Video games developer and publisher tinyBuild reported “strong” revenue growth of 39% in its preliminary results for 2021 on Tuesday, to $52.2m (£39.76m), “slightly ahead” of expectations.
The AIM-traded firm said that reflected a “strong performance” in the last part of the year from new titles, including Potion Craft, as well as back catalogue sales.
It reported record adjusted EBITDA of $22.2m for the 12 months ended 31 December, up 45% year-on-year, also slightly ahead of expectations.
The company’s margin expanded to 42.5% from 40.6% in 2020, primarily due to its ongoing shift towards own-intellectual property, versus third-party IP.
Operating profits increased 64% to $12.5m, as a result of lower share-based payment expenses.
Profit before tax and basic earnings per share also grew by “similar amounts”, by 63% to $12.5m and by 57% to 4.3 US cents, respectively.
Operating cash flows totalled $13.3m for the year, which was below the previous year’s record of $16.5m as a result of initial public offering costs of $5.5m.
Net cash at year-end on 31 December totalled $48.8m, compared to $26.3m at the end of 2020).
That was after accounting for gross proceeds of £36.2m ($50m) from the IPO, acquisitions, and a “significant increase” in development costs.
Looking ahead, tinyBuild described its pipeline for 2022 and beyond as “strong”, including the closed beta pre-orders for Hello Neighbor 2 that had seen a constant increase in the number of followers for more than a year.
The board said the implication of the invasion of Ukraine, and the “fluid macroeconomic situation”, imposed “caution and vigilance” in the medium and long terms.
In particular, it said it was carefully assessing the position of its staff, its exposure in terms of revenues, and other factors that could impact the business.
The directors said they remained confident the company was on track to deliver results at least in line with expectations, as well as accretive acquisitions.
“Last year has been an incredible ride, from the IPO to our largest deal ever with Versus Evil and Red Cerberus opening up new avenues of growth,” said chief executive officer Alex Nichiporchik.
“Our back catalogue has performed strongly, and we have an even more diverse revenue mix in terms of titles, genres, geography and audience.
“Our strategy to accumulate owned-IP has resulted in a strong financial performance and has translated into an improved profitability.”
Nichiporchik said a “growing pipeline” of high-quality titles set for release in the next two years – the majority of which were first- and second-party – meant the company could build more multi-game franchises and emulate the success of Hello Neighbor.
“It is great to see an enlarged fanbase engaging with Hello Neighbor 2, and we look forward with confidence to the closed beta pre-orders.
“With books, graphic novels, and early work for a potential animated television series, Hello Neighbor provides a template of how we might for many of our future games.
“Our goal is to expand our position as a leading global developer and publisher, focusing on IP ownership while creating long-term scalable franchises that will survive for generations regardless of the media.”
At 1156 BST, shares in tinyBuild were up 5.23% at 151p.