Keywords is an international technical service provider to the global Video Game Industry with offices in Dublin, Tokyo, Seattle, Montreal and Rome. Working on a worldwide basis, we provide a range of linguistic, testing, and quality control services to Video Game Developers and Publishers alike.

Keywords is focused 100% on the localization and testing of video games. Our experience and dedication to this field allows us to provide our clients with games that connect to their core audience, no matter what language they speak.

With our principal operations hub in Dublin, Keywords works globally. Our business is international in every sense so we are available to clients in North America and Japan just as we are available to those based in Europe. Providing our clients access to us so we can service their needs is tremendously important. There are points of contact ready to speak with our customers during all global business hours.

http://www.keywordsintl.com/en

Trading Statement
RNS
RNS Number : 5685D
Keywords Studios PLC
01 February 2018

1 February 2018


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

Full year trading update

Strong financial performance- strengthening our market leading position

Keywords Studios, the international technical services provider to the global video games industry, today provides an unaudited trading update for the year ended 31 December 2017, following a year of further strong organic growth and geographic expansion, complemented by a number of significant and successful acquisitions.

The Board is pleased to announce that it expects revenues to be not less than €150m (FY16: €96.6m) and adjusted PBT* of at least €22.5m (FY16: €14.9m), both of which are comfortably ahead of consensus market expectations. Strong organic growth remains a feature of the Group's performance and this has been supplemented by acquisitions as the Group continues to deliver on its strategy in order to become the "go to" supplier of technical services to the global video games industry. The Group is now comprised of seven globally managed service lines operating from 42 production studios in 20 countries, compared to four service lines operating from five production studios in five countries at the time of our IPO in July 2013.

During the year, we welcomed eleven businesses into the Group across all its existing service lines as well as its newly established Engineering service line. 2017 saw two of the Group's largest acquisitions to date, VMC and Sperasoft, which have further strengthened our service offerings and client penetration and extended our geographic reach and access to talent. Sperasoft enabled our entry into Co-Development, in which multiple services including game programming and art creation are delivered holistically in the game development phase, whilst VMC has bolstered our Engineering capabilities. These significant acquisitions represent yet further steps in the pursuit of our strategy and we are pleased with how smoothly they are being integrated with the rest of the Group.

The Group has invested net cash of €89.1m in the acquisitions described above, funded by the Group's strong cash generation, available debt facilities and a successful £75m equity placing in October 2017. The placing further demonstrated the support of our existing shareholders as well as enhancing our shareholder base through the addition of a number of new institutional investors. Following these acquisitions, the Group had €30.5m in cash at the year end and had utilised €18.3m of its €35m rolling credit facility, which leaves the Group well placed to complete further selective acquisitions in 2018.

The Group's effective tax rate has continued to decrease as we make better use of our brands, operating models and tools from our Dublin operational headquarters in support of our business around the world, much of which is in higher tax rate jurisdictions including Canada, the US, Japan, India and Italy. The Group's effective tax rate based on Keywords Studios' measure of profit before taxation in the period was 20.5% (2016: 21.7%). We note the enactment of the Tax Cuts and Jobs Act in the United States on 22 December 2017. Our preliminary view is that we can expect a devaluation of some of our deferred tax liabilities in 2017 due to the reduction in the statutory federal tax rate to 21%. While we continue to review the full future impact of the new US tax legislation on the Group, we currently anticipate that the changes will not have a material impact on the Group's effective tax rate. We will give updated guidance on the impact of these provisions together with our final results later this year.

Andrew Day, Chief Executive of Keywords, commented:
"We are delighted with the Group's performance as we grew revenues and profits strongly again this year. Our ever-increasing geographic footprint and broader range of services have combined to grow market share, introduce additional services to established clients and win new clients.

"The eleven acquisitions in 2017 demonstrate strong progress in our strategy to selectively consolidate the fragmented video games market and generate synergies through scale, and our entry into Engineering and particularly Co-Development, enhances our positioning as a strategic partner to game developers and publishers, whilst continuing to ensure we are not directly exposed to the commercial performance of individual titles. As games are becoming bigger and are higher definition, game developers are increasingly relying upon co-development arrangements with companies like Keywords to provide them with broader capability to develop both initial games and ongoing content and features post-launch.

"We look forward to another year of strong progress as we continue to invest in existing and new businesses, building our talent pool and integrating the newer members of our Group."


*The Group reports adjusted PBT before acquisition and integration expenses, share option charges, amortisation of intangibles and foreign currency gains

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Keywords studios: Berenberg reiterates buy with a target price of 2,040p

08:10 26/03/2018
Broker Forecast - Peel Hunt issues a broker note on Keywords Studios
Peel Hunt today initiates coverage of Keywords Studios (LON:KWS) with a accumulate investment rating and price target of 1850p. Story provided by StockMarketWire.com Broker Forecasts data provided by www.sharesmagazine.co.uk

Final Results
RNS
RNS Number : 1944K
Keywords Studios PLC
09 April 2018



9 April 2018


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

Full year results for the year to 31 December 2017

Another excellent performance reflecting strong organic and acquisitive growth

Keywords Studios, the international technical services provider to the global video games industry, today provides its full year results for the year to 31 December 2017.

