Team17’s (TM17) top-line hit another record in the first half, as demand for multiplayer games spiked during lockdown. But management expects revenue to hold steady across the year, as it gears up for more game releases.
Indeed weighting towards the second half meant that 86 per cent of revenues in the period came from the company’s back catalogue, compared to around three-quarters last year. Looking ahead, Team17 is set to launch six more new games in 2020, including a new title in the Worms franchise, as well as a jointly-developed project with Tencent (HK:700) Games’ NeXT Studios.
The gross profit margin dipped slightly to 47.3 per cent, down from 49.8 per cent in the same period last year – although chief financial officer Mark Crawford expects that this will nudge back up again by the end of 2020.
The developer has also been working to extend the life-cycle of its games, launching new downloadable content (DLC) on titles such as Genesis Alpha One.
Peel Hunt forecasts adjusted pre-tax profits of £22m and EPS of 13.9p in the 2020 full year, compared with £20.1m and 13.6p in 2019.
| TEAM17 (TM17) | ||||
| ORD PRICE: | 690p | MARKET VALUE: | £ 907m | |
| TOUCH: | 680-700p | 12-MONTH HIGH: | 738p | LOW: 290p |
| DIVIDEND YIELD: | nil | PE RATIO: | 47 | |
| NET ASSET VALUE: | 70p | NET CASH: | £48.8m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2019 | 30.4 | 10.4 | 6.80 | nil |
| 2020 | 38.8 | 13.3 | 8.50 | nil |
| % change | +28 | +28 | +25 | - |
| Ex-div: | na | |||
| Payment: | na | |||
