REG - Frontier Developmnts - Trading update & sale of publishing rights

Frontier DevelopmentsAnnouncement

02/04/2024 07:00

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RNS Number : 8987I  Frontier Developments PLC  02 April 2024

2 April 2024

Frontier Developments plc

 

Good progress and strengthening cash position

 

Frontier Developments plc (AIM: FDEV, 'Frontier' or the 'Company'), a leading
developer and publisher of videogames based in Cambridge, UK, provides an
update on trading including the successful release of Planet Zoo: Console
Edition, reports on the sale of the publishing rights for RollerCoaster Tycoon
3 to Atari, and highlights an improving cash position.

 

Trading

Sales across Frontier's portfolio since publication of its interim results in
January 2024 have been in-line with expectations, with the largest
contributions being provided by Frontier's creative management simulation
('CMS') games, led by Jurassic World Evolution 2 and Planet Zoo.

 

On 26(th) March Planet Zoo, which was previously available on PC only,
released successfully on Xbox Series X|S and PlayStation 5 to positive
critical reviews and strong player engagement. Total sales up to and including
the day of release were greater than the sales achieved by Planet Coaster when
it came to consoles on 10(th) November 2020.

 

The successful launch performance of Planet Zoo: Console Edition was supported
by three product options, including an Ultimate Edition which provides access
to a Season Pass covering 14 future content packs over the next 12 months.
Strong sales of the Ultimate Edition at launch will generate cash in FY24 but
revenue will be split between FY24 and FY25, since a portion of the revenue
will be deferred into FY25 as content is delivered in that financial year.

 

RollerCoaster Tycoon 3 publishing rights

Frontier has a long track-record of success in rollercoaster simulation games,
including the development of the 2004 game RollerCoaster Tycoon 3, working in
collaboration with Chris Sawyer, the original architect of the RollerCoaster
Tycoon franchise. Frontier went on to develop the ultimate coaster park
simulation and BAFTA-nominated Planet Coaster, which quickly became one of the
top selling PC games of 2016 when it released in that year. Planet Coaster
gives players unlimited freedom to build rides and scenery piece by piece,
with advanced management gameplay and a connected global village where
everyone can share in the creativity of players around the world.
Subsequently, many successful PDLC packs and a console edition were launched.

 

The publishing rights for RollerCoaster Tycoon 3 returned to Frontier in 2018
under the original development agreement, and since then Frontier has been
publishing the game on PC, Mac, iOS and Nintendo Switch under the Frontier
Foundry games label, generating profit (net sales receipts after deduction of
all costs) of approximately US$ 1.5 million per year. On 15(th) March 2024
Frontier sold the publishing rights for RollerCoaster Tycoon 3 to Atari Inc
('Atari') to enable Atari to become the sole publisher of all major titles
within the Rollercoaster Tycoon franchise. Total consideration for the sale of
the publishing rights was agreed at US $7m, made up of US $4 million of
up-front cash and US $3 million of deferred cash consideration. No value was
attributed to the publishing agreement on Frontier's balance sheet prior to
the transfer. The proceeds of the disposal will be utilised by the Company for
general working capital purposes.

 

Cash position

Frontier's cash position grew to £23.4 million as of 31(st) March 2024, up
from £19.9 million as at 31(st) December 2023. Cash received during that
three month period included the US $4m of up-front consideration due from the
sale of the RollerCoaster Tycoon 3 publishing rights and the first tranche of
the Video Games Tax Relief cash credit related to the FY23 UK tax returns.
Cash receipts from the March launch of Planet Zoo: Console Edition will be
received during April and May.

 

Outlook

The Board remains comfortable with the financial guidance previously provided
for FY24, before taking into account the incremental profit and cash from the
sale of the RollerCoaster Tycoon 3 publishing rights. The Board expects to
provide an update on the outturn for the financial year in June 2024.

 

 

 

Enquiries:

 

Frontier Developments   +44 (0)1223 394 300

Jonny Watts, CEO

Alex Bevis, CFO

 

Peel Hunt - Nomad and Corporate Broker   +44 (0)20 3100 2000

Neil Patel / Paul Gillam / Kate Bannatyne

 

Liberum - Joint Corporate Broker   +44 (0)20 3100 2000

Max Jones / Nikhil Varghese

 

Teneo   +44 (0)20 7353 4200

Matt Low / Arthur
Rogers
 

 

About Frontier Developments plc

Frontier is a leading independent developer and publisher of videogames
founded in 1994 by David Braben, co-author of the iconic Elite game. Frontier
uses its proprietary COBRA game development technology to create innovative
genre-leading games, primarily for personal computers and videogame consoles.

Frontier's LEI number: 213800B9LGPWUAZ9GX18.

 

www.frontier.co.uk (http://www.frontier.co.uk/)

 

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