Skip Header
Important information: The value of investments can go down as well as up so you may get back less than you invest. Investors should note that the views expressed may no longer be current and may have already been acted upon. This is a third-party news feed and may not reflect Fidelity’s views.

Keywords Studios confident after year of revenue growth

(Sharecast News) - Video games creative agency Keywords Studios reported full-year revenue of €780m in a trading update on Thursday, reflecting 13% growth year-on-year and a 17% increase on a constant currency basis. The AIM-traded firm said organic revenue growth, excluding the impact of foreign exchange and US entertainment industry strikes, stood at 9%, or 6% when reported.

It said the US strikes had a 2.6% impact, equivalent to €20m, on organic revenue growth.

Keywords achieved an adjusted operating profit of €122m, with margins of 15.6%.

The company also reported strong cash flow, with adjusted cash conversion exceeding 80% for the full year, surpassing earlier guidance.

Throughout 2023, Keywords Studios completed five acquisitions, amounting to a maximum consideration of €225m.

Notably, the acquisition of the Multiplayer Group for £76.5m in December substantially expanded the 'Create' division, increasing its exposure to high-end creative services.

At the end of the year, Keywords maintained a net debt position of roughly €68m.

Looking ahead to 2024, Keywords Studios said it anticipated strong revenue and profit growth.

That growth was expected to be driven by improving organic growth, recent acquisitions, and the commitment to maintaining adjusted operating profit margins above 15%.

The company said it aimed to achieve that through ongoing cost management and operational efficiencies.

As the industry's demand for new content rebounded and post-strike output from Hollywood increased, organic growth was projected to improve throughout the year.

"In what was a difficult year for the industry, we delivered resilient performance in 2023 and we continued to grow our market share and industry leadership position," said chief executive officer Bertrand Bodson.

"We made considerable progress against our strategic objectives and scaled our platform through the acquisition of five studios, broadening our high-quality offering for clients.

"We will continue to successfully navigate the market conditions in 2024 and are excited by the opportunity ahead to build the leading technology-enabled platform, solving complexity for clients across the content creation process in the largest entertainment industries in the world."

At 1513 GMT, shares in Keywords Studios were down 2.8% at 1,530p.

Reporting by Josh White for Sharecast.com.

Share this article

Related Sharecast Articles

Canaccord Genuity lowers target price on Arrow Exploration
(Sharecast News) - Analysts at Canaccord Genuity lowered their target price on Colombia-focussed oil firm Arrow Exploration from 50.0p to 44.0p on Thursday but acknowledged that near-term drilling was likely to reboot production growth.
Comptoir brings back former CEO Hanna
(Sharecast News) - Comptoir Group announced the formal appointment of Chaker Hanna as its chief executive officer on Thursday, effective immediately.
Ralph Lauren lifts guidance, shares spike
(Sharecast News) - Fashion brand Ralph Lauren lifted annual revenue guidance after reporting better-than-expected third quarter earnings, as wealthy customers splashed out on its range of clothing, sending shares in the company 12% higher on Wall Street.
Vertu Motors warns FY profits will miss expectations, shares tank
(Sharecast News) - Vertu Motors tanked on Thursday as it warned that full-year adjusted pre-tax profit would be "significantly below" current market expectations as the UK government's zero emissions vehicle (ZEV) mandate is causing severe disruption in the new car market.

Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.

Award-winning online share dealing

Search, compare and select from thousands of shares.

Expert insights into investing your money

Our team of experts explore the world of share dealing.