We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Team17 Group Plc | LSE:TM17 | London | Ordinary Share | GB00BYVX2X20 | ORD GBP0.01 |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-11.50 | -4.12% | 267.50 | 260.00 | 275.00 | 267.50 | 267.50 | 267.50 | 186,606 | 08:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Prepackaged Software | 137.44M | 23.48M | 0.1610 | 16.61 | 390.02M |
TIDMTM17
RNS Number : 3334S
Team17 Group PLC
16 March 2021
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014. Upon the publication of this announcement, this information is now considered to be in the public domain.
16 March 2021
Team17 Group plc
("Team17", the "Group" or the "Company")
Unaudited Final Results for the year ended 31 December 2020
Record year underpinned by Team17's strong Games portfolio
Team17 , a global games entertainment label, creative partner and developer of independent ("indie") premium video games, is pleased to announce its full year preliminary results for the year ended 31 December 2020.
2020 Headlines:
-- More titles released than any previous year helping to deliver revenue growth of 34% -- Record GBP26.2m profit before tax - up 36% year on year -- Continued improvement in shareholder value with basic EPS growth of 32%
Financial highlights:
12 Months ended 31 December 31 December Growth 2020 2019 Revenue GBP83.0m GBP61.8m 34% Gross Profit GBP39.1m GBP29.5m 33% Gross Profit Margin 47% 48% Profit Before Tax GBP26.2m GBP19.2m 36% Adjusted EBITDA(1) GBP30.1m GBP22.1m 36% Operating Cash Conversion(2) 109% 103% Cash and cash equivalents GBP61.5m GBP41.9m 47% Basic Earnings per Share ("EPS") 17.0 pence 12.9 pence 32% Diluted EPS 16.8 pence 12.9 pence 30% Basic Adjusted EPS ("AEPS")(3) 18.2 pence 13.6 pence 34% Diluted AEPS(3) 18.1 pence 13.6 pence 33%
Operational and strategic highlights:
-- Strengthening portfolio with 12 titles launched in the year providing new revenue lines which included a record 10 new games released, supported by an increasing depth of back catalogue titles:
o Approaching 400 digital revenue lines delivered across the whole portfolio
o 2 titles launched on next-generation consoles, Worms Rumble and Overcooked! All You Can Eat
o Cross-play tech integration in Next Generation titles (forms the wrapper for releases in future years for online games using the Unreal and Unity engines)
-- Solid underlying Back Catalogue performance making up 78% of revenues. -- First party IP reached 21% of revenues, supported by 2 first party titles launched in Q4.
-- Seamless transition to remote working in early March 2020 ahead of the Covid-19 ("Covid") outbreak with the safety of our Teamsters paramount.
-- Continued investment in senior management and core infrastructure:
o CFO appointed and key hires made in Development Studio, HR and IT
o Martin Hellawell appointed Senior Independent Non-Executive Director (with immediate effect)
o Finance system upgrade initiated
-- With the acquisition and integration of Yippee Entertainment Limited ("Yippee") establishing a second UK development studio based in Media City, Manchester, the team has now doubled in size.
-- Overall headcount growth of 25% to 250 Teamsters at year end (2019: 200)
-- In January 2021, completed the acquisition of all rights and assets for Golf With Your Friends, an
existing third party title to become a fully owned IP for a total consideration of GBP12m.
Outlook:
-- Team17 has a solid and diverse pipeline of launches for 2021 and beyond and is well positioned to continue to deliver on our growth plans
-- The year has started well and the expansion of both major new consoles and distribution platforms underpins management's optimism about the future of gaming given its unique mixture of technology and entertainment
-- The board continues to be mindful of any potential headwinds associated with a prolonged pandemic, including uncertain macro-economic and consumer environments alongside manufacturing and supply chain challenges
-- However, the Company remains confident that its ever-growing and diverse portfolio and high-quality development and commercial teams will continue to underpin performance
-- Team17 continues to review a healthy pipeline of potential M&A opportunities that could bring long term value to the Group
Debbie Bestwick MBE, Chief Executive Officer of Team17, commented:
"I am delighted that our Teamsters and the wider Team17 family have pulled together, in what has been a challenging 12 months for many. It is because of their hard work and creativity, alongside that of our brilliant label partners, that we can report yet another record year of profitability.
Team17 has been able to offer gamers a means of escapism and a way to interact with their friends and family more than ever before, even when they were unable to meet face to face. The ability to enjoy interactive entertainment between multiple households is something that is almost unique to gaming and we are pleased that our inclusive and family-oriented games have proven so popular.
2020 was a significant year for the gaming industry as a whole, as we saw the launch of both Sony and Microsoft's next-gen consoles. It is fantastic to see our titles being launched on both these platforms and that another generation of gamers will get to explore Team17's gaming universes. Incredibly, our Worms franchise is now twenty-five years old and in December we launched the franchise's newest title, Worms Rumble , on PlayStation 5. While we have all been delighted to see how well the game has taken to this new platform, I know many gamers, myself included, will fondly remember Worms' first iteration, developed for the Commodore Amiga and released in 1995.
2021 will be a very exciting and busy year for Team17, with more games signed to our label than any time in our history and new IP launches to look forward to including Rogue Heroes, King of Seas, Narita Boy, Epic Chef, Super Magbot, Greak: Memories of Azur, Honey I Joined a Cult and Hokko Life with three new games still to be announced. Alongside these, Hell Let Loose is due to exit Early Access and launch on PlayStation 5 and Xbox X/S, Overcooked! All You Can Eat will launch on Nintendo Switch, PlayStation 4, Xbox One & PC and Worms Rumble will launch on Xbox X/S, Xbox One and Nintendo Switch. I look forward to updating our shareholders on our progress as the year goes on."
Footnotes:
(1) Adjusted EBITDA is defined as operating profit adjusted to add back depreciation of property, plant and equipment, amortisation of brands and impairment of intangible assets (excluding capitalised development costs) and share based payment costs.
(2) Operating cash conversion is defined as cash generated from operating activities as per the statement of cash flows, divided by EBITDA.
(3) Adjusted earnings per share is calculated by dividing the adjusted profit after tax by the weighted average number of ordinary shares. This is adjusted for the effect of share options when calculating the diluted adjusted earnings per share (Note 5).
Enquiries:
Team17 Group plc via Vigo Communications Debbie Bestwick MBE, Chief Executive Officer Mark Crawford, Chief Financial Officer GCA Altium (Nominated Adviser) +44 (0)161 250 Adrian Reed / Paul Lines 3577 Berenberg (Broker) Chris Bowman / Toby Flaux / Marie Moy / +44 (0)20 3207 Alix Mecklenburg-Solodkoff 7800 Vigo Communications (Financial Public Relations) Jeremy Garcia / Charlie Neish +44 (0)20 7390 team17@vigocomms.com 0238
About Team17
Team17 is a leading games entertainment label and creative partner for independent ("indie") developers, focused on the premium, rather than free to play market, and creating games for the PC, console, mobile and tablet gaming markets.
Alongside developing the Company's own games in house ("first party IP"), Team17 also partners with independent developers across the globe to add value to their games in all areas of development and production and in bringing them to market across multiple platforms for fixed percentage royalties ("third party IP").
Since foundation in 1990, the Company has launched over 100 games, including the iconic Worms, Overcooked! and Escapists franchises, Yooka-Laylee, Yoku's Island Express, My Time at Portia, Hell Let Loose, Blasphemous, Golf With Your Friends, Neon Abyss and Moving Out making Team17 one of the most prolific developers and diverse partners of games for the indie market.
Visit www.team17.com for more info.
Chair and Chief Executive's Review
Introduction
We are delighted to report a sixth consecutive record performance year. Supported by our Teamsters and Games Label partners, we delivered one of our most ambitious rosters of game launches, built upon our internal tech wrappers for 1(st) and 3(rd) party online Games to include Cross-Play (for Unity and Unreal engine games), alongside further enhancements to our back catalogue portfolio contributing to another excellent year.
Pleasingly, we launched 2 existing titles on new platforms and released a record 10 new game titles in 2020 which included 7 new game releases and 3 new games set in existing gaming universes. We continued to build on our existing franchises with additional 34 downloadable content packs ("DLC") delivered across 15 titles, further enhancing their lifecycles and encouraging continued player interaction.
Across the year, 78% of the Company's revenues came from our strong and diverse back catalogue portfolio, partly as a result of Covid related lockdowns which provided an opportunity for gamers globally to explore our diverse mix of content. This contributed to a significantly better than expected performance in FY2020 with new releases in total for the year accounting for 22% of sales. Our portfolio model came into its own in 2020 and underpins our low risk business model that we believe in so strongly.
