Virtuality shares suspended as headset games flop

Virtual reality became grim reality yesterday for Virtuality after the once high-flying high-technology games and training simulation company asked for its shares to be suspended "pending clarification of its financial position".

Takara, the Japanese headset maker which licenses Virtuality's technology in that market, is thought most likely to step into the breach, either injecting cash through a rights issue or making an offer for the whole company.

Yesterday's suspension at 68.5p followed three months after the company crashed pounds 3.8m into the red, warning that disappointing sales of its virtual reality games were putting a squeeze on the cash flow it needed to develop its headsets. The red ink was much worse than analysts had expected and Virtuality's shares plunged below the 170p at which they came to the market three years ago and well down from the 361p they reached at the beginning of 1994.

Virtuality's honeymoon was short-lived as early bid speculation was soon replaced by the harsh reality of profits warnings, slumping sales and rapidly reined-in brokers' forecasts. Losses widened as the company passed through a difficult transition, reducing its dependence on arcade entertainment equipment and moving into lower-ticket home entertainment virtual reality headsets.

The company found it hard to make the shift from being a manufacturer and designer of equipment to a licenser of intellectual property to companies such as Takara in Japan. Yesterday it appeared the money had simply run out.

Opinion is divided on whether virtual reality was just another technological flash in the pan akin to the Sinclair C5 or whether it remains the technology of the future whose day will come, if not quite yet.

Whichever is right, investors have paid the price, with shareholders stumping up for a placing at 280p at the height of the stock's popularity. They became victims of a company that even analysts close to the business failed properly to understand. After October's loss, a huge range of forecasts underscored the guesswork that lay behind most expectations.

Virtual reality began in the US Air Force as a way of training pilots without risking millions of dollars worth of aircraft. Once inside his headset, a trainee pilot believes he is in the cockpit of a plane. If he turns his head to look at wingtips, he sees wingtips.

Other applications include architects taking clients on a virtual walking tour of a proposed building, and there are important uses in medicine and aeronautics. Virtuality had some success with a motorcycle simulator that was used in Japanese driving schools to train bikers.

If Takara does not take advantage of Virtuality's woes, the company boasts a roll-call of the world's electronics giants on its share register - including Philips, IBM and Motorola - which might welcome the opportunity to combine the company's technological know-how with their financial clout.

PROMOTED VIDEO
News
Angelina Jolie with her father Jon Voight
people
News
Bill Kerr has died aged 92
people
Sport
footballPremiership preview: All the talking points ahead of this weekend's matches
Arts and Entertainment
Warner Bros released a mock-up of what the new Central Perk will look like
tv'Friends' cafe will be complete with Gunther and orange couch
News
Keira Knightley poses topless for a special September The Photographer's issue of Interview Magazine, out now
people
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Voices
The Ukip leader has consistently refused to be drawn on where he would mount an attempt to secure a parliamentary seat
voicesNigel Farage: Those who predicted we would lose momentum heading into the 2015 election are going to have to think again
Arts and Entertainment
Cara Delevingne made her acting debut in Anna Karenina in 2012
film Cara Delevingne 'in talks' to star in Zoolander sequel
News
i100
Sport
Mario Balotelli pictured in his Liverpool shirt for the first time
football
Life and Style
tech
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SAS Business Analyst - Credit Risk - Retail Banking

£450 - £500 per day: Orgtel: SAS Business Analyst, London, Banking, Credit Ris...

Project Manager - Pensions

£32000 - £38000 Per Annum Bonus, Life Insurance + Other Benefits: Clearwater P...

KYC Analyst, Birmingham - £200-£250 p/d

£200 - £250 per day + competitive: Orgtel: KYC Analyst, Key Banking Client, Bi...

Test Manager - Banking - Yorkshire - £450 per day

£400 - £500 per day: Orgtel: Test Manager - Banking - West Yorkshire - £400-£5...

Day In a Page

Ukraine crisis: The phoney war is over as Russian troops and armour pour across the border

The phoney war is over

Russian troops and armour pour into Ukraine
Potatoes could be off the menu as crop pests threaten UK

Potatoes could be off the menu as crop pests threaten UK

The world’s entire food system is under attack - and Britain is most at risk, according to a new study
Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Seoul's plastic surgery industry is booming thanks to the popularity of the K-Pop look
From Mozart to Orson Welles: Creative geniuses who peaked too soon

Creative geniuses who peaked too soon

After the death of Sandy Wilson, 90, who wrote his only hit musical in his twenties, John Walsh wonders what it's like to peak too soon and go on to live a life more ordinary
Caught in the crossfire of a cyber Cold War

Caught in the crossfire of a cyber Cold War

Fears are mounting that Vladimir Putin has instructed hackers to target banks like JP Morgan
Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years

Salomé: A head for seduction

Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years. Now audiences can meet the Biblical femme fatale in two new stage and screen projects
From Bram Stoker to Stanley Kubrick, the British Library's latest exhibition celebrates all things Gothic

British Library celebrates all things Gothic

Forthcoming exhibition Terror and Wonder: The Gothic Imagination will be the UK's largest ever celebration of Gothic literature
The Hard Rock Café's owners are embroiled in a bitter legal dispute - but is the restaurant chain worth fighting for?

Is the Hard Rock Café worth fighting for?

The restaurant chain's owners are currently embroiled in a bitter legal dispute
Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival

In search of Caribbean soul food

Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival
11 best face powders

11 best face powders

Sweep away shiny skin with our pick of the best pressed and loose powder bases
England vs Norway: Roy Hodgson's hands tied by exploding top flight

Roy Hodgson's hands tied by exploding top flight

Lack of Englishmen at leading Premier League clubs leaves manager hamstrung
Angel Di Maria and Cristiano Ronaldo: A tale of two Manchester United No 7s

Di Maria and Ronaldo: A tale of two Manchester United No 7s

They both inherited the iconic shirt at Old Trafford, but the £59.7m new boy is joining a club in a very different state
Israel-Gaza conflict: No victory for Israel despite weeks of death and devastation

Robert Fisk: No victory for Israel despite weeks of devastation

Palestinians have won: they are still in Gaza, and Hamas is still there
Mary Beard writes character reference for Twitter troll who called her a 'slut'

Unlikely friends: Mary Beard and the troll who called her a ‘filthy old slut’

The Cambridge University classicist even wrote the student a character reference
America’s new apartheid: Prosperous white districts are choosing to break away from black cities and go it alone

America’s new apartheid

Prosperous white districts are choosing to break away from black cities and go it alone