PC & video games retailer Game Group has today confirmed that it is reviewing its international operations with a view to exiting foreign markets.
Responding to press reports that it was ready to sell all of its stores outside the UK, Game has now admitted that it is conducting a review of its international business.
Like-for-like sales for the retailer dropped 12.9 per cent year-on-year over the important Christmas trading period, and last month group CEO Ian Shepherd admitted that it had been an “incredibly tough” year for the business.
Game also revealed that it may not meet its EBITDA covenants which will be tested at the end of this month, and the retailer has been investigating ways to raise money whilst trading remains bleak.
Currently Game owns 670 stores overseas in countries such as France, Sweden, the Czech Republic, Australia and Spain, with the division reportedly making losses of £15.7 million over the last year.
A statement from the retailer today read: “In response to press speculation the Game Group confirms that it is in ongoing dialogue with its lending syndicate to reach agreement on revised terms for its facilities.
“As part of these discussions, the lending syndicate is reviewing a strategic plan of the company which includes a review of its overseas operations.”
What Shepherd has previously described as a “cyclical low point” for the games market has been exacerbated by the problems seen in the wider economy and but with so much trade in entertainment goods moving to online specialists the sustainability of Game‘s business model is now being seriously questioned by observers of the industry.
No confirmation on whether all or just part of Game‘s international business could be put up for sales has been made by the retailer, but it has said that a further update will be provided once “discussions with its lending syndicate have concluded.”