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Acclaim Posts Loss For 2002, Shuffles Management

Acclaim today announced that it sunk deep into red ink during fiscal Q4, resulting in a net loss on the year -- even as net revenues increased by 36% over last year.
Revenues for the year climbed to $268.7 million, but due to "significantly increased" marketing and selling expenses and higher payroll and product development expenses, its net income dove from a $17.3 million profit last year to a $4.5 million loss (5 cents per share) this year. The company's Q4 results were especially weak -- below even its recently revised lower guidance. While its net revenue was up 16% for the quarter, Acclaim reported a net loss of $28.2 million (31 cents per share). Last year its Q4 net loss was just $1.4 million. The company blamed poor sell-through of Turok: Evolution and Aggressive Inline. As a result of the disappointing sales of its recent titles, Acclaim announced a restructuring of its product development organization. Rod Cousens, President and COO of Acclaim International, in addition to his current responsibilities, is now also responsible for internal studio operations. There was no indication of what that means for John Ma, Acclaim's Executive Vice President of Product Development, to whom Acclaim's studio managers reported. "We are disappointed with our performance for fiscal year 2002. Some of our key titles did not meet our expectations, and we are making changes in our product development and brand organizations to ensure a more consistent and commercial success of the games we publish," said Rod Cousens, President and Chief Operating Officer of Acclaim International. Acclaim expects net revenue to be flat in fiscal 2003 as compared to fiscal year 2002, resulting in breakeven net earnings. The company also said it is reassessing its revenue and earnings guidance for Q1 and Q2, as a result of BMX XXX's limited distribution.

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