5th Feb 2020 11:09
(Alliance News) - Video games developer Frontier Developments PLC on Wednesday reported a sharp fall in interim profit, as revenue declined substantially due to currency movements.
Shares in Frontier Developments - which is based in Cambridge - were 8.5% lower at 1,322.00 pence on Wednesday in London.
For the six months to the end of November, Frontier Developments posted a pretax profit of GBP4.3 million, down 75% from GBP17.3 million the same period the year before.
This was on revenue that dropped by 51% year-on-year to GBP32.0 million from GBP64.7 million.
The group attributed the revenue decline to the appreciation of sterling in the fourth quarter of the 2019 calendar year, undermining revenue since the majority of it is recorded and received in US dollars.
The timing of the currency movement was poor for Frontier, as it affected revenue gained over the holiday period in November and December, as well as the launches of Planet Zoo in November, and the Return to Jurassic Park expansion pack for Jurassic World Evolution in December.
Despite the revenue decline, Frontier said all four video game titles contributed positively in the period, and have continued to do so in the second half of the year to date.
Looking ahead, Frontier expects to report revenue for the financial year ending May 31 in the range of GBP65 million to GBP73 million, reflecting an 18% to 28% decline from GBP89.7 million the year before.
"Planet Zoo's successful launch and subsequent performance is testament to the superb efforts of our growing team. We now have four successful games in the market each with a clear roadmap of additional content in line with our proven strategy," said Chief Executive David Braben.
"We have started calendar 2020 in a great position. We're bringing Planet Coaster to console players and significantly expanding the Elite galaxy this year, and developing two major games for release in the same financial year for the first time as a self-publisher," Braben added.
By Dayo Laniyan; [email protected]
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