NCSoft logs 45.9% plunge in net profit

Korea's online game developing giant NCsoft Corp. said Thursday that it posted a 45.9 percent drop in fourth-quarter earnings on higher costs and the absence of new game titles.

Net profit reached 37.87 billion won ($34.12 million) in the October-December period last year, compared with 70.02 billion won a year earlier, the company said in a regulatory filing.

Sales fell 19.4 percent on-year 158.98 billion won in the quarter and operating profit also sank 54 percent to 40.22 billion won, it added.

The company, which developed globally popular online PC game titles such as "Lineage," said that its long-awaited new game release at the end of 2008 multiplied its profit in the fourth quarter of 2009, eclipsing earnings in the same quarters in other years.

The development cycle of a blockbuster online PC game stretches to three to five years. The 2008 release of "Aion," NCSoft's first major product that arrived in the market five years after Lineage 2's launch, caused a spike in its profits in 2009, its spokesman explained.

On a full-year basis, NCSoft's 2010 net profit stood at 173.8 billion won, down 6 percent from 2009, hit by a lost legal case. In July last year, a U.S. court ordered the Korean company to pay $28 million in compensation to a former employee.

Its annual sales and operating profit, however, rose 2 percent and 4 percent each from a year earlier, driven by record sales of Lineage, it said. The company's major cash source is monthly usage fees it collects from online game users. (Yonhap)