Loans breach is looming at Game

Kasmira Jefford
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DIRE sales of video games over the Christmas period have forced Game Group to warn that it may breach an upcoming financial covenant test, knocking more than 43 per cent off its share price yesterday.

Chief executive Ian Shepherd blamed the lack of new games consoles dovetailed with the weak consumer environment for like-for-like sales falling 12.9 per cent in the eight weeks to 7 January.

The company said a cash position similar to last year’s £120m level meant it should meet the debt service requirements on its loans, stressing that it was in “regular and constructive dialogue” with lenders.

The group is betting on the release of new consoles, including Nintendo’s Wii U, which is out later this year.