Financial overview:
· Group revenue (including effect of acquisitions) increased by 57% to €151.4m (2016: €96.6m)
· Adjusted EBITDA* up 57% to €26.3m (2016: €16.7m), representing a margin of 17.4% (2016: 17.3%)
· Adjusted profit before tax* increased by 55% to €23.0m (2016: €14.9m)
· Adjusted basic earnings per share* up by 52% to 31.18c (2016: 20.59c)
· Adjusted operating cash generation** increase of 48% to €21.9m (2016: €14.8m)
· Net cash*** of €11.1m (2016: €8.7m)
· Final dividend of 0.98p (2016: 0.89p); 10% increase in total dividend to 1.46p per share (2016: 1.33p)

Operational overview:
· 15.1% increase in like for like**** revenue
· 11 acquisitions completed to expand our existing services lines (including a new engineering service line) and extend our geographical reach, including our two largest acquisitions to date:
o Acquisition of VMC in October for $66.4m giving the Group leadership in functional testing in North America, significantly increased our presence in player support services, added new service delivery models including Embedded Technical Services and the Global Beta Test Network
o Acquisition of Sperasoft in December for $27m brought strength in co-development, extended our Engineering and Art capabilities, and provided entry points into Eastern Europe
· Good progress made with integrating acquisitions, with multiple operations being integrated together in Paris, Mexico City, Seattle and Madrid
· Invested in adding capacity for organic growth across multiple studios
o Continued success in cross-selling our extended services with a 45% increase in clients using three or more services from 64 to 93

*before acquisition and integration expenses of €3.0m (2016: €1.3m), share option charges of €1.4m (2016: €0.7m), amortisation of intangibles of €3.0m (2016: €1.6m), and foreign currency exchange loss of €3.6m (2016: loss of €1.7m)
**cash flow from operations plus acquisition related expenses of €3.0 (2016: €1.3m), plus exceptional working capital costs related to the VMC acquisition of €3.0m (2016: nil), plus €2.3m in VMC receipts held by a third party on behalf of the Group and passed to the Group post year end. In the comparative year, multimedia tax credits (MMTC) of €1.6m were received in respect of claims prior to 2015
***after payment of €87.0m net cash consideration for acquisitions (2016: €21.1m), €3.0m of acquisition costs and integration expenses (2016: €1.3m), and £75.0m raised (before expenses) via an equity placing (2016: nil).
**** calculated on the basis of revenues being included for 2017 acquisitions from the date of acquisition and for the equivalent period in the prior year.

Current trading and outlook:
· Acquisitions announced separately today:
o Cord Worldwide Limited and Laced Music Limited for a total consideration of £4.5m
o Maximal Studio for an initial cash consideration of €0.3m and €0.2m deferred subject to performance
· The typically quieter first quarter has seen activity levels in line with our expectations and the positive momentum in the business gives us confidence in the outcome for the full year
· Encouraging early wins for new co-development services
· Agreed heads of terms for a revolving credit facility of up to €105m
· Acquisition pipeline remains healthy

Andrew Day, Chief Executive of Keywords Studios, commented:

"The Group has delivered another strong performance with good organic growth supplemented by a number of acquisitions including two of our largest acquisitions to date.

"Our organic investment and acquisitions have added significant scale to our existing service lines and extended both our service range and geographical reach, establishing a new Engineering service line, bringing additional capabilities in co-development, content management, and delivering services from within clients' premises, and providing us with a presence in Eastern Europe.

"We entered 2018 with pro forma revenues of €225m, across seven service lines and 42 studios in four continents, compared to just over €16m derived from four service lines and five studios in 2013 - the year of our IPO.

"We expect to make continued strong progress as we realise the full benefits of our enhanced services platform and with the financing in place to support further organic and acquisitive growth in 2018."

A presentation of the full year results will be made to analysts at 9.30am today at MHP's offices. There will also be a live, listen only webcast of the presentation and a recording will be made available via www.keywordsstudios.com. To register for access, please contact Charles Hirst at MHP Communications on +44 20 3128 8193 or email keywords@mhpc.com.

08:00 10/04/2018
Broker Forecast - Peel Hunt issues a broker note on Keywords Studios
Peel Hunt today reaffirms its add investment rating on Keywords Studios (LON:KWS) and set its price target at 1850p. Story provided by StockMarketWire.com Broker Forecasts data provided by www.sharesmagazine.co.uk

SMALL CAP SHARE IDEAS: Video games outsourcing firm Keywords Studios expands amid growing industry
By Philip Whiterow, Proactive Investors, For Thisismoney.co.uk
Published: 12:49, 23 April 2018 | Updated: 16:47, 23 April 2018


Keywords Studios operates in the highly fragmented world of ancillary services for computer games makers and is rapidly becoming the 800lb gorilla of that sector.
The company is trusted and relied upon as a partner by many of the world’s leading video game companies during the concept, development and post-publication phases of new content.
Localisation is the core of the business. Essentially this means translation into local language and ensuring the audio quality, player support and so on is up to scratch.
Growth recently has been rapid and global with facilities now in multiple locations across four continents.

Growing industry: Keywords Studios offers ancillary services to computer games makers
Andrew Day chief executive said: ‘We entered 2018 with pro forma revenues of €225million, across seven service lines and 42 studios in four continents, compared to just over €16million derived from four service lines and five studios in 2013 - the year of our IPO’.
By its own admission, Keywords has a big appetite for acquisitions.
Management likes to make six small bolt-on acquisitions each year and one or two larger purchases.

