Ubisoft 2006 Annual Report Download - page 47

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THE GROUP'S ACTIVITY AND RESULTS FOR FISCAL YEAR 2006-2007
35
1
The Ubisoft group’s sales are distributed over the three
core activities of the video game industry: development,
publishing and distribution.
Development covers revenues from titles developed, pro-
duced and marketed by Ubisoft's in-house studios. It also
includes sales coming from tittles created by third-party
developers for which Ubisoft provides supervisory and co-
production services and acts as guarantor of the final pro-
duct’s quality.
Publishing covers revenues from titles designed and pro-
duced by third-party developers for which Ubisoft finances
and supervises production in exchange for acquiring the
license. Ubisoft then handles localization and manufactu-
ring and is, of course, responsible for marketing and sales.
The company receives revenue from product sales and
pays royalties to the brand's developers and/or owners.
Distribution sales correspond to revenue from the sale of
products from publishers with which Ubisoft has signed dis-
tribution agreements and for which it handles marketing
and sales. Such agreements may be local, covering a limi-
ted geographical area, or may encompass several regions.
Breakdown of sales by activity (%) 2006-2007 2005-2006 Change in volume
Development 76% 85% - 11%
Publishing 18% 10% + 124%
Distribution 6% 5% + 86%
Total 100% 100%
At current rates, sales increased by 24% over FY 2006/2007; at constant rates, growth was 27%.
The sharp increase in publishing and distribution activities illustrates the company’s enhanced ability to attract more exter-
nal studios and publishers thanks to the quality of its distribution network and the expansion of its publishing teams.
Sales 2006-2007 2005-2006 Change at current Change at constant
(in M€) exchange rates exchange rates
First quarter 70 43 + 62% + 64%
Second quarter 102 110 - 7% - 4%
Third quarter 311 250 + 24% + 27%
Fourth quarter 197 144 + 37% + 42%
Total fiscal year 680 547 + 24% + 27%
Quarterly and annual consolidated sales
Breakdown of sales by activity
1.2.2
1.2.3
Breakdown of sales by activity is as follows: