22nd Oct 2018 10:35
LONDON (Alliance News) - Gfinity PLC on Monday said it intends to raise GBP6 million via a share placing and subscription to further develop its technology platform after it saw a double-digit revenue growth in its recently ended financial year.
The esports company said it has significantly invested in its esport technology platform through 2017 and 2018 and is now well positioned to build on this platform for growth and take advantage of the growing popularity of esports.
For the year to the end of June, Gfinity expects to report revenue of GBP4.3 million, up 82% year-on-year. The revenue growth came from both managed services and Gfinity's owned and operated properties, it said, and included the addition of two major new clients, Formula 1 and Facebook Inc.
Adjusted loss before interest, taxes, depreciation and amortisation for the year is predicted to total GBP12.6 million, reflecting higher commercial momentum in the Gfinity Elite Series.
Looking ahead, the company said it targets adjusted Ebitda break-even operating results within the next few years, as it expects revenue to increase on service fees and collaborations with publishers and distribution partners.
Gfinity also targets a long-term group gross margin of 30% to 40% and an adjusted Ebitda margin in the range of 15% and 25% on a normalised basis.
In a separate statement, the company said it intends to raise GBP6.0 million before expenses through a share placing and subscription.
Gfinity intends to place 75.0 million shares at a price of 8 pence each. The stock was trading 0.6% higher on the day Monday at 8.20p per share.
The company said it will use funds to expand the commercial delivery team and develop its technical platform.
The placing will be conducted by Allenby Capital Ltd and Pareto Securities Ltd. Following the admission, Gfinity will have 362.9 million shares overall.
"The net proceeds of the proposed placing will strengthen the company's financial position and support continued investment in its strategic priorities to generate future growth," said Executive Chairman Garry Cook.
Executive Chairman Garry Cook and Chief Operating Officer Graham Wallace have subscribed for GBP100,000 and GBP25,000 in shares, respectively. Following the admission, Cook's holding in the company will be 0.6%, while Wallace will hold 0.09%.
In addition, Gfinity said Charles Street International Holdings Ltd subscribed for 22.4 million shares, taking its stake in the company to 29.7%.
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