Examples of ‘larger purchases’ include North America-focused VMC Consulting, which it bought for $66million last October, financed by an underwritten share placing.
The new shares were sold through a book-build exercise and snapped up in about two hours, which underlines how highly regarded is the video games services group at present.
Shares over the last three years have rocketed from 153p to 1,746p as the carefully built portfolio, which ranges from translation services through to augmented and virtual reality services, has driven large rises in sales and earnings.

VMC looks to be more of the same. Keywords expects the latest addition to be ‘significantly earnings enhancing’ almost immediately.
Adjusted revenue of the US group in the year to October was $57.4million and underlying profits an annualised $6.4million.
The purchase will more than double Keywords' customer support operation in the North American market as well as growing market share and footprint.
Cross-selling has been a fundamental plank of the strategy and the number of clients using three or more of Keywords’ services increased to 93 in 2017 from 64 in 2016 and 51 in 2015.
German bank Berenberg, which rates the shares a ‘buy’ and has a price target of 2,060p, sees this trend as evidence that computer games publishers and developers are moving away from ‘tactical outsourcing’ towards strategic arrangements with trusted partners.
Crucially, it has made its first inroads into the eSports market, mostly through the provision of its services for game development and in-game support, but also via marketing.
ESports – football, rugby, Formula One to name three - are played electronically by teams with increasingly large numbers of people watching.
By 2020, the market is tipped to be generating £1billion annually in revenues and, like video games, there is a requirement for localisation and consistent quality.

ESports – football, rugby, Formula One to name three - are played electronically by teams with increasingly large numbers of people watching
Keywords highlights that it is continuing to seek out ways to ‘leverage the growth in eSports further,’ Berenberg observed.
The most recent acquisitions have focused on adding extra music and audio services to the group’s offering.
Cord Worldwide and Laced Music were acquired from the Cutting Edge Group for £4.5million and Maximal Studio from its owners for up to €500,000.
Being able to offer music services to clients will further enhance its reputation as the leading provider of services to the global video games industry, Keywords said.
Results for 2017 further underlined the rapid progress. Group revenue rose 57 per cent to €151.4million while adjusted profit before tax jumped 55 per cent to €23million. There was a dividend of 1.46p, up from 1.33p in 2016, but this not an income stock, far from it.
The share price of 1,685p points to an earnings multiple of 35 this year.
Like the well-backed share placing, this rating suggests the market has more than a degree of confidence that growth will continue.
As for current trading, Keywords noted that the first quarter is traditionally one where the video games industry takes a breather and that activity levels are currently in line with expectations.
Forecasts in the market point to sales nudging $250million and profits €37million, again, both substantial increases.
True, the current rating allows little margin for error but so far there has been little evidence of Keywords missing its footing and in markets growing so rapidly that still looks to be an opportunity.

Acquisition
RNS
RNS Number : 5983P
Keywords Studios PLC
30 May 2018

30 May 2018


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

Acquisition of Fire Without Smoke

Strengthening the Group's Art Services Line


Keywords Studios, the international technical services provider to the global video games industry, today announces that it has acquired Fire Without Smoke Ltd ("Fire Without Smoke") for a total consideration of up to £5.2m from the founders Will O'Connor, Michael David Thomson and others (the "Sellers").

Headquartered in London and with a studio in Montreal, Fire Without Smoke provides a full suite of creative and marketing services to game publishers and developers, creating assets such as game trailers, marketing art and materials for esports events, and providing marketing consultancy and general design services to the video game industry.

Founded in 2013 and now with [40] staff between London and Montréal, Fire Without Smoke works with major game publishers such as Sony, Square Enix, Riot Games, Deep Silver, Sega, Capcom and Ubisoft.

Will O'Connor will continue as Managing Director and the other founders, together with the rest of the talented team, will also remain with the business.

For the year ending 31 May 2018, Fire Without Smoke is expected to have revenues of £2.8m and adjusted profits before tax of £0.7m.

Under the terms of the acquisition Keywords is paying a consideration comprised of £3.85m in cash, £0.5m of which is deferred until the first anniversary of acquisition and subject to certain performance targets, and the issue of 77,006 new ordinary shares in Keywords, which will be issued to the Sellers on the first anniversary of the acquisition and will then be subject to orderly market provisions for a further 12 months.

Andrew Day, CEO of Keywords Studios commented:

"Fire Without Smoke's specialised offering represents an excellent addition to the Group's existing capabilities and adds some exciting new services to our global service platform. Their high end video game trailers expertise will be of great interest to Keywords' large client base, as will their broad suite of creative services, which range from marketing strategy to providing marketing content for events including esports tournaments, which can play a significant role in influencing the success of event and game launches.

"We are delighted to welcome the talented and passionate teams of Fire Without Smoke to the Keywords family as we continue to build the business in London, in Montreal and in other Keywords locations around the world."

New Revolving Credit Facility
RNS
RNS Number : 2610Q
Keywords Studios PLC
05 June 2018

05 June 2018

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

New Revolving Credit Facility for up to €105m agreed


Keywords Studios, the international technical services provider to the global video games industry, today confirms the completion of a new revolving credit facility, in line with the terms outlined in the Group's full year results announcement on 9 April 2018.

