Mad Catz Interactive, Inc. (MCZ), a third-party provider of accessories for video game consoles and personal computers, reported first quarter 2009 financial results this afternoon after the close. Revenues rose to a first quarter record of $23.2 million, an increase of 58.9% year over year from $14.6 million. Gross profit rose to $8.1 million, also a first quarter record, and an increase of 72.3 % from $4.7 million in Q1 2008. Net loss for the quarter was $0.8 million, or a penny per share, compared to a net loss of $0.2 million, or a fraction of a penny, for the same period last year. Earnings were impacted by a 76% increase in selling, general, and administrative expenses, which rose to $7.9 million compared to $4.5 million a year ago.
Commenting on the results, Darren Richardson, President and Chief Executive Officer of Mad Catz, stated, “Mad Catz’ record first quarter net sales of $23.2 million and gross profit margin of 34.9% reflect the significant progress we continue to make in diversifying our product lines, expanding our international presence and building our portfolio of prominent licenses. As a result of the expansion of our product offerings for the current generation of consoles, Mad Catz reached an important inflection point in the first quarter of 2008, as sales for the current generation of consoles surpassed those of the prior generation for the first time. We plan to build on this momentum through the high quality range of accessories we expect to begin shipping in North America and Europe in the second quarter for the hit Rock Band™ game, which has potential to serve as an important source of revenue for Mad Catz through the 2008 holiday season and beyond.
“During the first quarter Mad Catz also made significant progress in extending our geographic reach and product diversification by leveraging our acquisition of leading PC peripherals provider Saitek,” continued Mr. Richardson. “PC-based products comprised a significant portion of our revenues during the first quarter, broadening our product offerings and reducing Mad Catz’ reliance on gaming console-specific products. In addition, net sales into the European market in the fiscal 2009 first quarter more than doubled from the prior year period, with Europe now accounting for over 40% of net sales.”
Shares of MCZ closed at $0.60 today and have traded in a 52-week range of $0.48 – $1.39. With 55 million shares outstanding, MCZ has a market cap of $33 million, a P/E of 15, and a price-to-sales ratio of 0.34. The first quarter is seasonally the company’s slowest, while the third quarter, which includes the holiday season, typically accounts for over 40% of full-year revenues. Historically the stock bottoms in late summer before rising in January.
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