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					          Sustained and controlled growth
          If one were to try and describe in one          that will increase Infogrames’ worldwide     phones, has been financed internally
          word Infogrames’ performance during             market share. Henceforth known as            with investments of 7 million euros for
          fiscal 2000, at the close of the                Infogrames, Inc., the new affiliate brings   the year. It is expected to provide
          millennium, that word would be                  under a single roof all of the Company’s     significant alternative areas of expansion
          “transition”, as in:                            interests in the US. It has been             for our business in future years.
         • the transition from a company that was         restructured in less than eight months       Thanks to these capital projects,
           essentially European to a global               and is headed by a new management            Infogrames now has a global publishing
           corporation, through the acquisition of        team made up of experienced                  and distribution structure and a well-
           GT Interactive Software in the United          professionals. It now operates along the     stocked catalog of products for current
           States;                                        lines that have proved successful at         and future interactive systems.
         • the transition from now outmoded                                                            In its new form, the Company is ready to
           earlier-generation hardware to a              • Production projects of more than            take advantage of the expected
           spectacular new interactive technology;         100 million euros included expenditures     turnaround in the market and has started
                                                           to expand our catalog based on existing     fiscal 2001 full of confidence and
         • the transition from a limited installed         formats, but mainly to design software
           base to software designed to operate on                                                     optimism, intent on returning to a
                                                           for next-generation consoles, Sony’s PS2,   situation of significant and sustained
           all interactive hardware on which games         Microsoft’s Xbox and Nintendo’s
           can be played.                                                                              growth.
                                                           Gamecube and Game Boy Advance.
          These transitions have repeatedly shaken         Eight new games are scheduled to be         Beyond that, during the transition
          up our business, in particular during the        released this year for the PS2 console.     period, the Company demonstrated that
          last fiscal quarter, when they had an            Twelve more are being developed and         it had what it takes to be a growing
          adverse impact on our less-than-ideal            are expected to be in stores when the       international corporation, namely:
          financial performance.                           Xbox becomes available, and another         the ability to stay focused on
                                                           eight games are in progress for Nintendo    ambitious business objectives while
          Nevertheless, Infogrames has pursued its
                                                           systems.                                    limiting exposure to risks.
          overall business strategy of offering a line
          of high-quality games for all. In order to      Infogrames’ 2000/2001 catalog includes       When negotiating acquisitions or making

IT’S A    do this on a sustained basis, the Group
          must have expertise in the interactive
                                                          more than 80 new games for all formats.
                                                          It combines new and existing Company
                                                                                                       production decisions, Infogrames
                                                                                                       management has always sought to act in a

WONDER    technology required to design cutting-
          edge games, as well as access to
          distribution networks to reach the
          broadest possible consumer base.
          These two objectives provided a basis for
          the investments made this year.
         • The acquisition of GTIS in November
           1999 restores the balance in Company
           sales between Europe and the United
           States. It brings on board an efficient US
           distribution network and a set of licenses
                                                                              FUL WORLD
                                                          products, such as Alone In The Dark 4,
                                                          Driver 2, Unreal Tournament, Deer
                                                          Hunter, etc. with products based on
                                                          international licenses, such as Looney
                                                          Tunes, La femme Nikita, the Le Mans
                                                          24 hour auto race, etc., and has games
                                                          for all market segments, which reduces
                                                          overall publishing risks.
                                                         • Research into new interactive
                                                           media, including the Internet,
                                                           interactive television and cellular
                                                                                                       way that was consistent with the creation
                                                                                                       of value. This has enabled us to become
                                                                                                       Europe’s leading interactive
                                                                                                       entertainment company and bodes well
                                                                                                       for our next challenge, which is to
                                                                                                       become a world leader in our market.
                                                                                                       The race is on and Infogrames is on its
                                                                                                       way to a profitable first fiscal year in the
                                                                                                       new millennium.

                                                                                                       Bruno Bonnell
                                                                                                       Chairman and Chief Executive Officer
Because everyone loves to play,
Infogrames creates interactive games
for all.
The Infogrames catalog is consumer
oriented and covers all market
segments. It includes original hit titles
such as Alone In The Dark, V-Rally,
Unreal Tournament, the Humongous
games, Test Drive, Deer Hunter and
Driver, which has sold more than
4 million copies, as well as games
based on high-quality international
licenses, including Mission Impossible,
Looney Tunes and Ronaldo,
the cartoon characters “Astérix”
and “The Smurfs”, as well as the
Le Mans 24-hour auto race.

Because everyone loves to play,
Infogrames designs games
for the full range
of interactive systems:
- Game Boy for children
- PC and Playstation for others
- next-generation consoles,
including Sony’s PSX2,
Microsoft’s Xbox
and Nintendo’s Gamecube
and Game Boy Advance;
- new Internet technologies,
WAP for PDAs (personal digital
assistants and cell phones),
in-flight interactive entertainment
(soon also in cars) and interactive TV
with high-speed data transfer, etc.
        Sales of interactive game software
        have risen by 20 percent a year
        on average over the past four years,
        although they leveled off              The interactive games sector
        somewhat in 2000 while                 now ranks second worldwide
        consumers waited                       in terms of marketing budgets
        for next-generation consoles           for the next two years,
        to arrive.                             helped by the release of Sony’s PS2

