Future losses mount as it enters refinancing talks
LONDON - Troubled publisher Future Network has entered refinancing discussions as it posted widened first-half pre-tax losses of £106.8m - up a massive 652% from £14.2m, despite restructuring and cost-cutting at the company.
Future has axed 800 jobs from its worldwide operations this year, disposing of 39 magazines. These included the closure of Business 2.0 in the UK and Europe, and the sale of the US version to Time Inc. Future also closed its German and Dutch operations.
The company attributes most of its troubles to the games console industry, which has "been making a transition to the next generation of games consoles", the company said in a statement.
The PlayStation has upgraded to the PlayStation2, Microsoft is launching its Xbox and Nintendo its GameCube. Sony's decision to delay the launch of the PlayStation2 until after last Christmas slowed down sales of the platform, which in turn hurt sales of the Official PlayStation2 Magazine.
Future holds the licence to publish the Official PlayStation titles and the Official Xbox Magazine. The Official Xbox Magazine launches in the US next month, and the UK version will follow closely.
Revenues at its continuing operations were down by 10.3%, to £70.3m from £78.4m, hurt by slowing advertising sales. This is on turnover of £90.5m - down 21.8% from £110.2m last time.
Chief executive Greg Ingham said, "The outlook for the next 12 months may be affected by world economic and political factors. The specific factor most likely to impact on our business is the timing of the expected upturn in the computer games market."
Future's shares were suspended on the London Stock Exchange yesterday at 24.5p, pending the announcement about refinancing. The company said the board expects to be "in a position to make a further statement shortly".
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