SCi Kills 14 Projects, Cutting 25 Percent of Staff

SCi, developers of Tomb Raider, Hitman and Deus Ex, have canceled 14 of their projects and plan on laying off 200 people and cutting their annual operating costs by £14 million as part of a company restructuring plan meant to get SCi back on track.

"Following our business review over the last six weeks, we are initiating a clear action plan based on three fundamental strands of activity: a radical change in our structure to a studio-led business, a top to bottom programme of product improvement and efficiency and a considerable cost reduction plan," Phil Rogers, Chief Executive of SCi Entertainment Group said, in a prepared statement. "To get SCi on track we have to act rapidly and effect change quickly. We must allow the world-class people that we have within the Group to focus on strong, profitable titles which will create the value our shareholders deserve."

A chief part of that plan is a fundamental change to the way the company does business with SCi shifting from the current centrally-controlled development and publishing model to a studio-led one, similar to the labels model that EA moved to last year.

Under the new structure, SCI would have studios based around "cornerstone products" like Tomb Raider, Hitman, Championship Manager and Deus Ex. The company is also creating an Eidos PLAY studio which will "fuse together casual and new media resources." Finally, production services will form part of the studio group and be relocated to Montreal from London.

I blame the Wii... well that and a company that has essentially been living off of three franchises for nearly two decades.

SCi Corporate

Business review and half-yearly financial report for the six months ended 31
December 2007

COMPANY TO BE RE-STRUCTURED

SCi Entertainment Group plc ('SCi' 'the Company' or the 'Group'), today announces a group re-structuring plan following its business review and its interim results for the six months to 31 December 2007.

The business review led by new Chief Executive, Phil Rogers, has decided on the following actions:

Fundamental change in business structure:

* SCi's business structure will be significantly changed from a centrally controlled development and publishing model to a studio-led business focused around cornerstone products, such as Tomb Raider, Hitman, Championship Manager and Deus Ex.
* Creation of Eidos PLAY to fuse together casual and new media resources to attack growing markets.
* Flexible and efficient approach to distribution.

Product improvement initiatives started:

* Cancellation of 14 projects which the Board considers are unlikely to generate an acceptable return on investment or are not of appropriate quality.
* Studios focusing on product innovation and delivery of high quality games.
* Production services to form part of the studio group, relocating to Montreal from London.

Cost reduction plan:

* New business structure targeted to operate with a maximum of 800 people, a reduction of 25% from current headcount.
* Annual operating costs to be cut by £14 million by the end of June 2008 at a one-off cost of £7 million

Phil Rogers, Chief Executive of SCi Entertainment Group said, 'SCi is in need of immediate change.

'Following our business review over the last six weeks, we are initiating a clear action plan based on three fundamental strands of activity: a radical change in our structure to a studio-led business, a top to bottom programme of product improvement and efficiency and a considerable cost reduction plan.

'To get SCi on track we have to act rapidly and effect change quickly. We must allow the world-class people that we have within the Group to focus on strong, profitable titles which will create the value our shareholders deserve.

'I am confident our staff share this vision and excitement for the future, and determination to build a working environment where our innovation and creativity can be commercially realised.'


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