TIDMGFIN
RNS Number : 8520U
Gfinity PLC
31 March 2023
The information contained within this announcement is deemed by
the Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
31 March 2023
Gfinity plc
("Gfinity" or the "Company")
Half Year Results
Gfinity (AIM: GFIN), a world-leading esports solutions provider,
announces its unaudited results for the six-month period ended 31
December 2022.
Financial Highlights:
-- Revenue of GBP4.1m (H1 FY22: GBP3.3m), representing a 26%
increase year on year and a 106% increase on the six-month period
immediately preceding
-- Investment in development of Gfinity owned intellectual
property, in particular the proprietary Athlos Gaming Technology,
resulted in an increase in adjusted operating expenditure to
GBP2.7m in the period (FY22 H1: GBP2.4m)
-- Adjusted Operating Loss [1] of GBP0.8m (H1 FY22: GBP0.4m),
representing an increase of 101% year on year, but an improvement
of 47% on the previous six months
-- Period-end cash of GBP1.7m, supplemented by a post period end
placing and subscription, raising a further GBP2.0m before
expenses
-- Restructure announced post-period expected to deliver GBP0.7m
of recurring overhead savings, through reduced fixed costs of
central leadership group and release of Gfinity Arena
Operational Highlights:
Athlos Gaming Technology
Significant progress made to productise Gfinity's proprietary
esports technology, allowing it to be deployed at scale. This
includes:
-- Successful pilot programme with one of the world's leading
mobile publishers now extended into 3(rd) year, with the platform
having reached more than 22m gamers across 3 game titles in
2022
-- Two further beta clients integrated with Athlos platform,
with a significant reduction in the time taken to implement the
platform
-- Post-period end, deal announced with Playgendary, a top-10
mobile game developer for Athlos to be integrated into Playgendary
titles, with Gfinity's remuneration linked to number of users of
the platform each month
-- Todd Sitrin, former Head of Competitive Gaming at EA, added
to Athlos leadership group as a Strategic Advisor
Gfinity Digital Media
-- Average Monthly Active Users (MAUs) during the period of
13.1m, representing a 10% year on year reduction (H1 FY22: 14.5m),
following Google algorithm changes which impacted traffic from
September 2022
-- Annualised revenue per MAU of 22p, representing a 2%
reduction on prior year, but relatively consistent in a global
advertising market, which has seen significant pressure on CPM
rates over the past year
-- Revenue of GBP1.4m, an 11% reduction on the equivalent period
in the prior year (H1 FY22: GBP1.6m), but a 20% increase on the 6
month period immediately preceding
-- New commercial partner appointed for GDM business with effect
from April 2023, expected to drive a sharp increase in advertising
rates
-- Rebekah Billingsley, an experienced leader in the digital
media sector, announced as Managing Director of the GDM business in
September 2022
Esports Solutions
Gfinity has continued to build a leading position as a provider
of esports solutions to sports organisations, particularly within
the football and motorsports sectors, driving revenue up to GBP2.5m
(H1 FY22: GBP1.5m), an increase of 70% year on year.
-- Appointed as esports strategy development partner to Saudi Professional League
-- Completed delivery of fifth season of award-winning Formula 1 Esports Series
-- Delivery of an esports operating plan for a leading UK football club
-- Completed third season of V10 R League series, part of the
Global Racing Series venture co-owned together with Abu Dhabi
Motorsports Management, featuring leading motorsports teams
including Mercedes, Red Bull, McLaren, Ford and Aston Martin
Post-period, a restructure of the Esports Solutions business was
announced, to reflect the pivot towards developing solutions for
clients to engage with gamers, leveraging Gfinity's proprietary
technology and experience in building communities and away from
live event delivery and production. Under this restructure, the
Gfinity Arena was released and it was agreed that the previous CEO,
John Clarke would step down from the business .
Post-Period Transaction
On 9 February 2023, it was announced that Gfinity intended to
raise a minimum of GBP1.5m through a placing and subscription to
support working capital and to allow for continued development of
the Company's proprietary intellectual property to facilitate
future growth. On 14 February it was announced that this placing
had been oversubscribed and that, subject to General Meeting, the
Company would raise a total of GBP2.0m prior to expenses from a
combination of new and existing investors.
Shareholders approved this transaction at a General Meeting on
Monday 6 March 2023.
