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Giant Interactive CEO Quits

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Chinese online game developer Giant Interactive Group Inc. announced that Mr. Yuzhu Shi, the chief executive officer (CEO) of the company, will quit effective from Apr 19, 2013. The board will name a new CEO on the same day. However, Shi will continue to serve as the Chairman of the board of directors of the company.

The company reported its fourth quarter earnings in late February. Giant’s adjusted earnings increased 34.9% year over year in the fourth quarter of fiscal 2012 and 20% in fiscal 2012. Giant’s fourth quarter 2012 revenues were up 15.5%, while its fiscal 2012 revenues grew 20.1%. The company’s strong performance was attributable to the continued growth of Giant’s flagship game ZT Online 2 and contribution from its newly launched micro-client version. The company was able to control spending and deliver strong margins apart from top and bottom-line growth.

Giant expects to provide new content for ZT Online 2 in 2013 and to diversify its massively multiplayer online (MMO) game portfolio. The company also plans to launch its self-developed 3D MMO flagship game called World of Xianxia, which has the potential to deliver profits in 2013.

Giant is also set to launch two online games in the first half of 2013, which are expected to become major growth drivers for 2013. The company is also focusing on developing mobile games as a part of its growth strategy for 2013.

Giant Interactive focuses on massively multiplayer online role playing games. Currently, Giant operates multiple games, including the ZT Online 1 Series, ZT Online 2, Giant Online, XT Online, The Golden Land, Elsword, and Allods Online. The company holds a Zacks Rank #2 (Buy).

Other stocks in the industry that are performing well and are worth considering include Shutterfly Inc (SFLY - Free Report) , Angie’s List Inc (ANGI - Free Report) , and China Distance Education Holding . While Shutterfly holds a Zacks Rank #1 (Strong Buy), Angie’s and China Distance carries a Zacks Rank #2 (Buy).

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