2020 Launches
As referenced above, we continued to strengthen our IP portfolio with record title releases during the year working alongside development teams globally:
-- Moving Out - physics-based moving simulator (SMG Studio, Australia & DevM Games, Sweden)
-- Golf with Your Friends (console*) - multiplayer mini golf game (Blacklight Interactive, Australia)
-- Main Assembly - robot building sandbox game (Bad Yolk, Sweden) -- Crown Trick - role-playing game with turn-based combat (NeXT Studios, China) -- Going Under - satirical dungeon crawler (Aggro Crab, USA) -- Ageless - time altering puzzle platformer (One More Dream Studios, Malaysia) -- Neon Abyss - dungeon-based action-platformer (Veewoo Games, China) -- Hammerting - dwarf mining simulator (Warpzone Studios, Sweden) -- The Survivalists - island survival in The Escapists universe (own-IP, UK) -- Overcooked! All You Can Eat - boosted Overcooked bundle for next-gen (Ghost Town Games, UK) -- Worms Rumble - real-time, cross-platform Worms title (own-IP, UK)
-- Monster Sanctuary (console*) - monster collecting and turn-based combat (Moi Rai Games, Germany)
* existing games launched on to new platforms
As a result of both the strength of our portfolio model and the successful launch of new titles in 2020, we are delighted to report revenues of GBP83.0m up 34% (2019: GBP61.8m), an increase of 36% in gross profit to GBP39.1m (2019: GBP29.5m), profit before tax up 36% to GBP26.2m (2019: GBP19.2m) and a 33% increase in adjusted EBITDA to GBP30.1m (2019: GBP22.1m), all of which are records for the business. We continue to be highly cash generative, ending the year with cash and cash equivalents of GBP61.5m (2019: GBP41.9m).
The Company's portfolio continues to grow and now comprises nearly 400 digital revenue lines ("DRL"), compared to just over 300 DRL this time last year. The expansion of our DRL across our genre and platform agnostic portfolio continues to underpin the Company's growth and mitigates the risks associated with over-dependence on any one title or specific distribution platform.
The Company's core business model has remained focused, robust and is central to our ongoing success. Therefore, we will continue to focus on our key priorities:
-- Growing our strong portfolio of titles, including additional paid and free DLC; -- Harnessing new technology and platforms;
-- Capitalising on the strength of the Games Label model and our unique Greenlight process that identifies and contracts new IP;
-- Evaluating selective M&A opportunities; and
-- Continuing to invest in our people and infrastructure, while identifying new creative and commercial talent
Covid
Over the course of the pandemic and continuing into 2021, the safety and wellbeing of our Teamsters and Label Partners has remained our number one priority. Due to the seamless transition to remote working, the business suffered minimal interruption during the early stages of the pandemic. Having proven their ability to work effectively from home, we will continue to bring our people back to the office only when we feel safe and comfortable to do so. We also expect to see a permanent shift in working and business travel practices across our industry and will listen closely to feedback from our teams and partners, as we develop increasingly flexible working practices across the business.
2021 Pipeline
Continuing on from 2020, with one of our most ambitious pipelines delivered not just in the number of game launches and updates but technically as a remote work force, our fiscal 2021 pipeline is no less ambitious. We have a solid and diverse pipeline of new IP to look forward to including: Rogue Heroes, King of Seas, Narita Boy, Epic Chef, Super Magbot, Greak: Memories of Azur, Honey I Joined a Cult and Hokko Life with three new games yet to be announced. In addition to new IP, there is a special mention for some of our existing portfolio titles such as Hell Let Loose which will arrive on Next Generation Consoles this year alongside Worms Rumble and Overcooked! All You Can Eat which will launch on additional existing platforms with full cross play.
Rogue Heroes was launched in February 2021 and, together with the new titles already announced, we look forward to updating our shareholders on further titles to be released in 2021.
