Entertainment company sees lockdown earnings jump 73 per cent as people turn to video games
A Yorkshire games company has reported a 73 per cent increase in earnings in the last few weeks.
Sumo Group, which is based in Sheffield and provides creative and development services to the video game and entertainment industry, has said that the UK lockdown has caused a change in people’s leisure habits.
Since the lockdown, it says it has a 73 per cent increase in earnings visibility, reflecting an increase in people buying video games.
It also reported its results for 2019 this morning, announcing record revenues for the company at £49m - a 26 per cent rise from 2018.
Carl Cavers, CEO of Sumo Group, commented: “The group entered 2020 in great shape and global demand for our services remains strong.
“The video games market is forecast to grow at 9 per cent CAGR over the next three years and early indications show this increasing as COVID-19 ‘lockdown’ measures affect our leisure activities.
“Whilst March was challenging for the group operationally, as we transitioned to remote working, our people have risen to the challenge and are adapting well to their new working routines.
“The business continued to press ahead throughout this disruption and our earnings visibility on contracted or near contracted development fees for FY20 has increased further in the last few weeks to approximately 73 per cent.
“It is still too early to estimate accurately the financial impact of the pandemic on the group.
“However, our low-risk business model, strong balance sheet and robust liquidity position, with £24m cash at 20 April 2020, provide firm foundations on which to withstand the challenges.
“I am pleased to report that we are not using any furloughing arrangements, nor do we expect or intend to do so.
“Whilst there will inevitably be some impact from the pandemic on the group’s performance in FY20, the directors remain confident in the group’s strategy and its ability to continue delivering strong returns for stakeholders in the longer term.”
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