Atari 2009 Annual Report Download - page 26

ANNUAL FINANCIAL REPORT – REGISTRATION DOCUMENT
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amounting to €53.7 million compared to €23.4 million for fiscal year 2007-2008 and includes €27.1 million in write-downs
on games and licenses related to the reorganization of the publishing business. Other expenses included the pre-
production cost of projects that had not yet achieved technical feasibility, the cost of the online business, tests and
localization as well as certain start-up costs.
Marketing and selling expenses
Marketing and selling expenses amounted to €19.0 million, compared with €15.6 million for the previous period. The
additional €3.4 million went into supporting major new publishing releases such as Alone in the Dark, The Chronicles of
Riddick, Race Pro and others. As a percentage of net revenue, marketing and selling costs were down approximately
3.3% due to improved cost control measures in the US.
General and administrative expenses
General and administrative expenses decreased approximately 18% from €30.5 million to €25.0 million. These savings
are primarily attributable to the Atari Transformation plan announced in May 2008 plus incremental savings from
purchasing the remaining minority shares of Atari Inc. and eliminating, as from October 2008, Atari Inc.‟s US share-listing
costs.
Share-based incentive payment expense
Share-based payments amounted to €6.4 million versus €3.5 million in the prior period. This increase is primarily due to
(i) the cost of profit sharing for certain members of senior management for a full fiscal year as opposed to a partial year
as was the case in the previous period and (ii) additional management hired during the fiscal year.
Restructuring costs
Restructuring costs for the year ended March 31, 2009 amounted to €13.9 million versus €12.3 million in the previous
period. Approximately €8.9 million of the costs in fiscal year 2008-2009 were related to the Atari Transformation plan
announced in May 2008 while €5.0 million related to the publishing and corporate restructuring announced in the last
quarter of fiscal year 2008-2009. The previous year‟s restructuring costs related to prior year layoffs and unused
company premises.
Impairment of goodwill
The poor performance of the publishing unit resulted in the recognition of a goodwill impairment for the Retail
Development/Publishing cash-generating unit of €40.3 million for the year ended March 31, 2009. Impairment tests
performed on March 31, 2009 did not result in any other write-downs.
Operating income (loss)
There was an operating loss at the consolidated level of €123.2 million, compared with €52.5 million the previous year. It
reflected the combined impact of a loss on ordinary operations of €68.9 million (including an additional €23.2 million
amortization charge stemming from the reorganization of the publishing business), restructuring charges of €13.9 million
and goodwill amortization of €40.3 million.
OTHER INCOME STATEMENT ITEMS
(in € millions)
Operating income (loss) (123.2) -90.3% (52.5) -58.1% -70.7 134.7%
Cost of debt (7.7) (11.6) 3.9 -33.6%
Other financial income (expense) (4.1) (1.4) -2.7 192.9%
Income tax (1.1) (0.1) -1.0 N/A
Profit (loss) from continuing operations (136.1) -99.8% (65.6) -72.6% -70.5 107.5%
Profit (loss) from discontinued operations (90.8) 3.1 -93.9 N/A
Consolidated net income (loss) (226.9) -166.3% (62.5) -69.2% -164.4 263.0%
Minority interests 0.8 11.4 -10.6 -93.0%
Net income (loss) attributable to equity holders
of the parent
(226.1) -165.8% (51.1) -56.6% -175.0 342.5%
March 31, 2009
March 31, 2008
Change
3/31/08 3/31/07
Cha
Cost of debt
Cost of debt was down approximately €3.9 million or 33% because in the first six months of the fiscal year the Company
carried little debt as most of the debt had been restructured during fiscal year 2007-2008.
Other financial income (expenses)
Other financial expense and investment losses increased by approximately €2.7 million. This increase was primarily due
to fluctuations in the exchange rates for pounds sterling and US dollars during the period.
Income tax
A corporate income tax expense of €1.1 million was recognized for the year as compared to €0.1 million for fiscal year
2007-2008. This income tax expense is mainly due to an increase in the deferred tax liabilities of Cryptic Studios Inc.