Sheffield video game developer Sumo Group delays results, moves staff to cloud but could benefit from 'stay at home'

This is in line with the Financial Conduct Authority’s (FCA) request that all listed companies observe a moratorium on the publication of preliminary financial statements for at least two weeks.

As previously announced on January 22, full year results for 2019 are expected to be at least in line with market expectations.

The Sheffield-based firm has seen revenue increase 26.6 per cent from £38.7m to £49m in 2019, according to unaudited accounts.

Adjusted earnings before interest tax depreciation and amortisation was slightly ahead of expectations at £14.1m, up 37.5 per cent on the previous year.

Sumo said its liquidity position remains robust with cash balances of £23.6m at March 24, 2020, which includes an amount of £10m drawn down on the company's £13m committed revolving credit facility.

The firm added that it has enjoyed a positive start to the new financial year and already has a high degree of earnings visibility on contracted or near contracted revenue of approximately 71 per cent.

The coronavirus crisis has led to some disruption and loss of efficiency as project teams were migrated away from the developer’s ten studios to remote cloud based working from home.The firm added that early indications are encouraging.

It expects a manageable level of disruption and loss of efficiency to continue, as the firm recalibrates its project management controls and internal management systems.

Paradoxically, the COVID-19 pandemic is expected to increase global video games software revenues, as people staying at home play more games.

As a result, the firm is expecting some improvement in royalty income on games already published and which have increased sales or usage with the current restrictions on movement in many countries.

Carl Cavers, CEO of Sumo Group, said: "Our people are adapting well to home working and we have a strong and resilient business with £23.6m cash and a relatively low risk business model.

“Demand for great video games content is forecast to grow and may even strengthen as a result of the ‘stay at home’ measures taken to protect our health through the COVID-19 pandemic.

“As such, we are confident in our strategy and ability to continue generating strong returns for our stakeholders in the longer term.

“We are grateful to our team for their resilience, our clients for their support and our investors for their forbearance."