Keywords Studios - Looking like a winner as the dust settles
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.Keywords Studios is a technical services provider to the video games industry. Co.'s segments include: Localization Services, which relate to translation and cultural adaptation of in-game text and audio scripts; Localization Testing, which includes testing of linguistic correctness and cultural acceptability of computer games; Audio/Voiceover Services, which relate to audio production process for computer games; Functional Testing, which relates to quality assurance services provided to game producers; Art Creation Services, which relate to the production of graphical art assets for inclusion in the video game; and Customer Support, which relates to the live operations support services.
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