Industry recognition
The quality of Team17's business, management and games has continued to be recognised within the video game industry throughout 2020 with many awards and nominations but call out to:
-- Team17 named Indie Publisher of the Year at MCV Develop Awards
-- Blasphemous won Game of the Year, Best Art, Best Game Design, Best PC Game, and Best Console Game at Gamelab
-- Moving Out awarded Game of the Year Award at Australian Game Developer Awards -- Team17 named Publishing Star at Develop:Star Awards -- Team17 and Worms inducted into Golden Joysticks Hall of Fame
-- Greak: Memories of Azur won the Award for the Best Upcoming Game for PC/Consoles as well as Best Graphic Art at VJMX Awards
-- Debbie Bestwick named Entrepreneur of the Year at the 2020 AIM Awards
Market overview
In 2020, the video games market saw an unprecedented period of growth, accelerated by the significant increase in demand for at home entertainment during the Covid pandemic.
As a result of this positive tailwind, the overall market grew (4) 19.6% 2020 vs 2019 to $174.9 billion whilst previous estimates were for 8.2% growth to $164.6 billion. The market is now predicted to reach $217.9 billion by 2023 growing at 7.6% CAGR, a slightly lower rate than prior year predictions reflecting uncertainty within the global marketplace. Over the same period, the mobile gaming sector is expected to grow at 9.8% CAGR, whilst console and PC sectors are predicted to grow at 7.4% and 2.4% respectively.
With the launch of next-generation consoles in November 2020, we entered a new era of gaming with both consoles boasting significant improvements to architecture, processing, and graphics capabilities. Our platform agnostic approach means that although we will continue to release games across all platforms, including PlayStation 5 and Xbox Series X|S, the Company's performance remains untethered to a single console.
( (4) market data sourced from NewZoo Global Games Market Data January 2021)
Outlook
Team17 has a solid pipeline of launches for 2021 and beyond coupled with a strengthening Greenlight process continually adding further IP and strengthening our offering to 3(rd) party partners with our unique development tools and resources. The Company is therefore well positioned to continue to deliver on our growth plans.
The expansion of both major consoles and distribution platforms underpins management's optimism about the future of gaming given its unique mixture of technology and entertainment.
Whilst gaming has proven to be extremely resilient, the board continues to be mindful of any potential headwinds associated with a prolonged pandemic, including uncertain macro-economic and consumer environments alongside manufacturing and supply chain challenges facing next generation and existing hardware. We expect these to be in part ongoing and key considerations in 2021.
We would like to take this opportunity to thank our Teamsters for their tenacity and faultless commitment in what has been a challenging year for all of us. It is through their endurance and ingenuity that Team17 has been able to thrive in an unprecedented trading environment.
With a solid pipeline of launches for 2021 and beyond, Team17 is well positioned to continue to deliver underlying growth and support the long-term prospects aligned with our ambitious strategic plans. The acquisition in early January of IP rights and assets for Golf With Your Friends is a clear indication of our strategic intent and desire to grow our IP base, expanding our portfolio and franchise footprint.
The Group continues to focus on retaining cash generated from operations to further invest in the business and its growth plans and the Directors do not propose a dividend at this time.
We are confident that our ever-growing portfolio and high quality development and commercial resources place Team17 in a strong position and will continue to underpin the Group's future performance.
Debbie Bestwick MBE Chris Bell Chief Executive Officer Non-Executive Chair
15 March 2021
Chief Financial Officer's Review
Performance overview
2020 was undoubtedly an exceptional year with the Covid pandemic impacting individuals and businesses across the globe. Overall we reported record revenues with higher than expected back catalogue sales alongside the launch of 12 titles with 2 existing titles released on new platforms and a record 10 new titles launched during the year (2019: 7) resulting in new releases representing 22% of revenues in the period (2019: 29%). Overall, the Group's revenues grew 34% to another record level of GBP83.0m (2019: GBP61.8m) for the year to 31 December 2020.
Gross profit grew by 33% to GBP39.1m (2019: GBP29.5m) and gross margin percentage was 47% (2019: 48%). Movement in gross margins reflect a combination of the sales mix, the age profile of the titles within our portfolio and the ongoing support provided to titles post launch. It should be noted that this combination of sales mix between back catalogue and new releases together with associated amortisation charges is subject to the scale and timing of new game releases and will vary from year to year.
With a growing pipeline of titles in production combined with more internal IP, development costs capitalised in the period have increased by 134% to GBP7.5m (2019: GBP3.2m). Capitalised costs will vary from year to year as they reflect the combination of the increased number of titles in development, timing and number of planned launches, the mix of own IP launched in the year and also the technical tools we build within our talented development teams including multiplayer online games and cross platform technology. Costs incurred to support an increasing number of live games or deliver new content as DLC (either paid for or free updates) are fully expensed in the period.
