Ubisoft 2002 Annual Report Download - page 34

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2003
34
FINANCIAL
REPORT
1.3.8 Change in Working Capital
Requirement (WCR) and
Indebtedness
Ubisoft's financial ratios continued to improve. The inventory
level was brought down to 2.5 months as compared with
3.8 months in 2001/02. Customer accounts for Q4 2002/03
represented 77 days as compared with 105 days in 2001/02.WCR
represented 36.5% of sales versus 40% in 2001/02 and 46%
in 2000/01.
At 169.9 million, net indebtedness increased by 38.2 million
compared with 2001/02 due to a particularly high level of activity
during the year's fourth quarter (with sales of 179 million).
It represented 56% of shareholders' equity as of March 31,2003.
1.3.9 Pro forma presentation
in accordance with US GAAP
In addition to presenting its consolidated accounts according
to French accounting standards, Ubisoft also presents pro
forma accounts in which in-house development costs are stated
as expenses,as is the practice of certain American video game
publishers.
Differences between the standards:
French standards or "French GAAP"
- In-house research and development expenses are reported
as fixed assets and then amortized;
US GAAP Pro forma standard
- In-house research and development costs entered in the
accounts as charges
(million euros) 2002/2003 2001/2002 2000/2001 1999/2000 1998/1999
Published operating income 37.1 31 7.9 13.7 13.4
- Capitalized R&D expenses -72.1 -77 -60.7 -45.6 -33.7
+ Amortization of intangible fixed assets 66.1 54.7 33.7 37.8 21.5
Pro forma operating income according to US GAAP 31.2 8.7 -19.1 5.9 1.2
Unaudited pro forma presentation
Impact of US GAAP pro forma presentation on operating income over the last five fiscal years:
Unaudited pro forma presentation
(million euros) 2002/2003 2001/2002
Operating income (before amortization of goodwill and business assets) 31.0 8.7
Net income before amortization of goodwill and business assets 10.4 (0.7)
Net income after amortization of goodwill and business assets 4.9 (6.6)
(euros per share)
Net earnings per share before amortization of goodwill and business assets 0.43 -
Earnings per share after amortization of goodwill and business assets 0.11 -
According to this pro forma presentation, the main impact on the 2002/03 accounts can be stated as follows: