Gfinity First Half Loss Widens On Investments, Raises GBP7 Million (ALLISS)

28th Mar 2018 13:07

LONDON (Alliance News) - Esports entertainment company Gfinity PLC on Wednesday reported a significantly widened pretax loss for the first half in line with management expectations, and said that it will raise GBP6.7 million via share placing and subscription.

The company recorded a pretax loss of GBP7.7 million for the six months to the end of 2017, compared with a pretax loss of GBP1.7 million in the year ago period, on a revenue of GBP1.8 million and GBP902,212, respectively.

The sharply widened pretax loss was attributed to planned investments in the first two seasons of the Gfinity Elite Series, expansion into Australia and recruitment of additional staff. Revenue growth was driven by a mixture of partner programme revenues, sponsorship and broadcast revenues and ticket sales for live events.

The UK listed company is placing 21.5 million shares and will issue 34.3 million shares pursuant to a subscription pact at 12 pence per share. Shares in Gfinity were trading down 5.15% at 11.50p each Wednesday midday.

The placing shares have been subscribed for by institutional and other investors, including existing shareholders, it represents around 19.5% of the issued share capital of Gfinity as enlarged by the issue of the placing shares.

The company's Chief Executive Neville Upton has increased his stake to 14.8 million shares from 14.7 million shares.

Charles Street International Holdings Ltd have increased their ordinary shares holding to 85.2 million from 63.1 million. Hargreave Hale to 16.5 million shares from 14.0 million shares. Alden AS from 8.1 million to 11.2 million.

The funds raised will be used to fund the net cost of season three and four of the Gfinity Elite Series. It will also be used to further support the launch of season one of the Gfinity Elite Series Australia.

The proceeds will also support Gfinity's development of its digital platform. On March 13, it acquired RealSM Ltd, an online platform with a large digital community.

"We continue to invest in the quality of our people and technology, which has resulted in an increase in our cost base, which is in line with delivering our growth strategy. This has allowed us to build a leading position in the esports market and positions us well to take advantage of the commercial opportunities that the considerable expected growth in the esports market will present," Upton said.

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