Frontier Developments PLC (LON:FDEV) saw its shares rise on Tuesday as the company increased its expectations for current year revenue as a result of ‘strong’ digital sales for the Jurassic World Evolution video game.
The AIM-listed firm said, since its digital launch on 12 June 2018, Jurassic World Evolution - Frontier’s third game franchise - has been “strong across all platforms.”
READ: Frontier Developments roars as it unveils latest game, Jurassic World Evolution
In a trading update, Frontier said its current projections indicate that it could achieve total revenue for the year ending 31 May 2019 towards the upper end of the current market analyst range of £58mln to £88mln.
“This is based on sales forecasts for Jurassic World Evolution extrapolated from its initial performance, together with the expected performance of Frontier's first two franchises, Elite Dangerous and Planet Coaster,” the company said.
David Braben, Frontier's chief executive said: "We are pleased with the positive reaction we have seen to the launch of Jurassic World Evolution and its initial sales performance.
He added: “We already have future franchises in different phases of internal development and we will continue to explore other models to accelerate our scale-up.”
Liberum ups profit and cash forecasts
In a note to clients, analysts at Liberum Capital said: “The final FY19 profit outcome is clearly heavily geared into JWE's success and investors will continue to focus on the franchise through this year.
“But the bigger prize is the delivery of a multi-franchise gaming strategy and £100mln+ of annual revenues.”
The analysts said today’s update drives an upgrade to their profit and cash forecasts for Frontier and supports its updated target price of 1,800p and ‘buy’ rating on the stock.
In late afternoon trading, Frontier Developments shares were up 2.2% at 1,395.00p, albeit well below the session peak of 1,560p..
-- Adds analyst comment, updates share price --