Amortisation charges have risen primarily due to the increase in number of titles launched in the period. Team17's amortisation policy means that the majority of the capitalised development costs for a title are written off in the 12 months after the title is launched. Charges will vary year to year in accordance with the timing and quantity of titles launched alongside the level of development costs capitalised.
In December 2020, we launched Worms Rumble on PC, PlayStation 4 and the next generation PlayStation 5 console and as part of this launch, revenue was secured under a license agreement with PlayStation which was recognised in the period under IFRS 15. As a result of the licence deal combined with the launch on the next generation console, first year revenues are expected to be more heavily weighted towards the launch date and we have therefore updated our amortisation policy to better reflect this with a higher amortisation charge for this title being recognised in December 2020. The total amortisation charges for this title over the first year after launch will remain in line with the existing policy.
Administration costs grew by 23% to GBP13.0m (2019: GBP10.6m) with the key driver of the increase being the growth in headcount. We were pleased to be able to continue to recruit throughout the year despite the pandemic related restrictions and as a result total headcount grew by 25% to 250 (2019: 200). The increase in headcount includes the team that joined as a result of the acquisition of Yippee in January 2020, enabling the expansion our development capability with a second studio based in Media City, Manchester with access to a new and broad talent pool. Average headcount increased by 34% to 233 during the period (2019: 173) reflecting the fact that prior year headcount increase was predominantly second half loaded.
In line with the increased number of game launches in the period, there were increased marketing costs, however other commercial costs associated with global gaming events were reduced as a direct result of Covid restrictions. In addition, there were relatively small overhead costs associated with the Manchester studio in its first year within Team17.
The resulting operating profit for the period was GBP26.2m which showed a 38% growth compared to the previous year (2019: GBP19.0m).
The business continues to remain debt free (with the exception of the lease liabilities included under IFRS 16); with global interest rates remaining extremely low, bank interest generated net finance income of GBP0.1m (2019: GBP0.2m). The resulting profit before tax grew 36% to GBP26.2m (2019: GBP19.2m)
Adjusted EBITDA was GBP30.1m which grew 36% year on year (2019: GBP22.1m) and the Adjusted EBITDA margin as expressed as a percentage remained at 36% (2019: 36%) continuing to support the underlying profitability of the portfolio business model whilst making important investment in the team and infrastructure to support the future growth aspirations for the business. Adjusted EBITDA includes the add back for share based payments charges including employers national insurance contributions of GBP1.7m (2019: GBP0.9m) associated with share awards used to reward and incentivise Team17 employees.
The effective tax rate after Video Games Tax Relief (VGTR) and adjustments made to prior years is 16% (2019: 13%).
Statement of Financial Position
Team17 remains highly cash generative with an operating cash conversion of 109% (2019: 103%). Cash generated from operations increased to GBP35.4m (2019: 25.1m) which resulted in the continued growth in net cash and cash equivalents to GBP61.5m (2019: GBP41.9m) at 31 December 2020, an increase of GBP19.6m (2019: GBP18.3m). The Board expects the Group to remain highly cash generative in 2021. Cash and cash equivalents includes GBP3.2m (2019: GBP3.2m) held in the Employee Benefit Trust (EBT) which is used to support employee share awards and incentivise Team17 employees.
Intangible assets are reviewed for indicators of impairment every six months. As at 31 December 2020 the net book value was GBP22.4m (2019: GBP21.1m) for goodwill reflecting the addition to goodwill associated with the Yippee acquisition, GBP14.3m (2019: GBP16.0m) for brands and also includes GBP6.3m (2019: GBP2.8m) of capitalised development costs relating to unreleased titles and titles that have been launched within the previous two years.
Trade and other receivables has increased by GBP4.9m to GBP16.4m (2019: GBP11.5m). This increase is predominantly driven by trading uplift. Timing on tax recoveries has led to a tax receivable of GBP0.7m (2019: GBPNil). Trade and other payables equally increased in line with trading to GBP17.2m (2019: GBP11.7m), most notably impacted by royalty accruals and licence income timing on trading towards the end of the financial period.
