Gfinity plc sees its gaming community increase to 45 million in February and looks to raise £2m to strengthen its balance sheet
(AIM: GFIN ) has joined the Vox Markets Crusaders index after highlighting 2H20 has started strongly with significant improvements in volumes of gamers. The Group reported 1H20 results saw a 45% improvement in operating loss and is now looking to strengthen its balance sheet further by raising £2m and shows it is on the flightpath to break-even.
Trading during the period was difficult with a number of contracts taking longer than expected to close. The Group therefore undertook a strategic review with regard to understanding where it has competitive advantage and has now adopted an “Agile” operating model aimed at reducing its annual cost base by 60%.
Post period end, the Group has reported that it has already seen increased levels of engagement across its digital platforms due to the restrictions placed on the movement of people across the globe. Importantly, the group is seeing increased demand for virtual gaming solutions that utilise Gfinity's production expertise, its ability to connect players in remote locations and its online tournament and content management platform.
The Group therefore believes it can withstand the anticipated operational disruption caused by the COVID-19 virus, despite physical events have been postponed at the Gfinity Arena, due to the significant increase in the number of sports rights holders and media companies in particular looking for virtual gaming solutions and content.
The Group is currently in discussions to secure a further £2m of funding, which if completed will provide a further supplement the year end cash position of £2.4m.
Shares in GFIN opened down 5% to 1.65p
John Clarke, CEO, said: "There has been significant positive momentum in the business especially in the areas of motorsport through our relationship with F1, our fast-growing Own Community franchise and our online tournament platform that successfully delivered the ePremier League.
“However, the business also encountered significant headwinds during the period with commercial contracts and strategic partnership conversations taking longer than expected to conclude. These headwinds have been compounded by the unprecedented impact of COVID-19. To realise the significant opportunity that exists for the business it was clear that we needed to make structural changes, significantly reduce our cost base and sharpen our focus on those areas where we are already enjoying success. This is what we have done, and we are now on a pathway to breakeven" Gfinity plc sees its gaming community increase to 45 million in February and looks to raise £2m to strengthen its balance sheet
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