Frontier Developments Share Discussion Threads

[sbb1x] 25/5/2023 16:33

Any ideas who the seller is...

[liam1om] 25/5/2023 15:55

Biggest drop in five months. Can't see any reason for the drop. Anyone seen anything?

Placing incoming?

[northwards] 25/5/2023 15:47

What's average daily volume here ?

[sos100] 25/5/2023 15:41

weird tree shake...took it's time to go to £6 and now it's crashed?

[thomstar] 25/5/2023 14:43

Tree shake

[sbb1x] 25/5/2023 14:07

Aggressive pull back from 600

[jfbonner] 18/5/2023 18:29

Yank, have you thought of sending your findings to the FSA, or do you just post them on this board? 😉

[yankhanson] 18/5/2023 17:11

Fledgling1nvestor, you're wrong about the minimum threshold. It's quite possible for a flop like F1 Manager to fail to meet that, regardless of whether the minimum royalty is paid up front.

And you're wrong about "demand per title off 10-30%". FDEV did not disclose those figures in the Jan trading update or anywhere. It disclosed none except for the headline flop F1 Manager.

[cirlbunting1] 18/5/2023 15:58

This is a weak argument btw: "amortisation of capitalised R&D going through the P&L compared to the cash spent on capitalised R&D, the valuation looks a lot more challening". I remember seeing the same argument put fwd by investors chronicle...

[sbb1x] 16/5/2023 11:00

52 week high 1600 Quite some upside here if it turns up

[mortal1ty] 15/5/2023 18:48

This is stage 1 of the recovery. Target 7-8. Where market realises that this business is on a very attractive valuation of 1.5x sales, with 50m net-cash, some decent IP, and (hopefully) on trough earnings after 3 profit warnings.

Stage 2 of the recovery is about a return to growth story. Target 10 to 11. This requires a return to growth, and little bit of excitement around new titles.

Looking forward to watching this play out.

[fledgling1nvestor] 15/5/2023 17:33

@YankHanson

> Fledgling1nvestor, you have some source for that? Because that's not
> at all what FDEV has said.

On the contrary, it is exactly what was stated at the time the contract was announced. It is a 4 games in as many years deal, subject to meeting certain royalty thresholds.

The contract wasn't "renewed". It already has a timespan and number of games baked into it.

Whilst we cannot possibly know all the intricacies of the deal, if they didn't meet the minimum royalty thereby triggering a void of further games then they would have had to announce it in an RNS update within a couple of working days of the voiding.

It's usually pretty much impossible to fail to meet the minimum threshold in year one of a license because the IP rights holder typically want that minimum royalty up front when you sign the contract. Whether or not the licensee makes money is secondary, they're taking on all the risk.

It's why Telltale Games went bankrupt in 2018. They overextended themselves by licensing out way too many IPs for which they had to pre-pay minimum royalties in advance. This ended up leaving them cash poor to the point they could no longer pay their staff when they had some flops and couldn't raise additional funding from potential investors.

> "December saw things falter with demand per title off 10-30%".
>
> Interesting inside info there re the recent profit warning. If legit, FDEV
> should have disclosed to the market.

They announced just that in the Trading update on January 5th. Perhaps you should try reading the RNS updates instead of getting your information from randos on gaming forums.

[p1nkfish] 15/5/2023 16:53

EU have approved the Microsoft/ActiV merger. Not a big surprise but now rests on the US to go along with the UK or we are the only stand-out. Personally, I don't believe the EU has much of a clue on this one, certainly little to lose. There does come a point where mega-tech becomes too mega.

[se81] 15/5/2023 16:38

And a close at the highs of the day on decent volume- makes you start to wonder if something more than a slight recovery is brewing

[hamhamham1] 15/5/2023 16:28

Lovely steady rise over past month.
Look at the 5yr chart, can't even see the recovery.
Enjoy the ride.

[mortal1ty] 15/5/2023 12:51

Nice chart. Assuming steady trading i can see this getting back to 9 to 10 pound.

[se81] 15/5/2023 10:58

certainly on the up- 570 looks a very interesting area on the chart with the gap back to 980 if it pushes through

[yankhanson] 14/5/2023 12:22

"December saw things falter with demand per title off 10-30%".

Interesting inside info there re the recent profit warning. If legit, FDEV should have disclosed to the market.

[se81] 14/5/2023 09:50

When are we next due to hear from the company? The conspiracy theories are running wild :)

I mean if everything was perfect the share price would be £35 not £5.

Interesting comment in this weeks SCSW “I’m due to meet FDEV shortly and it could be a new buy” - definitely would be welcome to get some insight from the company

[yankhanson] 13/5/2023 16:16

"As long as Frontier meet whatever minimum royalty they have determined the contract will stay in force."

Fledgling1nvestor, you have some source for that? Because that's not at all what FDEV has said.

And regardless, FDEV paying a minimum royalty above what's earned by sales would be a very risky loss-lead which should be declared to the market.

[fledgling1nvestor] 12/5/2023 18:39

As long as Frontier meet whatever minimum royalty they have determined the contract will stay in force.

Who else are they going to find to pay for everything? It's all free money to F1.

[mortal1ty] 12/5/2023 17:38

I didn't say targets were met. You can only speculate about F1's view. Maybe F1 accepted that their targets were too aggressive given its a relatively niche game.

Sensible business to sell the old version of the game at a low price. Thats how you entice people to try the game ahead of the next launch.

[yankhanson] 12/5/2023 14:43

"F1 2022 did perform below expectations. Who knows what clauses are in that contract."

FDEV did reveal a clause wherein renewal of the contract is conditional on meeting sales targets.

But the fact the contract got renewed doesn't mean those targets were met. More likely the brand owner recognised it had no choice. With FDEV having shat on the brand, no alternative developer would touch it.

Another sure sign of lack of value is FDEV dumping this £45 game at £9 on Steam and other stores.

[yankhanson] 12/5/2023 14:07

"How long would you like to see it supported for?" The best thing for the share price would be FDEV to end support for Elite Dangerous ASAP, selling the rights to a developer capable of restoring its profitability.

This would be a good start to rehabilitating FDEVs brand, now so toxic as to be harming every new release.