Net loss more than doubled to $75.9 million
With its cash rapidly depleting and stock hovering well below the $1 mark, Sumner Redstone-owned Midway Games reported another quarter of heavy losses in the quarter ending Sept. 30.Vidgame publisher reported that its net loss more than doubled to $75.9 million, while revenues were up 40% to $51.4 million. Midway ended the quarter with just over $10 million in cash on hand, a potentially dire situation given that it is projecting a loss of about $18 million in the current quarter and has a $79 million convertible debt note due in April. CEO Matt Booty assured analysts on the call that Midway is working to address the problem but didn’t provide any details. “The board and management are actively engaged in addressing liquidity issues,” he said. Company released one major new title, “TNA Impact,” late in the quarter and didn’t release any sales data. In the current quarter, most of its hopes are pinned on next week’s release of “Mortal Kombat vs. DC Universe.” Midway has spent much of its time recently cutting costs and dealing with corporate drama. During the quarter, it canceled two undisclosed licenses and killed a game in development at its Austin studio called “Career Criminal” that was co-created by director Tony Scott. Last Friday, Midway’s chairman, Shari Redstone, Sumner’s daughter, unexpectedly ankled in order to spend more time focusing on the debt problems of National Amusements, the Redstone clan’s exhib chain and investment vehicle, from which Midway has borrowed tens of millions of dollars. New chairman Peter Brown, CEO of AMC Entertainment, wasn’t part of Monday’s earnings conference call. It was led by CEO Booty, who has held the job on an interim basis since March and was officially named to the job on Oct. 30. Midway stock closed down 23% at just 43¢ before earnings were released. It has been trading at under $1 since late last month, putting the company in danger of delisting.
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