The new facility is being provided by Barclays Bank plc, HSBC Bank plc and Lloyds Banking Group plc for an initial €75m over a three-year term, with the option to extend the facility up to €105m and by a further two years. It replaces the existing €35m facility and is on improved terms.

Andrew Day, Chief Executive of Keywords Studios, commented:

"We are pleased to have finalised this significantly expanded facility, on terms which improve upon our previous arrangement, in line with our intention of maintaining a conservative mix of equity and debt funding to support our investments in both the underlying business and new activities.

"We have made 4 acquisitions to date this year and, over the last twelve months, we have invested to substantially expand our capacity across six existing and five new facilities.

"We are reviewing a strong pipeline of acquisition candidates and organic investment opportunities as we continue to build our business organically and through acquisition. This facility gives us the flexibility and headroom to act on our investment decisions whilst continuing to enhance shareholder value."

Acquisition
RNS
RNS Number : 8634Q
Keywords Studios PLC
11 June 2018

11 June 2018


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

Acquisition of Blindlight

Keywords goes to Hollywood


Keywords Studios, the international technical services provider to the global video games industry, today announces that it has acquired Blindlight LLC ("Blindlight") for a total consideration of up to $10m, from the founder, Lev Chapelsky (the "Seller").

Founded in 2001 and based in Hollywood, California, Blindlight enjoys a leading position in the provision of Hollywood production services for the video games industry. The company works on behalf of game publishers and developers in procuring specialised talent and managing the entire production processes for the parts of games that benefit from Hollywood production resources. Blindlight's service disciplines include voiceover production, celebrity acquisition and rights management, game writing, music, sound design and motion capture.

Blindlight works with top game producers around the world (including Bethesda, NCSoft, Sony Interactive Entertainment, and Ubisoft) making the creative expertise of Hollywood readily available for the video games industry. The addition of Blindlight to the Group will increase the value of the services provided by Keywords and contribute to making those services more accessible to a wider customer base.

Blindlight achieved EBITDA of an average of $1m per annum over the three-year period to 31 December 2017. Under the terms of the acquisition Keywords is paying an initial $3.64m in cash and will issue 64,521 new ordinary shares in Keywords to the Seller on the first anniversary of the acquisition which will then be subject to orderly market provisions for a further 12 months. Deferred consideration of up to $4.8m will be payable to the Seller in cash depending on the performance of the business in the 12-month periods to the first and second anniversaries of the acquisition.

Andrew Day, CEO of Keywords Studios commented:

"Keywords and Blindlight have got to know each other well over the past three years and we see good opportunities to leverage both businesses to offer a wider range of world leading services to our clients. We are delighted to welcome Lev and the rest of the team to the Keywords family.

"Following our recent acquisition of music services companies, Cord Worldwide and Laced, we see excellent opportunities for Blindlight to bring these services to Los Angeles, as well as providing access to further opportunities for our downstream production services of translation and localised voice over."

A clip about the company in todays DM

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Launch of Keywords Ventures Ltd
RNS
RNS Number : 6483T
Keywords Studios PLC
05 July 2018

5 July 2018

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

Launches Keywords Ventures Ltd ("KWV") with Initial Investment in an Automated Test Solution for Compliance with the Global Data Protection Regulation (GDPR)

Keywords Studios, the international technical services provider to the global video games industry, today announces that it has established Keywords Ventures which will make modest investments in innovative technologies and services that will benefit its clients, whilst accelerating the success of investee companies through access to its global platform and relationships.

Incorporated in the UK, KWV will have a remit to identify and support innovative new ventures, complementary to those of Keywords and where the Group believes that its game developer and publisher client base would benefit from improved access to those technologies and services. Investee companies will benefit from both Keywords funding and associated commercial agreements providing access to Keywords global reach, whilst Keywords will benefit from its ability to drive further value from its investments by generating revenues from its client base. An investment committee, formed of senior members of the Keywords executive team, many of whom have started and run their own businesses and have technical backgrounds, will propose investments and commercial arrangements to the Board of Keywords, who will agree funding on a case by case basis before taking what will typically be minority stakes in selected investee companies.

Keywords is also announcing today the first investment being made by Keywords Ventures. KWV will invest up to £300,000, dependent upon development milestones, in Series A funding for a 45% shareholding in a pre-revenue company, AppSecTest Ltd, creator of AS Analyser, a cloud based automatic testing solution for mobile apps, including games. AS Analyser very effectively analyses apps for compliance with the GDPR, producing a detailed report of those aspects of the app that are likely to contravene the regulations. AS Analyser is differentiated by its ability to test products without requiring access to source code, making it an extremely efficient way of establishing possible areas of non-compliance.

Alongside the funding being provided to accelerate the development of AS Analyser, Keywords has entered into an exclusive worldwide licence to commercialise AS Analyser. Keywords will begin client trials of AS Analyser during July with a possible full deployment of the solution in September.

Andrew Day, Chief Executive Officer of Keywords Studios, commented:

"We are excited by the establishment of KWV, which we believe will help bring products, technology and services to market that will be attractive to our clients. Our established relationships with most of the world's leading games companies, and our expanded global presence, provide a strong platform to support investees' growth while adding further value to the relationships we enjoy with our clients.

