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Gfinity cuts losses as revenues surge over 80%

The esports tournament operator also reiterated its target of hitting EBITDA breakeven by 2021

Gfinity PLC - Gfinity cuts losses as revenues surge 80%
The company operates its own esports arena in Fulham, West London

Gfinity PLC (LON:GFIN) has reduced its losses for 2019 after revenues at the esports tournament operator jumped by over 80%.

For the 12 months ended 30 June, the AIM-listed media firm reported revenues of £7.9mln, up from £4.3mln in the prior year, while its adjusted operating losses narrowed to £8.6mln from £12.2mln.

WATCH: Gfinity PLC reports revenue growth above 80% for second year running

The company said the revenue surge was driven by growth in the size and number of its “strategic client relationships”, adding that it had continued to build partnerships with major brands including Microsoft, video game firm EA Sports and Formula 1.

Gfinity also reiterated its target of achieving breakeven earnings (EBITDA) by 2021 following the reduction in losses, with a long-term adjusted EBITDA margin of 15-25% on a normalised basis.

Margins will be expanded through the development of Gfinity’s strategic consultancy, which helps companies organise and promote esports events, as well as growth in shared commercial rights and advertising growth among its viewer community.

The company has also forecast an improvement in gross profits as a result of tight controls on its administrative expenses.

Meanwhile, the firm has promoted its chief operating officer, Graham Wallace, to the position of chief executive with immediate effect.

Wallace will now be in charge of delivering the company's three-year strategic plan, with executive chairman Garry Cook saying Wallace had demonstrated “the qualities required to lead and accelerate the performance of the company”.

“Our business is at an inflection point. We are at the epicentre of the fragmented esports ecosystem, trusted to deliver high impact esports solutions to an ever-growing list of organisations looking to connect with young gamers”, Cook said.

In late-morning trading on Monday, Gfinity's shares were 2.5% lower at 3.5p.

--Adds share price--

Quick facts: Gfinity PLC

Price: 3.7645 GBX

AIM:GFIN
Market: AIM
Market Cap: £18.05 m
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