause 2: (Playstation 3) ... Release date: 01/01/2009 $59.99
US8 Just Cause 2: (Xbox 360) ... Release date: 01/01/2009 $49.99
US9 Just Cause 2: (PC) ... Release date: 01/01/2009 $59.99

I dont think that either list is complete and both are subject to change. But they do give a flavour of how things may happen. Please check the websites yourself for more accurate information.

Note

To put things in perspective SEG has roughly 5% of the Coming Soon list in the UK.