Game shows strength after bid blow

COMPUTER games retailer Game Group shrugged off the collapse of takeover talks to report a big increase in profits for last year and a return to underlying sales growth in recent weeks.

Chief executive Martin Long said a 'resolute' performance had consolidated the group's position as Europe's largest specialist retailer of computer and video games software.

Overall sales declined 5% to £577m, reflecting lower selling prices and a severe shortage of consoles over the vital Christmas period, but profits before tax and goodwill jumped 31% to £31.9m.

Like-for-like sales slid by 15.5% in the UK and Ireland, where Game has 400 shops, but rose by just over 6% in the rest of Europe. But there has been a return to growth at home this year, with overall sales for the group up 18% and like-for-likes 8% better in the 11 weeks to 16 April.

Underlying growth in Britain was 5.4% while sales on the Continent surged 22% like-for-like. Game has now moved into the black in continental Europe, ahead of schedule.

While trading was weak in February, it was followed by a 'very strong' March, boosted by an improved software line-up and launch of the Nintendo DS handheld.

Trading is expected to remain 'challenging' for the rest of the year, particularly in the second half, as prices continue to fall and comparisons get tougher. But the group is confident of a 'satisfactory' outcome for the full year.