Ubisoft 2012 Annual Report Download - page 36

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Management Report
2012
31
1.6 GENERAL INFORMATION
1.6.1 CAPITAL EXPENDITURE POLICY
Ubisoft continued its sustained capital expenditure policy, which should enable the Company to gain
traction in new platforms, create new licenses in various genres, develop the online activity and more
generally increase its market share. Accordingly, in 2011/2012, internal production costs rose 4% from
€287 million to €299 million.
2011/2012
2010/2011
2009/2010
Production-related capex
€299 million
€287 million
€259 million
% of total sales ex-VAT
28.21%
27.66%
29.70%
Capex per member of production staff
(average headcount)
€55,668
€57,003
€50,451
1.6.2 RESEARCH AND DEVELOPMENT POLICY
In order to develop exceptional video games, Ubisoft has established a project-led R&D policy for tools
and technologies, using the most recent technological advances. The choice of development engines,
tools and processes takes place well upstream in a project, because this choice determines the
potential for innovation and the necessary investment in terms of time, human resources and financing
for the game.
Its close-knit team of engineers who have mastered the best available technologies now enables
Ubisoft to take a highly pragmatic approach to its projects: Depending on the challenges and expected
results on a game, the choice of tools may involve specific internal developments, software already
available on the market, or a combination of the two. Research is thus focused on innovation and
functionality, using technologies suited to a high-quality product.
Development costs on commercial software are capitalized and amortized over two or three years,
with additional impairment losses recognized to reflect the product life cycle. During the financial year,
they were amortized in the amount of €206 million.
The Group does not carry out any fundamental research.
1.6.3 PROPERTY, PLANT AND EQUIPMENT
Ubisoft owns the land and building occupied by its Hybride Technologies Inc. subsidiary in Canada, at
111 Chemin de la gare, Piedmont, Quebec.