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Game firm Keywords Studios has €100m to fuel acquisition spree

Irish company also looking at increasing its office space in Dublin

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All to play for: CEO Andrew Day is happy with the integration of acquisitions

All to play for: CEO Andrew Day is happy with the integration of acquisitions

All to play for: CEO Andrew Day is happy with the integration of acquisitions

Irish video-game company Keywords Studios has more than €100m available to spend on acquisitions, according to the group's chief executive Andrew Day.

Speaking to the Irish Independent he said that analysts assume that the group will spend between €40m and €60m a year on acquisitions.

"This is a reasonable assumption unless we buy something bigger, and yes we have the firepower for this, we have a €105m bank facility," Mr Day said.

So far this year the group has made eight acquisitions, and looking forward it said that it was "selectively reviewing a strong acquisition pipeline".

Deals are being bolted on so that Keywords can offer the same mix of technology services to the gaming sector in all of the markets where it operates.

"The [acquisition] programme will be continuing into the future, due to the fragmented market place," Andrew Day said

"This makes sense as a lot of our clients are global, we are operating in 20 odd countries, we have done a lot of geographic expansion but we put don't provide full suite of services in all those countries, so there are always more opportunities [for acquisitions]," Mr Day said.

Yesterday, Keywords reported revenue of €110m in the six months to June 30. It closed 11 acquisitions in 2017.

The deals helped boost revenue by 72pc year-on-year.

On a like-for-like basis revenue was up 2pc year-on-year, and up 8.6pc on a constant currency basis, according to a trading update.

Mr Day also said that the group was looking at increasing its office space in Dublin.

Looking forward, the group said that technology and internet bandwidth improvements could enable streaming of video games for the first time which it believes will drive record demand for gaming content.

Overall, and on a like-for-like basis, revenue was up 2pc year-on-year to €110m, and up 8.6pc on a constant currency basis.

Adjusted profit before tax was up 67pc year-on-year to €16m.

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An interim dividend of 0.53p was also declared, up 10pc year-on-year.

Keywords also announced that Hollywood-based Sound Lab will be joining the group, while it separately announced the acquisition of The TrailerFarm for a total consideration up to £2m.

"We are particularly pleased with our performance in respect of acquisitions and their subsequent integration," Mr Day added.

Behind that acquisition spree is Keywords' view that it can tap into a reorientation of the games market around interactive streaming of content.

That mirrors the change companies like Netflix have experienced in the video market.


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