"Our strategy to consolidate the fragmented market for video games services remains unchanged with KWV being highly complementary to this in bringing additional capabilities to our global services platform. KWV will be making selective and relatively small investments in companies where we can help commercialise complimentary products or services, with our annual investment in KWV unlikely to exceed 5% of our annual spend on acquisitions.

"Our investment in AppSec Test Ltd is intended to help bring AS Analyser to market through our extensive geographic reach across the video games industry and beyond. We believe AppSec Test fits the investment model of KWV particularly well. We look forward to supporting the testing and improvements to its existing Android version of AS Analyser and also the development of its iOS version, as AppSec Test moves towards full commercialisation."

Acquisition of Snowed In
RNS
RNS Number : 2354V
Keywords Studios PLC
20 July 2018

20 July 2018

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

Acquisition of Snowed In

Keywords expands its Engineering Service Line in Canada


Keywords Studios, the international services provider to the global video games industry, today announces that it has acquired Snowed In Studios Inc. ("Snowed In") for a total consideration of up to CAD$4m, from its current owners, Jean-Sylvain Sormany, Tim Vito and Evan Hahn (the "Sellers").

Founded in 2010 and based in Ottawa, Canada, Snowed In offers engineering and co-development services to the video-games industry and has a strong global reputation and well-established relationships with clients such as Ubisoft and Bethesda. The Company has 29 employees all working in-house in its office in Ottawa led by the current owners, who will remain with Snowed In to drive its growth as part of Keywords.

Snowed In achieved EBITDA of CAD$0.8m in its last financial year ending January 31 2018, from revenue of CAD$2.4m. Under the terms of the acquisition Keywords is paying an initial CAD$2.67m in cash and will issue 37,983 new ordinary shares in Keywords to the Sellers on the first anniversary of the acquisition which will then be subject to orderly market provisions for a further 12 months. Deferred consideration of up to CAD$0.2m will be payable in cash to the Sellers 18 months after the acquisition.

Andrew Day, CEO of Keywords Studios commented:

"The addition of Snowed In to the Group will add strength and scale to our recently established Engineering service line and enable Snowed In to take advantage of the Group's very strong presence in the region to support its growth.

"Having grown the Engineering service line from nothing in May 2017, we now employ over 300 software engineers in multiple regions, and I'm delighted that Jean-Sylvain, Tim, Evan and their highly talented and creative team are joining the Group as we continue to grow."

Ends

Acquisition
RNS
RNS Number : 4096V
Keywords Studios PLC
23 July 2018

23 July 2018

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

Acquisition of Yokozuna Data
Entering the market for Predictive Analytics for the Video Games Industry

Keywords Studios, the international technical services provider to the global video games industry, today announces that it has acquired the business and assets of Yokozuna Data ("YD") from Silicon Studio Corporation ("Silicon"), a Japanese developer of video games and middleware solutions for game production. Keywords is paying a total cash consideration of $1.5m for the business and all associated technology rights and trademarks from Silicon.

Based in Tokyo, YD's team of international machine learning engineers, big data engineers and data scientists, led by Dr África Periáñez, have developed a range of cutting edge self-learning, predictive analytic models drawing on AI and machine learning technologies that predict individual player behaviour and adapt themselves in response to changes that are made in the game. These models are used for determining the likelihood of players abandoning the game and their propensity to buy items in the game. By processing large quantities of data and delivering real time predictions, YD's technology can be used to reduce player attrition, maximise conversion, increase average spend, and materially impact the lifetime value of players all while increasing the appeal of the game for the individual users.

Along with the AI driven models, YD has a management framework solution to allow games companies to adjust key parameters, to record and view results and to monitor key performance metrics of their games in live operation.

Yokozuna Data's solutions have been developed over the past three years and are now ready for commercial roll out. YD has won numerous accolades for its technology including competitions staged by NC Soft and others and they have published numerous scientific, peer-reviewed articles. In joining Keywords at this stage, the business can leverage the worldwide reach of Keywords and its extensive client relationships. As part of the agreement, Silicon will collaborate with Keywords in introducing the technology to Japanese game developers and publishers, and it has a non-exclusive right to resell the YD solution into the non-games markets (such a healthcare), in exchange for a share of the associated revenues.


Andrew Day, Chief Executive Officer of Keywords Studios, commented:
"We have been looking for opportunities to establish a foothold in the exciting area of video game analytics for a few years. This acquisition brings industry leading technology and capabilities to Keywords that we believe we can support, enhance and roll out to our clients thanks to the engineering, player research and video game specific data science skills we have within the business. While YD is pre- revenue, it is a rare asset and we expect the first clients to start implementing the software during 2018.

"As games continue to transition to a service model from a product model, the use of sophisticated analytics engines like this to automatically understand player behaviour and trigger real time decisions in-game will become increasingly valuable to our clients. The use of AI to constantly adapt the predictive models to changes that are made in the games, such as when new items, expansion packs and promotions are introduced, is critical to the future of the video games industry so we are delighted to have secured this leading-edge technology.

"We look forward to continuing the development of the YD solution set and bringing this capability to our clients around the world."

Half Year Trading Update
RNS
RNS Number : 6958W
Keywords Studios PLC
03 August 2018

3 August 2018



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

Half year trading update

A strong first half performance delivered a 66% increase in adjusted PBT

Keywords Studios, the international technical services provider to the global video games industry, is pleased to provide an update on trading for the six months ended 30 June 2018.

