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Chaotic folds as trading card games deal 4Kids a bad hand

Chaotic folds as trading card games deal 4Kids a bad hand

Five or ten years ago, 4Kids was riding high. The Fox Box was a premiere showcase for toons like Sonic the Hedgehog, Teenage Mutant Ninja Turtles, Viva Pinata, Yu-Gi-Oh!, and Pokemon. More importantly, the company was dominating in the field of trading card games. At the height of TCGs, recess across the globe was owned by gauntlets of cards, with kids showing whose monster or dragon or beast or bot was superior. Today, 4Kids is a different story, with financial woes, a new program block called Toonzai, and a mighty blow to the TCG empire with the loss of TC Digital Games. 4Kids was majority owner of TCD which, along with TC Websites, was a major factor in the Chaotic line. With those pieces gone, the Chaotic brand is essentially all but dead – certainly bad news for animation and TCG fans. Check out the detailed press release

4Kids Entertainment, Inc. /quotes/comstock/11i!kide (KIDE 0.45, +0.02, +4.65%) , the global children’s entertainment and merchandise licensing company, today announced financial results for the third quarter ended September 30, 2010.

Net revenues for the three months ended September 30, 2010 totaled $3.0 million, compared to $5.3 million for the same period in 2009. The Company’s net loss for the three months ended September 30, 2010 attributable to 4Kids Entertainment was $(9.8) million, or $(0.73) per diluted share (consisting of a net loss from continuing operations attributable to 4Kids Entertainment of $(8.4) million, or $(0.63) per diluted share and a net loss from discontinued operations attributable to 4Kids Entertainment of $(1.4) million, or $(0.10) per diluted share) as compared to a net loss for the three months ended September 30, 2009 of $(5.0) million, or $(0.37) per diluted share (consisting of a net loss from continuing operations attributable to 4Kids Entertainment of $(3.3) million, or $(0.25) per diluted share and a net loss from discontinued operations attributable to 4Kids Entertainment of $(1.7) million, or $(0.12) per diluted share).

For the nine months ended September 30, 2010, net revenues totaled $9.7 million, compared to $18.0 million for the same period in 2009. The Company’s net loss attributable to 4Kids Entertainment for the nine months ended September 30, 2010 was $(19.8) million, or $(1.47) per diluted share (consisting of a net loss from continuing operations attributable to
4Kids Entertainment of $(17.4) million, or $(1.29) per diluted share and a net loss from discontinued operations attributable to 4Kids Entertainment of $(2.4) million, or $(0.18) per diluted share), as compared to a net loss of $(20.8) million, or $(1.56) per diluted share for the nine months ended September 30, 2009 (consisting of a net loss from continuing operations attributable to 4Kids Entertainment of $(14.7) million, or $(1.11) per diluted share and a net loss from discontinued operations attributable to 4Kids Entertainment of $(6.1) million, or $(0.45) per diluted share).

As of September 30, 2010, the Company had approximately $4.0 million in cash and $10.9 million in investment securities at their fair market value.

As previously announced, the Company is continuing to explore its strategic alternatives. The Special Committee of the Board of Directors consisting of the Company’s four independent directors is presently in ongoing discussions with several companies which may be interested in investing in 4Kids or acquiring all or a portion of the Company’s business. There can be no assurance that any transaction will result from these discussions.

“4Kids had another tough quarter as the Company continues its efforts to rationalize its cost structure, rebuild revenues and execute its turnaround plan,” said Alfred R. Kahn, Chairman and Chief Executive Officer, 4Kids Entertainment. “Despite the reported third quarter losses of $(.73) per share, the cash burn in the third quarter was approximately $700,000.

“At the end of the third quarter, we discontinued the business operations of our majority-owned trading card subsidiary, TC Digital Games LLC, and our majority-owned Website company, TC Websites LLC, recording substantial write-offs in our financial statements. The cessation of the Chaotic related businesses should save approximately $1 million per quarter. In addition, the closing of the Chaotic business enables the Company to focus its resources on the Company’s core merchandise licensing business,” said Kahn.

