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THQ Achieves Targeted $220 Million Fiscal 2010 Cost Savings

AGOURA HILLS, Calif.--(BUSINESS WIRE)--Apr. 2, 2009-- THQ Inc. (NASDAQ: THQI) today announced that it has substantially completed the actions necessary to achieve its previously announced plan to reduce fiscal 2010 budgeted annual spending by $220 million.

“We have executed on our previously announced business realignment actions,” said Brian Farrell, THQ president and CEO. “Our goal is to return to profitability and generate positive cash flow in fiscal 2010, and to position THQ for long-term sustainable and profitable growth.

“We are confident in achieving these goals based on our focus on key market opportunities, our robust franchise portfolio and our dedicated and talented employee base,” said Farrell. “We look forward to demonstrating success with our upcoming fiscal 2010 releases, including UFC 2009: Undisputed, Red Faction Guerrilla and Darksiders.”

During the fiscal 2009 fourth quarter, the company expects to report approximately $45 million in non-GAAP business realignment expenses, which includes cash costs of approximately $4 million, including severance and other employee-related costs, and lease and other contract termination costs; and approximately $41 million in non-cash impairment charges related to the cancellation of titles and long-lived assets associated with studio closures. The company expects to record additional charges of up to $10 million in fiscal 2010 as certain projects are completed and facilities are vacated. The charges will be excluded from the company’s non-GAAP results.

About THQ

THQ Inc. (NASDAQ: THQI) is a leading worldwide developer and publisher of interactive entertainment software. Headquartered in Los Angeles County, California, THQ sells product through its global network of offices located throughout North America, Europe and Asia Pacific. More information about THQ and its products may be found at www.thq.com and www.thqwireless.com. THQ, Red Faction Guerrilla, Darksiders and their respective logos are trademarks and/or registered trademarks of THQ Inc.

All other trademarks are trademarks or registered trademarks of their respective owners.

This press release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, the company’s expectations for non-GAAP business realignment expenses to be reported during the fiscal fourth quarter ending March 31, 2009 and fiscal 2010, and statements about the expected impact of the business realignment initiatives on our future operations and financial condition. These forward-looking statements are based on current expectations, estimates and projections about the business of THQ Inc. and its subsidiaries (collectively referred to as “THQ”) and are based upon management’s beliefs and certain assumptions made by management. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements, including, but not limited to, economic, competitive and technological factors affecting the operations, markets, products, services and pricing of THQ, and our ability to successfully implement our cost reduction plans. Unless otherwise required by law, THQ disclaims any obligation to update its view on any such risks or uncertainties or to revise or publicly release the results of any revision to these forward-looking statements. Readers should carefully review the risk factors and the information that could materially affect THQ’s financial results, described in other documents that THQ files from time to time with the Securities and Exchange Commission, including its Quarterly Reports on Form 10-Q and its Annual Report on Form 10-K for the fiscal period ended March 31, 2008, and particularly the discussion of risk factors that may affect results of operations set forth therein. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.

Source: THQ Inc.

THQ/Investor & Media Relations
Julie MacMedan
818-871-5125


 
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