Outlook
The sector opportunity remains strong, reflecting a continued
trend towards video gaming, both playing and watching, as the
entertainment pastime of a new generation. Within this space,
directors believe that the greatest opportunity lies in creating
technology and products that engage all fans of competitive gaming,
not only the elite 1% at the top of the professional pyramid.
Gfinity's expertise, audience, relationships and proprietary
technology means that it is well positioned to take advantage of
this opportunity.
By business unit, directors see the outlook as follows:
Athlos Gaming Technology:
Represents a significant opportunity to create scalable,
recurring, high-margin revenues. Work to date has validated the
belief that the target market for this product is very large and
that the Athlos product has a distinct first-mover advantage in
helping publishers drive engagement and revenue per user through
quickly and seamlessly integrating competitive functionality for
players at all levels.
Fully unlocking this potential will require further investment
in the product. As a result, the company continues to engage
actively with potential investors with regards to a direct
investment in the Athlos product, so this potential can be unlocked
without an ongoing requirement for group funding.
Gfinity Digital Media:
The Gfinity Digital Media network continues to represent a
valuable asset for the group, both in its ability to generate
revenues from an owned audience through ecommerce and advertising,
but also in providing Gfinity with a forum through which to
directly connect with a large network of gamers.
The trading environment in the digital media sector, however,
has been more challenging over the past 12 months than in previous
years. Directors expect this situation to continue for the next 12
months, before returning to growth in 2024.
Esports Solutions:
While the size of the audience watching esports has continued to
grow over recent years, the provision of production and event
services around esports has become more commoditised than at the
outset of the industry. There have been several new entrants in the
market, willing to deliver work at a loss, which has impacted the
economics of the industry.
As a result, directors believe the greatest opportunity lies in
designing esports solutions for key clients and leveraging the
investments made by others to facilitate the delivery of live
events and productions required as part of such programmes.
This approach allows Gfinity to own key client relationships,
while reducing its cost base from the level that would be required
to maintain a market leading events and production delivery
capability.
Overall:
Gfinity remains well positioned as a business with a strong
reputation, an owned audience and proprietary technology in an
industry that continues to grow. Directors believe that the actions
taken over the six months to December 2022, and in the three month
period following that date, have positioned the business to fully
capitalise on that opportunity.
S
Enquiries :
Gfinity plc www.gfinityplc.com
Canaccord Genuity Limited (AIM Nominated Tel: +44 (0)207
Adviser & Broker) 523 8150
Bobbie Hilliam / Patrick Dolaghan
About Gfinity
Gfinity is a leading media and technology company in the fast
growing esports and gaming sector. Founded in late 2012, Gfinity
established itself as esports and community engagement experts.
More recently, the company's business model has evolved to reflect
the rapidly developing gaming market, sharpening its strategic
focus, based on 3 distinct areas:
Gfinity Digital Media is made up of 11 sites that reach an
average of >13 million monthly unique active users, and delivers
75 million impressions per month across its social network of over
7,000,000 followers.
Athlos Gaming Technology is a fully configurable, white-label,
bespoke solution, designed to maximise community engagement through
competitive play, and is already trusted by some of the world's
biggest gaming and esports organisations.
Esports Solutions - Designing and delivering esports programmes
for partners, building communities and deepening their engagement
with gamers, both under a fee-based model and through programmes in
which Gfinity shares in the commercial rights created.
Operational Review:
The results for the six-month period to 31 December 2022 reflect
a period of strong top line growth, with a 26% increase in revenue
year on year, coupled with a period of investment in building the
intellectual property, products and audience that the directors
believe will provide a platform for profitable future growth and
long term shareholder value.
Athlos Gaming Technology:
Since Gfinity's foundation, the structure of the gaming industry
has changed significantly.
-- Two-thirds of games industry revenues now come not from the
day one sale of games, but in-game revenues, both through
micro-transactions and through advertising.
-- Mobile gaming has become the largest segment within the
market. Newzoo's Global Games Market Report now estimates revenue
from mobile gaming to be worth more than $100bn p.a., accounting
for more than half of the annual revenue of the games industry.
-- The audience for esports has continued to grow, with 2.5bn
people now aware of esports and 261m gamers identifying themselves
as esports enthusiasts. (Source: Newzoo: Global Esports and Live
Streaming Market Report 2022.)
