GAME Post Losses, Close Stores

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GAME Group PLC have today released their financials for the first half of 2010/11, and it doesn’t make pleasant reading. This probably comes as no surprise to people in the know, as GAME has been shedding money for quite some time now.

GAMES’ troubles started in 2009 as the recession caused people to prioritise things like food, housing and ridiculously expensive fuel over gaming. This squeeze on their incomes lead to a spate of articles about widening losses and store closures.

GAME have reported that in the 26 weeks to July 31st, revenue was down 9.6 per cent to £624.6m  compared to £690.8m the year previously. This is almost exactly in line with the decline in the UK game market as a whole. Breaking the results down it shows that like-for-like sales in the UK and Ireland declined by 16.2%. Elsewhere the figures made for better reading, with GAME’s international division sales up 4% and online sales growing by 2%.

According to industry publication MCV:

The Group made a loss before tax and non-recurring costs of £18.8m in the first half of the year, compared to a profit before tax and non-recurring costs of £14.5m in the previous half year.

“This profile reflects the performance of the wider market. In the UK, market revenues were down by 17.1%1 and we have seen similar trends in other territories. This has largely been driven by revenue declines from Nintendo products, which enjoyed explosive growth in 2008 and 2009.

Unfortunately these losses are going to lead to more store closures, on top of the closures already announced earlier this year. Currently, the firm runs 635 stores across its two brands, GAME and Gamestation, but the firm now expects to slim down further to 550 stores, meaning that a total of 85 more stores will be closing.

In a statement reported on by MCV, chairman Peter Lewis said “By Christmas 2013 we expect the UK store portfolio to have been reduced to about 550 stores as we reduce store over-lap and drive for greater cost efficiency.”

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47 Comments

  1. They might save some money if they were a bit more clever on how many stores they have. For example, in Hemel Hempstead there are two different game stores within a one minute walk away from eachother in the same shopping centre.. Clever guys !

    • Yeah, I don’t get why so many places do this. In Peterborough there are two HMV’s about 5 mins apart :/

    • In Wolverhampton, there are two in the same row, there is about four shops and a McDonald’s between them!

      • Its the same just down the road in Telford, in this case the reason is because one of them used to be Electronic Boutique, but in a weird twist, EB bought out GAME, but re-branded all its stores under the GAME brand and didn’t close down stores that had both. Hence two GAME stores close to each other.. I expect that’s why a lot of places have two.

      • I live in Telford too and was over at Game in my lunch break – it was deserted. There’s also a Gamestation two doors down from one of the branches!

      • Same in Cambridge. There’s a Game and a GameStation with one shop between them and they still battle it out between themselves on pricing. It’s crazy – they’re owned by the same company, yet will happily price beat each other into oblivion. *mind boggles*

      • I seem to prefer gamestation, more so in the past cos I could pick up n64 carts for a couple of quid, is it hawkins bazarr between the 2 of them?! cant remember now, havent been in town for ages!

    • The reason retailers have so many stores is because the economic boom was so big they could justify them.

      Also, a high street store gets a very different demographic of customer to a shopping centre store or a retail park store… its all about attracting different customer types, obviously in boom years you can afford that luxury but as things are squeezed it becomes unsustainable.

      • This is the unfortunate thing about property cc. When the market is peaking the stores need more locations, then when the market goes flat they still have to pay their leases on the extra stores they acquired. So even if they do close stores they will only be saving on labour and rates. The rent will still be a huge killer for all the additional locations they will have.

    • Norwich used to have a Game next door to a Gamestation, with a further 2 Game stores 5 minutes down the road. You do have to wonder if they really thought this through!

    • HAHA! its the same in hanley, stoke-on-trent theres one below the other in the same shopping centre, about 30 seconds walk away from the other, and its a small shopping center too.

    • maybe the CEO goes starbucks a lot and is inspired by them.

  2. Not a surprise, in Swindon alone. We have 2 game stores within 100yds of each other plus 5 minutes walk, a gamestation. Wholly unnecessary in my opinion plus online prices, even within their own group, beat them every time.

    • It’s like this is a running gag. Right, even here in [enter city name e.g. Guildford] we have two stores within 2 feet of each other!

  3. oh no they ‘only’ made £600 million. Boo fucking hoo!

    This is just about chinless-wonders executives/CEO’s/whatever lining their pockets I guess. Not that I care though, I buy 9 out of 10 of my games from the internet ;)

    • But they lost £18m

      That means they could have closed all their stores down, not bothered with the whole running a company shifting millions of things around the country to sell through hundreds of stores, and just put a pound in a crappy current account and made £18 million more than they did.

    • There is a difference between revenue and profit. And is there any need for the swearing?

      • I know that, but £18m is teeny compared to £600 od million, so probably just 1 or 2 overrated mainstream games (Halo, COD etc) could fix this?

  4. They don’t help themselves if you ask me. I have seen zero change in my local Game right through the recession. Maybe think about some price drops or promotions?
    It is hard to compete with online stores but, seriously, try.

    • Online stores avoid various taxes through shipping from Jersey or somewhere similar, which means they have a 17.5% head start on highstreet stores

      • Hence why I said try. They have some advantages over online stores, like passing trade and that ‘in the hand’ feeling but they do nothing to maximise on it. They also charge higher prices than even rival high street stores like Gamestation.

      • Gamestation is part of GAME Group, they may have offers that GAME don’t so they don’t cannibalise GAME’s exisisting business

    • I swear they don’t even try. I actually bothered going into one of their stores a couple of days ago (because the annoying Mastercard security system blocked my card, even though my password was definitely correct), however, when I tried to buy FFXIV, the store manager hadn’t even heard of it. When he then checked the computer, he said it wasn’t out for a week. The collectors edition is out now, which I told him, but he refused to check, so they lost my custom to Play. I tried my hardest to give them my money, but apparently they don’t like money…

  5. I can’t remember the last time I actually bought anything from either of their chains! Consumers have become smarter shoppers while retailers have got dummer!

    • Agreed. I only ever buy from them if I have store credit, and that’s only when I can’t be arsed selling games on ebay.

  6. Maybe it would help if they didn’t charge every new game at £39.99 when others charge it for £10 less.

  7. I actually understand when they have a GameStation and a GAME in the same town, the branding and target markets are pretty different. Having two GAMEs is just silly though, I imagine that’s where they’ll be making the majority of the cuts.

    • already seen it in a few local towns. Two games stores in each, and one is shutting in each places. Makes sense to be honest. They should focus more on their online market.

  8. “GAMES’ troubles started in 2009 as the recession caused people to prioritise things like food, housing and ridiculously expensive fuel over gaming.”
    People are idiots!

  9. i agree with the comments regarding GAME stores being over priced. Who in their right minds would EVER buy a game from GAME, when another store down the road will inevitably sell for cheaper, even if it’s just £5 cheaper, for example in super markets. In the case where there isn;t, just wait a few weeks and you’ll probably save £20, and therefore buy 2 games for a similar price.

    Unless you have more money than sense I suppose, which hopefully one day in the future I will :-)

    • Game have only survived this long because of naive Mum’s and Dad’s purchasing games.

      Game make me laugh, where else would you see a pre-owned game the same price as a brand new copy?

    • The thing is though, GAME now owns Gamestation, in the shopping centre by my house there is one of each and yet Gamestation is still better value for money across the board, I don’t see how that works to be honest!

  10. There store layout to me has been abysmal over the years that has sometimes put me off visiting Game, because of that I would go to either Gamestop or HMV instead in the city centre.

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