The Group has performed strongly during the first half, with preliminary unaudited revenues for the period expected to be up by 72% to €109.9m (H1 2017: €63.8m) and an anticipated 66% increase in adjusted PBT* to €15.9m (H1 2017: €9.6m). This was achieved despite the incorporation of the historically lower margin VMC business, as well as a marked weakening of the US dollar, in which approximately 60% of the Group's revenues are denominated, against the Euro with average exchange rates having declined 12% between the comparable periods.

The 11 acquisitions made during 2017 and the 7 acquisitions made since the beginning of 2018 are all performing in line with expectations. The Group's largest acquisition to date, VMC, completed on 30 October 2017 and has been well integrated with the rest of the Group. It is starting to benefit from being part of a larger group focused on similar services, with a number of its client relationships having been strengthened, while cost synergies are leading to improved operating margins.

The second half of 2017 and the first half of 2018 saw us invest substantially in expansion of the Group's facilities in Montreal, Dublin, London, Liverpool, Madrid, Katowice, New Delhi, Zhengzhou, Manila and Tokyo, which are now providing additional capacity to support the higher levels of activity we anticipate in the second half given the demand we are seeing from our customers.

Keywords has also continued to strengthen its management team with some changes to its senior management team including the hiring of a Chief Marketing Officer, and the appointments of an Engineering Service Line Director, Global Operations Director and a Chief Commercial Officer, as announced on 10 July 2018.

The Group has invested net cash of nearly €10.0m for the 5 acquisitions made in the first half of the year and we are actively reviewing a number of high quality acquisition opportunities, in line with our acquisition strategy. Significant headroom in our new €105m credit facility with Barclays Bank, Lloyds Bank and HSBC (announced on 5 June 2018), combined with continuing strong cash generation and the judicious use of Keywords shares to part-fund acquisitions where appropriate, leaves the Group well placed to complete further selective acquisitions this year. At 30 June 2017, the Group had no net debt.

Andrew Day, Chief Executive of Keywords, commented:

"Our progress so far this year has been very encouraging. We have made significant investments, most notably in enlarged facilities and senior and mid-level management, which are further supporting our organic growth in the second half and beyond. Despite the incorporation of the lower growth and margin VMC business, our largest acquisition to date, and a weaker US dollar, we have delivered a first half in line with our expectations while also strengthening the business for the future.

"With the benefits of a full six months contribution from first half acquisitions, a strengthening dollar, a healthy pipeline of activity and expanded capacity to deliver it, we anticipate a strong second half performance in line with current market expectations for the full year."


Keywords Studios will provide a further update on trading with its half year results which it expects to announce in mid-September.

*The Group reports adjusted PBT before acquisition and integration expenses, share option charges, amortisation of intangibles and foreign currency gains

Acquisition of Studio Gobo and Electric Square
RNS
RNS Number : 2246Y
Keywords Studios PLC
20 August 2018

20th August 2018


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

Acquisition of Studio Gobo and Electric Square
- Substantially Expanding Keywords' Engineering Service Line with its Video Game Development capabilities

Keywords Studios, the international technical services provider to the global video games industry, today announces that it has acquired Studio Gobo Ltd and Electric Square Ltd (together, "Gobo"), for a total consideration of up to £26 million from the founders and other members of the management team (the "Sellers").

Gobo provides game development services to video game developers and publishers around the world from its Studio Gobo and Electric Square studios based across three studio locations in Brighton and Hove, UK.

Founded in 2011 by game industry veterans, Gobo employs 170 software engineers, artists, animators, game designers, quality assurance testers and producers. Gobo works with game developers and publishers in a number of different operational models to deliver its services. These services include:

· Full game development in which Gobo will develop the game from concept to completion on behalf of the owner of the game franchise.
· Co-development in which a portion of the game's development is assigned to Gobo who's team work alongside the client's development team.
· Live operations in which Gobo develops new features and downloadable content packages to ensure the games they support continue to keep players excited and engaged.
· Porting services in which Gobo will adapt a game to run on a different platform (for example a mobile or Nintendo Switch version).

Over the years, Gobo has worked on top games franchises such as Disney Infinity, Ubisoft's For Honor, and Microsoft's newest racing game, Miami Street.

Gobo adds considerable expertise and scale to Keywords' new and growing video game development business. It significantly increases Keywords' access to the UK's talent pool of video games developers, growing our total UK game development team to 220, in combination with our existing 50-strong team at d3t, whilst also expanding our worldwide game development team, which includes Snowed In, Sperasoft, and GameSim, by over a third to 610 people.

Gobo's revenue has grown quickly from £6.2m for the year ended 30 September 2017 to an estimated £11.6m for the 12 months ending 31st July 2018. Underlying pro-forma EBITDA for the same 12 months is expected to be approximately £3.6m.

Under the terms of the acquisition, which is expected to be earnings enhancing in the first year, Keywords is paying a total consideration of up to £26m. The initial consideration is £10.5m in cash and 254,529 new ordinary shares in Keywords, which will be issued on the anniversary of completion and will then be subject to orderly market provisions for a further 12 months. The remaining consideration of £11m is payable in a mix of cash and shares, or all in cash at the discretion of Keywords, subject to the achievement of a substantial increase in Gobo's EBITDA over the 12-month period following completion. All of the Sellers are remaining with the business under the continued direction of Tony Beckwith.


