U.K. Video Game Companies Shooting the Lights Out in 2019

U.K. Video Game Companies Shooting the Lights Out in 2019
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U.K. video game companies are on a tear, due to the growing number of online platforms bolstering revenue, according to Bloomberg.

Team17 Group reported an almost 50 percent year-on-year growth in revenue, and is now targeting potential acquisitions. “We’re in a very exciting industry, and it’s no secret growth in the games industry is phenomenal,“ Team17 Chief Executive Officer Debbie Bestwick said in an interview, adding that retail “was a tough world“ and digital distribution has been the major beneficial disruptor.

Shares of Wakefield-based Team17 have risen about 44 percent since May, and of the five analyst recommendations tracked by Bloomberg, three maintain a buy position while two advise to hold. Investor confidence is similar for other British video-game companies that have held initial public offerings within the past 18 months.

Shares of Codemasters, whose IPO was in June, are up more than 40 percent for the year; Sumo Group, public since December 2017, has gained 16 percent in the same period. The trend is being reflected across Europe too, with Rovio, maker of the Angry Birds mobile games, up more than 53 percent since the start of the year, despite warning investors in February of lower profits for the first half of 2019.

Team17, which produces the popular Worms franchise, reported its first full-year earnings since its IPO ten months ago. Sales increased 46 percent for the year ended Dec. to 43.2 million pounds, and adjusted earnings before taxes, interest, depreciation and amortization were up 18 percent to 15.3 million pounds.

Britain was the sixth-largest video-game market globally in 2018 according to data compiled by Newzoo, with an estimated 37.3 million gamers collectively spending $4.5 billion. The U.K. is also the origin of some of the world’s best-selling games, such as Grand Theft Auto V, which came out of Scotland’s Rockstar North studio, and is the third-most popular game of all time with more than 100 million copies sold worldwide.