British video games firm Codemasters Group Holdings Plc (LON:CDM) reported higher revenue and profit for the twelve months ended 31 March, and highlighted that a rise in digital sales amid lockdown is expected to continue.
Codemasters noted the continued growth in esports and the upcoming ‘next generation’ console launches (Xbox Series X and Playstation 5), in the 2020 holiday season, among anticipated factors in its outlook for the current year.
Revenue for the year, ended 31 March, rose by 6.8% to £76mln while gross profit was up 4.5% to £65.2mln. Digital sales represented some 67.7% of total revenue and the company noted that this was amplified at the end of the period following the outbreak of coronavirus (COVID-19).
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Earnings (adjusted EBITDA) was marked at £18.2mln, from £18.7mln in the prior year, including the cost of the 2019 acquisition of Slightly Mad Studios. The company ended the year with £24.8mln of net cash.
The year’s highlights included the renewal of Codemaster’s exclusive contract for the Formula One game franchise, for the period between 2021 and 2025 with options in place for the 2026 and 2027 seasons.
In November, the company acquired Slightly Mad Studios and raised £20mln in an equity funding.
Two game titles were released during the financial year, GRID and F1 2019.
The upcoming release schedule will include F1 2020, Fast & Furious Crossroads, DiRT 5, and Project CARS 3. It also expects to launch Project CARS GO, its first mobile title, in the second half.
It also noted the continued growth in esports activity involving its game titles, particularly the successful F1® Esports Virtual Grand Prix tournament which has been taking place with real F1 drivers and celebrities during the lockdown, which saw real-world F1 events suspended.
"Our first full financial year since admission to AIM has been a period of significant progress across the group,” said Frank Sagnier, Codemaster’s chief executive.
“Despite only having two game launches we have delivered further growth in revenues, gross profit and digital sales increasing over the period.
“We have also continued to strengthen our leadership in the racing genre, achieved against the key strategic objectives that were set out at the time of IPO.”
Sagnier added: “This is an exciting time for the gaming sector and I believe we are well placed to take advantage of the opportunities that will arise during the next 12 months and beyond.
“Despite the wider macro-environment being hampered by COVID-19, we have seen minimal disruption to our business and I am confident in our growth prospects for the coming year, supported by a strong pipeline of game releases and investment in the sector."