TIDMKWS
RNS Number : 8083W
Keywords Studios PLC
03 August 2018
3 August 2018
Keywords Studios plc ("Keywords Studios" or "the Group")
Half year trading update - CORRECTION
The following amendment has been made to the 'Half Year Trading
Update' announcement released on 3 August 2018 at 7:00am under RNS
No 6958W.
The original statement stated that at 30 June 2017 the Group had
no net debt. The date has been corrected to 30 June 2018.
All other details remain unchanged. The full amended text is
shown below.
Keywords Studios plc ("Keywords Studios" or "the Group")
Half year trading update
A strong first half performance delivered a 66% increase in
adjusted PBT
Keywords Studios, the international technical services provider
to the global video games industry, is pleased to provide an update
on trading for the six months ended 30 June 2018.
The Group has performed strongly during the first half, with
preliminary unaudited revenues for the period expected to be up by
72% to EUR109.9m (H1 2017: EUR63.8m) and an anticipated 66%
increase in adjusted PBT* to EUR15.9m (H1 2017: EUR9.6m). This was
achieved despite the incorporation of the historically lower margin
VMC business, as well as a marked weakening of the US dollar, in
which approximately 60% of the Group's revenues are denominated,
against the Euro with average exchange rates having declined 12%
between the comparable periods.
The 11 acquisitions made during 2017 and the 7 acquisitions made
since the beginning of 2018 are all performing in line with
expectations. The Group's largest acquisition to date, VMC,
completed on 30 October 2017 and has been well integrated with the
rest of the Group. It is starting to benefit from being part of a
larger group focused on similar services, with a number of its
client relationships having been strengthened, while cost synergies
are leading to improved operating margins.
The second half of 2017 and the first half of 2018 saw us invest
substantially in expansion of the Group's facilities in Montreal,
Dublin, London, Liverpool, Madrid, Katowice, New Delhi, Zhengzhou,
Manila and Tokyo, which are now providing additional capacity to
support the higher levels of activity we anticipate in the second
half given the demand we are seeing from our customers.
Keywords has also continued to strengthen its management team
with some changes to its senior management team including the
hiring of a Chief Marketing Officer, and the appointments of an
Engineering Service Line Director, Global Operations Director and a
Chief Commercial Officer, as announced on 10 July 2018.
The Group has invested net cash of nearly EUR10.0m for the 5
acquisitions made in the first half of the year and we are actively
reviewing a number of high quality acquisition opportunities, in
line with our acquisition strategy. Significant headroom in our new
EUR105m credit facility with Barclays Bank, Lloyds Bank and HSBC
(announced on 5 June 2018), combined with continuing strong cash
generation and the judicious use of Keywords shares to part-fund
acquisitions where appropriate, leaves the Group well placed to
complete further selective acquisitions this year. At 30 June 2018,
the Group had no net debt.
Andrew Day, Chief Executive of Keywords, commented:
"Our progress so far this year has been very encouraging. We
have made significant investments, most notably in enlarged
facilities and senior and mid-level management, which are further
supporting our organic growth in the second half and beyond.
Despite the incorporation of the lower growth and margin VMC
business, our largest acquisition to date, and a weaker US dollar,
we have delivered a first half in line with our expectations while
also strengthening the business for the future.
"With the benefits of a full six months contribution from first
half acquisitions, a strengthening dollar, a healthy pipeline of
activity and expanded capacity to deliver it, we anticipate a
strong second half performance in line with current market
expectations for the full year."
Keywords Studios will provide a further update on trading with
its half year results which it expects to announce in
mid-September.
*The Group reports adjusted PBT before acquisition and
integration expenses, share option charges, amortisation of
intangibles and foreign currency gains
For further information, please contact:
Keywords Studios (www.keywordsstudios.com)
Andrew Day, Chief Executive Officer
David Broderick, Chief Financial
Officer +353 190 22 730
Numis (Financial Adviser)
Stuart Skinner / Kevin Cruickshank
(Nominated Adviser)
James Black / Tom Ballard (Corporate
Broker) 020 7260 1000
MHP Communications (Financial PR)
Katie Hunt /Ollie Hoare 020 3128 8100
Certain information contained in this announcement would have
constituted inside information (as defined by Article 7 of
Regulation (EU) No 596/2014) prior to its release as part of this
announcement.
About Keywords Studios (www.keywordsstudios.com)
Keywords Studios is an international technical services provider
to the global video games industry. Established in 1998, and now
with over 42 facilities in 20 countries strategically located in
Asia, the Americas and Europe, it provides integrated art creation,
software engineering, testing, localisation, audio and customer
care services across more than 50 languages and 16 games platforms
to a blue chip client base of approximately 650 clients across the
globe. It has a strong market position, providing services to 23 of
the top 25 most prominent games companies, including Activision
Blizzard, Bandai Namco, Bethesda, Electronic Arts, Konami, Riot
Games, Sony, Square Enix, Supercell, TakeTwo, and Ubisoft. Recent
titles worked on include Uncharted 4: A Thief's End, Call of Duty:
WWII, Mortal Combat X, Assassin's Creed Origins, Battlefield 1,
League of Legends, Fortnite, Clash Royale, and Mobile Strike.
Keywords Studios is listed on AIM, the London Stock Exchange
regulated market (KWS.L).
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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