These changes have impacted the market in a number of important
ways:
-- There has been a proliferation of new games coming to market,
particularly mobile games, which typically have a lower cost to
develop and launch than AAA console and PC titles
-- There is a direct and significant financial benefit to
publishers of keeping players engaged in their games for longer
-- Competitive gaming has proven to be one of the most effective
tools for driving this increased engagement.
Gfinity's proprietary Athlos platform allows game publishers to
deploy this competitive functionality quickly and easily into their
games, delivering esports capability without gamers having to leave
the game and connect to an external platform.
The Athlos platform solves 2 key problems for game developers in
this new eco-system, firstly, producing content for games in a
live-service model is incredibly expensive and time intensive and
secondly, development resources are incredibly constrained, and
remain entirely focused on core game mechanics that make each game
unique.
In the six-month period to 31 December 2022, Gfinity
successfully integrated the technology into two new beta games,
delivering significant reductions in the integration time required
on each occasion.
This period also saw the completion the second year of a major
beta programme with the Athlos technology integrated into 3 major
titles of one of the world's leading mobile game publishers. Across
2022, this resulted in more than 22m interactions with the Athlos
product during the year.
Through this beta period, all Athlos revenue has come through
flat license fees. In the six months to 31 December, this revenue
showed a 2% increase to GBP0.2m (H1 FY22: GBP0.2m). In January
2023, however, Athlos signed with a second major mobile game
publisher, Playgendary, to integrate the Athlos platform with their
games. This will be the first contract under which Gfinity will be
remunerated on a per user basis, making revenues truly scalable and
annualizied based on a player-base.
The directors believe that this technology, licensed on a SaaS
basis will become a significant part of the Group's revenue over
the medium term.
Gfinity Digital Media
During the six-month period to December 2022 Gfinity's digital
media platforms had an average of 13.1m monthly active users. This
represented a reduction of 10% on the prior year (H1 FY22: 14.5m).
The reduction in users across the platform reflected the impact
from September 2022 onwards of Google algorithm changes, which
resulted in a reduction in the level of Search Engine Optimisation
(SEO) driven traffic.
The six-month period to December 2022 was a tough one for the
wider digital media sector, with fears of recession having a
downward impact on advertising rates. In this context, annualised
revenue per user of 22p, which reflected a reduction of just 2% on
the prior year, represented a positive performance.
Overall, the impact of these movements was that GDM revenue in
the period was GBP1.4m, a reduction of 11% on the prior year. This
did, however, represent a 20% increase on the 6 month period
immediately preceding.
In line with the strategy of recruiting sector experts to lead
each of the respective business units, in September 2022, Gfinity
announced the appointment of Rebekah Billingsley, an experienced
leader in the digital media sector, as MD of the GDM business.
In January, an agreement was reached with Mediavine, a leading
provider of digital advertising, to commercialise the advertising
inventory of GDM. This agreement takes effect from April 2023 and
is expected to drive a significant increase in revenue per
advertising impression delivered.
Esports Solutions:
In the period to December 2022, Gfinity continued to build on
their position as a leader in providing esports solutions to
clients in the traditional sports sector, supporting clients
particularly in the football and motorsports sectors in finding
ways to engage with a new generation of fans who are gamers first.
Revenue from this business unit for the period was up to GBP2.5m
(H1 FY22: GBP1.5m), an increase of 70% year on year.
In the football sector, in November 2022, Gfinity were announced
as the exclusive esports strategy development partner to Saudi Pro
League (SPL), to lead the creation of a gaming property to support
the development of the SPL brand, connecting with a digital
audience around the world. The period also saw the completion of
the second phase of work with a leading UK football club,
developing the operating plan for their own esports programme.
Within the motorsports sector, the period to December 2022 saw
the completion of the fifth year of Gfinity's partnership with
Formula 1 to deliver the F1 Esports Pro Series. Gfinity managed all
aspects of programme operations for this award-winning programme,
utilising its proprietary Race Control technology to manage all
aspects of race adjudication and delivering the event and broadcast
production.
The period also saw the finals of the third season of the V10
R-League programme, a race series co-owned by Gfinity in
conjunction with Abu Dhabi Motorsports Management. This season
featured 10 of the leading motorsports teams, including Mercedes,
Red Bull, McLaren, Aston Martin and Ford and for the first time
featured live finals in Abu Dhabi, supported by event sponsors
Miral.
