12 September 2023

Keywords Studios plc ("Keywords Studios", “Keywords”, the “Group”)
Half Year Results for the period to 30 June 2023

Good H1 trading performance, in line with guidance and growing ahead of the market
Keywords Studios, the international provider of creative and technology-enabled solutions to the global video games
and entertainment industries, is pleased to announce its unaudited half-year results for the six months to 30 June
2023.
Financial Overview:
Results for the six-months ended 30 June
Group revenue
Organic revenue growth

H1 2022

Change€ 383.5m€ 321.1m+ 19.4%+ 10.4%€ 77.3m
20.1%€ 60.5m€ 70.1m
21.8%€ 61.0m+ 10.3%€ 58.9m
15.4%€ 29.3m€ 56.0m
17.5%€ 39.5m+ 5.2%(25.8)%

55.60c18.48c55.89c36.80c(0.5)%(39.8)%

0.85p

0.77p

33.2%

57.9%

€ (11.4)m€ 121.3m

1Adjusted EBITDA
Adjusted EBITDA margin
EBITDA

2

Adjusted operating profit
Adjusted operating profit margin
Operating profit

3

Adjusted earnings per share
Earnings per share

42Interim dividend per share
Adjusted cash conversion rate

H1 2023

5

Net cash / (net debt)(0.8)%

Finance and Operating Highlights:
Good trading performance reflecting the benefits of diversification across full game development cycle
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•
•
•
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Group revenue up 19.4% to €383.5m (H1 2022: €321.1m), driven by robust organic growth andsupplemented by acquisitions
Organic revenue growth of 10.4%, driven primarily by strong growth in Create
Adjusted operating profit margin of 15.4%, in-line with guidance and H2 22 (H1 22: 17.5%), with adjusted
operating profit rising 5.2% to €58.9m
Adjusted free cash flow6 of €18.5m (H1 2022: €31.7m) due to timing of working capital
Adjusted cash conversion full year expectations unchanged at ~80%, H1 rate of 33.2% (H1 2022: 57.9%),
would have been ~16% pts higher but £7.5m of VGTR payments were delayed into Q3
Net debt of €11.4m (FY 2022: net cash of €81.8m) reflecting acquisition activity and EBT share buybacks
Interim dividend of 0.85p per share, an increase of 10% on the 2022 interim dividend (H1 2022: 0.77p)

Strategic Highlights:
Delivering against strategy and investing in technology offering••••

Strategic partner relationships increasingly opening long-term opportunities for collaboration
Increasing traction with AAA clients with our AI-led product families across Globalize and Engage
Expansion of Keywords Labs into an AI Centre of Excellence, with key hires madeGood progress in adjacent markets; strong growth in our LiveOps studio, launched a dedicated studio for
in-game cinematics and virtual production, with acquisition of DMM extending entertainment offering

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Executing on our acquisition strategy, delivering four high-quality acquisitions for a total maximum
consideration of ~€130m year to date
RCF increased to $400m, with maturity extended to 2027, providing long-term liquidity and flexibility to
pursue M&A opportunities in the pipeline
Positive recognition of ESG practices, with rating increased to AA at MSCI

Current trading and outlook
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•
•
•
•

Continue to grow faster than the market, with organic growth supplemented by acquisitions
Monitoring US entertainment strikes, which have begun to impact performance in early H2, with potential
to impact organic growth by around 2-2.5% for the full year
Expecting full year underlying organic growth (excluding the strike impact) to be broadly similar to the first
half, with H2 growth weighted to the fourth quarter; mindful of continuing currency volatility
Adjusted operating margins expected to remain above 15% for the full year, with cost control measureslargely mitigating the impact of the strikes
Remain confident in the long-term growth trajectory of the businessBertrand Bodson, Chief Executive Officer of Keywords Studios, commented:"Keywords delivered good H1 growth despite the current industry backdrop, benefitting from our focus on
strategic partnerships and our unique provision of solutions across the full game development cycle. We havecontinued to broaden our offering through high-quality targeted acquisitions and are excited about the pipelineahead. We are on track to deliver underlying organic growth (excluding the unfortunate impact of the US
entertainment strikes) and operating margins in line with our guidance for the year.
We are uniquely placed to capture the opportunities that technology advancement creates over time as it
constantly increases the bounds of possibility, leading to a proliferation of ever improving content as our clientsseek to engage the three billion gamers globally. We are excited about the opportunities that lie ahead and arebuilding for the future whilst we continue to grow market share and deliver against our plans for 2023 andbeyond.”Presentation and Webcast
A presentation of the full results will be made to analysts and investors at 9.00am this morning and the live webcast
can be accessed via this link: https://brrmedia.news/KWS_HY23
To register for dial in access, or for any enquiries, please contact MHP Group on keywords@mhpgroup.com.

