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Update on LEGO Minifigures Online and the financial situation of the Company

Published on (07-23-2015)

Funcom N.V. (the "Company") would like to provide an update regarding the launch of the LEGO Minifigures Online game and the financial situation of the Company.

LEGO Minifigures Online launched three weeks and three days ago and the Company has gathered enough information on the initial sales to provide an update. The game is currently not meeting internal revenue forecasts. This is mostly due to low sales on the PC platform.

Sales on the iOS platform have performed better, mainly due to the featuring in the Apple Store during the launch week, but as the price point of the game on this platform is lower, these additional sales are not enough to compensate for the low sales on PC for the time being.

Initial results from the test marketing activities have started to become available and they have been able to drive traffic to the game's website and the relevant App Stores. However, conversion from those visits is low resulting in these activities being unable to deliver a return relative to their cost of execution. Additional PR and test marketing activities are in progress and results will be analysed as they become available.

A new round of physical product integration will also happen at the beginning of September and that, combined with the end of the holiday period, may have an impact on the sales of the game.

Finally, interest from gaming press in the product is more limited than expected and there is thus less exposure of the game in traditional gaming outlets. The Company attributes this, among other possible factors, to the fact that the game has been available since last year. The MetaCritic score, and aggregation of various press review,  is currently at 65 for PC, while the MetaCritic score of the iOS version is at 77. The PC score is below the internal target range, while the iOS score is within the internal target range

As previously communicated, the Company continues to actively seek solutions for the repayment of its debt that is due in June 2016. The revenues generated from all of the Company’s games are not expected to cover both operational expenses and the debt repayment obligations. In light of this, the Company is in discussions with its principal creditor on the subject and it will   engage with advisors for a strategic review of the business in order to resolve the situation in a timely manner.

Badhoevedorp, The Netherlands, 23 July 2015
Funcom N.V.

This information is subject to the disclosure requirements acc. to § 5-12 vphl (Norwegian Securities Trading Act)

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