Over the past two years, Gfinity has moved higher up the value
chain, acting as a strategic advisor to partners with regards to
esports solutions and utilising partners to deliver certain aspects
of live event and operations services. During FY21 and FY22, this
has enabled Gfinity to deliver a significant reduction in its
operating expenditure. This process continued following the period
end, with the decision to relinquish the Gfinity Arena. This,
aligned to savings in staff costs and related overheads, will
release a further GBP0.7m p.a. from the company's cost base.
Financial Review:
Revenue of GBP4.1m represented growth of 26% on the prior year
(H1 FY22: GBP3.3m) and growth of 106% on the six-month period
immediately preceding this.
Despite this growth however, an increased investment in resource
attached to development and marketing of the Athlos platform and in
the content and technology for Gfinity's Digital Media network
meant that the Adjusted Operating Loss actually increased to
GBP0.8m for the period.
As a result, on 9 February 2023, directors announced their
intention to raise a minimum of a further GBP1.5m, through a
placing and subscription, to supplement the GBP1.7m of cash the
company held at 31 December 2022. On 14 February, the Company
announced that this placing had been oversubscribed and that,
subject to General Meeting, the Company would raise a total of
GBP2.0m prior to expenses from a combination of new and existing
investors. Shareholders approved this transaction at a General
Meeting on Monday 6 March 2023.
Directors have noted the impact this has had on the market
capitalisation of the Company. It is directors belief that this
movement reflects short term market pressures and the requirement
to raise cash in a challenging capital markets environment. They do
not believe it is a true reflection of a change to the underlying
value of the business. On that basis, directors will undertake a
full review for indications of impairment to goodwill and
intangible assets as part of the full year audit process.
Group Statement of Profit or Loss
6 months 6 months Year to
to 31 December to 31 December 30 June
2022 Unaudited 2021 Unaudited 2022 Audited
GBP GBP GBP
CONTINUING
OPERATIONS Note
Revenue 5 4,107,938 3,261,361 5,258,977
Cost of sales (2,250,835) (1,320,260) (2,546,508)
Gross profit 1,857,103 1,941,101 2,712,469
Other Income - 697 1,529
Administrative
expenses (3,755,214) (3,511,533) (6,950,105)
Operating loss (1,898,111) (1,569,735) (4,236,107)
Gain on
disposal of
associate - 45,090 45,090
Finance income 373 2 77
Finance Costs - - -
Loss on
ordinary
activities
before tax (1,897,738) (1,524,643) (4,190,940)
Taxation 123,459 117,685 209,968
-------------------------------- -------------------------------- --------------------------------
Retained loss
for the period (1,774,279) (1,406,958) (3,980,972)
Loss and total
comprehensive
loss for the
period (1,774,279) (1,406,958) (3,980,972)
Earnings per
Share (Basic
and
Diluted in
pence) (0.001) (0.001) (0.004)
Group statement of comprehensive income
6 months 6 months Year to
to 31 December to 31 December 30 June
2022 Unaudited 2021 Unaudited 2022 Audited
GBP GBP GBP
Items which may subsequently
be reclassified to profit or
loss
Foreign exchange gain / (loss)
on retranslation of foreign
operations 3,501 (5,510) (3,458)
---------------- ---------------- --------------
Other Comprehensive Income for
the period 3,501 (5,510) (3,458)
Loss and total comprehensive
loss for the period (1,770,778) (1,412,468) (3,984,430)
Group Statement of Financial Position
As at 31 December As at 30 June
2022 Unaudited 2022 Audited
GBP GBP
NON CURRENT ASSETS
Property, plant and equipment 104,975 148,510
Goodwill 4,714,399 4,714,399
Intangible fixed assets 4,191,523 4,575,141
9,010,897 9,438,050
CURRENT ASSETS
Trade and other receivables 1,591,621 1,968,893
Cash and cash equivalents 1,686,497 2,141,361
3,278,118 4,110,254
TOTAL ASSETS 12,289,015 13,548,304
EQUITY AND LIABILITIES
Equity
Share capital 1,315,697 1,315,697
Share premium 54,856,008 54,858,008
Other reserves 4,030,635 3,876,676
Retained earnings (53,057,948) (51,283,669)