        Over that period,                      next-generation PlayStation console,
        Infogrames’ revenue rose by            the entry of a major new competitor
        70 percent annually,                   into the console market
        thanks to a corporate strategy         with Microsoft’s Xbox
        that combined internal growth          and the announcement by Nintendo
        with acquisitions.                     of the release of its Gamecube
                                               and Game Boy Advance systems.
                                          Since being acquired by Infogrames,
                                          the US company has been entirely
                                          reorganized and management
                                          problems have been resolved.
                                          This has been accomplished by:
                                          - completely overhauling the
                                          management team and hiring
                                          executives from leading consumer
                                          entertainment firms,
                                          - cutting down on the distribution
                                          of third-party products,
Infogrames Inc.                           - outsourcing logistical functions,
Infogrames has gained entry
                                          - extending the product line to include
to the US market.
                                          all formats and worldwide distribution.
Infogrames’ expansion into the United
                                          The final step in the restructuring
States was a key step in the Company’s
                                          effort occurred on October 3,
overall business strategy.
                                          when Infogrames North America,
Last year, Infogrames became a top-tier
                                          the Company’s US branch, merged
publisher of interactive entertainment
                                          with GT Interactive to form
software when it acquired a 70-percent
                                          Infogrames Inc. (Nasdaq IFGM).
interest in GT Interactive Software
                                          The Company increased its equity
for USD 135 million. The US company
                                          interest to 88 percent through a stock
owns rights to such best-selling games
                                          issue and arranged for its affiliate
as Driver, Deer Hunter,
                                          to have access to the financial
Unreal Tournament, a line of children’s
                                          resources it needs to grow.
entertainment software from
Humongous Entertainment,
along with licenses such as Blues Clues
(Nickelodeon) and Harley-Davidson.
It is a leading producer of games
for Macintosh and has a distribution
network that provides it with direct
access to some 20,000 retail
outlets in the United
                                   on the
                                 US Scene
across the game nation                                                            Europe
                                                                                  Jean Claude Larue, Chairman of Infogrames Europe
                                                                                  Infogrames has improved its global structure through
                                                                                  the absorption of the GT Interactive Software business
                                                                                  and the appointment of Jean-Claude Larue as chairman

Unites States                                                                     of Infogrames Europe.
                                                                                  Mr. Larue supervises all operations in Europe and
                                                                                  Australia and participates in corporate business strategy
INFOGRAMES Inc.                                                                   discussions.

Created through the merger of Infogrames North                                    Operations :
America and GT Interactive Software, this new entity
                                                                                  Infogrames Entertainment (principal office), Lyon, France
brings all of the Company’s US production, publishing
                                                                                  Infogrames Europe, Paris and Lyon, France
and distribution business under a single entity with:
                                                                                  Infogrames France, Lyon
- a staff of 850,
                                                                                  Infogrames UK, London
- management that includes senior executives with a
                                                                                  Infogrames Sheffield House, Sheffield, England
  proven record in the field of interactive entertain-
                                                                                  Infogrames Benelux, Eindhoven, The Netherlands
  ment software,
                                                                                  Infogrames Deutschland, Frankfurt, Germany
- a distribution network with 20,000 outlets,
                                                                                  Infogrames Spain, Madrid
- a catalog filled with successful franchises (Driver 2,
                                                                                  Infogrames Italia, Milan, Italy
  Unreal Tournament, Oddworld Munch, Test Drive,
                                                                                  Infogrames Portugal, Estoril
  the Humongous Entertainment collection),
                                                                                  Infogrames Nordic, Spanga, Sweden
- a focus on mass-market distribution.
                                                                                  Infogrames Hellas, Athens, Greece
                                                                                  Infogrames Israel, Tel Aviv
Infogrames improved its opportunities for
expansion in the US with its July 2000 acquisition
of this major producer of game software for next-
generation consoles, including for the Nintendo’s

Canada                                                     Asia
Den-O-Tech Interactive
                                                           Infogrames Melbourne House, Melbourne, Australia
Infogrames has acquired a controlling interest in
                                                           Ozisoft (distribution for Asia and the Pacific), Sydney, Australia
Den-O-Tech (DTI), which specializes in in-flight enter-
tainment. The company is now known as DTI                  Joint Venture with Hudson Soft Co.Ltd
Infogrames and is intended to become the principal
supplier of interactive content for in-flight and other    After setting up a subsidiary in Japan in January 2000,
embedded entertainment systems (on trains, boats,          Infogrames expanded its operations in Japan in October
cars, etc.).                                               2000 by forming a joint venture with the Hudson Soft
                                                           publishing company, consistent with the Company’s global
Operations                                                 growth strategy.
Infogrames Inc. (principal office), New York, NY           The new entity is known as Infogrames Hudson K.K. and
I-Stars, Los Angeles, CA                                   its head office is in Tokyo. Its main objective will be to pro-
Infogrames San Jose, San Jose, CA                          mote the local development of games for next generation
Paradigm Entertainment, Dallas, TX                         consoles for the Japanese market.
Humongous Entertainment, Seattle, WA                       Operations
Wizardworks & MacSoft, Minneapolis, MN
Legend Entertainment, Virginia                             IInfogrames Japan KK, Tokyo
DTI Infogrames, Montreal, Canada                           Infogrames Hudson KK, Tokyo.
The world is going digital.                In keeping with the Company’s policy
Telecommunications are becoming digital    of issuing products for all formats,
and all media and data transmission        Infogrames already has a line of games
systems are becoming interactive.          for the new media, in particular iTV,
The Internet is taking advantage           third generation cell phones, PDAs and in-flight
of the rapid rise in data transfer rates   entertainment systems. By making games based
to become the single focal point           on original or licensed themes available for these new
for access to information                  media, Infogrames is contributing to “Global Gaming”,
and entertainment.                         when games will be accessible by anyone,
WE ARE ENTERING                            anywhere, and anytime, regardless of location,
THE ALL-DIGITAL ERA.                       time or even type of terminal.

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