Acclaim Reports Large Loss, May Face Bankruptcy

Thanks to Yahoo!/Reuters for its story revealing videogame publisher Acclaim Entertainment has announced a quarterly loss of $25.4 million, and warned of possible bankruptcy, since "needs new cash to replace a financing agreement... that expires on Aug. 4." Apparently the company "has signed a letter of intent with a different lender to borrow up to $30 million but the deal has not yet been completed." The long-standing publisher has also recently been sued by the Olsen Twins, although it still lists upcoming titles as including 100 Bullets, The Red Star, Worms Forts: Under Siege!, and Interview With A Made Man. Update: 07/03 01:34 GMT by S : Acclaim's 10-K financial statement reveals "notification from The Major League Baseball Player's Association (MLBPA) that we were late in making certain royalty payments and our license was terminated", and "due to failure to make certain royalty payments relating to the videogame title Turok: Evolution... our [Turok intellectual property] license agreement with Classic Media was terminated."

Comments

What we need worms!

[kabocox]

Worms is a great game. I hope it doesn't die.

Re:What we need worms!

[gl4ss]

it is a good game, but it will be a good game regardless of the future crap they'll be putting out under the name.

what matters even more is that it's a so simple genre that anybody can clone it, add their own twist and ship it off - AND GET A FRESH START! so they won't have to keep adding stuff or turn it into 3d and appear to be selling a new game(whilst everyone is pondering if they should 'upgrade' or not), they can genuinely sell a new game and add genuinely new stuff without 'risking' anything(team17, who ate your innovation? or did everybody with new dangerous ideas just get sacked?).

(and hey, it's not like it was the first game in it's genre either)

no great loss

[Giant Ape Skeleton]

Acclaim has cranked out an astonishingly large number of mediocre-to-awful games in the last several years.

To be honest, they haven't done *anything* worth playing lately except for the Burnout series, which has now been taken over by EA.

While any developers who lose their jobs due to Acclaim's demise have my sympathies, Acclaim's departure from the scene will not be a Bad Thing for the gaming industry.

Quite the opposite in fact....

Re:Chump Change

[Romeozulu]

>>Because the average CEO takes down $10 million a year.

Facts to back this up?

>>Anyone know what the CEO is making?

Before spouting your mouth off with "facts", why don't you spend 10 minutes looking up what he/she makes, it's all public record and can be found by clicking on the stock link in the story.

That post was not Insightful.

Re:Chump Change

[Anonymous Coward]

Relax. Relatively speaking, he wasn't off by that much ($9.2 million instead of $10 million). Acclaim doesn't drop that kind of cash -- only a couple mil among its officers -- but the points being made are probably on the mark.

Money goes a lot farther when you throw it at programmer salaries than it does when you throw it at the execs.

Though maybe I'm just saying that because I program.

GOOD.

[Pluvius]

In over 15 years, Acclaim (aka Acclame LOL) has put out practically nothing but drivel. I seriously can't think of one good game that they were responsible for, and a ton that were complete crap (Airwolf, Destination: Earthstar, and Total Recall to name a few, and that's just on the NES!). Moreover, Acclaim's main subsidiary during the NES days was LJN, which made execrable movie-license games like Back to the Future 2 & 3 and Bill and Ted's Excellent Video Game Adventure. I honestly don't know how they survived longer than companies that made decent games (e.g. Sir-Tech, 3DO, Microprose). Good riddance.

Rob

Re:Chump Change

[Colazar]

So I went and looked at theire financials, and it looks like they actually died back in 2000, with a horrendously bad year. They stayed afloat by borrowing a large amount of money (~$50 million), and the interest payments on that doubtless kept them below water ever since. Their operating cash flow has been negative ever since, with the only cash they've generated having been from the sale of stock. So really, it's just taken 3 years for their corpse to stop twitching.

The other thing I noticed which would have sent up an immediate red flag to me is that they factor their receivables. Now, it wouldn't surprise me if that was industry standard practice (this is not my industry), but in my experience the terms on factoring are usually so bad, that if you have to depend on that for your cash flow for more than a short time, you're already in danger. Maybe I'm just too cautious, but that's usually enough to keep me away from a company right there.

Didn't look like their G&A was particularly bad, or that their managers were unreasonably compensated. They just didn't sell enough games.

Good Riddance

[darkmayo]

The name acclaim has never really been linked with creating good games. These guys have been snapping up movie and television licenses for years and have been producing shitty games based on these said licenses.Just take a look at the crap they putout with the Simpsons name. They never had the power to actually create anything worthwhile and just used the Movie names to bring in the sales. Now in the light that you actually can create a decent game out of a movie license (See Spiderman 2 and Chronicals Of Riddick) companies who actually want to make a game out of their movie will go to a group with Talent.

Cya Acclaim nobody is going to miss you.

Re:Chump Change

[aliens]

He's close:

In 2003, the average CEO of a major company received $9.2 million in total compensation

From Here

On average they make 531 times the average Joe.

Nice huh?

In 1980 they made 42.