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Keywords Studios overcomes pandemic disruption to achieve 8% organic revenue growth

The group's service lines have performed well given the operational and market disruption caused by the coronavirus (COVID-19)

Keywords Studios PLC -

Keywords Studios PLC (LON:KWS), a provider of services to the video game industry, saw its organic revenue grow by 8% in the first half of 2020.

In a trading update, the group said it expects to report first-half revenues of about €173.5mln, representing an increase of around 13% on the prior year’s €153.2mln, despite the disruption caused by the coronavirus (COVID-19) pandemic.

Adjusted underlying earnings (EBITDA) are expected to be in the region of €30.8mln, representing an increase of around 19% on the €25.8mln reported for the first half of last year. Adjusted profit before tax is expected to be around €21.7mln, up 18% or so from €18.4mln in the corresponding period of 2019.

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Since June, the group has been able to reopen most of the studios where it does audio work and from July it started to operate some activities from its studios where testing is carried out, although it said recently extended unemployment support measures are constraining its ability to recruit at the entry-level, particularly in its testing operations in the Americas.

“We are prioritising in-studio recruitment and training activities to mitigate some of these constraints with the aim of meeting as much of the strong demand for our services as possible,” Keywords said in the statement.

At the end of June, the group had net cash of €101mln, compared to €17.9mln of net debt at the end of 2019, following its well-supported fundraising in May.

The group has €100mln of funds undrawn on its revolving credit facility.

Quick facts: Keywords Studios PLC

Price: 2184 GBX

Market: AIM
Market Cap: £1.61 billion


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