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Troubled video game company Sega Corp reduced its losses in its latest financial year, but has seen sales fall by 15 percent.
Sega has been suffering of late after the dismal performance of its game console the Dreamcast and the last year has seen the company engaged in a cost-cutting exercise that saw unprofitable elements of the business sold-off and a disposal of other assets.
The moves appeared to have had some effect with its results for the fiscal year ended in March 2002 showing a loss of USD140 million, which is well down from the USD1.6 billion it lost the year before.
In further good news for the creator of video game legend Sonic the Hedgehog, Sega managed to return to black for the first time in five years at an operational level. The company made an operating profit of USD112 million compared with an operating loss of USD411 million in the previous year.
The company has not, however, been able to reverse the trend in falling sales with sales of USD1.6 billion for 2001-2002 comparing badly with the year before when they were worth USD1.9 billion.
Sega did say that it expects to return to profitability during the current fiscal year, which ends in March 2003, and the firm forecast a net profit of USD141 million on sales of USD1.6 billion. The company said that a more streamlined organisation combined with continued growth in the world's video game market would be the main enablers of this turnaround.
The results included a special charge of nearly USD260 million, about half of which was to reflect the fall in the value of shareholdings donated to the company by its former chairman and president Isao Okawa, who died last year.
Sega halted production of the Dreamcast last year after disappointing sales of just 10 million globally. This compares with Sony's PlayStation2 console, which has sales figures three times higher.
Sega now concentrates on creating games for the PlayStation2, Microsoft's X-Box and Nintendo's GameBoy and GameCube. During its last financial year, it produced 14 game titles for the PlayStation2, which had total sales of 3.5 million, eight titles for the GameCube (1.2 million sales) and 13 titles for GameBoy Advance (1.7 million sales).
The company also announced on Friday that it had signed a deal to make video games starring comic book characters created by the so-called Japanese version of Walt Disney, Osamu Tezuka.
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