Keywords Studios PLC (LON:KWS) shares pushed higher on Thursday as the acquisitive computer game production services provider said 2018 was “another year of good organic growth and geographic expansion”.
The group, which has its head office in Ireland, expects full-year revenues for the year just ended to be at least €250mln, up from €151.4mln in 2017. Organic revenue growth clocked in at 10.1%.
WATCH: Keywords Studios sees big opportunities in 2019 for cloud-based gaming
Adjusted profit before tax, which excludes acquisition and integration expenses plus various other bits & bobs such as amortisation of intangibles, is expected to rise to around €37.8mln from €23.0mln the year before).
Adjusted earnings per share are expected to be around 47.0 cents, which would be an increase of 51% compared to the prior year’s figure of 31.18 cents.
The group finished the year with net debt of €400,000, compared to net cash a year earlier of €11.1mln, reflecting the group’s outlay on acquisitions.
The only fly in the ointment for Keywords was a weaker than expected performance from its Localisation Testing arm, where a number of titles that were expected to be launched in the quarter were delayed.
“Particularly exciting for us during the year has been our expansion into new areas including predictive analytics, music services, marketing services, sound design, and Hollywood-based voice production and writing services,” said Andrew Day, the chief executive officer of Keywords.
Keywords Studios - Trading update confirms LFL sales and cloud gaming drive - https://t.co/1IVupsv0Cb
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“As we look forward to another year of extending the ways in which we work with our video game developer and publisher clients, we are pleased to report that we are engaged on a number of projects with clients who are investing in the field of cloud-based gaming. This is an exciting development in the games market as a whole, as 5G mobile networks and expanded internet bandwidths allow for the emergence of platforms aiming to become the ‘Netflix of gaming’,” Day said.
“We expect this to create enhanced demand for both content, which would benefit most of our service lines, and for making games more accessible to more people in more territories, which would fuel demand for localisation in particular," he concluded.
In late morning trading, shares in Keyword Studios gained 8.3% at 1,170p.
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