Gfinity PLC Trading Update (6864E)
22 October 2018 - 5:00PM
UK Regulatory
TIDMGFIN
RNS Number : 6864E
Gfinity PLC
22 October 2018
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the
publication of this announcement via a Regulatory Information
Service, this inside information is now considered to be in the
public domain.
22 October 2018
Gfinity plc
("Gfinity" or the "Company")
Year end trading update
Gfinity plc (AIM: GFIN), a world leading esports solutions
provider, announces a trading update for the year ended 30 June
2018.
The Company has invested significantly through 2017 and 2018 in
its esport technology platform, its content creation and community
building expertise and in its relationships with key business
partners. It is now well positioned to build on this platform for
growth and take advantage of the growing popularity of esports. The
Company sees increasing momentum in managed services through
solutions for leading sports rights holders such as Formula 1 and
Premier League and leading publishers such as EA Sports,
Codemasters and Microsoft. It also sees increasing momentum in
Owned and Operated properties with Gfinity Elite Series and
opportunity in development of the digital "Tribe" community.
Results for the year to 30 June 2018 are expected to be
announced towards the end of November. These results are expected
to show turnover for the year of approximately GBP4.3 million,
representing an increase of 82% year on year. The revenue growth
came from both managed services and Gfinity's owned and operated
properties and included the addition of two major new clients,
Formula 1 and Facebook, alongside existing strong client
relations.
Operating results improved significantly through fiscal 2018.
Adjusted EBITDA* loss (unaudited) improved by GBP2.2 million from
GBP7.4 million in the first half of fiscal 2018 to GBP5.2 million
in the second half. Combined, the results are expected to show an
Adjusted EBITDA loss for the year of GBP12.6 million. The improving
Adjusted EBITDA loss reflects higher commercial momentum in the
Gfinity Elite Series. Production of two out of three seasons of
Gfinity Elite Series in the UK took place in the first half of the
fiscal year, prior to the addition of the content rights deal with
Facebook in March 2018. These unaudited results also do not reflect
the sponsorship deal with Domino's, commencing in the 2019
financial year, which, when combined with content and franchise
revenues, have significantly improved the financial performance of
the Elite Series. Nor do these unaudited annual results include the
significantly enlarged 2018 Formula 1 programme, or the start of
the ePremier League, both of which also fall into the second
calendar half of 2018.
The cash position as at 30 June 2018 was GBP3.7 million. As at
today's date, the Company has cash reserves of over GBP2
million.
Financial outlook
The Company targets Adjusted EBITDA break-even operating results
within the next few years. Revenue is expected to be driven by
significant increased activity in managed services, both service
fees and content revenue from esports solutions for sports rights
holders and commercial brands in collaboration with publishers and
distribution partners. The Company also expects significant
contribution from its owned and operated properties, hereunder the
Gfinity Elite Series and its digital "Tribe" community under
development. Annual opex is expected to reach and remain relatively
stable around GBP10-12 million in the medium term, as the majority
of investment in the esport solutions platform, commercial delivery
and content production is completed. Increasing value of esports
content through a growing audience and stable opex is expected to
drive material operational scalability. As such, the Company
targets a long-term group gross margin of 30-40% and an Adjusted
EBITDA margin in the range of 15-25% on a normalised basis.
*Earnings before interest, tax, depreciation and amortisation,
excluding adjustments for share based payments.
To learn more about Gfinity, see latest company presentation
here:
https://cdn.gfinityplc.com/app/uploads/2018/10/19161817/Gfinity-Company-Presentation-October-2018.pdf
Enquiries:
Gfinity plc www.gfinityplc.com
Garry Cook, Executive Chairman Via Walbrook PR
Allenby Capital Limited - Nominated Adviser Tel. +44 (0)20 3328 5656
and Broker
Jeremy Porter / John Depasquale / Nick Chambers
Walbrook PR (Media & Investor Relations) Tel: +44 (0)20 7933 8780
Paul Cornelius / Sam Allen or gfinity@walbrookpr.com
About Gfinity
Gfinity (AIM: GFIN) is a world-leading esports solutions
provider. Its business to business platform, "Powered by Gfinity",
delivers managed services to game publishers, sports rights
holders, commercial partners and media companies. Gfinity creates
bespoke solutions, including competitions and industry leading
content production, connecting its partners with the esports
community in authentic and innovative ways. Partnerships include EA
SPORTS, Premier League, F1 Esports Series, Halo World Championship
and the Forza Racing Championship.
Gfinity connects directly with competitive gaming consumers
through its owned competition platform, the "Gfinity Elite Series".
The Series enables competitive gamers to be part of the Gfinity
community, testing themselves and developing new skills, while
providing a pathway for those who aspire to a career in esports to
join a leading professional team. "Gfinity Elite Series" content is
distributed through linear and digital channels and is enjoyed by
tens of millions of esports fans around the world.
All Gfinity managed service solutions and owned competitions are
underpinned by its proprietary technology platform delivering a
level playing field for all competitors and supporting scalable
multi-format leagues, ladders and knock out competitions.
More information about Gfinity is available at
www.gfinityplc.com.
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END
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