Keywords Studios Share Discussion Threads

[nurdin] 07/10/2015 14:34

Wouldnt be surprised if these get tipped by SCSW this weekend.Its their type of stock.Just a gut feel though..

[saucepan] 07/10/2015 12:54

Well spotted, rivaldo; thanks for highlighting.

[rivaldo] 07/10/2015 11:28

New Edison report out today:



Conclusion:

"Valuation: Growth and changing business mix profile warrant valuation premium

Keywords is trading on an c FY16e EV/EBIT of 12x, broadly in line with its
localisation peer group median. However, the company benefits from significantly
higher growth prospects, with much of the growth taking place in the higher-margin art production vertical. Therefore, direct comparisons with localisation companies are becoming less relevant over time. With the added potential for further accretive acquisitions, we believe that Keywords should be trading on a higher multiple. This would result in additional upside from the current share price."

[rivaldo] 29/9/2015 13:32

Buying coming in at 205p. Looks extremely strong.

[mg1982] 29/9/2015 08:37

So we are going to attempt to conquer 200p today. Already difficult to buy any stock even at 203p.

[modform] 28/9/2015 20:14

Nap, I have been highlighting KWS in the CR thread for the past few weeks. I even posted the link to the post that Saucepan had done looking into the company's fundamentals

[napoleon 14th] 28/9/2015 16:45

Means a spread of >10%, sauce.
No can do!, or later this eve, Knockando!

[soupdragon55] 28/9/2015 16:32

Not bad day considering the general markets.

[saucepan] 28/9/2015 16:03

Difficult call, nap; sometimes it just pays to bite the bullet - especially if you hope to hold long term.

It sounds like the stock is in demand, however; which augurs well for those already holding.

[saucepan] 28/9/2015 14:51

Still very quiet here considering the tremendous momentum :-)

[mg1982] 28/9/2015 13:02

This is going to shoot way past 200p now. Im not kidding you can literally only buy 2 shares with Barclays at the full 200p!

Coil is ready

[soupdragon55] 28/9/2015 12:43

So difficult for them to get shares, it pushes up pretty easily.

[rivaldo] 28/9/2015 12:16

Buying coming in at 197p now.

[rivaldo] 24/9/2015 09:34

KWS are featured in today's Shares Magazine in an article written by Douglas Lawson, director of Amati Global Investors, about the fund's holdings:

"The micro cap universe is a good place to look for companies with fundamentals that are broadly unaffected by an uncertain macro environment. We tend to focus
on non-cyclical businesses that can continue to grow earnings irrespective of the wider economic landscape."

"another company that falls into this category is Keywords Studios (KWS:AIM), a £74 million market capitalisation stock, also held across the Amati funds.

Keywords provides support services to developers of video games, principally for the ‘localisation’ of games titles – in other words, making the game language and content appropriate for local markets. The rate of video games development tends to be non-cyclical, being more influenced by the release of new consoles (and perhaps teenage buying patterns) than global economic concerns."

[rivaldo] 22/9/2015 13:49

Good interview with the CEO:

Http ://www.proactiveinvestors.co.uk/companies/news/111020/keywords-studios-eyes-all-year-round-business-111020.html

"Keywords Studios eyes all-year-round business
13:01 22 Sep 2015

Typically, the summer months have been the peak period for the industry, as developers push for key release dates ahead of Christmas.

Keywords Studios (LON:KWS), which today revealed results in line with expectations, is working to become a less seasonally dependant business.

Typically, the summer months have been the peak period for the industry, as developers push for key release dates ahead of Christmas.

Huge peaks and troughs, however, are something Andrew Day, chief executive of Keywords Studios, said he is trying to avoid.

August and September have traditionally been the busiest months for video game service provider, with less work in the after-Christmas period.

“We’re seeing a slight flattening out of the peak so it’s less sharp but runs for more months,” Day said.

