Wednesday 21 August 2019

Keywords counts the cost of video game Fortnite


Buying: Keywords CEO Andrew Day is keen to make purchases in the engineering area
Buying: Keywords CEO Andrew Day is keen to make purchases in the engineering area
Ellie Donnelly

Ellie Donnelly

Popular computer game Fortnite negatively impacted revenue at Irish video game company Keywords Studios to the tune of more than €10m last year.

Keywords, which provides services to video game makers, saw some clients reduce their spending because of Fortnite's dominance of the industry.

Andrew Day, CEO of Keywords, said it was not easy to put an exact financial number on the game's overall effect on group income, but said it was "north of €10m".

"In 2018, Fortnite was elbowing its way into the video gaming market, I think it's more stable now," Mr Day said. "We now also provide five services to Fortnite from one."

Despite the Fortnite effect, revenue at the Dublin-based group jumped 66pc to €250.8m last year, fuelled by acquisitions. On a like-for-like basis, revenue increased 10pc.

Adjusted profit before tax increased by 65pc to €37.9m, according to annual results from the group.

Keywords finished the year with a net debt of €400,000, having ended 2017 with cash of €11m.

During the year the group acquired eight companies.

Mr Day said the group planned to purchase a similar number of businesses this year, with a focus on marketing, engineering and audio companies.

"Engineering is an area we like, it's a high-value service, and our investment in this area makes Keywords more relevant to our clients," he added.

In detailed results yesterday Keywords said its effective tax rate had decreased again in 2018.

The company added that it continues to make better use of its Ireland-based operational headquarters "in contracting and treasury management such that we expect our effective tax rate to continue to reduce despite our exposure to higher tax jurisdictions in most of the territories we operate in."

Looking to this year, the group said it had experienced an "encouraging start" to 2019.

Irish Independent

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