Keywords Studios


£1062.7m market cap

1643p last close

Keywords Studios is now the largest and most diverse supplier of outsourced services to the games industry. Through regular acquisitions, the company is building its scale, geographic footprint and delivery capability.

Investment summary

After three years in the role, David Broderick, Keywords’ CFO, will be stepping down as part of an orderly handover to be replaced by Jon Hauck, group financial controller of Rentokil Initial. With an expected M&A pipeline of €40–80m in 2019, we see no reason why Keywords’ formula of organic growth supplemented by M&A, should not continue to deliver and as Keywords executes its strategy, investors should get better visibility of the company’s continuing growth potential. We therefore expect the company to continue to trade at a premium to peers.

Y/E Dec
Revenue (€m)
PBT (€m)
EPS (c)
P/E (x)
P/CF (x)
2017A 151.4 26.6 23.1 30.0 61.1 50.3
2018A 250.8 44.2 37.9 45.8 40.0 30.6
2019E 298.9 51.3 44.1 54.3 33.7 35.4
2020E 334.7 57.3 49.4 60.9 30.1 33.0
Industry outlook

Keywords Studios operates in the global games sector, an industry where change and innovation are the norm. We believe that the dynamics of the industry remain attractive and looking ahead, we see sustained industry growth (c 9% to 2021), driven by ongoing digital transition and strategic investment in the sector (Streaming, eSports), as well as a continuing shift towards outsourcing for large projects.

Last updated on 25/07/2019
Share price graph
Balance sheet
Forecast net debt (€m) 5.6
Forecast gearing ratio (%) 2
Price performance
Actual (2.4) 6.3 (14.8)
Relative* (3.5) 5.8 (12.4)
52-week high/low 2065.0p/900.0p
*% relative to local index
Key management
Ross Graham Chairman
Andrew Day CEO
David Broderick FD

Content on Keywords Studios