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Future Network climbs out of debt

LONDON - Future Network, publisher of the Official PlayStation magazines, saw its share price climb after revealing it has wiped out its debt and has £2m in the bank.

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Future also announced the resignation of board director Elisabeth Murdoch, who is stepping down from her non-executive role at Future to focus on other business interests including TV production company Shine.

The news comes after a period of financial instability at the company, which saw debt levels reach £78m in June last year. Future's share price was up 1.54% to 65.52p this morning in London, compared with a high of 926p during the technology boom of 2000.

The company's troubles began in 2000 when the launch of Sony's PlayStation2 was seriously delayed, in turn delaying the launch of the official magazine.

During that year, the company also committed £35m to launching 34 new magazines and increasing investment in online activity.

This investment strategy ended abruptly in early 2001, when it was forced to close its flagship new-economy title Business 2.0 in the UK and sold its US version to Time Inc for $68m (£46.5m) as part of a restructuring programme aimed at stemming mounting losses.

The company then made 140 staff redundant and, for a while, hope of a recovery returned for the Bath-based publisher, as speculation mounted that it was in takeover talks with a number of potential unnamed buyers.

It then pulled out of the talks to look at new ways of raising fresh capital, including selling its Polish operation to H Bauer and launching a new Xbox magazine in the US.

Speaking today at the company's AGM, Future chairman Roger Parry admitted that despite managing to reduce debt, its success was largely dependent on the games market.

Parry said: "Our success for 2002 overall will be determined primarily by our ability to capitalise on the continued growth of the games market. Overall, the group's business continues to perform in line with the board's expectations for 2002."

In March, the company reported full-year losses of £121m, twice the £59m it reported a year earlier. At the time, the company said it was optimistic about its prospects, which would be buoyed by increasing activity in the games market.

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