Ubisoft 2006 Annual Report Download - page 58

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UBISOFT • FINANCIAL REPORT 2007
Ubisoft has maintained its investment policy momentum in
order to gain a foothold on new platforms, create new
licenses in different genres and, more generally, increase
its market share. Thus, in FY 2006/2007, in-house produc-
tion costs increased by 24%, rising from €131 million to
€161 million.
Production-related investment
% of total pre-tax sales
Investment related to average workforce
Research and
development policy
In an ongoing effort to create top-quality video games,
Ubisoft has developed a policy of researching and develo-
ping tools for each project, incorporating the latest tech-
nological advances. Indeed, the selection of engines, tools
and development process take place at a very early stage
in each project, because decisions made at that point
directly affect the innovation potential and the investment
required in terms of time, human resources and the game’s
overall financing.
Thanks to its in-house team of engineers, who have a solid
grasp of the best technology currently available, Ubisoft
now has a highly pragmatic approach to its projects.
Depending on the problems involved in a game and the
expected results, the tools selected will either be develo-
ped in-house with a specific purpose in mind or using com-
mercial software, or a combination of the two. Research is
therefore focused on innovation and functionality based on
technologies suited to a high-quality product. Develop-
ment is focused on producing creative games that offer
gamers a total entertainment experience.
Research and development expenses are capitalized and
amortized over a three-year period along with additional
depreciation to follow the product life-cycle of the pro-
duct. During the year under review, these depreciations
totaled €162 thousand.
No basic research is conducted.
Real estate,
plants and equipement
Ubisoft does not own the buildings it occupies in any coun-
try.
2006/2007 2005/2006 2004/2005
€161 million €131 million €100 million
2006/2007 2005/2006 2004/2005
23.69% 23.85% 18.80%
2006/2007 2005/2006 2004/2005
€53,531 €52,159 €50,890
General information
Investment policy
1.8.1
1.8.2
1.8.3
1.8