21 November 2022

Keywords Studios plc

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

     Trading Update

Full year performance now expected to be ahead of market expectations

Keywords Studios, the international technical and creative services provider to the global video games industry, today provides a trading update for the year ending 31 December 2022.

The Group has continued to perform very well in the second half of the year, building on the encouraging start to the period and the strong performance in H1. The Group has benefitted from the continued strength of the US dollar during the period, which has meant that the adjusted profit before tax¹ margin remained higher than anticipated.

As a result, the Board now expects that full year revenue for 2022 will be at least €675m (+32% year-on-year growth) and the adjusted profit before tax will be in excess of €110m (+28% year-on-year growth), both comfortably ahead of current analysts' consensus².

Outlook for 2023

We expect the positive trading momentum to continue into 2023. Organic growth is expected to moderate but remain above the medium-term guidance of 10%+, with adjusted profit before tax margins expected to move to historical levels of c.15% as previously guided and as we invest into the business to support our growth ambitions.  As a result, we are confident in achieving a performance at the upper end of the current analysts' forecast range³ for 2023. 

The Group will provide a further update with its scheduled trading update at the end of January 2023.

Bertrand Bodson, Chief Executive Officer of Keywords Studios, commented:

"We expect to deliver another excellent year of growth as the demand for our unique full-service platform remains strong. We have continued to grow our global footprint, scale and capabilities to deliver an ever more compelling proposition and support our customers' needs wherever they are in the world.

"Looking forward, whilst mindful of the current economic climate, I am excited about the opportunity ahead for Keywords as our leading position in the growing content creation market and our strong balance sheet mean we are well placed to continue to build on the Group's successful organic and acquisitive growth track record."

¹ Adjusted profit before tax comprises Profit before taxation as reported in the Consolidated statement of comprehensive income, adjusted for share-based payment expense, costs of acquisition and integration, amortisation and impairment of intangible assets, non-controlling interest, foreign exchange gains and losses, and unwinding of discounted liabilities. In order to present the measure consistently year-on-year, other income is excluded.

² As at 18 November 2022, company compiled analysts' forecasts gave a consensus for FY 2022 of €648m of revenue (range: €632-669m) and €102m of adjusted profit before tax (range: €97-105m).

³ As at 18 November 2022, company compiled analysts' forecasts gave a consensus for FY 2023 of €737m of revenue (range: €712-779m) and €112m of adjusted profit before tax (range: €106-118m).

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About Keywords Studios (www.keywordsstudios.com)

Keywords Studios is an international technical and creative services provider to the global video games industry. Established in 1998, and now with over 70 facilities in 26 countries strategically located in Asia, Australia, the Americas and Europe, it provides services across the entire content development life cycle through its Create, Globalise and Engage service lines to a blue-chip client base of over 950 clients across the globe.

Keywords Studios has a strong market position, providing services to 23 of the top 25 most prominent games companies. Across the games and entertainment industry, clients include Activision Blizzard, Bandai Namco, Bethesda, Electronic Arts, Epic Games, Konami, Microsoft, Netflix, Riot Games, Square Enix, Supercell, TakeTwo, Tencent and Ubisoft. Recent titles worked on include Anthem, Star Wars Jedi: Fallen Order, Valorant, League of Legends, Fortnite, Clash Royale and Doom Eternal. Keywords Studios is listed on AIM, the London Stock Exchange regulated market (KWS.L).