Share Issues
During the year Team17 announced separate share issues, firstly in January 2020 for 114,000 new ordinary shares issued as part of the consideration for the acquisition of Yippee and then in July, further to the exercise of options as part of the Team17 Group plc Long Term Incentive Plan, 70,946 ordinary shares were issued and allotted. The Group's issued share capital now comprises 131,473,222 ordinary shares of GBP0.01 each.
The Group continues to manage a Deferred Bonus Share Plan for its senior management as well as an All Employee Share Incentive Plan ("SIP"). Team17 runs an employee SIP with matching shares and this continues to be well supported with 44% of all employees as shareholders making monthly contributions. These are both funded from the Employee Benefit Trust ("EBT") and therefore will not result in the issue of shares to satisfy the options.
Events After the Reporting Date
On 21 January, Team17 announced the acquisition of all rights and assets for Golf With Your Friends, an existing third party title to become a fully owned IP for a total consideration of GBP12m which will be satisfied totally in cash with an initial payment of GBP9m and a further GBP3m paid within 12 months.
Mark Crawford
Chief Financial Officer
15 March 2021
Unaudited Consolidated Statement of Comprehensive Income
Unaudited Audited Year ended Year ended 31 December 31 December 2020 2019 Note GBP'000 GBP'000 Revenue 3 82,969 61,794 Cost of sales (43,823) (32,257) Gross profit 39,146 29,537 Administrative expenses (12,979) (10,581) Operating profit 26,167 18,956 Finance income 112 232 Finance cost (43) (18) Profit before tax 26,236 19,170 Taxation (4,292) (2,551) Profit and total comprehensive income attributable to shareholders 21,944 16,619 Basic earnings per share 5 17.0 Pence 12.9 Pence Diluted earnings per 5 16.8 Pence 12.9 Pence share Basic adjusted earnings 5 18.2 Pence 13.6 Pence per share Diluted adjusted earnings 5 18.1 Pence 13.6 Pence per share
Unaudited Consolidated Statement of Financial Position
Unaudited Audited 31 December 31 December 2020 2019 Note GBP'000 GBP'000 ASSETS Non-current assets Intangible fixed assets 6 42,921 39,925 Property, plant and equipment 1,353 1,478 Right-of-use asset 1,378 1,513 Deferred tax - 248 45,652 43,164 Current assets Trade and other receivables 16,430 11,487 Tax receivables 670 - Cash and cash equivalents 61,470 41,853 78,570 53,340 Total assets 124,222 96,504 EQUITY AND LIABILITIES Non-current liabilities Lease liabilities 1,320 1,464 Provisions 76 26 Deferred tax liabilities 2,126 3,007 Total non-current liabilities 3,522 4,497 Current liabilities Trade and other payables 17,206 11,736 Lease liabilities 145 122
Total current liabilities 17,351 11,858 Total liabilities 20,873 16,355 Equity Share capital 1,315 1,313 Share premium 44,084 44,084 Merger reserve (153,822) (153,822) Other reserve 159,296 158,864 Retained earnings 52,476 29,710 Total equity 103,349 80,149 Total equity and liabilities 124,222 96,504
Unaudited Consolidated Statement of Changes in Equity
Share Share Merger Other Retained capital premium reserve reserves earnings Total Year to 31 December 2019 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 Balance at 1 January 2019 1,313 44,084 (153,822) 158,864 12,170 62,609 Share based compensation - - - - 921 921 Total transactions with owners - - - - 921 921 Profit and total comprehensive income for the year - - - - 16,619 16,619 Balance at 31 December 2019 (audited) 1,313 44,084 (153,822) 158,864 29,710 80,149 Year to 31 December 2020 Balance at 1 January 2020 1,313 44,084 (153,822) 158,864 29,710 80,149 Share based compensation - - - - 822 822 Issue of shares on exercise of options 1 - - - - 1 Issue of shares on acquisition of subsidiary 71 - - 432 - 433 Total transactions with owners 2 - - 432 822 1,256 Profit and total comprehensive income for the year - - - - 21,944 21,944 Balance at 31 December 2020 (unaudited) 1,315 44,084 (153,822) 159,296 52,476 103,349
Unaudited Consolidated Statement of Cash Flows
Unaudited Audited Year ended Year ended 31 December 31 December 2020 2019 Note GBP'000 GBP'000 Operating activities Profit before tax 26,236 19,170 Adjustments for: Depreciation of property, plant and equipment 404 355 Depreciation of right-of-use assets 135 57 Amortisation of intangible fixed assets 6 5,812 4,888 Share-based compensation 822 921 Finance income (112) (232) Finance cost 43 18 Loss on disposal 24 29 Increase in trade and other receivables (4,908) (3,351) Increase in trade and other payables 6,908 3,321 Increase/(Decrease) in provisions 50 (113) Cash generated from operating activities 35,414 25,063 Tax paid (7,125) (2,494) Net cash inflow from operating activities 28,289 22,569 Cash flow from investing activities Acquisition of subsidiary (net of cash received) 7 (813) - Purchase of property, plant and equipment (338) (1,265) Sale of property, plant and equipment 43 43 Capitalised development costs 6 (7,512) (3,215) Interest received 112 232 Net cash from investing activities (8,508) (4,205) Cash flow from financing activities Interest paid (43) (17) Receipt of lease incentive - 48 Repayment of lease liabilities (121) (54) Net cash from financing activities (164) (23) Net increase in cash and cash equivalents 19,617 18,341 Cash and cash equivalents at beginning of period 41,853 23,512 Cash and cash equivalents at end of period 61,470 41,853
Notes to the Unaudited Consolidated Financial Statements
1. Nature of operations and general information
Team17 Group plc and its subsidiaries (the Group) are a global games label, creative partner and developer of independent ("indie") premium video games.
