Sat, Aug 18, 2012 - Page 13 News List

Gamania Digital Entertainment cutting 150 more jobs

MARKET CHANGES:The cuts will come from headquarters, R&D and overseas operations. The firm would not say if it was responding to shareholder pressure

By Kevin Chen  /  Staff reporter

Gamania Digital Entertainment Co (遊戲橘子) confirmed yesterday it is streamlining its operations, following in the footsteps of other online game companies such as UserJoy Technology Co (宇峻奧汀) and Chinese Gamer International Corp (中華網龍).

The company said in a statement that it would cut about 10 percent of its workforce as part of a restructuring plan aimed at enhancing its market competitiveness.

The cuts mean that the company, which has a market share of 28.53 percent in Taiwan’s online gaming industry, plans to eliminate more than 150 jobs, as it has become clear that the past two years of dramatic market changes — driven by the increasing popularity of mobile applications — demands a new response for the company to survive, it said.

Gamania’s move came after UserJoy Technology slashed 10 percent of its workforce late last year.

Chinese Gamer International recently announced a hiring freeze on full-time employees to decrease personnel expenses.

“To cope with fierce competition, the company will immediately undergo an organizational adjustment, which is expected to affect about 10 percent of employees, and plans to complete the adjustment and reallocate company resources by the end of August,” Gamania said in the statement.

The company, which already eliminated 30 jobs in recent weeks, said it would prioritize its latest job cuts within its headquarters, the research and development division and its overseas operations, while cutting the salaries of its high-ranking executives.

Gamania reported a net income of NT$56.20 million (US$1.87 million) in the first quarter, or earnings per share of NT$0.35, compared with a net income of NT$129.72 million, or NT$0.84 in EPS, a year earlier.

Revenue in the first seven months totaled NT$4.23 billion, up 0.62 percent from NT$4.21 billion for the same period of last year, company data showed.

Gamania did not say how much it would save from the latest cost-cutting, nor would it confirm whether it was making the move under pressure from its largest shareholder, Nexon Co, as local media have speculated.

Gamania is 34.6 percent owned by the South Korean online gaming giant and it has been in a fight against a hostile takeover by Nexon since May. Last month, the Fair Trade Commission fined the South Korean company NT$900,000 for failing to report its acquisition of more than a one-third stake in Gamania and demanded that Nexon either submit an application to the commission or reduce its stake in the Taiwanese company within three months.

Shares in Gamania dropped 6.37 percent to NT$25 yesterday in Taipei trading, declining 9.09 percent so far this year and down 28.5 percent from this year’s high of NT$34.98 on March 26.

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