Interplay Entertainment Corp – ‘8-K’ for 4/14/04 – EX-99

On:  Wednesday, 4/14/04, at 4:10pm ET   ·   For:  4/14/04   ·   Accession #:  1170918-4-278   ·   File #:  0-24363

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         3     16K 
 2: EX-99       Ex-99.1 Press Release (4-14-04)                        3     13K 

EX-99   —   Ex-99.1 Press Release (4-14-04)

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                                                                    EXHIBIT 99.1

                                                                        NEWSLEAD
                                                             Contact: Luke Haase
                                                                    231.932.0400

INTERPLAY ANNOUNCES FOURTH QUARTER AND YEAR-END 2003 OPERATING RESULTS          

IRVINE, CA, April 14, 2004 -- Interplay Entertainment Corp. (OTC Bulletin Board:
IPLY)  ("Interplay") today reported operating results for the fourth quarter and
year-end of 2003.                                                               

For the fourth quarter ended December 31, 2003,  Interplay reported a net income
of $3.3 million,  or $.04 per basic and diluted common share,  compared to a net
loss of $5.4 million,  or $.06 per basic and diluted  common share,  in the same
period last year.  The  increase  in net income is mainly a result of  recording
revenue for the delivery of BALDUR'S GATE: DARK ALLIANCE II (SONY  PLAYSTATION 2
AND MICROSOFT  XBOX) product gold masters in North America in the fourth quarter
this year.  Net revenues for the fourth  quarter 2003 were $11.5 million  versus
$7.1  million in the same period a year ago,  an  increase  of 62  percent.  The
increase in net revenues in the fourth  quarter was mainly a result of increased
net  revenues  from the  delivery  of more new  product  gold  masters  in North
America,  increased  royalty and  licensing  net revenues due to the sale of the
GALLEON video game and lower product returns and price concessions in both North
America  and Europe,  offset in part by a decrease in catalog  sales in the 2003
period as compared to the 2002 period.                                          

For the twelve-month  period ended December 31, 2003,  Interplay  reported a net
income of $1.3 million, or $.01 per basic and diluted common share,  compared to
a net  income  of $15.1  million,  or $.18 per basic  common  share and $.16 per
diluted  common share,  in the same period last year. The decrease in net income
from last year is mainly a result of recording a $28.8  million gain on the sale
of Shiny Entertainment, Inc., a subsidiary, in the 2002 period. Net revenues for
the twelve-month  period ended December 31, 2003 were $36.3 million versus $44.0
million in the same period a year ago, a decrease of 18  percent.  Net  revenues
during the  twelve-month  period ended December 31, 2003 included $15 million in
revenue related to the sale of all future interactive  entertainment  publishing
rights to the HUNTER: THE RECKONING license. Additionally, although we delivered
the product gold masters to six new titles in each of the 2003 and 2002 periods,
all six titles in 2003 were released by Vivendi  Universal Games, as compared to
five in  2002,  under  the  terms of the 2002  distribution  agreement,  whereby
Vivendi pays us a lower per unit rate and in return assumes all credit,  product
return  and  price  concession  risks,  as well  as  being  responsible  for all
manufacturing,  marketing  and  distribution  expenditures.  Finally,  operating
income  increased  111 percent from the prior year to a $1.4  million  operating
income in the twelve-month period ended December 31, 2003 as compared to a $12.4
million operating loss in the 2002 period.                                      

Commenting on the results,  Interplay Chairman and Chief Executive Officer Herve
Caen said, "These results mark an important milestone for Interplay. In 2003, we
had a return                                                                    

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to operating profit and substantially  reduced our debt. However, we continue to
operate  under cash  constraints.  Specifically,  Interplay  is three  months in
arrears  on  its  corporate  lease  obligation,   may  have  short-term  payroll
difficulties and has outstanding  payroll tax obligations as of the date of this
release.  Certainly,  financial  challenges remain, yet we are proud of what our
team has  accomplished  thus far and we are  committed to working even harder to
maintain our return to operating profitability."                                

