REG - Team17 Group PLC - Trading Update

Team17Announcement

14/07/2022 07:00

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RNS Number : 4107S  Team17 Group PLC  14 July 2022

14 July 2022

Team17 Group plc

("Team17", the "Group" or the "Company")

 

Trading Update

Enlarged Group delivering record half year revenue and adjusted EBITDA

 

Team17 Group plc, a global games label, creative partner and developer of
independent ("indie") premium video games, developer and publisher of
educational entertainment ("edutainment") apps for children and a leading
working simulation games developer and publisher, confirms that trading in the
six months ended 30 June 2022 ("H1") has been in line with the Board's
expectations.

 

The enlarged Group, including recent strategic acquisitions, has delivered
significant growth against H1 2021, once again showing record half year
revenue and adjusted EBITDA performance.

 

Team17's core Games Label business ("Games Label") continues to show the
strength and expertise in back catalogue management, delivering low
double-digit year on year growth alongside one new release. The underlying
quality of portfolio management and franchise building is a testament to the
strength of Team17's best in class lifecycle management. The Games Label has
also seen significant growth in the share of 1(st) party IP revenues within
its portfolio.

 

StoryToys, acquired in July 2021, is performing in line with expectations. The
launch of LEGO® DUPLO® Marvel in December 2021 was its biggest to date and
has continued to perform well during H1 benefiting from the recent Hulk and
Iron Man content updates. Across the StoryToys app portfolio, both active
subscribers and subscription revenues have grown significantly in H1 vs the
prior year. StoryToys has also entered a longer-term extension with the LEGO
Group for multiple apps over multiple future years.

 

astragon, acquired in January 2022, is performing in line with expectations
with its own IP titles launched in 2021, in particular Police Simulator:
Patrol Officers released into early access on PC, continuing to build momentum
in H1 2022 and adding value to the growing own IP portfolio. The physical
distribution side of astragon's business has seen strong performance across
the portfolio of titles from various partners including Farming Simulator
which continues to perform strongly in Germany.

 

Team17 USA (formerly The Label), acquired in January 2022, is now fully
integrated within the Games Label and performing as expected, and is actively
exploring future opportunities to bring Team17 IP to mobile platforms
alongside additional 3rd party titles.

 

The Group has continued to add new talent to its exceptional teams, growing
headcount in each of its businesses to support individual requirements.
Attrition rates have remained at historic single digit levels for the first
six months, below market levels.

 

Outlook

 

As outlined at the full year results announcement in March 2022, the Group has
a solid and high quality portfolio of new releases planned for the second half
of the year, which alongside continued back catalogue performance is expected
to drive a more second half weighted performance than prior years. The Board
remains mindful of ongoing macro-economic uncertainty and inflationary
pressures, the impact of which remain in line with its expectations.

 

The latest version of Construction Simulator, astragon's successful own IP
franchise launches on PC and Console on 20(th) September 2022, 7 years after
the last launch and is their biggest release of an own IP in the last few
years. In addition, Bus Simulator: City Ride is due to launch on mobile and
Switch in the second half, its first mobile launch for the Bus Simulation
franchise and the highly rated Police Simulation: Patrol Officers will leave
Steam's Early access and launch on consoles in in the final quarter of the
year.

 

During the second half, the Games Label, plans to launch seven titles as part
of its new release offering. Highlights will include Marauders (which is
tracking above any previously launched Games Label title on internal metrics),
Thymesia a 'Souls-like' Indie game, Sweet Transit and Sunday Gold, amongst
others. These launches will be combined with continued support for Hell Let
Loose and Golf With Your Friends with new content and multiple planned updates
across the back catalogue. Team17 USA's planned mobile title releases are all
on track and the latest update 'Wimblegolf' for What the Golf? is seeing
strong visibility and traction on mobile.

 

StoryToys is planning over ten major app updates alongside multiple smaller
updates across its portfolio and continues to strengthen its subscription app
offering and global license partners.

 

The recent acquisitions have all settled well into the Group and are
delivering incremental earnings. In addition, the senior management teams are
already exploring Group synergies to leverage portfolio breadth as we
strengthen our entertainment portfolio offering.

 

Results for the six months ended 30 June 2022 will be announced in September
2022.

 

Debbie Bestwick MBE, Chief Executive Officer of Team17, commented:

 

"I am delighted with Team17's first half performance, trading in line with our
expectations. Pleasingly, 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 own IP's than ever before, alongside a
phenomenal back catalogue portfolio, and in StoryToys, a growing subscription
model. New releases include additions to many established franchises and
licensed global brands alongside exciting new original IP's that are tracking
well.

 

"We have made a solid start to 2022 and remain confident about the near-term
prospects for the Group despite the ongoing broader macro-economic climate."

 

 

For further information please contact:

 

 Team17 Group plc                                                     via Vigo Consulting

 Debbie Bestwick MBE, Chief Executive Officer

 Mark Crawford, Chief Financial Officer

 Houlihan Lokey (Nominated Adviser)                                   +44 (0)16 1250 3577 / +44 (0)20 7484 4044

 Adrian Reed / Tim Richardson

 Berenberg (Broker)                                                   +44 (0)20 3207 7800

 Chris Bowman / Toby Flaux / Marie Moy / Alix Mecklenburg-Solodkoff

 Vigo Consulting (Financial Public Relations)                         +44 (0)20 7390 0233

 Jeremy Garcia / Kate Kilgallen

 team17@vigocon (mailto:team17@vigoconsulting.com) sulting.com
 (mailto:team17@vigoconsulting.com)

 

About Team17

 

Team17 Group plc is a global provider of games entertainment to a broad
audience. The Group now includes a games entertainment label and creative
partner for indie developers, a leading developer of educational apps,
targeting children under the age of eight and a leading working simulation
games developer and publisher.

 

Visit www.team17.com (http://www.team17.com) for more info.

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