Launch of new titles fails to lift Game out of the gloom

VIDEO games retailer Game Group yesterday warned that the launch last week of titles such as Modern Warfare 3, FIFA 12 and Mario Kart 3D was unlikely to improve the market in the short term.

At its AGM, the group - which has 322 stores and concessions in the UK and Ireland - revealed like-for-like sales were down 9.4 per cent in the 19 weeks to 11 June, compared to a industry-wide decline of 12.8 per cent.

Players have held on to their cash amid worries over high inflation and a lack of growth in wages. Retailers are also suffering from a lack of new games consoles entering the market. Nintendo is not expected to launch the next version of its Wii console until December 2012, despite unveiling it at last week's E3 video game trade show in Los Angeles.

High street retailers - such as rival HMV, which is selling off its Waterstone's book shop chain to help manage its debt - are facing increased competition from online shops and from games developers selling software directly through the internet, rather than discs in shops.

Nick Bubb, an analyst at Arden Partners, said: "Beneath all the guff in the AGM update about Game's strategy delivery, the fact is that Game has delivered yet another profit warning. The market is afraid that this will go the same way as HMV's, given the challenges in the games market."

Game said UK like-for-like sales were down 9.1 per cent, while its overseas business posted an 11.8 per cent fall.