“On September 18, 2010, we launched the new season of our five-hour Saturday morning block on The CW Network, which is called ‘Toonzai on CW 4Kids.’ Our network lineup includes new episodes of such leading Japanese animated series as Yu-Gi-Oh! 5D’s and Dragon Ball Z Kai, as well as longtime favorites such as Sonic X, Dinosaur King and classic Yu-Gi-Oh! We also launched our new online video player called ‘Toonzaki’ in the third quarter, which we are hopeful will attract additional Internet advertising revenues,” concluded Kahn.

About 4Kids Entertainment, Inc.

With U.S. headquarters in New York City, and international offices in London, 4Kids Entertainment, Inc. /quotes/comstock/11i!kide (KIDE 0.45, +0.02, +4.65%) is a global organization devoted to the creation, development, production, broadcasting, distribution, licensing and manufacturing of children’s entertainment products.

Through its subsidiaries, 4Kids produces animated television series and films, distributes 4Kids’ produced or licensed animated television series for the domestic and international television and home video markets, licenses merchandising rights worldwide to 4Kids’ owned or represented properties, operates Websites to support 4Kids’ owned or represented properties. Additionally, the Company programs and sells the national advertising time in “TheCW4Kids” five-hour Saturday morning block on The CW television network.

Additional information is available on the www.4KidsEntertainment.com corporate Website and at the www.4Kids.tv game station site.

The information contained in this press release, other than historical information, consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may involve risks and uncertainties that could cause actual results to differ materially from those described in such statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Important factors beyond the Company’s control, including general economic conditions, consumer spending levels, competition from toy companies, motion picture studios and other licensing companies, the uncertainty of public response to the Company’s properties and other factors could cause actual results to differ materially from the Company’s expectations.


ToonBarn Rob

um… the ToonBarn guy, of course! but you can call me Rob
Published in4kidsChaoticYu-Gi-Oh!

23 Comments

  1. marrilian marrilian

    this is the end chaotic? do not new episodes im 4kids?

  2. the future doesn’t look good, marrilian. at least with 4Kids.

    However, classic franchises have been reborn before – just look at how many different Teenage Mutant Ninja Turtles there have been, with Nickelodeon bringing out another one next year. Maybe Nick or Cartoon Network will relaunch Chaotic some day in the future.

    If they did, would you be in?

  3. robin robin

    yea they should bring this back but what happened to Eon kid and Kamen rider dragon knight Its like CW has totaly forgotten about these 2 major shows which they need to put back on instead of constantly repeating Sonic X over and over again or they could at least make a brand new season or somethin

  4. Blazvatan Fan Blazvatan Fan

    Monday i noticed my computer wouldn’t allow me to get on the chaotic forums. Yesterday it wouldnt let me get into the dromes. Today, any official chaotic website will not come up. CHAOTIC IS DEAD. MY LIFE IS RUINED. I have strong feelings of hate as my prolonged hobby has come to a complete end. Nothing to do at my moms work now, and my big box of cards have become a legend. My question is, how is Dinosaur King topping Chaotic, and why did chaotic have to end?

  5. totally agree, Blazvatan and robin! So sad to see it all go away, and I’d absolutely love to have it all back again. Chaotic was a cool show and a cool game, and it’s run ended far too soon. it is VERY possible we’ll see it revived down the line, maybe with another network, so there’s always hoping for the future.

    for the record, Blazvatan, we’d be happy to host a lot of you “forgotten” chaotic forum people over here. Feel free to have your friends bring their conversations to the ToonBarn forum (toonbarn.com/forum/). The more the merrier! If you build up enough content, we could even add a special “Chaotic” folder to the forum!

    And don’t worry – we’re not going anywhere 🙂

  6. Blazvatan Fan Blazvatan Fan

    Well thanks for the offer, but chaotic has been ressurected! I had a lot of drama in my previous comment, so sorry lol. I posted that right after i found out it was dead. However… it has come back for a couple weeks now and we are all rejoicing. If it does happen again, i will bring every one here.