For further information, please contact:
Investor Contacts:

Media Contacts:

Keywords Studios

MHP Group

Giles Blackham
Director of Investor Relations+44 7714 134 681
gblackham@keywordsstudios.com

Katie Hunt / Eleni Menikou /Charles Hirst+44 20 3128 8794
keywords@mhpgroup.com

Numis Securities
Nominated Adviser & Broker
Stuart Skinner / Will Baunton+44 20 7260 1000
About Keywords Studios (www.keywordsstudios.com)
Keywords Studios is an international provider of creative and technology-enabled solutions to the global video games
and entertainment industries. Established in 1998, and now with over 70 facilities in 26 countries strategically locatedin Asia, Australia, the Americas, and Europe, it provides services across the entire content development life cycle
through its Create, Globalize and Engage service lines to a large blue-chip client base across the globe.
2Keywords Studios has a strong market position, providing services to 24 of the top 25 most prominent games
companies. Across the games and entertainment industry, clients include Activision Blizzard, Bandai Namco,
Bethesda, Electronic Arts, Epic Games, Konami, Microsoft, Netflix, Riot Games, Square Enix, Supercell, TakeTwo,
Tencent and Ubisoft. Recent titles worked on include Starfield, Diablo IV, Hogwarts Legacy, Elden Ring, Fortnite,
Valorant, League of Legends, Clash Royale and Doom Eternal. Keywords Studios is listed on AIM, the London Stock
Exchange regulated market (KWS.L).
The Group reports a number of alternative performance measures (APMs) to present the financial performance of the business
which are not GAAP measures as defined by International Financial Reporting Standards (IFRS). The Directors believe thesemeasures provide valuable additional information for the users of the financial information to understand the underlying trading
performance of the business. In particular, adjusted profit measures are used to provide the users of the financial statements aclear understanding of the underlying profitability of the business over time. For full definitions and explanations of thesemeasures and a reconciliation to the most directly referenceable IFRS line item, please refer to the APMs section at end of thestatement.
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Organic revenue at constant exchange rates is calculated by adjusting the prior year revenues, adding pre-acquisition
revenues for the corresponding period of ownership, and applying the 2022 foreign exchange rates to both years,
when translating studio results into the euro reporting currency.
EBITDA comprises Operating profit as reported in the Consolidated statement of comprehensive income, adjusted foramortisation of intangible assets, depreciation and impairment, and deducting bank charges. Adjusted EBITDA
comprises EBITDA, adjusted for share-based payments expense, costs of acquisition and integration and noncontrolling interest. In order to present the measure consistently year-on-year, the impact of other income is also
excluded.
Adjusted operating profit consists of the Operating profit as reported in the Consolidated statement of comprehensive
income, adjusted for share-based payments expense, costs of acquisition and integration, and amortisation of
intangible assets. In order to present the measure consistently year-on-year, the impact of other income is also
excluded.
The Adjusted earnings per share comprises the Adjusted profit after tax divided by the non-diluted weighted average
number of shares as reported. The Adjusted profit after tax comprises the Adjusted profit before tax, less the Taxation
expense as reported in the Consolidated statement of comprehensive income, adjusted for the tax impact of theadjusting items in arriving at Adjusted profit before tax.
The Adjusted cash conversion rate is the Adjusted free cash flow as a percentage of the Adjusted profit before tax.
Adjusted free cash flow is a measure of cash flow adjusting for capital expenditure that is supporting growth in future
periods (as measured by capital expenditure in excess of maintenance capital expenditure).

