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FDEV Frontier Developments Plc

198.40
-4.10 (-2.02%)
18 Dec 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Frontier Developments Plc LSE:FDEV London Ordinary Share GB00BBT32N39 ORD 0.5P
  Price Change % Change Share Price Shares Traded Last Trade
  -4.10 -2.02% 198.40 115,633 16:35:11
Bid Price Offer Price High Price Low Price Open Price
197.00 198.00 204.50 189.60 203.00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Manufacturing Industries,nec 89.27M -21.47M -0.5447 -3.62 79.83M
Last Trade Time Trade Type Trade Size Trade Price Currency
16:37:46 O 3 199.60 GBX

Frontier Developments (FDEV) Latest News

Frontier Developments (FDEV) Discussions and Chat

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Date Time Title Posts
19/12/202401:06Frontier Developments - Elite gaming.....7,995

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Frontier Developments (FDEV) Most Recent Trades

Trade Time Trade Price Trade Size Trade Value Trade Type
2024-12-18 17:19:25199.6035.99O
2024-12-18 16:37:48198.4074146.82O
2024-12-18 16:35:11198.407,44814,776.83UT
2024-12-18 16:29:48197.001733.49AT
2024-12-18 16:00:56198.00181358.38AT

Frontier Developments (FDEV) Top Chat Posts

Top Posts
Posted at 18/12/2024 08:20 by Frontier Developments Daily Update
Frontier Developments Plc is listed in the Manufacturing Industries,nec sector of the London Stock Exchange with ticker FDEV. The last closing price for Frontier Developments was 202.50p.
Frontier Developments currently has 39,423,349 shares in issue. The market capitalisation of Frontier Developments is £77,663,998.
Frontier Developments has a price to earnings ratio (PE ratio) of -3.62.
This morning FDEV shares opened at 203p
Posted at 19/12/2024 01:06 by yankhanson
Remember April? Peeps here writing e.g. "Planet Coaster 2 announcement in June. Road back to 1000." Reality is road back to 100.

David Braben's management just added another nail to its coffin. A Planet Coaster 2 game update intended to fix bugs broke the game for many players, for some totally wiping their 100s of hours of coaster building work. Players retaliated by smacking last week's Steam review score down to 33% and the laughable Deluxe Edition extras score is down to 13%. Steam concurrent players is down to 25% of the predecessor edition at the corresponding time. Despite a second emergency price discount, game has disappeared from the Steam top 100.

Last month FDEV's broker Panmure Liberum grimly forecast game's FY revenue down 25-30% on the predecessor. Now, industry data suggests much worse.
Posted at 13/12/2024 17:12 by yankhanson
Hot on the heels of one disastrous Planet Coaster 2 launch comes two more. Yesterday FDEV released an add-on pack and "Premium Edition"... despite having delivered only a comprehensively broken and unfinished mess in place of the main game launched last month.

Result? Customer revolt, dislike-bombing the YouTube launch video and review-bombing the main game and DLC on Steam.

Video link < >

Despite FDEV making an emergency price drop of 20%, the game's Steam chart position is down to #83 - from #2 on launch.
Posted at 30/11/2024 20:57 by yankhanson
Over the period in question, the share price dropped 90%. Since the the last game release, it dropped 20%.

"continue to rise"?? The current continuous rise has lasted one day.
Posted at 17/11/2024 11:19 by yankhanson
CEO: "The strong historical and ongoing performances of our CMS games give me great confidence in our refocused portfolio strategy". After a £26m loss, he hailed Planet Coaster 2 as leading the refocus on CMS games and return to profit.

The game is out. Another major fail. Review scores place it below even Frontier's previous flop, F1 Manager 2024. Game took only 10 days to fall out of the Steam top 40. A launch-day DLC brazenly attempting to charge £18 extra for missing PC1 content backfired, earning a 37% Steam score. Game's player numbers are already down by well over half.

Share price is down 25%.

CEO had better be ready with "refocused portfolio strategy" Version 2.
Posted at 07/11/2024 21:22 by timmy40
20% off the share price seems a little harsh imo
Posted at 16/10/2024 11:45 by grahamytrain
Strange they rise in notification that a few directors share option have lapsed because of the poor performing share price Don’t understand it but sure these gains will be given up by weekend. Roll on post Budget, and see where we land then.
Posted at 20/9/2024 19:24 by mirabeau
Are recovery prospects at video games developer Frontier Developments FDEV

0.61%
coming together, or is this investment still highly speculative?

Viking Global Investors thinks now is the time to buy at around 245p; its Viking Capital subsidiary has in recent months accumulated a 5% stake in this £97 million company. It does, however, manage £44 billion equivalent, so may prefer a few higher-risk/reward plays as part of diversification in pursuit of capital growth.

Invest with ii: Top UK Shares | Free Regular Investing | What is a Managed ISA?

Yesterday, it was announced that this stake had increased implicitly from 1.9% last July, hence appears to be a verdict on Frontier’s annual results to 31 May, declared last Friday. Mind that in July and at end-August respectively, Arcadian Asset Management trimmed its stake modestly to 2.6% and Invesco to 5.6%.

