Team17 reports several first-half financial records

Video games developer, label and creative service provider Team17 reported a 33% improvement in half-year revenues on Tuesday, to a record £53.2m.

The AIM-traded firm said its gross profit for the six months ended 30 June was ahead 26% year-on-year to a record £25.5m, while adjusted EBITDA jumped 10% to also reach a record £18.2m.

Profit before tax fell, however, to £11.2m from £14m a year earlier, while adjusted profit before tax increased 7% to £17.3m.

Earnings per share slipped to 6.5p from 8.6p, while adjusted earnings per share increased to 10.4p from 10.1p.

Team17 reported operating cash conversion of 139%, compared to 108% a year ago, while net cash and cash equivalents at the half-year end totalled £51.3m, slipping from £66.6m in the first half of 2021.

Looking ahead, Team17 said it had an “exciting pipeline” of new releases for the second half, combined with continued back catalogue performance, to deliver second half-weighted results.

It said the period started well with Sweet Transit released in July and Thymesia in August, launched by Games Label, with both performing in line with expectations.

Games Label was planning to launch seven new titles in total in the second half, including Marauders which was tracking ahead on internal metrics, and Sunday Gold, while Astragon would release the latest version of Construction Simulator.

While it was mindful of the potential impact of ongoing macroeconomic uncertainty and inflationary pressures, the firm’s board said it remained confident that the group would continue to trade in line with its expectations.

“We are pleased with the group's first half performance, trading in line with our expectations,” said chief executive officer Debbie Bestwick.

“Our new acquisitions, led by our talented and committed management teams, have worked incredibly well together across all parts of the group, and we are all looking forward to a busy and productive second half.

“The group now has more evergreen first-party intellectual properties than ever before, alongside a phenomenal back catalogue portfolio, and in StoryToys, a growing subscription revenue model.”

Bestwick said new releases included additions to a number of established franchises and licensed global brands, as well as “exciting” new original intellectual properties that were tracking well.

“Complementing our first half performance, we have made an encouraging start to the second half of 2022 and we remain confident about the group's prospects going forwards.”

At 1040 BST, shares in Team17 Group were up 4.05% at 385p.

Reporting by Josh White at Sharecast.com.