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Ubisoft posts £26m loss, but outlook is strong

Full year sales expectations climb to £985 million

Buoyant publisher Ubisoft has balanced out a jubilant start to its week with a negative bottom line to its first-half financial results.

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The company posted an overall loss of £26 million for the six month period ended September 30; a slight improvement on the £29 million it lost during the same period last year.

Ubisoft's net loss arrived on the same week as the publisher discovered that Assassin's Creed 3 was the fastest-selling game in the firm's 25-year history. Meanwhile, overall first-half sales hit £223 million, above analyst expectations.

"First-half sales were buoyed by the performance of Ghost Recon Future Soldier and the digital segment, as well as by the initial sell-in of Just Dance 4," said the publisher's chief executive Yves Guillemot.

The marketing spend on major titles scheduled in the third fiscal quarter (Assassin's Creed 3 and Far Cry 3) were a substantial cost factor and helped pull sales into a loss.

"However, those large-scale marketing campaigns for Assassin's Creed 3 and Far Cry 3 should pave the way for an exceptional year-end, with a significant increase in both sales and profitability," Guillemot added.

Ubisoft said it has 16 more games to release this year, compared to the 30 it released in the second half last year, and about 40 in the 2010 fiscal year. This is part of a wider plan to focus on fewer, bigger-potential titles as the console cycle draws to a close.

The plan appears to be bearing fruit, with Assassin's Creed 3 helping push the firm's full year sales expectations up to £985 million.

Guillemot concluded: "From a longer-term perspective, Wii U's progression and the arrival of the next generation of consoles, combined with the strong momentum in the free-to-play model for PC, mobile and tablet games, will enable us to capitalise on the investments we have made in recent years."

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