Guild Esports PLC (LSE:GILD, OTCQB:GULDF) saw a surge in top-tier sponsorships deals take front and centre in the company’s annual results, which showcased £10.7mln in newly inked deals with global brands including Bitstamp, Coca-Cola, Sky UK and Samsung.
The total value of contracts signed by the London-listed competitive gaming group surged by 174% year-on-year, while total annual revenues increased by 137% to £4.5mln, reflecting a significant step up in sponsorship income.
The company’s total order book remaining to be recognised as revenue over the lifetime of signed contracts amounted to £9.2mln as of the year ending September 30, 2022.
Pre-tax losses decreased to £8.75mln from £8.82mln in 2021 despite a £1mln rise in administration costs amid ongoing investment in the business to drive long-term growth.
Net cash amounted to £2.73mln at the end of the period, though that was reduced to £1.6mln post-period end.
Period highlights and outlook
During the period, Guild Esports managed to renegotiate its brand ambassador agreement with David Beckham’s image rights company to reduce Guild’s total minimum payment obligations by £7.5mln over the next two years.
Another major period highlight was the opening of the 9,831 square foot Sky Guild Gaming Centre and Guild Academy in London’s Shoreditch, aimed at providing state-of-the-art physical space for budding players and for other commercial opportunities.
During the year Guild teams won five competitions and tournaments across Rocket League, Fortnight and FIFA.
Commenting in the results statement, the company’s chief executive Jasmine Skee said: “Guild delivered strong growth as we transformed our pipeline of potential sponsorship opportunities into revenues.
“The new year has started well with a lower cost base, a strengthened board and senior management teams, as well as a focus on expanding our revenue streams and audience, all of which place Guild in an excellent position to continue its positive momentum. We, therefore, look to the future with confidence.”
Looking forward, Guild expects an annual sponsorship revenue run rate of approximately £5mln at present while also implementing a stringent cost-rationalisation programme.
Annual cash burn is expected to fall significantly in 2023 reflecting a £2.5mln reduction in operating costs “We are mindful of the need to streamline our cost base to reduce the cash requirements of the business and accelerate our path to profitability. Accordingly, a significant rationalisation programme was implemented towards the end of the financial year,” the company said.