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CEO Statement
Performance
The business performed well over the first half of the year delivering revenues of €383.5m, representing growth of
19.4%. Organic revenue growth of 10.4% was in line with guidance and reflected the current market backdrop, with
the industry in a reset year, having experienced exceptional growth over the past few years. We have continued to
grow market share in the first half, with our overall growth being faster than the expected mid-single digit growthin the external service provision market this year (Source: IDG Consulting).
Operating margins, as expected, were in line with the second half of 2022 at 15.4%, which meant that the businessdelivered adjusted operating profit of €58.9m (operating profit was €29.3m). This was 5% higher than H1 2022,
despite the higher margin experienced in the comparative period, as we continued to invest in the business andpre-COVID-19 costs fully returned.
Last year we consolidated our business in a simplified structure of three service lines. The performance of eachsegment, which will be discussed in more detail later in this report, reflected the varied conditions in the market. We
saw strong demand in Create, and more moderate demand in our Globalize and Engage service lines, but we remain
confident in the long-term opportunity across all of our service offerings.
We continued to invest in growing the platform through M&A, supported by our strong balance sheet and recently
expanded revolving credit facility. In H1 we spent approximately €92m on four high-quality acquisitions (net of cash
acquired), representing the total of the cash component of both the current and previous years’ transactions. As aresult we moved from a net cash position of €82m at December 2022 to a net debt position of €11m. Cashgeneration is generally H2 weighted, and due to our investment in the business, and timing of working capital, wedelivered H1 adjusted free cash flow of €18.5m. We remain on track to deliver full year adjusted cash conversion of~80%.
Market opportunity
After a number of extremely strong years of growth, 2023 is proving to be a year where the video gaming industry
pauses for breath. Whilst major titles such as Hogwarts Legacy, Diablo IV and Baldur’s Gate 3, have delivered
record performance (Keywords worked on all three), and overall player numbers continue to rise, the broader
industry is currently seeing publishers reducing the number of game launches and focusing on core IPs. They havealso looked to de-risk their return on investment, which has led to smaller scopes for some titles and delays orcancellations of others.
Beyond 2023, we are increasingly optimistic about the market back-drop. The mobile market, which has been
through a difficult period, appears to be close to returning to growth after 6 consecutive quarters of declines.
Hardware challenges have also eased, with the PS5 now readily available. Industry forecasts point to continuinglong-term growth in the video-gaming space, with growth in the external service provision market still expected to
outstrip overall industry growth.
As the key player in this market, at more than 3x the size of the next largest competitor, yet with just a 6% share,
we believe we are incredibly well placed to grow our market share into the significant white space in the industry.
To do so, we are driving strategic partnerships with the key market players, and investing in leading technology
solutions to better serve our customers and enhance our economic and technology moat against competitors.
Delivering against strategy
Against that market backdrop, we have a very clear strategy from which to scale our industry leading platform, by
Imagining More across our strategic pillars: strategic partnerships, technology, One Keywords, talent development
and adjacent markets. The ultimate goal is to become a true partner to our clients and to create a platform
providing holistic solutions to enable them to make the best games and entertainment.
We are making good progress against all aspects of the strategy. We have continued to get closer to our largest
clients as we seek to evolve our relationships to more strategic partnerships. This is giving us the opportunity tosupport our clients on larger, long-term projects and we have recently completed several substantial long-term
agreements to provide functional testing and game development services. This is a continuous process, but isincreasingly important and will differentiate us in the market, as we look to help our clients to navigate the evolving
technological landscape and create bigger and better games. We have increased our focus on technology, scaling
our AI product portfolio, whilst driving automation across service lines and launched our “Accelerating
Accessibility” initiative out of our innovation team, harnessing the work of five studios.

