Sumo Group flags forecast-beating revenue and earnings
Sumo Group
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16:41 14/01/22
Video game and entertainment creative and development service provider Sumo Group said on Thursday that its revenue and adjusted EBITDA for 2020 were expected to be ahead of consensus market expectations, with adjusted EBITDA for the year of at least £16m.
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The AIM-traded firm said the higher-than-expected results reflected strong performances from Sumo Digital and its latest acquisition Pipeworks, and higher-than-expected royalty income during the year.
Net cash at 31 December was ahead of management expectations at £6.8m, which the board put down to a number of timing effects that were expected to reverse during 2021.
Its headcount increased to 1,043 at the year-end, including 139 people at Pipeworks and 40 at Lab42, making for an increase of 277 on the prior year.
“Sumo Group performed very strongly in an already fast-growing market that was further boosted by the effects of the pandemic,” said chief executive officer Carl Cavers.
“We are a people business and I'd particularly like to thank all of our people for making our collective response to the pandemic a truly inspirational story which unfortunately isn't over yet.
“We're keen to return to some level of normality in our studios in the various countries as the vaccine roll-out progresses.”
In the meantime, Cavers said the firm was continuing to work well from home, and had the ongoing support from its partners to do so.
“We are focussed on making great games and continue to operate at good levels of efficiency with no significant delays to production schedules.
“We announced or launched a relatively large number of client intellectual property (IP) and own IP games in 2020, including Spyder, Little Orpheus, Sackboy A Big Adventure and Hood.
“We also completed two great acquisitions, Lab42 and Pipeworks.”
Carl Cavers said both businesses were fitting in “very well”, and had performed ahead of our expectations.
“Pipeworks and Genvid announced Rival Peak, a massive interactive live event styled game for Facebook livestream in December.
“Our royalty performance in 2020 is also ahead of our expectations,” Carl Cavers added, saying the company recognised royalties on eight games, including two of its own IP.
“While our teams across our 12 studios in four countries are nearly all working remotely, in accordance with the relevant local regulations, we continue to manage our studio estate.
“Both our studios in the North East of England and The Chinese Room in Brighton have moved to new larger premises to accommodate our expected growth.”
The company was also pursuing a number of acquisition opportunities and new studio locations, Cavers said, as well as working to recruit more talented people to join its teams globally.
“We are proud of our achievements in what has been a challenging year and remain very positive about our prospects for 2021 and beyond.”
Sumo Group said it would announce its results for the year ended 31 December on 31 March.
At 0944 GMT, shares in Sumo Group were up 4.33% at 337p.