Video game accessories manufacturer Mad Catz today revealed its fourth quarter and full-year earnings for the period ended March 31. Sales in the fourth quarter were up over 13 percent to $21.9 million while net loss amounted to $0.8 million. For the entire year, however, net sales were $87.6 million (down over 12 percent) and Mad Catz posted a net income of $3.2 million, down slightly from the previous year's $3.7 million.
Darren Richardson, President and Chief Executive Officer of Mad Catz, provided the following statement: "The fiscal 2008 fourth quarter results reflect a significant economic contribution from the Saitek acquisition which was completed late in calendar 2007 and Mad Catz' strategy to focus on maintaining healthy gross margins to achieve consistent profitability. On an operating basis, Saitek was accretive to our results during the quarter and we anticipate further contributions from this acquisition as we generate additional operating efficiencies and revenue opportunities. Already in fiscal 2009 we have reduced Saitek's operating expenses by an annual run-rate of over $1 million and we expect to eliminate additional operating costs during this fiscal year.
"Fiscal 2008 was an important year for Mad Catz in which we diversified and expanded our product lines through acquisition and internal development while building our portfolio of prominent licenses. These actions have further reduced the Company's reliance on gaming console specific products and we entered fiscal 2009 with a broad suite of interactive entertainment products that generate attractive gross margins.
"We secured the license to produce and distribute game accessories for the hit Rock Band game with initial North American and European product shipments scheduled for the second quarter of fiscal 2009. Rock Band has quickly emerged as the leading platform for music fans and gamers in the explosive music category and Mad Catz is the only third-party company to have a license to produce musical instruments. Given the game's popularity, we believe future sales of our bass, microphone and drum accessories will be important sources of revenue throughout fiscal 2009.
"In addition, with our focus on achieving further geographical diversification, Mad Catz recently strengthened its global portfolio of sports licenses with the addition of the Manchester United, Liverpool and Arsenal Football Clubs, as well as NASCAR racing. These additions round out what we believe to be the industry's most robust sports license portfolio that now includes every major U.S. sports league as well as some of the most recognizable soccer teams and sports franchises around the world.
"Mad Catz will also benefit in 2009 from several new product lines introduced in fiscal 2008. In February we began shipping our next generation of AirDrives earphones designed specifically for the Apple iPhone and have already gained a presence on prominent online retail outlets. In addition, in May we began shipping a new range of accessories compatible with the Nintendo Wii Fit system that have been met with a strong initial response from retailers and serve to further establish our presence as a provider of peripherals for the increasingly popular Wii console."
"With the integration of recently acquired entities, several upcoming high profile licensed product launches based on agreements secured throughout fiscal 2008 and the introduction of several innovative new products, we have established a solid suite of interactive entertainment products and accessories, and created a well positioned platform from which to leverage the success of our products based on the overall continued strength of the interactive entertainment industry. In fiscal 2009 we expect to benefit from the wide range of opportunities established in fiscal 2008 and will continue to focus on diversifying and expanding our sources of revenue and creating long-term shareholder value."