Non controlling interest 3 3
------------------ ----------------------------------
Total equity 7,144,395 8,766,715
Non-current liabilities
Other Payables 582,882 840,742
Deferred Tax Liabilities 732,984 897,575
1,315,866 1,738,317
Current liabilities
Trade and other payables 3,828,754 3,043,272
Total liabilities 5,144,620 4,781,589
TOTAL EQUITY AND LIABILITIES 12,289,015 13,548,304
Group Cash Flow Statement
6 months 6 months Year to
to 31 December to 31 December 30 June 2022
2022 Unaudited 2021 Unaudited Audited
GBP GBP GBP
Cash flow used
in operating
activities
Net cash used
in operating
activities 23,960 (592,836) (2,573,719)
Cash flow
from/(used in)
investing
activities
Interest
received 373 2 77
Additions to
property,
plant
and equipment (3,558) (68,850) (74,137)
Additions to
intangible
assets (477,140) (351,103) (685,951)
Net outflow on
business
combination - (2,155,630) (1,774,020)
Gain on
disposal of
associate - 45,090 45,090
Issue of shares
to non
controlling
interest - - 3
Net cash used
in investing
activities (480,325) (2,530,491) (2,488,938)
Cash flow
from/(used in)
financing
activities
Issue of equity
share capital (2,000) 3,246,513 5,831,603
Net cash from
financing
activities (2,000) 3,246,513 5,831,603
Net (decrease)
/increase
in cash and
cash
equivalents (458,365) 123,186 768,946
Effect of
currency
translation
on cash 3,501 (5,510) (3,458)
Opening cash
and cash
equivalents 2,141,361 1,375,873 1,375,873
Closing cash
and cash
equivalents 1,686,497 1,493,549 2,141,361
Statement of Changes in Equity
Share Share Share Retained Foreign Total
Capital premium option earnings NCI currency equity
reserve translation
reserve
GBP GBP GBP GBP GBP GBP
GBP
At 30
June 2021 930,513 46,511,089 3,403,414 (47,302,697) - (18,500) 3,523,819
Loss for
the period - - - (1,406,958) - - (1,406,958)
Other
comprehensive
income - - - - - (5,510) (5,510)
Total
comprehensive
income - - - (1,406,958) - (5,510) (1,412,468)
---------- ----------- ---------- -------------- ----- ------------- -------------
Shares
issued 169,184 6,183,150 - - - - 6,352,334
Share Issue
Costs - (205,321) - - - - (205,321)
Share options
issued - - 463,608 - - - 463,608
Total
transactions
with owners,
recognised
directly
in equity 169,184 5,977,829 463,608 - - - 6,610,621
At 31
Dec 2021 1,099,697 52,488,918 3,867,022 (48,709,655) - (24,010) 8,721,972
Loss for
the period - - - (2,574,014) - - (2,574,014)
Other
comprehensive
income - - - - - 2,052 2,052
Total
comprehensive
income - - - (2,574,014) - 2,052 (2,571,962)
---------- ----------- ---------- -------------- ----- ------------- -------------
Shares
issued 216,000 2,484,000 - - - - 2,700,000
Share Issue
Costs - (114,910) - - - - (114,910)
Share options
issued - - 31,612 - - - 31,612
Addition
of NCI - - - - 3 - 3
Total
transactions
with owners,
recognised
directly
in equity 216,000 2,369,090 31,612 - 3 - 2,616,705
At 30
June 2022 1,315,697 54,858,008 3,898,634 (51,283,669) 3 (21,958) 8,766,715
Loss for
the period - - - (1,774,279) - - (1,733,718)
Other
comprehensive
income - - - - - 3,501 3,501
Total
comprehensive
income - - - (1,774,279) - 3,501 (1,730,217)
---------- ----------- ---------- -------------- ----- ------------- -------------
Shares - - - - - -
issued -
Share Issue
Costs - (2,000) - - - - (2,000)
Share options
issued - - 150,458 - - - 150,458
Total
transactions
with owners,
recognised
directly
in equity - (2,000) 150,458 - - - 148,458
At 31
Dec 2022 1,315,697 54,856,008 4,049,092 (53,057,948) 3 (18,457) 7,144,395
Notes to the interim financial statements
1. General Information
Gfinity plc is a company limited by shares, incorporated and
domiciled in England and Wales under the Companies Act 2006. Its
registered office is 16 Great Queen Street, London, England, WC2B
5AH. Its shares are quoted on the AIM market of London Stock
Exchange.
The functional and presentational currency is GBP sterling
because that is the currency of the primary economic environment in
which the group operates. Foreign operations are included in
accordance with the policies set out in note 2.
These condensed interim financial statements were approved for
issue on 31 March 2023.
