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Team17 plummets on profit warning, though expects revenue beat

24th Nov 2023 11:01

(Alliance News) - Team17 Group PLC on Friday said it is "well positioned with strong traction across its new release and back catalogue titles" ahead of Black Friday and Christmas, but warned earnings are set to disappoint.

Shares in Team17 plunged 42% to 183.32 pence each in London on Friday morning.

The Wakefield, England-based developer of video games, educational entertainment apps for children, and working simulation games said it now expects full-year adjusted earnings before interest, tax, depreciation and amortisation of at least GBP28.5 million, including non-cash title impairments of up to GBP11.5 million.

In 2022, it achieved an adjusted Ebitda of GBP48.8 million.

Team17 said this resulted from it being "too slow to address some project overspends" and delays on key cost initiatives, as well as some of its games not selling as well as it had originally expected.

Nevertheless, the firm said it expects revenue in 2023 to be "modestly ahead" of current market expectations.

In 2022, Team17 generated revenue of GBP137.4 million.

"The group has an exciting schedule of high-quality new releases planned across the group in 2024, while back catalogue investments will continue to support revenue growth," the firm said.

It will update further on 2024 alongside its full-year results, but expects to see an "improved underlying trading performance" compared to 2023.

By Sabrina Penty, Alliance News reporter

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