Keywords Studios PLC - Trading Update and Notice of Results
Half year trading update and notice of results
8% organic revenue growth driven by robust demand and resilient business model
Clear medium-term growth opportunities beyond certain short term resource constraints
Trading and COVID-19 update
As previously announced, the Group's revenue and profit performance started the year in line with management's expectations. However certain service lines have been held back due to disruption caused by COVID-19, particularly in our Testing and Audio businesses.
Despite this, the Board expects to report first half revenues of approximately
Adjusted EBITDA2 is expected to be approximately
This robust performance has demonstrated the resilience of the Group's business model, the benefits of its diversified service platform, and the continued strong demand for most of its services. Our service lines have performed well given the operational and market disruption caused by COVID-19, including some rescheduling of the later stages of content production, which we expect to see unwind in the second half.
Since June, we have been able to reopen most of our Audio studios and from July we are starting to operate some activities from our Testing studios, albeit recently extended unemployment support measures are constraining our ability to recruit at the entry level, particularly in our testing operations in the Americas. We are prioritising in-studio recruitment and training activities to mitigate some of these constraints with the aim of meeting as much of the strong demand for our services as possible.
Notification of Full Year Results
The Group expects to announce its half year results for the six months ended
Andrew Day, Chief Executive of Keywords, commented:
"We are pleased to report a robust performance in the first half. I am proud that our resilient and flexible platform enabled our clients to pursue their production schedules, with Keywordians continuing to show their passion to create, adapt and support our clients' great game content, despite the COVID-19 challenges. In-turn, our clients have increasingly looked to us for their outsourcing needs during this challenging time.
"Demand for video games content has accelerated during the pandemic which has positively expanded the addressable market for our clients. We expect to see continued strong demand for our services given the industry's structural growth drivers, the continuing trend towards outsourcing, the launch of next generation games consoles later in 2020 and the further development of new streaming platforms.
"Our successful placing of
1 Organic revenue growth is calculated by adjusting the prior year revenues, adding pre-acquisition revenues for the corresponding period of ownership in the current year results, and applying the 2019 foreign exchange rates in both years.
2 EBITDA comprises Operating profit, adjusted for amortisation of intangible assets, depreciation, while deducting the share of profit from associates and bank charges. Adjusted EBITDA is before share option expense, costs of acquisition and integration and non-controlling interest. In order to present the measure consistently year-on-year, the impact of COVID-19 government subsidies claimed is also excluded. Both EBITDA and Adjusted EBITDA include the impact of IFRS 16 in the current and prior year periods.
3 The Group reports Adjusted profit before tax comprises Profit before taxation, adjusted for costs including amortisation of intangible assets, share option expense, costs of acquisitions and integration, foreign exchange gains and losses, non-controlling interest and unwinding of discounted liabilities. In order to present the measure consistently year-on-year, the impact of COVID-19 related subsidies claimed is also excluded.
For further information, please contact:
Keywords Studios (www.keywordsstudios.com)
Andrew Day, Chief Executive Officer
Jon Hauck, Chief Financial Officer
Joseph Quinn, Investor Relations
+353 190 22 730
Stuart Skinner/Kevin Cruickshank/Will Baunton
020 7260 1000
Katie Hunt/James Midmer/Charles Hirst
020 3128 8193
This information is provided by RNS, the news service of the
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Market Cap: £1.63 billion
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