JoWooD Productions Software AG

euro adhoc: JoWooD Productions Software AG
Quarterly or Semiannual Financial Statements
Results of the first six months 2004: (E)

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 JoWooD announces stable mid-year results  Group results increase by 260% on a year-on-year basis  Equity ratio at 73%

JoWooD Productions Software AG, a public company listed at the Vienna Stock Exchange, managed to increase its results on a year-on-year basis as well as compared to the previous quarter. The group result after minorities amounted to TEUR 527 during the first half of 2004, which is traditionally considerably weaker than the second half due to the release schedule. The group result for the first half increased by more than 260% on a year-on-year basis. The results for the second quarter were nearly 90% higher than the first quarter figures.

Last year’s results for the first six months included approximately 6.9 Mio EUR in revenues from distribution activities, which are not continued anymore. This year’s mid-year revenues, which amount to 7.3 Mio. EUR, were thus 35% higher than last year’s adjusted mid-year revenues from publishing activities.

JoWooD considerably increased its market share during the reporting period. A market share of 4.62% in Germany during the first six months of 2004 represents an increase of 1.25 basis points compared to last year. In June 2004 JoWooD even reached a market share of 6.59% in the PC games segment. Titles released during the second quarter like "Spellforce - The Breath of Winter", "Transport Giant", "Söldner - Secret Wars" or "YetiSports Deluxe" have been in the Top10 of the sales charts for weeks. Furthermore, for the first time JoWooD titles performed strongly in non-German-speaking territories as well.

The slight reduction in the gross margin from 60% (mid-year 2003) to 56% (mid-year 2004) was caused by depreciations associated with the primary release of several titles during the second quarter. This led to an increase in cost of goods sold to 3.2 Mio. EUR.

A significant improvement in JoWooD’s cost structure laid the basis for consistent positive results. General administration, sales and other expenses were at approximately EUR 3.1 million. This represents a reduction of approximately 28% compared to previous year’s reference period. The increase in sales expenses compared to the first quarter reflects an intensification of JoWooD’s international marketing and sales efforts, especially for upcoming PC- and console titles.

The increased financial result is on the one hand due to the fact that the majority of last year’s liabilities have been set free of interest charges during the fiscal year 2003 as a result of a banking agreement supporting the restructuring plan. On the other hand, it is due to a valuation adjustment of own shares coming in during the second quarter amounting to TEUR 257.

In contrast to other assets, the inflow of own shares is accounted for as an expense (allocation to reserves) and selling or adjusting their value is accounted for as a reduction in the allocation reserve. Thus, the inflow of own shares led to an expense of TEUR 192 in the results.

The positive figure disclosed tax result is the balance of a taxation expense on the group result before tax and a tax credit for a subsidiary. Possible influences not affecting payment which are caused by the reduction of the corporate income tax rate are not accounted for at the moment due to the high amount of existing deficit carried forward.

As of June 30th 2004, JoWooD employed a staff of 136 and 47 freelancers.

The first six months were dominated by high investments for titles due for release in the second half of 2004 and in particular for the highly attractive and ambitious catalogue in 2005. Major development works for 2005 titles such as Gothic III, Spellforce II, The Guild II, Hotel Giant II and Stargate have been financed during the first six months of 2004. The main strategic target for the current year is the entry into the game console market. JoWooD aims of establishing itself as the only German-speaking multi-platform publisher. The high guaranteed order backlog worth considerably more than 40 Mio. EUR underlines the positive outlook.

Key Figures
in TEUR                                 Jan - Jun 2004 Jan - Jun 2003
Sales                                    7,303                12,273
Costs of goods sold              -1,030              -2,268
Development costs                 -2,206              -2,614
Gross profit                         4,067                7,391
Result before restructuring 1,007                3,120
Result after restructuring  1,007                967
Ordinary result                    446                  752
Income before minorities      461                  152
Group result                         527                  145

                                              Jan - Jun 2004  Jan - Jun 2003
Non- current assets                            15,001                18,051
Current assets                                    32,523                18,710
Total assets                                        47,524                36,762

Shareholders' equity                          34,770                14,173
Minority interests                                    20                -8,108
Long-term payables                                7,711                 4,113
Short-term debts to banks                        612                 15,981
Other short term payable                      4,411                 10,601
thereof advanced payment                      1,176                  2,020
Equity ratio                                              73%                      39%

Number of fixed employees                        136                      125
Number of free lancers                              47                        21

end of announcement            euro adhoc 12.08.2004

Further inquiry note: JoWooD Productions Software AG Dr. Michael Pistauer, Vorstand. Karin Kraberger, Investor Relations Manager. Tel.: +43 (0)3614 2966 1015

Branche: Software
ISIN:      AT0000747357
WKN:        074735
Index:    ATX Prime, ViDX, WBI
Börsen:  Wiener Börse AG / official dealing
              Berliner Wertpapierbörse / free trade
              Bayerische Börse / free trade
              Baden-Württembergische Wertpapierbörse / free trade
              Frankfurter Wertpapierbörse / free trade

Weitere Meldungen: JoWooD Productions Software AG

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