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Capcom posts profits

PS2 still dominant consumer platform.

Japanese publisher Capcom has announced a profit for the first half of fiscal 2003, turning around a loss last year, and has given unit software sales guidance for each of the hardware platforms in the current year.

The company made a profit of some 919 million Yen (€7.1 million) in the six months ended September, as against a loss of 17.3 billion Yen (€134 million) in the same period last year.

The profit became despite a drop in sales, which fell 13 per cent to 22.5 billion Yen (€174.6), and a massive 69 per cent decline in profits from the company's consumer sector - which publishes games on the various home console platforms.

This decline was offset by the success of Capcom's arcade division, which pinned much of its success on the range of arcade cabinets based on Bandai's hugely popular Gundam anime franchise - recently reinvigorated by the launch of a massively successful new TV series, Gundam Seed.

Interestingly, this rise in the fortunes of Capcom's arcade division mirrors similar performance at Sega, suggesting that Japan's arcades are turning their fortunes around slightly, even if some of this new-found profitability is being created by the closing of less successful arcades. In both cases, revenues from arcade activities have smoothed over rocky periods for the companies' home console divisions.

"We didn't release many home console games during the first half, but that was our plan," explained Heiji Oshima, a vice president at the publisher. "It has to do with the restructuring of our development divisions in the first half."

For the full year, Capcom expects to sell nearly 13 million units of software for home consoles, with the lion's share of that figure being on the PlayStation 2 - with some 7.6 million units spread over 31 titles expected.

The GameCube is Capcom's number two target platform, with 2.2 million unit sales expected (not including Resident Evil 4, which isn't due until the start of the 2004 fiscal year), while the GBA projections call for 2.04 million units. The Xbox lags behind, with expectations of about 800,000 units.

For the full year, Capcom expects to announce profits of 4.2 billion Yen (€32.6 million) on sales of 63 billion Yen (€489.2 million) - a strong step in the right direction for the publisher's financials, which were considered to be in crisis only a few years ago when the falling value of property in Japan caused huge losses for the company.