"The Driver franchise set the benchmark for the driving adventure genre, as the incredible legacy of Driver and Driver 2 has combined to sell more than 12 million units worldwide, said Bruno Bonnell, Chairman and CEO of Atari, Inc. "We believe that this additional time will give our marketing team the ability to exploit DRIV3R's full potential, meeting the high expectations of gamers, media and shareholders," he continued.
Additionally, based on a preliminary review of results from holiday sales, the Company said it expects net revenues and earnings for the third quarter ended December 31, 2003, to be lower than its initial guidance provided in November 2003. Atari anticipates quarterly net revenue of approximately $190 million and net income between $20.5 million and $22.5 million, or between $0.17 and $0.19 per share. The Company is also revising its full-year fiscal 2004 results, based upon a number of factors, including preliminary holiday sales information and the shift of DRIV3R into the fiscal 2005 first quarter. Accordingly, the Company's fiscal 2004 net revenue guidance has been revised to between $460 million and $470 million, and net income and earnings per share are expected to be breakeven, prior to a $39.4 million one-time non-cash dividend relating to the Company's September 2003 recapitalization and public offering. Including the dividend, the Company's loss per share guidance is approximately ($0.40) on a GAAP basis.
On November 3, 2003, the Company issued fiscal 2004 third quarter net revenue guidance between $215 million and $235 million and net income between $28 million and $36 million, or between $0.23 and $0.30 per share. For fiscal 2004, the Company's original guidance was net revenue of $560 million to $590 million and net income of $35 million to $45 million, or $0.36 to $0.46 per share, prior to the one-time non-cash dividend relating to the Company's recent recapitalization and public offering.
"The strong performance of franchises such as Dragon Ball Z combined with a solid start for several of our holiday releases was unfortunately not enough to offset the underperforming consumer acceptance of other titles in our holiday line-up," said Mr. Bonnell. "While we are disappointed that our financial performance is below our expectations, we remain optimistic that, prior to the dividend, we will report breakeven full-year net income results on the strength of several new titles, including Unreal Tournament 2004 for the PC and Unreal 2: The Awakening for Xbox; Trivial Pursuit: Unhinged on PlayStation2 and Xbox; and Backyard Baseball 2005 featuring Alex Rodriquez on PlayStation2."
Mr. Bonnell continued, "Looking further ahead, fiscal 2005 will now include DRIV3R and several exciting new properties such as Transformers, Shadow Ops, Duel Masters, and Sid Meier's Pirates!, which will join a roster that will also feature new titles from our Dragon Ball Z, Dungeon & Dragons, Terminator, and Backyard Sports franchises. It is a compelling release slate that we believe will meet the demands of the consumer audience."
Atari will release its financial results for the third quarter on Monday, February 2, 2004, after the close of regular trading. Following the issuance of the earnings release, the Company will host a teleconference with a simultaneous webcast at 4:45 p.m. Eastern Time to discuss its quarterly results, the overall industry and outlook for the remainder of fiscal 2004. Participants on the call will be Bruno Bonnell, Chairman and CEO, David J. Fremed, Senior Vice President and CFO, and Ryan Barr, Director of Investor Relations. To access the teleconference, please dial 1-800-901-5217 (domestic) or 1-617-786-2964 (international), access code 80574926, 10 minutes prior to the start time. The conference call will also be available live via the Internet by accessing the Company's Web site (www.atari.com). To listen to the live webcast, please go to the Web site at least 15 minutes prior to the start of the call to register, download and install any necessary audio software.