Keywords Studios


£1887.9m market cap

2538p last close

Keywords Studios is the largest and most diverse supplier of outsourced services to the games industry. Through regular acquisitions, it is building its scale, geographic footprint and delivery capability to become the ‘go to’ supplier across the industry.

Investment summary

Buoyed by exceptional demand for games during lockdown and boosted by the start of the console transition, the global games industry showed year-on-year growth of 20% in FY20 (Newzoo). Benefiting from increased industry development spending and the growth in new releases, Keywords delivered underlying organic revenue growth of 12%, with FY20 revenues rising 14% y-o-y. Assuming no worsening impact from COVID-19, FY21 looks set to be a more settled year. With publishers launching increasing numbers of new titles to address a growing next-gen console base in FY21–23, demand for Keywords’ services should continue to build in the short to medium term. The outlook for Keywords appears positive and, with net cash of c €100m (plus €100m of undrawn facilities), Keywords remains well placed to participate in earnings-enhancing M&A.

Y/E Dec
Revenue (€m)
PBT (€m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2018A 250.8 43.7 37.9 43.7 66.3 54.8
2019A 326.5 57.6 40.9 47.2 61.4 40.9
2020E 373.0 72.9 55.0 62.0 46.7 29.7
2021E 464.5 89.7 67.8 72.1 40.2 26.8
Industry outlook

Keywords Studios operates in the global games sector, a net beneficiary from COVID-19-related lockdowns (Newzoo: 20% y-o-y growth in FY20). Although Keywords has experienced some short-term business disruption (particularly Audio and QA), as lockdowns ease, it will quickly be business as usual, with potential catch-up from pent-up demand as the industry returns to trend growth (Newzoo: 10.5% CAGR 2019–23e).

Last updated on 03/03/2021
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Share price graph
Balance sheet
Forecast net cash (€m) 92.5
Forecast gearing ratio (%) N/A
Price performance
Actual (7.0) 9.2 64.1
Relative* (9.5) 5.3 61.5
52-week high/low 2942.0p/1330.0p
*% relative to local index
Key management
Ross Graham Chairman
Andrew Day CEO
Jon Hauck CFO
Joe Quinn Investor relations

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