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Game responds to falling sales with new strategy

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Entertainment retailer Game Group is set to make innovations to its existing formats in order to keep up with a changing marketplace, it was announced today.

Over the course of the next 12 months, the company is set to venture further into social and mobile gaming, as well as grow its digital and online distribution.

More will be revealed in a strategy update from new CEO Ian Shepherd next month, but today’s announcement came as the retailer reported its trading performance for Christmas and the 49 weeks to January 8th 2011.

Like-for-like (LFL) sales in Game’s UK and Ireland stores over the five weeks to January 8th were just 0.5 per cent down, which compares favourably with recently reported results.

Group LFLs were down 2.1 per cent for the period, bringing the total LFL decline for the 49 weeks of the year-to date to 6.6 per cent.

And while UK and Ireland LFL trading was down 12.2 per cent in the 44 weeks to December 4th, this figure improves to -9.7 per cent when the crucial five-week Christmas period is also taken into account.

Peter Lewis, Chairman of Game Group, commented: “We expect our profit before tax and exceptional items will be in the range of £37 million to £39 million for the year to January 31st 2011, which is within current market expectations.

“Our margin guidance remains unchanged.”

Matt Piner, Senior Retail Analyst at Verdict Research, was also positive about the company’s performance considering its results announcements in 2010.

“Among the weak results, Game has bucked the trend and its own recent history, albeit against soft comparatives,” he explained.

“With the Microsoft Kinect and the Playstation Move among the most in demand Christmas presents, Game was well placed to capitalise on this.

“However, the challenge is to now maintain this stabilisation in 2011 as the market continues to evolve.”

Published on Thursday 13 January by Editorial Assistant

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