LONDON (ShareCast) - (Sharecast News) - Video game label, creative partner and developer Team17 said on Thursday that its performance in 2020 was ahead of its expectations, with year-on-year revenue and adjusted EBITDA growth of around 34% and 36%, respectively.
The AIM-traded firm said its growing portfolio continued to perform well in the second half, in particular over the peak Christmas trading period.

It launched nine titles in the second half - more than in any previous year, despite the impact of changing working restrictions as a result of the Covid-19 pandemic.

The company said its portfolio grew stronger during 2020, with additions to the Worms, Escapists and Overcooked franchises as part of the 12 titles launched in the year across a variety of platforms, further strengthening its "diverse" gaming portfolio.

As outlined in our interim results, Team17 saw one-off commercial benefits delivered in spring, although those quickly normalised early in the second half.

The board said it was "particularly pleased" with performance in the peak November and December months, maintaining strong retail pricing in the face of an "aggressive competitive environment".

It said it continued to monitor the potential headwind impacts of the prolonged pandemic, uncertain macroeconomic and consumer environments, alongside manufacturing and supply chain challenges facing next generation and existing gaming hardware.

The directors said they expected those to be ongoing and key considerations in 2021.

Team17 said it was confident about its pipeline and its ability to continue to build the business in 2021.

While it was assuming any additional one-off benefits linked to the pandemic that impacted the 2020 results would not be repeated, it said it believed the business would continue to deliver underlying growth, and support the long-term prospects aligned with its ambitious strategic plans.

The board said 2021 would bring a "solid and very diverse" pipeline of both existing intellectual property (IP) on new platforms, and new IP including Worms Rumble and Overcooked: All You Can Eat on more platforms, Rogue Heroes, The Unliving, Epic Chef, Super Magbot, Greak: Memories of Azur, Honey I Joined a Cult, Hokko Life, a number of unannounced games, alongside Hell Let Loose exiting early access, and the announcement of additional platforms to support.

Team17 also announced the acquisition of all rights and assets for Golf With Your Friends (GWYF), an existing third party label title, to its first party family, for a total consideration of £12m.

It described GWYF as a multiplayer golf video game created by Australian developer Blacklight Interactive, and published by Team17.

The game first launched in early access on Steam in 2016, with Team17 partnering with Blacklight in 2019 and being involved in the ongoing development and publishing of the title for its full release on 24 May 2020 for PC, Nintendo Switch, PlayStation 4 and Xbox.

The board said the acquisition would enable the firm to further expand both its portfolio and franchise footprint, enabling it to increase first party IP and create additional opportunities to extend the life cycle of the existing game.

That would include further downloadable content, as well as exploring potential sequels and other opportunities for the GWYF IP.

The acquisition would be satisfied wholly in cash, with an initial payment of £9m and a further £3m paid within 12 months.

"Whilst the board and I are very pleased with the financial results we are even more pleased with the resilience and dedication shown by our teamsters and label partners to deliver, launch and sell the complex games we made in 2020," said chief executive officer Debbie Bestwick.

"Many of our games are local co-op and online play and we added cross play to some of our titles alongside numerous quality of life and gaming enhancement updates across our back catalogue.

"We achieved this under the ever changing global restrictions and we should not underestimate the support and passion for the games we create."

Bestwick said the board was also "delighted" to start 2021 with the announcement that it had acquired GWYF.

"Over the last two years, GWYF has shown strong consumer demand and mass market appeal, doubling its owner base and achieving success on multiple gaming platforms.

"GWYF is the type of IP we believe is right for ownership, it is successful and proven but still at the start of its journey.

"The team at Blacklight Interactive can be assured that we will take great care of this amazing IP."

Team17 said it would report its full-year results for the year ended 31 December during March.

At 0928 GMT, shares in Team17 were up 3.57% at 870p.

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