  7. awesome news, Blazvatan Fan – glad to hear it for you!!

    Please do keep my offer in mind. I know the Chaotic message boards may be up and running now, but with all the (pardon the expression) chaos that’s going on with 4Kids and TCDigital lately, it wouldn’t surprise me at all if everything was gone tomorrow.

    You guys are always welcome here as an alternative. You might even want to start spreading the word now, just incase things DO disappear over there. Better take care of it before it’s too late, you know? Anyway, whether you wanted to move over now, post in both spots, or relocate when “the end” arrives, we’ll be here. Whatever is best for you guys, I’m more than happy to help!

    Shoot me an email if you have any questions (rob@toonbarn.com) and I’ll walk ya through it!

  8. sUPERTOES sUPERTOES

    But Jetix had Chaotic.

  9. Powerking133 Powerking133

    I want chaotic to be in CN this time. I don’t like 4kids that much because they didn’t stick with the cool tcg Chaotic. Chaotic ain’t dead because you know when a tcg is dead. Chaotic will come back.

  10. I’m with you, Powerking. A new Chaotic series on Cartoon Network seems like it would do well. Maybe we can start a petition 🙂

  11. Powerking133 Powerking133

    @To All Chaotic Players: We will need a big community to actually work hard and do something for Chaotic tcg. We have to do something… Its not even fair, Chaotic didn’t even get a chance to be a fully developed tcg experience to just end so soon. I love Chaotic tcg….. I am so tired of these other tcgs trying to copy Chaotic( Radiakai). Come on people we can save Chaotic

  12. like I said before, you guys should set up shop in the ToonBarn message board – http://toonbarn.com/forum/. If we get a big enough group talking about the toon and the TCG, maybe we can make a difference.

  13. Eli Scott Bromlow Eli Scott Bromlow

    Hey Power King 123 . Why do you say Redakia is copying Chaotic? They don’t have an online game play website or an unique alphameric code, and their cards are made with plastic. You stack cards on top of other cards. Wouldn’t you agree that it was just the right time to release Redakai. Do you honestly think that stacking plastic (Good quality of cards, they are not made of paper) cards to K.O an opponent is copying Chaotic? I’m just wondering what made you think Redakai in any way,shape, or form copies the unique Chaotic TCG?

  14. Chaos Chaotic Chaos Chaotic

    Im still a big chaotic fan im still buying cards when ever i get the chance i know its been awile when someone post but i really enjoy watching and i dont know who still play chaotic but ita a very fun show an i really enjoy it i hope 2 years from now there will be a channel just for all the shows we love and know

  15. maxxor maxxor

    Chaotic !!!!!!!!!!!!!!!!!!!!!!!!

  16. maxxor maxxor

    I still collect i buy boxes online toywiz

  17. Ricardo D. Ricardo D.

    We need chaotic back

  18. Nathan Nathan

    If this TV show came back it would make my day so if you want to bring it back please help to do so

  19. NathanM NathanM

    I wish it would come back too, i love the show and the card game. I don’t think if we get alot of people, it still wont come back because they are afraid to loose money. Sad… one of the most complex and unique TGC games got pooped on cause the lack of money or they just didn’t want to loose alot of it.

  20. Hi. I play chaotic with my little bro and have watched all of the episodes on youtube. I never had the chance to “enter the code” or anything on the online game. I like mipedians, as well as bladez the underworlder and aarthoa and iparu the overworlders. I say that I like the petition idea, even though it was from a few years ago. I love the game, and I think we should try to get it going again. I am trying to teach more people how to play, like my neibors. so I am going to start a petition. If anybody wants to join, type CHAOTIC in caps and your favorite tribe, creature, battlegear, mugic and location. It’s like I always say. Never give up withought a fight. Thank you for letting us use this as a forum, toonbarn rob. Goodbye for now.

    – chaotikid

  21. MoisesZ MoisesZ

    Waiting for someone to bring back chaotic!!

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