4We launched and embedded our new Leadership Principles across the organisation, a critical element of our One
Keywords initiative and during the period Sperasoft completed its transition into four new operating hubs inEastern Europe, with production in Russia ceasing. This has been a major One Keywords undertaking, with a multidisciplinary team from across the organisation working together to make this a success. We are now excited to see
Sperasoft 2.0 ready to move back into a growth phase from its four new hubs.
We continued to broaden our talent acquisition and development programmes, as well as continuing to enhance
our employee engagement. In addition, we have continued to bring senior talent into the organisation, with Rob
Kingston joining the Group as CFO in July, with Jon Hauck moving across to the COO role to support the long-term
growth of the business. In August, we hired Stephen Peacock as Head of Gaming AI, to spearhead our AI Centre of
Excellence and expect further hires to follow in due course.
Our progress in adjacent markets has also been very encouraging, with Lively, our dedicated LiveOps studio,
experiencing strong growth and demand from a wide variety of clients, and at the end of the period we launched
Big Farmer, a dedicated studio focused on in-game cinematics and virtual production to capitalise on the broader
opportunities that our mastery of game engines will provide. We have also extended our media and entertainment
offering in the US, through the acquisition of Digital Media Management, who work with some of the world’s
biggest franchises, including the recent Barbie movie, to enhance their reach online and in social media. With theconvergence of gaming and film and television, we see meaningful opportunities ahead for us.