2. Accounting Policies and Basis of Preparation
Basis of Preparation
The interim financial statements for the six months ended 31
December 2022 have been prepared using accounting policies that are
consistent with those of the audited financial statements for the
period ended 30 June 2022 and in accordance with IAS 34, "Interim
Financial Reporting" as adopted by the United Kingdom. The interim
financial information should be read in conjunction with the
Group's Annual Report and Accounts for the year ended 30 June 2022,
which has been prepared in accordance with IFRS as adopted by the
United Kingdom.
The interim financial information contained in this report does
not constitute statutory accounts within the meaning of section 434
of the Companies Act 2006.
The Annual Report and Accounts for the year ended 30 June 2022
has been filed with the Registrar of Companies. The auditors'
report on those accounts was unqualified, however, did not a
material uncertainty with regards to going concern, relating to the
fact that the going concern basis of preparation was linked to a
need to raise funding within 12 months from the date of signature
of the Annual Report.
Significant Accounting Policies
The critical accounting policies and presentation followed in
the preparation of this interim report have been
consistently applied to all periods in these financial
statements and are the same as those applied in the company's
annual accounts for the year ended 30 June 2022.
A copy of the accounts to 30 June 2022 can be obtained from the
company's website: www.gfinityplc.com .
Critical Accounting Judgements
The preparation of financial statements in conforming with
adopted IFRS requires management to make judgements, estimates and
assumptions that affect the application of policies and reported
amounts of assets, liabilities, income and expenses. The estimates
and assumptions are based on historical experience and other
factors considered reasonable at the time, but actual results may
differ from those estimates. Revisions to these estimates are made
in the period in which they are recognised.
The critical accounting judgements made in preparing this
interim report are the same as those in preparing the annual
accounts for the Company for the year ended 30 June 2022 which can
be obtained from the company's website: www.gfinityplc.com .
Going Concern
At 31 December 2022 the group had cash of GBP1.7m. This figure
was supplemented through the raising of a further GBP2.0m, which
was approved by shareholders on 6 March 2023.
This sum was intended to provide directors with the headroom
to:
-- Restructure the Esports Solutions business, delivering
GBP0.7m of annualised cost reductions;
-- Bring in a new commercial partner for the Gfinity Digital
Media business, driving revenues back up in this business unit;
and
-- Provide a runway to bring a separate external investor into
the business to invest directly into the Athlos Gaming Technology
platform, leaving Gfinity with a significant holding, but ensuring
that the platform had sufficient funds to bring the final version
of the product to market and support a successful launch.
The group is making strong progress against each of these
objectives and on that basis, directors believe that the going
concern basis of preparation is appropriate. In forming this
assessment, directors also note the capital value that has been
created through the development of both Gfinity's technology and
its owned audience. In the event that further funding were to be
required, it could be realised through the sale of one or more of
these assets, rather than requiring any further recourse to new
investment.
3. Loss per share
Basic earnings per share is calculated by dividing the loss
attributable to shareholders by the weighted average number of
ordinary shares in issue during the period.
IAS 33 requires presentation of diluted EPS when a company could
be called upon to issue shares that would decrease earnings per
share or increase the loss per share. For a loss-making company
with outstanding share options, net loss per share would be
decreased by the exercise of options and therefore the effect of
options has been disregarded in the calculation of diluted EPS.
6 months 6 months Year to
to 31 December to 31 December 30 June
2022 2021 2022
GBP GBP GBP
Loss attributable to shareholders
from continuing operations (1,774,279) (1,412,468) (3,984,430)
Number Number Number
000's 000's 000's
Weighted average number of
ordinary shares 1,315,697 963,463 1,122,821
Loss per ordinary share for
continuing operations -0.001 -0.001 -0.004
4. Notes to the Cash Flow Statement
6 months 6 months Year to
to 31 December to 31 December 30 June
2022 Unaudited 2021 Unaudited 2022 Audited
GBP GBP GBP
Cash flows from
operating
activities
Loss for the
financial year (1,774,279) (1,406,958) (3,980,972)
Depreciation of
property, plant
and equipment 47,093 56,109 112,993
Depreciation on - - -
right of use
assets
Amortisation of
intangible fixed
assets 860,758 631,608 1,554,745
Impairment of
intangible fixed
assets - - 76,989
Interest Received (373) (2) (77)
Share based
payments 150,458 463,608 495,220
(Increase) in - - -
Inventories
(Increase)/
decrease in
trade
and other
receivables 377,272 (509,217) (524,205)
Increase in trade
and other
payables 527,622 334,791 (110,916)
Gain on disposal
of Associate - (45,090) (45,090)
Movement on
deferred tax
liabilities (164,591) - (294,568)
Corporation tax
(paid)/ R&D
credits
received - (117,685) 142,162
------------------------------ ------------------------------ ------------------------------
Cash used by
operating
activities 23,960 (592,836) (2,573,719)
Net cash
generated by/
(used
in) operating
activities 23,960 (592,836) (2,573,719)
5. Revenue
The Group's policy on revenue recognition is as outlined in note
2 of the financial statements for the year ending June 2022. The
period ending December 2022 included GBP58,359 in the contract
liability balance and at the beginning of the period (December
2021: GBP0.36m and year ending June 2022: GBP0.2m).
