24 June 2014

Keywords Studios plc ("Keywords Studios", "the Group")

AGM Statement & Board Change

Keywords Studios, the international technical services provider to the global video games industry, is today holding its inaugural AGM at which, Ross Graham, Chairman, will make the following remarks:

The Group continues to make good progress in line with its stated strategy of growing both organically and by acquisition to extend the Group's client base, market penetration and service lines, where the Group can use its existing expertise, multi-service platform, scale and global reach to become the leader in providing outsourced services to the video games industry.

Since the Group's admission to AIM in July 2013, we have acquired Liquid Violet, Babel Media and Binari Sonori; all of which have been positively received amongst the respective customers of Keywords and the acquired businesses.  The integration of these acquisitions is proceeding well.

We have also been successful in line with our strategy of securing outsourcing arrangements with major clients; in April 2014 we announced a Singapore based outsourcing arrangement with Electronic Arts thereby demonstrating the attraction, to large developers and publishers of video games, of a high quality independent global provider of technical services.

The Group continues to review a healthy pipeline of acquisition opportunities with a view to selectively acquiring attractive opportunities to extend its range of services, in line with the stated strategy.

Change of Group Finance Director

After two years with the Group, which included the Group's successful flotation on AIM and the Group's first acquisitions, David O'Connor is leaving to pursue other opportunities.  David will continue with the Group until 31 July, to ensure a smooth handover of roles. We would like to thank him for his contribution over this very exciting period in our development.  Andrew Lawton (ACA, BEng, aged 51), who has already spent some time in the Group as a consultant will be appointed to the role  of Group Finance Director, on 1 July 2014.  Andrew was previously CFO of Sony Computer Entertainment Europe where he joined at the start of the PlayStation business in 1994 and supported its growth to over €3bn and 1000 employees. We extend a warm welcome to Andrew as we continue to develop the Keywords Group through organic and acquisition led growth.

In relation to Andrew Lawton's appointment to the board, there is no further information required to be disclosed pursuant to paragraph (g) of Schedule 2 of the AIM Rules for Companies.

Summary and Outlook

Revenue for the first five months of the year increased to €10.1m (2013: €5.3m), including the revenues from the acquisitions since their incorporation into the Group.   As previously stated, these acquisitions have historically achieved lower margins than Keywords, partly due to a different mix of services but also due to the more rigorous focus Keywords places on lean and agile operations.  We anticipate that the benefits of the roll out of Keywords' approach to operational efficiency will be realised incrementally over the course of the respective earn-out periods.

The Group continues to grow market share and win new clients. We typically experience lower levels of activity in the first half of the year compared to the second half, but the seasonal ramp up has begun with encouraging signs of activity from our key clients. 

The board anticipates a strong trading performance for the year ending December 2014 albeit there will likely be a €300,000 impact from the reductions to Multi Media Tax Credit in Montreal announced on June 4^th by the newly elected government of Quebec Province.

Overall, we look forward to enhancing the returns from our recent acquisitions, and continuing to grow our client base and range of titles, whilst selectively acquiring businesses that will extend our service offering to our global client base.

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