Frontier Developments Share Discussion Threads

[makw61] 23/11/2016 13:14

The market has been very slow to wake up to the potential here. My base case is identical to that above i.e. 1m units of ED and of PC per year for revenue net of Steam fees etc of c.£40m against cash costs of £25m to £30m i.e. underlying operating profit of £10m to £15m (not sure how the amortisation of development costs will impact reported profits but those costs are already spent!). Incremental sales kick in £20 per unit bottom line so another 1m sales of PC would increase profit by £20m to up to £35m.
Current market value is under £70m and there is cash in the bank. I feel like I must be missing something?
Looking forward to the next trading statement so that I can reconcile my numbers - Steamspy will not include Xbox sales of ED but I'm not clear if it includes PC sales via Frontier's website where the customer activates their Steam key and PC then appears in their Steam account?
I thought the share price would be motoring by now, but maybe we will have to wait for the trading statement for the market to wake up.
Interested to hear also what the next franchise will be. Frontier have some history in platform games (Lost Winds) but those are not particularly fashionable currently. I would like to see something for PC, Xbox and PS4 to maximise sales. Still waiting to see the PS4 port for ED and I suspect PC is too demanding to port to current generation consoles (they have confirmed no VR for now for the same reason but the hardware will catch up in a couple of years I'm sure).
GLA

[culford] 23/11/2016 08:29

Yes Planet Coaster has been top of the best sellers list for more than a week now and SteamSpy estimate sales of c200k. If you add the sales by Frontier direct it is probably c300k games sold in total now, or £9m in revenues. That is a major step change up for Frontier and there should be a very positive trading update in December after their 1/2 year to end November - worth accumulating now.

[m4ybe] 23/11/2016 05:31

Planet Coaster current in-game users on Steam was 15,000 near the daily peak yesterday, just at one moment in time. Even at the daily low point now while most people sleep it's 6400.

So I bought some FDEV yesterday. This looks like all profit to me if their costs are covered by Elite, which currently has a fraction of the users. The Minecraft style creative model could keep users attached and hopefully sharing content for a long time to come. This isn't Minecraft but I can see the lean towards that direction, and that sold for billions. And if anyone understands getting high performance 3D graphics right it's David Braben.

[p1nkfish] 22/11/2016 20:06

Yes, Catalysts kicking in and pleased they were early in VR. VR opens up many future opportunities. Shift to a new price level more than likely. Hold and buy on weakness.

Pleased to see this developing. Great British potential.

[culford] 22/11/2016 11:47

Further to the post above, Frontier's annual sales with their first game have been c£20m per annum or £400k per week. The 2nd game released last week (Planet Coaster) is selling at c£600k per day. This clearly won't last for ever but all the indications are that it will be a substantially bigger selling game and that sales will more than double off the current cost base. The third game will be announced in the next few months and we will get an update on early Planet Coaster sales.

[culford] 22/11/2016 08:15

Market will wake up to Planet Coaster success at some stage soon. Game launched on 17th November last week and has been top of Steam sales charts since. Initial sales are running at c20,000 games per day, or c£600,000 per day at £30. It looks as if it should hit at least the bottom end of the 1-3m per annum range which suggests that FDEV's sales have moved to a new level more than double previous levels.

[culford] 15/11/2016 12:46

Planet Coaster, the 2nd game to be published by Frontier is due to be released later this week. It has had good feedback in Alpha release and the beta release is top of the Steam charts!!



Steam has >10 million active games players and is a good barometer on game sales.

Elite Dangerous, the 1st Frontier self published game is selling c£20m per annum. This second game is in a much more popular genre and could sell 1m - 3m per annum, which at £30 per game is £30m to £90 per annum. Frontier has said there will be step changes in its revenues and that is clear, with revenue potentially rising from £20m per annum now to £50m-£110m after the release of this game. Incremental sales have a 70% margin and little other additional costs. Profits/cash flow should thus rise by 70% x £30m-£90m or £21m - £63m per annum. This company has been breaking even as it has only had one game self published covering all its costs. Its market cap. should rise from £70m to somewhere over £200m if this game sells as predicted, as profits will rise to £21m - £63m.

In future it will add another new game each year and has the ambition to become a significant publisher in the $100bn games market. Its quoted competitors in the US, EA and Activision, have market values in excess of $20bn. Frontier could well reach a market value near a £bn in a few years time if it succeeds with its strategy.

[p1nkfish] 29/10/2016 02:00

I hold fdev and have added a small amount on weakness, If I didn't I would look to open a position about now. It looks ready.

[p1nkfish] 28/10/2016 13:46

Early VR compatibility will help drive this too. Coaster should be interesting and beaten early adoption expectations. With care this could move quite nicely over the next 3 yrs or so. New CFO will be busy enough.

[mininozzle] 27/10/2016 22:33

And the latest update was out on Tuesday and it's freeking awesome...

Nozzle

[p1nkfish] 27/10/2016 20:50

Having spent some time looking into the product, development of the company and potential I think this is a buy and hold. Substantial upside potential in my opinion, just an opiion mind.

Spoke to some kids that have eLite and they were very positive on the experience.

[p1nkfish] 23/10/2016 23:03

It's possible the move of Amstrong to Operations might be related to the devleopment delays that have gone down badly. No idea if this is correct but there was some bad reception and Frontier woudn't give specifics of the reason for the delays.

The erecent appointment looks good but may have simply been to allow problems elsewhere to be addressed now Armstrong is freed up.

hxxp://www.idigitaltimes.com/elite-dangerous-cqc-tournament-canceled-developmental-delays-blamed-frontier-544839

[p1nkfish] 21/10/2016 22:48

I think he sees something interesting or similarities here.

[p1nkfish] 21/10/2016 22:47

Cfo, x-csr, x-xaar.

[p1nkfish] 27/5/2016 22:23

Not enough exposure of the new to the wider market or understanding of what it means to future prospects. Only followers get it and there's not enough of them.
One day the wider market will cotton on.

[18bt] 27/5/2016 07:45

Useful update this morning. Good expectation management.

[p1nkfish] 27/4/2016 07:46

Doesn't read badly and May should have news to spark some interest. Good that Barclays facility not needed.

[p1nkfish] 14/3/2016 16:47

sometimes a slipped relesae schedule can make a good entry point on a games company as there is usually a hard mark down.

given that might have happened here can it be marked down further if the game now releases as stated?

was recent weakness the bottom?

[richsmithsmith] 14/3/2016 13:45

I think it all depends on the tie in with VR.

[stegrego] 11/3/2016 18:03

Games - Star Citizen and Crowded Sky are likely to grab the limelight from Elite this year.

I'm not predicting the share price going up any time soon, in fact it looks fairly overpriced at 200p

[18bt] 02/3/2016 09:31

Reaction could have been worse

[mininozzle] 02/3/2016 08:17

IC?

Nozzle

[source] 02/3/2016 07:57

Another IC kiss of death...Regards,Source.

[18bt] 24/2/2016 08:05

Buy in IC last Friday

[18bt] 24/2/2016 08:05

Buy in IC last Friday