Andrew Day, Chief Executive Officer of Keywords Studios, commented:
"We are delighted to welcome Studio Gobo and Electric Square to the Keywords family. By significantly enhancing our game development services in both scale and expertise, these studios together with recently acquired Snowed In, Sperasoft, d3t and GameSim help position Keywords as a go to game development partner and give us ever greater visibility of games in the pipeline, at the outset of their development.

"The acquisition further expands the number of the world's leading game companies who use our development services. As winner of GamesIndustry.biz's Best Places to Work 2017 award, its Brighton and Hove locations and strong culture is also a major draw for talent around the UK and beyond.

"We look forward to working closely with Gobo's highly talented team to build upon their strong industry reputation and relationships with some of the world's leading games developers and publishers."


Tony Beckwith, Chief Executive Officer of Gobo, commented:
"We are excited about joining the Keywords Studios family. As we look to build upon our strong foundations, Keywords leading position in the video games industry, its breadth of services and its geographical reach will provide us with a strong and broader platform from which to deliver our ambitious growth plans. We also look forward to working collaboratively with other members of the Group in offering wider capabilities to all our clients."

Broker Forecast - Berenberg issues a broker note on Keywords Studios
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Berenberg today reaffirms its buy investment rating on Keywords Studios (LON:KWS) and raised its price target to 2150p (from 2060p).

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Half-year Report
RNS
RNS Number : 0470B
Keywords Studios PLC
18 September 2018

18 September 2018

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

Half year results for the six months to 30 June 2018

An excellent performance and a strengthened services platform

Keywords Studios, the international technical services provider to the global video games industry, today provides its half year results for the six months to 30 June 2018.

Financial overview:
· Revenue, including contribution from acquisitions, increased by 72% to €110.0m (H1 2017: €63.8m)
o On a constant currency basis, revenue would have been up by 84% to €117.5m
· 2% increase in like for like** revenue; 8.6% increase on a like for like constant currency basis
· Gross profit margin increased to 37.4% (H1 2017: 35.6%)
· Adjusted profit before tax* was up 67% to €16.0m (H1 2017: €9.6m)
· Adjusted earnings per share* were up 53% to 20.1c (H1 2017: 13.2c)
· Net cash of €0.1m (H1 2017: €1.1m; FY 2017: €11.1m) after €10.6m of net cash outlay on acquisitions
· 10% increase in interim dividend to 0.53p per share (H1 2017: 0.48p)

Operational overview:
o VMC has been successfully integrated with our margin improvement plan ahead of schedule
o Continued to invest in the development of the Group:
o Expansion of studios in response to demand including investing €3.8m in new or expanded facilities in Montreal, Dublin, London, Liverpool, Madrid, Katowice, New Delhi, Chengdu, Manila and Tokyo, providing a total of 660 additional workstations
o Acquisition of Maximal, adding further scale to our Audio capabilities in South American markets, in March
o Acquisition of Cord and Laced, which extended our Audio offering in to the provision of composed or licenced music for use in games and other media, in April
o Acquisition of Fire Without Smoke, which provides a suite of marketing services to game publishers and developers, in May
o Acquisition of Blindlight, which provides Hollywood based talent resources and services, in June
o Launch of Keywords Ventures, to invest in innovative technologies and services that can leverage Keywords' reach in the games market and that will benefit clients; first investment in automated app testing solution for GDPR compliance, AppSec Test, in June
o New revolving credit facility secured for up to €105m
o Further cross selling progression with 19% increase in clients using three or more services to 100 (H1 2017: 84)

Post period end, current trading and outlook:
· Further investment in operational capacity and Group infrastructure to support growth in future periods:
· Announced separately today:
o Acquisition of TrailerFarm, a Brighton, UK based creator of video game trailers for a total consideration of up to £2m
o. Hiring of a leading Hollywood based sound effects team of 7 people, SoundLab, bringing world-class audio design and production services for games, film and TV to our Audio service line
· Acquisition of Studio Gobo and Electric Square, both in Brighton, UK, enhancing our game development services in both scale and expertise, in August
· Acquisition of Tokyo, Japan based Yokozuna Data, developer of machine learning and AI technology bringing industry leading capabilities in video game analytics for live operations, in July
· Acquisition of Snowed In, in July adding strength to our Engineering service line and access to talent in Ottawa, Canada.
· Further strengthened the senior management team with the appointment of a Chief Commercial Officer, Chief Marketing Officer, Global Operations Director and Engineering Service Line Director, all newly created positions

Outlook
· Selectively reviewing a strong acquisition pipeline
· Trading in the second half has been good and we expect to meet market expectations for the full year before the positive impact of any additional acquisitions

* before acquisition and integration expenses of €2m (H1 2017: €0.5m), share option charges of €0.8m (H1 2017: €0.4m), amortisation of intangibles of €3.1m (H1 2017: €1.2m) and foreign currency gain/(loss) of €0.8m (H1 2017: (€1.96m))
** calculated on the basis that the H1 2017 comparative includes all of the 2017 and 2018 acquisitions as if they had been owned for the same period in 2017 as they have been in 2018.

Andrew Day, Chief Executive of Keywords Studios, commented:

"In a period in which the gaming phenomenon, Fortnite, had a significant impact on the games market and in which the US dollar which represented 54% of our revenues declined by 12% compared to the same period in 2017, we have none the less delivered yet another strong set of results for the first six months of 2018 as we continue to deepen and broaden the business for the future.