2. Basis of preparation
The preliminary results for the year ended 31 December 2020 are unaudited. The financial information set out in this announcement does not constitute the Group's financial statements for the year ended 31 December 2020 as defined by Section 434 of the Companies Act. This financial information has been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006. It has been prepared on the historical cost basis, except for those items which are measured at fair value.
This financial information should be read in conjunction with the financial statements of Team17 Group plc for the year ended 31 December 2019 (the "Prior year financial statements"), which are available from the Registrar of Companies. The auditors, PricewaterhouseCoopers LLP, reported on those accounts and their report was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under Section 498 (2) or (3) of the Companies Act 2006.
The Group's financial statements for the year ended 31 December 2020 will be finalised on the basis of the financial information presented by the Directors' in these preliminary results and will be delivered to the Registrar of Companies following the Annual General Meeting of Team17 Group plc.
Accounting policies
The Group's principal accounting policies used in preparing this information are as stated on pages 31 to 37 of the prior year financial statements. There has been no significant change to any accounting policy from the date of the prior year financial statements.
3. Segmental information
Whilst the chief operating decision maker considers there to be only one segment, the Company's portfolio of games is split between those based on IP owned by the Group and IP owned by a third party and hence to aid the readers understanding of our results, the split of revenue from these two categories are shown below:
Revenue by first party/third party IP:
Unaudited Audited Year ended Year ended 31 December 31 December 2020 2019 GBP'000 GBP'000 First party IP 17,310 10,312 Third party IP 65,659 51,482 82,969 61,794
4. Adjusted EBITDA
Unaudited Audited Year ended Year ended 31 December 31 December 2020 2019 Profit attributable to shareholders 21,944 16,619 Share based compensation 1,662 921 Adjusted profit after tax 23,606 17,540 Taxation 4,292 2,551 Finance income (112) (232) Finance cost 43 18 Amortisation of brands 1,784 1,783 Depreciation 535 412 Adjusted EBITDA 30,148 22,072
5. Earnings per share
The calculation of the basic earnings per share is based on the profits attributable to the shareholders of Team17 Group plc divided by the weighted average number of shares in issue. The weighted average number of shares takes into account treasury shares held by the Team17 Employee Benefit Trust. The diluted earnings per share uses the same calculation however the number of shares in issue are adjusted to include shares considered to be dilutive under the treasury stock method. An option is considered to be dilutive when the total proceeds per option is less than the average share price for the period.
Unaudited Audited Year ended Year ended 31 December 31 December 2020 2019 Profit attributable to shareholders GBP'000 21,944 16,619 Weighted average number of shares 129,398,375 129,246,382 Weighted average diluted number of shares 130,607,624 129,253,947 Basic earnings per share (pence) 17.0 12.9 Diluted earnings per share (pence) 16.8 12.9
The calculation of adjusted earnings per share is based on the profit attributable to shareholders as shown in the Statement of Comprehensive Income plus additional costs added back during the year as shown in note 4. The weighted average diluted number of shares includes share options considered to be dilutive under the treasury stock method as described above.