I examined Frontier last November at 147p after a 96% share price fall, intrigued as to whether a “mean” or average performance rate for the business could exist – somewhere in between the exceptional demand for games during Covid lockdowns and its aftermath.

The stock chart shows a classic boom/bust pattern around Covid. Frontier floated at 127p in mid-2013 it peaked above 3,300p then ceded nearly all of it:

At 147p I sought more evidence so rated the shares a “hold”. The price did ease to a 130p range in this year’s first quarter after revenue fell, then losses increased at January’s interim results to 30 November. But an “in line” trading update on 2 April was enough to trigger a run from 140p to 225p, although it’s unclear whether insiders sensed what was in store, as a more bullish update on 7 May saw this rally continue to 300p.

It has been a good example of whether to take your cue mainly from the chart – anticipating some extent of mean-reversion upwards – or insist on proof in numbers, especially profit. Frontier guided expectations for adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) upwards last May.

Perhaps a more important call is whether the business overall is now on the cusp. This stock has been in a sideways-volatile trend since May - it was down to 230p earlier this month and it slipped 3% to 247p yesterday compared with rises elsewhere in response to the US interest rate cut.

A tale of two financial half-years, and better prospects

Annual results to 31 May showed revenue disappointingly down 15% to £89 million, although a £97 million market value implies a modest price/sales ratio of 1.1x at 245p currently – such that if costs are better managed and return on investment kicks in, the PS ratio should be roughly 1.5x at least.

The narrative cites under-performing game launches in the first half, partly offset by a strong back catalogue performance of “creative management simulation” games mimicking real-life situations. CMS outperformance persisted into the second half, meaning the annual revenue fall was ahead of expectations.

A carrot is dangled by way of the strongest-ever release of games set to launch over the next three years. Among the titles, Planet Coaster 2 is due to launch this autumn, hence scope for useful news from reviews, leading to user numbers; then a third Jurassic World game in the May 2026 year and a further (as yet unannounced game) in 2027. Unless more are under wraps, that implies reliance on several proving hits.

Alongside better revenue prospects, management says it has cut annual operating costs by 20%, albeit they’re yet to manifest given the annual income statement shows sales and marketing costs down only 3% to £11.6 million and administrative expenses also by 3% to £13.7 million. Implicitly, they mean “run-rate̶1;.

The biggest cost element is £68 million research and development expenses, the same as the May 2023 year, although it’s unclear whether that is included (I rather doubt) in boasting 20%-lower costs. Sometimes, intellectual property development companies do go through investment phases that lead to harvesting, but in games there seems an element of “running to stand still” – always needing to prepare a next big release. See the material element of annual capital expenditure persisting in Frontier’s eight-year table below.

But combine these two broad elements – potentially improving sales against lower costs – and there is scope for quite an inflection point. The table shows £18 million net profit achieved on similar £89 million revenue in the May 2019 year; the little difference between operating and net profits in the trend over years implies benefits from tax credits linked to R&D.

This company has achieved reported operating margins over 20% in four of the past years from 2016:

Radical cash flow elements, albeit potentially reducing PE

The May 2024 annual results highlight cash up 4% to £29.5 million, although referencing the cash flow statement, cash generated from operations halved to £22 million.

After this and on the investing side, investment in new titles eased 30% to £29 million, and on the financing side £9 million tax was received. There was also no repeat of £3 million share purchases for an employee trust in 2023, nor a £1.3 million loan repayment. There were, hence, some significant dynamics within the slight rise in cash held, and the outcome could have been different than a pleasing rise.

It is speculative but, yes, there are grounds to believe Frontier can mean-revert its performance – the chief uncertainty being, to what degree?

Consensus anticipates a small normalised loss for the current financial year and only £1 million net profit in 2026. Unless R&D costs continue to weigh heavily, I sense this is probably cautious guidance from the company to its broker, and there is scope to outperform.

While the May 2026 price/earnings (PE) multiple is 80x based on projected earnings per share (EPS) of 3.1p, eventual mean-reversion towards EPS more like 20p would imply a PE of 12x.

A case for intangible value

A “price-to-book” ratio under 1.3x (book value of 195p) along with 1.1x price/sales, seems another indicator how, if management has an astute grip, the return on assets can be raised.

Looking back to 2016, for example, a share price around 200p compared with net asset value near 67p a share, hence a 3x ratio. Frontier made only £1.4 million net profit that year; the premium correctly anticipated the advance to £18 million in respect of May 2019 (before Covid lockdown sales manifested).

While 56% of net assets comprise mainly intangibles also goodwill, you can expect this for an intellectual property type business.

Warren Buffett has argued – primarily regarding newspapers – that intangible values are integral to modern business valuation. Implicitly, such a view included brand loyalty to Apple Inc AAPL

1.17%
, which (through success) became Berkshire Hathaway Inc Class B BRK.B

1.05%
’s biggest holding.

