Ubisoft 2012 Annual Report Download - page 14

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Management Report
2012
9
1.2.6 CHANGES IN THE INCOME STATEMENT
The gross profit margin has increased to €718.1 million, up significantly as a percentage of sales at
67.7% compared with 64.8% in 2010/2011. In line with the continued improvement observed in
2010/2011, this increase is mainly due to the considerable improvement in the gross profit margin of
the back catalogue and to the strong increase in online sales at a very high margin.
Current operating income excluding share-based payments amounts to €56.0 million; a significant
improvement compared to €29.4 million posted in 2010/2011. This figure is at the higher end of the
target range announced a year earlier (between €40 million and €60 million) and falls in line with the
recent upward revision of these targets (between €45 million and €65 million).
Current operating income before share-based payments is as follows:
Increase of €44.5 million in the gross profit margin.
Decrease of €15.1 million in research and development costs, which amount to €348.4 million
(32.8% of sales) compared with €363.5 million in 2010/2011 (35.0%), due to the fact that fewer
games were released on high-definition consoles during the period, partially offset by higher
royalties and a rise in certain online non-capitalized costs.
Increase of €33.0 million in SG&A expenses to €313.7 million (29.6%), compared with €280.7
million (27.0%) in 2010/2011:
− Variable marketing expenses are up at 16.7% of sales (€177.1 million) compared with
15.4% (€160.4 million) in the financial year 2010/2011. This increase is primarily related to
growth in online and dance activities.
− Structuring costs are up at 12.9% of sales (€136.6 million) compared with 11.5% (€120.3
million) in 2010/2011. This increase is primarily explained by higher expenses related to
online activities.
The operating profit, including €10.4 million in share-based payments, comes to €45.6 million
compared with an operating loss of €(80.4) million in 2010/2011, which included €95.9 million in non-
recurring expenses and €12.6 million in share-based payments.
Financial income amounts to €2.5 million compared with financial expenses of €3.7 million in the
financial year 2010/2011, breaks down as follows:
o €(2.5) million in financial expenses compared with €(5.0) million in 2010/2011, which
included €(3.6) million in factoring expenses of loss carry back refund claims.
o €(3.4) million in foreign exchange losses, compared with a loss of €(4.3) million over
the financial year 2010/2011.
o €8.5 million positive impact (compared with €5.7 million in 2010/2011) mainly from the
sale of 3.2 million Gameloft shares. At March 31, 2012, 3.1 million Gameloft shares are
recognized in the balance sheet.
Net profit of €37.3 million was posted, corresponding to earnings per share (diluted) of €0.39,
compared with a net loss of €(52.1) million and €(0.54) over the financial year 2010/2011.