Ubisoft 2014 Annual Report Download - page 2

Dear Shareholders and Partners,
Before reviewing our 2013-14 fiscal year performance
in detail and looking at our ambitions for 2014-15,
I wanted to highlight the success of Assassin’s
Creed
®
. Year after year we have transformed
this property into one of the most powerful in the
industry. It started in 2007 when we introduced the
game to the world; it was the best launch ever for a
new IP. Every year since 2009 we have succeeded in
offering rich and innovative experiences, which are
a big source of satisfaction for our fans and recurring
profit for Ubisoft. Today, the Assassin’s Creed
®
franchise is more vibrant than ever: it has made the
transition to the new generation of consoles and
we have consistently sold over 10 million units for
each new installment. Our constant focus on quality
and innovation has also enabled us to install other
hit franchises like Just Dance
®
, confirming Ubisoft’s
position as a leading creator of strong brands.
Consistent quality, regular releases and a large
production capacity have been key success factors
for Ubisoft that we will continue to pursue in the
new cycle. Our goal is to extend this winning recipe
to other franchises as well as seize new opportunities
on the horizon. Firstly, we think open world games
are going to make up an increasingly large part of
the market. Furthermore, the early years of a new
cycle are always the best time to launch new games
and transform them into long-standing franchises.
Finally, thanks to increasingly connected gaming
platforms, our consumers now have the possibility
to stay engaged with their favorite brands wherever
they are, and all year long.
For these reasons, and given the success of Watch
Dogs
™
as well as the highly anticipated releases of
Assassin’s Creed
®
Unity, Far Cry
®
4, The Crew
™
and
The Division
™
, we think Ubisoft is well positioned to
fully benefit from market growth in the coming years
and to continue improving its financial performance.
Now let’s look at our results for 2013-14.
Our turnover reached €1007 million, down 17% at
constant exchange rates; this drop reflects the release
of only two major titles this year versus three the prior
year. Our gross margin is also slightly down to 71.7%
of total revenues; nevertheless, it remains high, notably
thanks to growth in digital distribution. Finally, our non-
IFRS operating loss reached €66 million.
We therefore did not meet the financial objectives
we set for ourselves one year prior, primarily due
to the delay of Watch Dogs
™
and investments in the
Free-to-Play segment. That being said, 2013-14 was
marked by many important achievements, which
enabled Ubisoft to confirm its image as a leading
creator of interactive entertainment and to reinforce
our presence in new markets:
High quality games. All of our 2013-14 titles were
praised by fans and the media alike: Rayman
Legends
®
, Far Cry
®
3 Blood Dragon, Just Dance
®
2014, Rocksmith
®
2014 and Splinter Cell
®
Blacklist
™
not to mention Assassin’s Creed
®
IV Black Flag
™
and
South Park
™
: The Stick of Truth
™
, the highest rated
Christmas title on new-gen and best game of the end
of the fiscal year respectively.
Strong growth in digital revenue. Up 32%, this
segment now represents 19% of our total revenues,
compared to 12% in 2012-13. These figures attest to
a rise in digital distribution and the sale of items and
downloadable content, as well as progress made on
PC and mobile Free-to-Play segments.
Increased consumer engagement. Ubisoft teams
have reinforced our presence on social media and
within gaming communities, bringing us even closer
to our fans. Today we have more than 45 million
fans on Facebook, and thanks to Uplay, our online
distribution and services’ platform, we are now in
A statement from Yves Guillemot