Game like-for-likes up, profits expected to exceed expectations

Game's group like-for-like sales grew 9.5 per cent in the same period, and total group sales rocketed 24.2 per cent.

The games retailer posted a strong Christmas performance, with group like-for-likes up 5.4 per cent and total sales up 16.6 per cent in the 6 weeks to January 10.

In the same period, UK and Ireland comparable store sales increased 10 per cent while total sales grew 16.3 per cent.

Chairman Peter Lewis said: “The board now expects the group profit before non recurring costs and tax for the 53 weeks to January 31 2009 to be not less than£122m (2008:£75.5m), slightly ahead of market expectations.”

However, he added: “The board is cautious about the outlook for 2009 and is aware that general economic conditions are likely to deteriorate further. Revenue growth for the group will be challenging and there will continue to be inflationary pressures on costs."

Game said it will continue to exercise “strong cost disciplines” and a “more cautious expansion strategy”.

Online sales rocketed 75 per cent to£99.2 million in the 50 week period.

Game expects group gross margin for the 53 weeks to January 31 2009 to be around 140 basis points ahead of last year at 26.2 per cent, which is “slightly ahead” of its previous guidance.

The Gamestation integration is “progressing well” and Game now expects to deliver synergies of£10 million for the full year, ahead of its previous guidance of£9 million.

It said it has benefited from “significant changes to the competitive landscape with some competitors having limited availability of stock or ceasing to trade”.

Two of its biggest competitors, Woolworths and Zavvi, collapsed last year.

Game said it has a “strong” balance sheet, with expected net cash of£30 million to£40 million as at January 31 2009. It is anticipated that average net debt this year will be around£70 million and in the region of£50 million in the year to January 2010.

Terry Scicluna will join the board as chief operating officer, UK and Ireland. Scicluna joined Game on October 15 2008.

Game will report its preliminary results for the 12 months to January 31 2009 on April 21 2009.