Gross profit margin for the fourth  quarter 2003 was 73 percent,  compared to 16
percent in the fourth  quarter of 2002.  Gross  profit  margin was higher in the
fourth  quarter  this year as  compared to last year mainly due to a decrease in
product  returns  and  price  concessions  and  lower  amortization  of  prepaid
royalties on externally  developed titles. Total operating expenses decreased 21
percent to $5.1 million from $6.5 million in the fourth  quarter of this year as
compared to the same period last year.  The decrease in operating  expenses is a
result  of  lower  personnel  costs  and  general  expenses  and a  decrease  in
advertising expense.                                                            

Gross profit margin for the  twelve-month  period ended December 31, 2003 was 64
percent,  compared to 39 percent in the same period of 2002. Gross profit margin
was higher in the 2003  period as  compared  to the same period last year mainly
due to a decrease  in  product  returns  and price  concessions,  lower  royalty
expense  as a result of a decrease  of $1.2  million  in  write-offs  of prepaid
royalties and the gross profit  margin  realized from the $15 million in revenue
related to the sale of all future interactive entertainment publishing rights to
the HUNTER: THE RECKONING license. Total operating expenses decreased 27 percent
to $21.8  million from $29.7 million in the twelve months of 2003 as compared to
the same period last year.  The  decrease in  operating  expenses is a result of
lower  personnel  costs and general  expenses,  the lack of advertising  expense
under the terms of the August 2002  distribution  agreement  with  Vivendi and a
decrease in  advertising  expense and overhead  fees paid to Avalon  Interactive
Group Ltd.                                                                      

Net revenues by platform  for the fourth  quarter of 2003 were 26 percent PC, 66
percent  console,  and 8 percent OEM,  royalties and licensing.  On a geographic
basis,   North  America   accounted  for  77  percent  of  total  net  revenues,
international  represented 15 percent,  and OEM, royalty and licensing accounted
for 8 percent.                                                                  

According to NPD Funworld,  BALDUR'S  GATE:  DARK ALLIANCE II was a top 10 title
shipped to retail in the United States in January 2004.                         

About Interplay Entertainment Corp.                                             

Interplay  Entertainment  is a leading  developer,  publisher and distributor of
interactive  entertainment  software  for both core gamers and the mass  market.
Interplay  develops games for personal computers as well as video game consoles,
many of which have garnered industry  accolades and awards.  Interplay  releases
products through Interplay, Black Isle Studios and its distribution partners.   

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

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Statements  contained  in this release  except for  historical  information  are
forward-looking  statements that are based on current  expectations  and involve
risks and uncertainties. Without limiting the generality of the foregoing, words
such as "may," "will," "expect,"  "believe,"  "anticipate,"  "intend,"  "could,"
"estimate,"  or  "continue"  or the  negative  or other  variations  thereof  or
comparable terminology are intended to identify forward-looking  statements. The
risks and  uncertainties  inherent in such  statements  may cause actual  future
events or results to differ materially and adversely from those described in the
forward-looking statements. Examples of such forward-looking statements include,
among other things, future improvements in gross margin, operating expenditures,
and product  sales.  Important  factors that may cause actual  future  events or
results  to  differ  materially  and  adversely  from  those  described  in  the
forward-looking statements include (a) the success of company's future adventure
and role playing games, (b) consumer  reaction to Interplay's  future games, (c)
Interplay's  ability to consistently and timely release profitable  products and
its ability to control  costs,  and (d) other factors  discussed in  Interplay's
filings from time to time with the Securities and Exchange Commission, including
but not limited to  Interplay's  annual  report on Form 10-K for the fiscal year
ended December 31, 2002 and  Interplay's  subsequent  quarterly  filings on Form
10-Q. Interplay disclaims any obligation to revise or update any forward-looking
statements that may be made from time to time by it or on its behalf.           

INTERPLAY(R) IS AN INTERPLAY  ENTERTAINMENT CORP. TRADEMARK.  THIS PRESS RELEASE
ALSO CONTAINS TRADEMARKS BELONGING TO OTHERS.                                   

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
Filed on / For Period End:		4/14/04		1
		12/31/03		1		2			10-K,  10-K/A,  NT 10-K
		12/31/02		3					10-K,  10-K/A,  NT 10-K
									List all Filings