Friday, Mad Catz Interactive, Inc. (MCZ,MCZ.TO), a third-party interactive entertainment accessory company, reported a loss in the third quarter, hurt by goodwill impairment charges and increased inventory reserves, amid prevailing uncertainty in the economy as well as the retail industry.
The San Diego, California-based company's net loss for the quarter was US$26.91 million, or US$0.49 per share, compared to net income of US$3.31 million, or US$0.06 per share, in the year-ago quarter.
Adjusted net income for the third quarter declined to US$2.06 million, or US$0.04 per share, from US$3.65 million, or US$0.06 per share, in the prior year. The company incurred a pre-tax non-cash charge of $28.5 million related to goodwill impairment, amortization of intangible assets and stock-based compensation.
Quarter net sales were US$40.82 million, a 19% increase from US$34.27 million in the last year.
Quarterly gross profit decreased to US$10.55 million from US$12.66 million a year ago. The company noted that the decline was primarily due to provisions for increased inventory reserves, higher royalty expenses, increased costs due to added product development staff and higher shipment costs.
For the nine-month period, net loss was US$28.93 million, or US$0.53 per share, compared to a profit of US$4 million, or US$0.07 per share, in the prior year. Adjusted net income was US$1.02 million, or US$0.02 per share, compared to US$4.36 million, or US$0.08 per share. Net sales for the year-to-date period were US$89.87 million compared to US$65.70 million last year.
MCZ ended Thursday's trading at $0.38 on the AMEX.
MCZ last traded at C$0.48 on the Toronto Stock Exchange.
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