Unaudited Audited Year ended Year ended 31 December 31 December 2020 2019 Adjusted profit after tax GBP'000 23,606 17,540 Weighted average number of shares 129,398,375 129,246,382 Weighted average diluted number of shares 130,607,624 129,253,947 Basic adjusted earnings per share (pence) 18.2 13.6 Diluted adjusted earnings per share (pence) 18.1 13.6
6. Intangibles
Development costs Brands Goodwill Total GBP'000 GBP'000 GBP'000 GBP'000 Cost At 1 January 2019 10,615 21,983 21,083 53,681 Additions 3,215 - - 3,215 At 31 December 2019 13,830 21,983 21,083 56,896 Additions 7,512 - - 7,512 Amounts arising on acquisitions - - 1,296 1,296 At 31 December 2020 21,342 21,983 22,379 65,704 Accumulated amortisation At 1 January 2019 7,922 4,161 - 12,083 Charge for the year 3,105 1,783 - 4,888 At 31 December 2019 11,027 5,944 - 16,971 Charge for the year 4,028 1,784 - 5,812 At 31 December 2020 15,055 7,728 - 22,783 Net carrying amount At 31 December 2020 6,287 14,255 22,379 42,921 At 31 December 2019 2,803 16,039 21,083 39,925
Goodwill
The Group tests for impairment every six months, or more frequently if there are indicators that goodwill might be impaired.
The recoverable amount of the cash generating unit ("CGU") at 31 December 2020 is determined from the fair value less costs of disposal of the underlying business units. The key assumption in calculating the fair value was the expected future cashflows at 31 December 2020. No impairment is considered necessary at 31 December 2020.
7. Acquisition of subsidiary
On 1 January 2020 Team17 Group plc acquired 100% of the issued shares in Yippee Entertainment Limited, for total consideration of GBP1,363,000. The acquisition is expected to increase the studio capacity by adding a talented and versatile team which will continue to be run by Mike Delves, an industry veteran with over 30 years' experience. Details of the purchase consideration, the net assets acquired and goodwill are as follows:
GBP'000 Purchase consideration Cash consideration 780 Deferred consideration 150 Total cash consideration 930 Shares issued in Team17 Group plc 433 Total purchase consideration 1,363
The assets and liabilities recognised as a result of the acquisition are as follows:
GBP'000 Cash and cash equivalents 116 Property, plant and equipment 8 Receivables 58 Payables (115) Net identifiable assets acquired 67 Add: Goodwill 1,296 1,363
The goodwill is attributable to Yippee Entertainment Limited's talented multi-award winning video game development team. It has been allocated to the sole segment of the business which is the production and publishing of video games. None of the goodwill is expected to be deductible for tax purposes.
Acquisition related costs of GBP108,000 are included in administrative expenses in the Statement of Comprehensive Income for the year ended 31 December 2019.
Financial performance of Yippee Entertainment Limited has not been disclosed as it was wholly immaterial to the year ended 31 December 2020 results.
Deferred consideration
The deferred consideration arrangement required the Group to pay the former owners of Yippee Entertainment Limited up to a maximum of GBP150,000 by 31 December 2020 with no minimum. The full amount of GBP150,000 was paid in December 2020.
Shares issued in Team17 Group plc
The shares were issued as part of the consideration for the acquisition of Yippee and therefore merger relief has been applied to the premium on the issue.
Trade and other receivables
The fair value of trade and other receivables at acquisition was GBP58,000 and the full amount was deemed to be collectible.
8 . Post balance sheet events
On 4 January 2021 Team 17 Digital Limited acquired the Golf With Your Friends IP from Entertainment Holdings Pty Ltd a company incorporated in Australia for GBP12,000,000. This consideration is made up of an initial cash payment of GBP9,000,000 and deferred cash consideration of GBP3,000,000 due within 12 months of the acquisition date.
The acquisition underlines part of the Company's strategy to make value enhancing acquisitions that will support the growth ambitions alongside organic growth and the Board expects this to be an ongoing part of the growth strategy.
At the time when these financial statements are authorized for issue, the Group had not yet completed the accounting for the acquisition and hence the fair values of assets acquired have not been disclosed.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
END
FR EAFDSFLNFEAA
(END) Dow Jones Newswires
March 16, 2021 11:09 ET (15:09 GMT)
1 Year Team17 Chart |
1 Month Team17 Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions