Ubisoft eyes buys, but wants to stay cash positive

By Dominique Vidalon

PARIS, May 30 (Reuters) - Europe's second-largest independent video games publisher, Ubisoft (UBIP.PA), wants to stay cash positive in the current fiscal year even as it also is looking at acquisitions, its top managers said on Wednesday.

"The idea is to stay cash positive, but we remain on the lookout for acquisition opportunities," Chairman Yves Guillemot told a news conference on the group's 2006/07 earnings.

Chief Financial Officer Alain Martinez told Reuters after the meeting that Ubisoft was currently looking at two or three opportunities and notably at development studios.

He would not go into details but said the possible targets were in the range of 1 million to 20 million euros.

Ubisoft, which unveiled its 2006-07 earnings after the market close on Tuesday, ended the year on March 31 with a net cash position of 55 million euros ($73.8 million), which was an improvement of 120.3 million euros from end-March 2006.

This was after cash flow from operations rose by 85.5 million euros to 53.2 million due to a sharp improvement in operating income and a reduction in working capital requirements.

Martinez said Ubisoft could end the current fiscal year to end-March 2008 with a net cash position of 75 million to 95 million euros, excluding acquisitions.

Operating income was bolstered in 2006/07 by a 24 percent jump in revenue to 680 million euros in a global video games market that grew 5 percent as Ubisoft reaped the benefits of its early positioning on new generation gaming consoles.