Ubisoft 2009 Annual Report Download - page 18
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14
latter are expected to be recovered during the first half of the 2011 financial year. The reduction in the
inventory item reflects increased efforts in the management of inventories and destocking activities, which
were carried out in particular for Nintendo DS™ products. The positive change in trade payables is linked to
a business trend that is more oriented towards Microsoft and Sony products.
There was a net financial surplus (i.e. cash minus Bank borrowings and bank overdrafts) of €41.3 million at
March 31, 2010. The change on the previous sum of €+154.2 million at March 31, 2009 can be explained
by:
- cash flow from operating activities of €-90.1 million,
- investment in property, plant and equipment and intangible assets of €19.1 million,
- acquisitions for a total of €9.1 million,
- capital increases of €4.8 million, resulting from the conversion of stock options and capital
increases reserved for Group employees,
- translation adjustments of €0.6 million.
1.1.2.8 Asset financing policy
The Company does not use securitization agreements, Dailly Act assignment of receivables or repurchase
agreements, but it does use discounting and factoring, mostly in Germany and the United Kingdom.
The factoring position is as follows:
in millions of euros03.31.10 03.31.09 03.31.08
United Kingdom22.0 22.5 19.5
Germany21.9 15.9 9.6
Total43.9 38.4 29.1
For the rest, it finances its peak cash requirements using confirmed credit facilities of €210 million (including
a syndicated loan of €180 million) as well as short-term credit facilities.
1.1.3 Cash and capital
1.1.3.1 Changes in equity
The video games business line calls for investments in development of around 35 % of revenue. This capital
expenditure takes place over average periods of between 18 and 24 months, which publishers must be able
to finance out of their own resources. Furthermore, publishers are required to launch new releases on a
regular basis, and their level of success cannot be guaranteed.
For these reasons, significant capitalization is essential to guarantee the continuous financing of capital
expenditure and to deal with contingencies stemming from the success or failure of a particular title without
endangering the future of the Company.
With equity of €761 million, up €9 million, Ubisoft easily finances its capital investments, which amounted to
€331 million.