Focus on Technology
Technology and innovation is a key part of our strategy and a big opportunity for future growth. We have had afocus on responsibly harnessing AI and other technologies for a number of years and it is part and parcel of what
our 4,000 dedicated engineers and technical experts in Create do every day. The teams have a strong track recordof unlocking and deploying multiple generations of new technologies and supporting the industry’s “race to thetop” to create the most immersive experience for players.
Through a combination of M&A and internal development, the business has also been building a portfolio of AI-led
product families that meet critical post-production client needs whilst complementing our existing service
offerings. These offerings, which span across the key Globalize and Engage offerings, such as functional testing,
localization, localization testing and player support, are designed so that we can do more, faster, whilst enhancing
the quality of service for clients.
There are a number of workstreams underway across each of these domains. In Localization, at the beginning of
the year, we formed our Localization Research Labs team to accelerate this work. This team has a broad mandateof ensuring that we are developing and delivering leading production offerings to clients, whilst pursuing internal
automation opportunities within text and audio localization and localization QA. The team now has over 60 productengineers and in the last 6 months has developed and enhanced a range of AI-led tools that will be marketed underthe “Kantan” brand. KantanStream, a text localization workflow automation tool, currently in use to complete over
3,000 projects a week, is gaining traction with AAA clients and continues to be developed to support their differingneeds. The move to this innovative way of working will continue in H2 and beyond. KantanAudiomate, which
manages and stores audio digital assets, whilst automating and enhancing audio workflows, is currently being
piloted by a further AAA client, and in H2 will integrate an innovative internally developed AI-tool that has thepotential to reduce QA/QC requirements on audio files significantly.
We have also made great strides in developing the Mighty Build and Test platform (“Mighty”) in the 12 months wehave owned the business. A small Australian based business, Mighty has a 10 year track record in the automatedtesting and development of mobile games space. On acquisition, they had four developers in Australia, operating
solely on the Unity game engine, with a number of small mobile clients. In the past 12 months, we have grown theteam to 40 people across 5 countries, developed the platform to be able to work on Unreal Engine as well as any
custom engine, and started to take on larger AAA mandates. Clients are increasingly seeing the benefits that
automated testing, earlier in the development cycle can bring to the quality of the game, whilst still utilising humantesters to test other elements of games.
We are increasingly seeing our solutions becoming interconnected. An example of this is one of Mighty’s
automated testing solutions, the Proofbot, which provides a localization testing solution, now being integrated with
XLOC, our proprietary localization content management system. Together they provide a visual overview of all of
the localized content in a game, and enhance the testing of that content. A further example is of the integration of
KantanMT with the Helpshift platform in player engagement, enabling more languages to be supported throughthe platform, and for mono-lingual customer support agents to be able to support multiple languages. This holistic
solution enabled us to reduce our cost to serve a major mobile client by increasing efficiency, whilst maintaining
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excellent customer satisfaction scores. Our scale and ability to invest means that we have a leading position fromwhich to create joined up solutions like this.
As we move forward we will continue to build out an industry leading technology platform to enable us to take on
more work and better serve our clients. This will be both under the existing product umbrellas of Kantan, Mighty
and Helpshift, and by looking for new ways to support our customers, whether by owning, partnering or licensing
the technology and tools that are best suited to the tasks that our clients need us for. In order to do this aseffectively as possible, we are creating an AI Centre of Excellence, that will sit within our innovation team, led by
Jamie Campbell. This team will draw on both internal and external expertise to assess and develop AI tools acrossthe game development landscape, providing a conduit for knowledge sharing across the organisation andsupporting customers in building their AI strategies. To support this initiative, we are delighted to have made thekey hire of Stephen Peacock as Head of Gaming AI, previously at Amazon as Head of ML/AI of AWS Gaming, whobrings unparalleled knowledge across the gaming value chain from an integral player in the industry.
M&A
Complementing our strategy, we continue to add significant value by consolidating a fragmented market in ourfour M&A focus areas: game development, marketing, technology and adjacent markets. During the first half, theGroup completed four high-quality acquisitions, for total maximum consideration, including performance related
contingent deferred consideration, of ~€130m.
In line with our focus areas, two acquisitions broadened our Engage offering in the US, the largest global market
for gaming, 47 Communications and Digital Media Management (DMM), with both enhancing our media andentertainment offering, and DMM bringing market leading social media capabilities and an innovative Creatorfocused technology platform. In game development we acquired Hardsuit Labs, a 70-person studio focused on
AAA games and specialising in the Unreal engine. In addition, we expanded our Climax game development studiothrough the acquisition of Playboss Interactive in the UK, providing Climax with a second location to grow from.
Responsible BusinessOur responsible business agenda is centred around five key areas; our people, planet, community and our clients,
underpinned by our commitment to good governance and ethics. We have made solid progress against our mainpriorities in the first half, with a range of initiatives designed to enhance culture, employee engagement anddiversity and inclusion. These included our third Women’s Summit held in Asia, growth of the ambassador
programme with Women in Games, and a range of Keywords diversity and inclusion trainings. Aligned to this, we
continued to roll-out our Leadership Principles, which are designed to support the One Keywords culture acrossthe group and stepped up employee engagement ranging from group wide townhalls to small bespoke sessions
with the CEO. In May, we celebrated 25 years of Keywords by planting 25,000 trees across the world and havecontinued to win a range of Best Company to work for awards in a number of locations. Our progress against ourpriorities has been increasingly recognised by third party rating agencies, with MSCI now rating the business AA,
the joint highest rating in our category.
US Entertainment Strikes
In the US, there are currently a number of entertainment union strikes, that have begun to have an impact on our
performance in certain parts of the business. These strikes started as a SAG-AFTRA writers’ strike in May, which
had limited direct impact on our business. In July, the strikes expanded to include SAG-AFTRA actors, and stopped
work which was already underway. This has a more direct impact on our media and entertainment focused audio
businesses and our US marketing studios, who due to the increasing cross-over between video gaming and TV/film
work with a range of entertainment houses. A third segment of the entertainment industry, the SAG-AFTRAInteractive Media performers, focused on video games, are currently balloting for strike action. If successful, strikeaction could commence at the end of September, although would have limited direct impact for this year as the
majority of our audio localization work is done outside of Hollywood. At this stage it is not clear when the strikes will
be resolved, but for planning purposes, we assume that they will lead to disruption until the end of the year.
OutlookDespite the current challenging industry backdrop and macroeconomic conditions, the Group is trading robustly
and growing faster than the market, reflecting our position as a diversified enabler of the industry, providing
services and solutions across the content generation cycle rather than being exposed to the IP of individual games.
Over the medium-term we remain uniquely placed to capture the opportunities in our markets, due to our scale
and provision of diversified solutions for the major developers and publishers of the highest quality franchises. We
are gaining traction with cementing strategic partnerships with our clients, harnessing and broadening our AI-led
6product suite, and expanding our activities in adjacent markets. We have also extended our offering through highquality targeted acquisitions and continue to have a busy pipeline, with our recently expanded RCF providing
enhanced flexibility to execute our M&A strategy.
We are excited about the opportunities ahead, as new technologies lead to a proliferation of ever improving
content as our clients seek to engage the three billion gamers globally. We expect to continue to grow our market
share whilst investing to harness the symbiosis of cutting-edge technology and human creativity to lead thecontent creation industries in the future and create significant value for shareholders.”
Bertrand Bodson
Chief Executive Officer