“We won’t see the big downturn around November and December because there won’t be a big peak in September.

“If the business continues to show this trading it’s much better than having peaks and troughs,” he added.

The reason for this levelling out, is the work on less seasonal sectors, including mobile games, Day said.

While blockbuster games such as Fable and Tomb Raider can take up to two months to translate and another three to test, mobile games are produced much quicker and updated with further content once released.

Looking ahead, Day is confident for the full-year, after reporting a strong first half to the year.

“Daily and weekly production on mobile games and then a raft of triple A games which are already in hand or coming into us shortly mean the pipeline is very strong,” he told Proactive.

Today, Keywords reported revenue in the first six months of 2015 rose 23% year-on-year on a pro forma basis, which strips out the contribution of companies acquired in the last 12 months.

Group revenue, including contributions from acquisitions, shot up 74% to €23.9mln from €13.7mln in the same period of 2014.

Its two most recent acquisitions, Kite and Liquid Development, have already begun to make an impact, Day said.

"The acquisition of Liquid Development in August this year has both provided additional in-house capacity and has also brought much greater flexibility in resourcing which will allow us to flex up and down with the demands of individual projects in much the same way that we do in our other service lines,” he added.

Meanwhile, Mexico City-based audio recording and localisation group Kite Team, another acquisition made this year, was bought to allow the company to take on work that it had been outsourcing to other providers.

Broker Numis Securities said: “We believe that acquisitions have been a significant source of value creation for the group.”

Adjusted profit before tax for the period- climbed 65% to €2.2mln from €1.3mln, while statutory profit before tax soared to €1.6mln from €0.04mln.

Numis added that the strong profit improvement was “somewhat ahead of our expectations,” but has kept its pre-tax profit forecast of around €7.6ln unchanged.

The interim dividend has been hiked to 0.40p from 0.36p.

“We believe it’s right to pay a dividend because it’s a good discipline, and while the business is growing as it is, we would like to think we can continue this progressive dividend policy and raise the payout year on year,” Day said."

[mg1982] 22/9/2015 11:09

The interesting thing is that if Numis is already increasing their target to 230p - up 15% from their previous 200p target, they must be feeling confident that the company will go on to beat expectations as the second half is usually stronger.

Any pullback will result in top ups - im sure not just from me!

[rivaldo] 22/9/2015 10:53

Cheers for the info MG82 - here's a link to Numis' 230p target:

[soupdragon55] 22/9/2015 10:18

Watching in the background, pleased with the results. Appears to be tightly held as it's always difficult to buy in any volume. Looks good for H2 over the coming months.

[saucepan] 22/9/2015 10:10

The share price is gaining some traction now; perhaps the Numis recommendation?

Another thing perhaps worth pointing out - only four of us have commented on today's results. That suggests to me KWS is still largely off the private investor radar.

[the stigologist] 22/9/2015 10:09

Just a warning for anybody who gets taken in by rivaldo's style of subtle ramping/deramping/talking his own book. I have just exposed him for being either wilfully stupid or an outright liar on the VENN thread.

[mg1982] 22/9/2015 10:05

Numis say to buy and have a 230p target

[saucepan] 22/9/2015 09:50

Thanks, MG1982.

[mg1982] 22/9/2015 09:39

Presentation is now available:

hxxp://brrmedia.co.uk/event/140318?popup=true

listening to it now

[mg1982] 22/9/2015 09:03

NORTHLAND CAPITAL PARTNERS VIEW: Keywords’ buy and build strategy means that financial statements can be a little opaque but the momentum in the business remains strong. The acquisitions have increased the breadth and depth of Keywords’ offering and enables it to provide publishers with a comprehensive offering. This represents a clear competitive advantage in a highly fragmented market. The different dynamics of the different service offerings also helps to smooth some lumpiness. That said, the business remains H2 weighted but we are through the peak summer trading months. Shares are trading on 19.2x FY15 and 14.9x FY16.