"Our continued organic investment and acquisitions have extended our geographical reach, added further scale to our existing service lines, and broadened the range of capabilities we can offer our clients to include co-development, analytics, music, marketing services and sound effects.

"We are particularly pleased with our performance in respect of acquisitions and their subsequent integration. Our largest acquisition to date, VMC, which was absorbed into the Group with a track record of reducing revenues and an operating margin of 9.1% in October 2017, has been fully integrated and the resulting synergies are already significantly enhancing operating margins as can be seen by the overall group profit margin of 14.5%. We are confident of being able to return it to revenue growth in the near to medium term.

"The games market is starting to focus on the prospect of games being streamed and played live across all connected devices. Advances in technology and increases in internet bandwidth including the forthcoming 5G mobile networks and the resultant reduction in latency of communications could enable streaming of games for the first time which we believe will drive record demand for gaming content. We are excited by the prospect of assisting the industry in creating and repurposing content for this new medium over the coming years and Keywords is already working on interactive streaming content and porting games to upcoming streaming platforms.

"Our focus on organic and acquisition led growth is being maintained and we continue to invest in additional talent and better facilities as well as in acquisitions of synergistic businesses as we build our global games services platform and lead the consolidation of a highly-fragmented market."

A presentation of the half year results will be made to analysts later this morning at MHP's offices. There will also be a live, listen only webcast of the presentation and a recording will be made available via www.keywordsstudios.com. To register for access, please contact Charles Hirst at MHP Communications on +44 20 3128 8193 or email keywords@mhpc.com.

Acquisition
RNS
RNS Number : 0409B
Keywords Studios PLC
18 September 2018

18 September 2018

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

Leading sound production team, known as Sound Lab, joins Keywords Studios in Los Angeles

and

Acquisition of The TrailerFarm Ltd ("TrailerFarm") in Brighton to complement the Group's marketing services and games trailer production capability


Keywords Studios, the international services provider to the global video games industry, today announces that renowned Hollywood sound designer, Scott Gershin and his Sound Lab team in Burbank, California, have joined Keywords Studios from Technicolor. Sound Lab at Keywords is a leader in the video game and immersive entertainment market (VR / AR) and provides sound services for movies and streaming (over the top - OTT content). In support of the Sound Lab team joining The Group, Keywords is investing in new, state of the art production equipment to fit out a sound design studio in Burbank already occupied by Sound Lab.

With more than 30 years' experience in sound design, Scott Gershin and his team have been credited on an extensive list of bestselling video games including the likes of Final Fantasy XV, Resident Evil, Gears of War, Fable and Epic Mickey, and worked on projects for Riot, Capcom, Activision, Infinity Ward, Amazon and a host of others.

At Keywords, Gershin will also be continuing his work in the film and broadcast industry having worked on such titles as Nightcrawler, Pacific Rim, American Beauty, Hellboy 2, Chronicles of Riddick, Team America, Blade II, The Strain, Shrek and The Book of Life. Joining Keywords alongside Gershin is a team of five passionate audio professionals, sound designers, mixers, musicians and creative managers.

Separately, Keywords is also announcing the acquisition of The TrailerFarm Ltd. Based in Brighton, UK, TrailerFarm produces trailers for the marketing and support of video games, and will complement Keywords' recently acquired Fire Without Smoke marketing services business in producing high impact, cost-effective trailers for a broad range of games.

Founded in 2011 by brothers Tony and Dan Porter, TrailerFarm's team of 12 creative directors, video game artists, project managers and motion graphic designers produce trailers for both mobile and console/PC games for use in game launches and ongoing promotional events.

In the year ending 30 June 2018, TrailerFarm posted revenues of £1.0m and adjusted EBITDA of £165k. Under the terms of the acquisition, Keywords is paying a total consideration of up to £2m. The initial consideration of £1.0m is being satisfied by the payment of £790k in cash and 11,070 new ordinary shares in Keywords, which are to be issued to the sellers on the first anniversary of the acquisition. The remaining consideration of up to £1m is payable in cash, subject to the increase in profit before tax of TrailerFarm over the 12 month period post acquisition.

Andrew Day, CEO of Keywords Studios commented:

"I'm delighted to welcome Scott and his team into the Keywords family. As games become ever more immersive, sound design quality is getting ever closer to that of movies. Our new Sound Lab studio, created around Scott and his team, will be integrated within the Keywords Audio Services Line and will benefit accordingly from our global network of studios and our extensive video game client base around the world.

"Our presence in audio services continues to grow. In Los Angeles, with our long-established voice-over studio in Burbank, the recently acquired Blindlight LLC, which focuses on Hollywood voice-over production and writing services, and our specialist music services through recent Keywords joiners, Cord and Laced. The sound design services we are adding with this investment help round out the full suite of audio services we are now able to offer to clients in interactive and linear media.

"Trailers are the primary marketing asset for video games and Keywords' ability to produce trailers across the spectrum from cost effective small productions to the very high end trailers for AAA games positions us well in this interesting segment of the games services market. Bringing together art, animation, sound effect, music and voiced audio, trailers can further act as a showcase for our range of services and creative abilities."

Ends

8 Nov
Berenberg
N/A
Buy