7Service Line Review
CreateCreate combines Art Services and Game Development to deliver a range of services to clients and partners globally. It
represents over 4,000 people across 4 continents.

H1 2023

H1 2022*

ChangeRevenue €m

162.9

124.3

31.1%

Organic Revenue growth %

22.1%

23.3%

(1.2%)

41.7

32.4

28.7%

25.6%

26.1%

(0.5%)

Adjusted EBITDA €m
Adjusted EBITDA margin %*H1 2022 restated to reflect updated FY 2022 allocation of costs, please see note 4 for more information

H1 2023 Performance
Create performed strongly during the first half, with total revenues up by 31.1% to €162.9m (H1 2022: €124.3m) and
Organic Revenue, which excludes the impact of acquisitions, growing by 22.1%, as we continued to see strong
demand for our high-end services.
The performance was driven by growth in a number of regions, with the UK and Australia seeing excellent growth,
as increased headcount enabled our studios to take on more work. In Australia, we have seen the business growfrom zero to over 200 game developers in recent years through both acquisitions and organic growth. Our Art
studios also performed strongly across the period, as the high-end art that we provide across both our concept art
and asset production businesses remained in demand.
Whilst there have been industry lay-offs over the past six months, high-quality talent continues to be a scarce
resource. Our recently formed talent acquisition team, in tandem with studio-led efforts, and our academy
initiatives, have driven the continued expansion of our team across our various geographies, enabling us to bettersupport clients and our future growth.
During the period Sperasoft completed its transition into four new operating hubs in Eastern Europe. This was amajor undertaking, and we are delighted that we were able to complete this with limited disruption to our clients.
The business is now well positioned for future growth, and we are taking advantage of the access to high quality
talent in the new regions and began to take on new work during the half.
Adjusted EBITDA in Create grew 28.7% to €41.7m in H1 2023 (H1 2022: €32.4m), with the Adjusted EBITDA marginof 25.6% in H1 2023 slightly lower than the previous period (H1 2022: 26.1%) due to the increased footprint outsideof Russia, partially offset by the increased weighting of game development in the service line following theacquisitions in 2022.
We welcomed two new Game Development studios this year, Hardsuit Labs, in Seattle, and Playboss Interactive inLiverpool. Hardsuit has deep expertise in Unreal Engine, delivering full-stack development services, and multi-SKU,
cross-platform execution to AAA clients such as Activision and Epic and is our first game development studio in
Seattle. Playboss is a small UK studio that has worked closely with Climax, one of our largest UK studios, for anumber of years. The acquisition allows Climax to expand to a second UK location in a vibrant, city centre gamedevelopment hub and to continue its growth trajectory.
Outlook
Our Create service line remains extremely well positioned to capitalise on the strong demand for its high-end
services. The industry continues to be capacity constrained and our geographic spread and ability to grow capacity
means we are able to serve our clients as they look for support on more and more complex projects.
We believe Generative AI will be used as another tool to enable the production of more and higher quality content
over time, although copyright and quality concerns are currently a barrier to adoption for AAA publishers. The
scale and depth of our engineering and technical expertise in Create means we are uniquely well placed to harness
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this when clients are ready. Together with other technology advancements these tools will be able to augment thecreativity of our clients and teams, and enable the delivery of ever more content.