The Group's revenue disaggregated by primary geographical
markets is as follows:
6 months to 31 December 2022
Esports Digital Media Athlos Total
GBP GBP GBP GBP
United Kingdom 2,451,456 384,029 - 2,835,485
North America - 659,846 168,452 828,298
ROW 39,200 404,955 - 444,155
Total 2,490,656 1,448,830 168,452 4,107,938
========== ============== ======== ==========
6 months to 31 December 2021
Esports Digital Media Athlos Total
GBP GBP GBP GBP
United Kingdom 1,337,794 620,549 - 1,958,343
North America - 625,522 164,829 790,351
ROW 126,000 386,668 - 512,668
Total 1,463,794 1,632,739 164,829 3,261,361
========== ============== ======== ==========
Year to 30 June 2022
Esports Digital Media Athlos Total
GBP GBP GBP GBP
United Kingdom 1,927,951 853,907 47,232 2,829,090
North America - 1,248,627 315,356 1,563,982
ROW 126,000 739,904 - 865,904
Total 2,053,951 2,842,438 362,588 5,258,977
========== ============== ======== ==========
The Group's revenue disaggregated by pattern of revenue of
revenue recognition is as follows:
6 months to 31 December 2022
Gfinity Cevo Megit Total
GBP GBP GBP GBP
Services transferred
at
a point in
time 2,017,395 50,171 249,128 2,316,694
Services transferred
over time 1,791,244 - - 1,791,244
Total 3,808,639 50,171 249,128 4,107,938
========== ======== ======== ==========
6 months to 31 December 2021
Gfinity Cevo Megit Total
GBP GBP GBP GBP
Services transferred
at
a point in
time 1,568,313 166,797 425,547 2,160,657
Services transferred
over time 1,207,226 - - 1,207,226
Total 2,775,539 166,797 425,547 3,367,883
========== ======== ======== ==========
Year to 30 June 2022
Gfinity Cevo Megit Total
GBP GBP GBP GBP
Services transferred
at
a point in
time 2,913,332 108,485 541,755 3,563,572
Services transferred
over time 1,695,405 - - 1,695,405
Total 4,608,737 108,485 541,755 5,258,977
========== ======== ======== ==========
As at 31 December 2022 the Group had the amounts shown below
held on the consolidated statement of financial position in
relation to contracts either performed in full during the year or
ongoing as at the year end. All amounts were either due within one
year or, in the case of contract liabilities, the work was to be
performed within one year of the balance sheet date.
Dec-22 Jun-22
GBP GBP
Trade Receivables 989,325 928,446
Contract Assets 359,688 246,428
Contract Liabilities 58,359 208,715
Trade receivables are non-interest bearing and are generally on
30 day terms. Credit risk of customers is low with many being large
multinational corporations.
Contract assets are initially recognised for revenue earned
while the services are delivered over time or when billing is
subject to final agreement on completion of the milestone. Once the
amounts are billed the contract asset is transferred to trade
receivables.
Contract liabilities arise when amounts are paid in advance of
the delivery of the service. These are then transferred to the
statement of comprehensive income as either milestones are
completed or work is completed overtime.
6. Intangible fixed assets
During the development phase of Gfinity's proprietary Athlos
Gaming Technology, a total of GBP477,140 has been invested and
capitalised in the company's intellectual property in the
period.
[1] Adjusted operating loss is before interest, tax,
depreciation, amortisation, impairment and the share-based payment
expense.
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END
IR MZGFFRGNGFZM
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March 31, 2023 02:00 ET (06:00 GMT)
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