Ubisoft 2006 Annual Report Download - page 64

UBISOFT • FINANCIAL REPORT 2007
Recent events, outlook and strategies
Recent developments
April 2007
Sales in Europe for the first quarter 2007 rose by 31% in
a market that has grown by 15%. Ubisoft is the second
largest independent publisher and has a market share of
8.6% compared to 7.6% the previous year. Ubisoft is the
number one independent publisher on Wii™, DS™ and
Xbox 360™.
On the same period sales in the United States rose by
41% in a market that has grown by 28%. Ubisoft is the
third largest independent publisher and has a market
share of 6.7% compared to 6.1% the previous year.
Ubisoft is the leading independent publisher on Wii™ and
the second on DS™ and Xbox 360™.
Ubisoft acquired the Anno™ brand. With 5 million units
sold worldwide, Anno™ is one of the most successful
strategy games and one of the best-selling games in the
German market. As a result of this acquisition, Ubisoft
will also hold a 30% interest in Related Designs, the
company that developed Anno 1701, the latest game in
the series, and is currently working on a sequel.
Ubisoft announced the creation of a new Tom Clancy
brand, Tom Clancy’s EndWar™. Under the supervision of
strategy game veteran Michael de Plater, Tom Clancy’s
EndWar™ is being developed at Ubisoft Shanghai by an
experienced team whose members have worked on such
prestigious licenses as Tom Clancy’s Ghost Recon®, Tom
Clancy’s Rainbow Six®and Tom Clancy’s Splinter Cell®.
Tom Clancy’s EndWar™ on next-gen consoles is schedu-
led to be released some time in fiscal year 2007/2008.
May 2007
Ubisoft develops the video game adapted from
“Beowulf”, a film by Paramount Pictures, Shangri-La
Entertainment and Warner Bros. Entertainment, to be
released in November 2007 which is directed by Robert
Zemeckis and stars Angelina Jolie, Anthony Hopkins and
John Malkovich.
Market outlook
The year 2006 saw the release of Nintendo and Sony next-
gen consoles – Wii™ and PS3 – following the launch in late
2005 of Microsoft’s Xbox 360™. In this context marked by
a transition between two generations, the video game mar-
ket fared extremely well with 5% growth in Europe, North
America, Australia and New Zealand. This growth far
exceeded the expectations of industry professionals,
thanks in particular to the enormous success of Nintendo
DS™, Nintendo’s portable console, which enjoyed an
annual growth rate of 202%. The market was also helped
by the very strong performance of PlayStation®2, which
was less affected by the arrival of PS3 than anticipated, and
by the solid performance of Xbox 360™ in the US and UK
markets.
In 2007, the market is expected to grow by at least 12%,
with next-gen consoles picking up speed and accounting for
43% of total sales compared with 14% in 2006.
With the success of Wii™ and DS™, in 2006 the market
opened its doors to a new category of gamer. The ease of
use of these consoles is attracting new market segments,
including women and older people, for whom video games
offer the chance to live out their dreams (for instance,
taking care of animals) or develop their mental faculties.
These easily accessible games are providing new opportu-
nities for game developers like Ubisoft, as well as new
growth prospects.
With regard to industry players, as in previous years FY
2007 saw a number of acquisitions of studios and brands by
major publishers. Ubisoft, for its part, purchased the assets
of the Reflections Interactive Ltd studio and the Driver®
brand from Infogrames. Activision bought the Guitar Hero
brand and MTV acquired Harmonix, the studio that deve-
lops this brand. Electronic Arts acquired the Mythic stu-
dio, creator and owner of the massively multiplayer game
Warhammer®Online: Age of Reckoning™.
Activision was also an active player in technology through
the purchase of Demonware, a company that specializes in
middleware for PC and consoles, with a focus on online
applications.
1.12
1.12.1 1.12.2
Coverage limits France United States Canada China
in K€ in KUSD in KCAD in KCNY
General liability 3,049 4,450 18,000 500
Property insurance 3,712 8,179 29,071 6,000
Inventory insurance 3,000 7,000 1,250 -
Coverage
Summary of coverage limits for each type of insurance carried by the principal entities: