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.