Obviously, the more rapid turnover in video games does not have a general loyalty factor to the extent of The Washington Post or Apple advancing the iPhone brand. Frontier wrote down its “other intangible assets” by 37% to £35.7 million over the last financial year due to amortisation and impairment.

So, there is a case for intangible value albeit lacking longevity.

A ‘good’ start to the new financial year

While a top management might strictly be positioned now to quantify the first quarter, Frontier cites “ongoing strength with the CMS-led back catalogue, with Planet Zoo and Jurassic World Evolution 2 again the star performers.

There is a “fear of missing out” aspect to my conclusion, after awaiting more proof last November and ending up missing a two-thirds re-rating to the current price, or more than doubling to over 300p since May. But there seem decent odds that the business at least is on a rising trend once again.

Frontier is speculative, yet Viking’s stake-building affirms my sense that the shares are a Buy.

Edmond Jackson is a freelance contributor and not a direct employee of interactive investor.
Posted at 10/9/2024 19:04 by mr euro
You pays your money you take your choice. Sometimes you have to make your bets and stick with it until the story changes.

You can read my posts from sometime ago and I have always been about the mid/long term roadmap. Nothing has changed despite the weekly share price volatility.

If we are up or down 30% tomorrow it makes no difference to me. I am with the story on this one.

PC2 will be huge IMHO. Not seen such a buzz around a title from FDEV for a long time.

I doubt there are too many bigger private investors in FDEV than me. If I have got it wrong, then we move on and correct the mistake for next time.
Posted at 26/5/2024 11:19 by yankhanson
Katie Cousins of Shore Capital, the nice young lady who upgraded from Hold to Buy 'cos "The group appears on track for another record revenue-breaking year in FY23" ... days before the entirely forseeble profit warning that delivered the largest one-day crash in the history of FDEV's share price.

"Frontier share price plummets following F1 Manager 2022 flop"
hxxps://www.eurogamer.net/frontier-share-price-plummets-following-f1-manager-2022-flop

Good luck on that one.
Posted at 05/12/2023 23:36 by yankhanson
"How does a company share price go from £34 down to £1.30? Can anyone explain"

The key to understanding is the £34, not the £1.30. At £34, FDEV was a balloon inflated by hype, pumped by newspaper tipsters, analysts etc..... whilst quilted from red flags that unravelled when the game market renormalised post-COVID, and oops, game buyers once again would not buy sub-standard product.

The immediate cause of FDEV's fall is just one thing. The major investors lost confidence in management. Said management then proved them right with flop after flop, warning after warning, and most damning of all, total failure to spot each obviously foreseeable disaster ahead. The real damage done by the latest game Realms of Ruin is not the flop, but the fact management actually really genuinely sincerely believed it was going to be a massive hit, worth their biggest development spend ever, right up to the moment of the launch day memo saying the number of people buying the game was ... virtually zero. Further, after each disaster they compounded the error by showing total lack of contrition. If they'd admitted they'd done a bad job, then investors might take seriously their promises to do better. But no, they always push the blame onto external factors such as competition, spending power, which is fatal, because that is the one type of thing on which management can never do better.

This is why no amount of promised remedial action by this management is going to arrest the share price fall, let alone recover the loss. They have proven to the market that nothing they say should be trusted. This will be solved only by the departure of David Braben and friends, to make room for untainted replacements who can start rebuilding trust.

How ironic it is then that the only recent board departure was its most valuable member, Chairman David Wilton, a long-time industry star, fresh from the biggest AIM game company sale ever... but sticking with Frontier only for one year. And how telling it is that the best replacement Frontier could find was a nice lady who has zero management experience of the games industry.

I predict share price will drop to double figures by end January, soon after which management will be forced to face the cash crisis and will do a dilutive cash raise, or delist and take private, or both.
Frontier Developments share price data is direct from the London Stock Exchange

Frontier Developments Frequently Asked Questions (FAQ)

What is the current Frontier Developments share price?
The current share price of Frontier Developments is 198.40p
How many Frontier Developments shares are in issue?
Frontier Developments has 39,423,349 shares in issue
What is the market cap of Frontier Developments?
The market capitalisation of Frontier Developments is GBP 79.83M
What is the 1 year trading range for Frontier Developments share price?
Frontier Developments has traded in the range of 106.60p to 330.50p during the past year
What is the PE ratio of Frontier Developments?
The price to earnings ratio of Frontier Developments is -3.62
What is the cash to sales ratio of Frontier Developments?
The cash to sales ratio of Frontier Developments is 0.87
What is the reporting currency for Frontier Developments?
Frontier Developments reports financial results in GBP
What is the latest annual turnover for Frontier Developments?
The latest annual turnover of Frontier Developments is GBP 89.27M
What is the latest annual profit for Frontier Developments?
The latest annual profit of Frontier Developments is GBP -21.47M
What is the registered address of Frontier Developments?
The registered address for Frontier Developments is 26 SCIENCE PARK MILTON ROAD, ENGLAND, CAMBRIDGE, CB4 0FP
Which industry sector does Frontier Developments operate in?
Frontier Developments operates in the MANUFACTURING INDUSTRIES,NEC sector

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