Globalize
Globalize brings together our Audio, Testing and Localization businesses to create a global business with around
5,500 people across 5 continents.

H1 2023

H1 2022*

ChangeRevenue €m

145.7

141.5

3.0%

Organic Revenue growth %

4.7%

25.7%

(21.0%)

Adjusted EBITDA €m

27.7

29.6

(6.4%)

19.0%

20.9%

(1.9%)

Adjusted EBITDA margin %*H1 2022 restated to reflect updated FY 2022 allocation of costs, please see note 4 for more information

H1 2023 Performance
Globalize performed robustly in H1 2023 with total revenues up by 3.0% to €145.7m (H1 22: €141.5m). Organic
Revenue, which excludes the impact of acquisitions, grew by 4.7%, outperforming the market, which is forecast to
decline this year (Source: IDG).
The current industry backdrop, where there have been a number of project cancellations and delays, has impacted
the performance of Globalize as the service line works across a large number of clients and titles given its strong
position in the market. Functional testing continued to deliver robust results, with growth in lower cost locations
such as Poland and with our operations in Mexico beginning to scale up. Localization and Localization QA had atougher period, with clients looking to reduce costs by only focusing on key languages where the best returns
could be generated. Audio delivered a solid performance given the current game release cycle, but this comparednegatively to an exceptional H1 2022 performance. We saw limited impact in the first half from the entertainment
industry strikes in the US, but they have begun to impact our H2 performance in our media and entertainment
audio business.
We continue to build for the future and during the period have expanded our technology offering within Globalize.
Mighty Games’ “Build and Test” solutions can operate across both FQA and LQA and we are seeing positive traction
with clients looking to pilot the technology in order to automate certain elements of the testing process. We havealso made excellent progress through our Localization Research Labs initiative, to build on the initial success of
KantanStream’s automated localization solution with a large industry player. We are in the process of transitioning
a number of existing text localization clients to KantanStream, which will enable us to offer a more streamlined
service, with faster turnaround times, and take on more work, as well as building out other audio localization
solutions under the Kantan brand that are already being utilized by large clients.
Adjusted EBITDA of €27.7m was 6.4% lower than H1 2022 (€29.6m), with Adjusted EBITDA margins of 19.0% slightly
lower than H1 2022 (20.9%). Margins were expected to normalise following exceptional demand in 2022, and were
impacted by the lower utilization of resources compared to the prior year, as we maintained our capacity to beready to take advantage of future improvements in market conditions, and with pricing currently more of a focus
for clients.
OutlookGlobalize’s position within the industry means that it is well placed to benefit when the content cycle turns, and as
publishers increasingly move from fixed to variable costs for their testing operations. We continue to look to
optimise costs and collaborate across the service lines to offer the best service to customers. As we continue tobuild out our technology offering to augment the service we offer, we are increasingly differentiated in the market.

9EngageOur Engage service line brings together our Marketing Services and Player Engagement businesses to create aholistic offering focused on player engagement, encompassing around 2,500 people across 3 continents.

Revenue €mOrganic Revenue growth %Adjusted EBITDA €m
Adjusted EBITDA margin %H1 2023

H1 2022*

Change

74.9

55.3

35.4%

-

9.8%

(9.8%)

7.9

8.1(2.5%)

10.5%

14.6%

(4.1%)*H1 2022 restated to reflect updated FY 2022 allocation of costs, please see note 4 for more information

H1 2023 Performance
Engage saw good overall growth during the year, with revenues up by 35.4% to €74.9m (H1 22: €55.3m) driven by
a number of acquisitions as we built out the capabilities of the service line. Organic Revenue, which excludes theimpact of acquisitions, was flat year on year.
Player Engagement is primarily focused on supporting player communities of mobile titles and saw a contraction indemand as the broader mobile market continued to experience a reduction in player spend. This meant thatcertain clients reduced the scale of the teams working on their games to reflect the reduced activity. New businesswins through the year mitigated a portion of the reduced demand, and we have continued to see positive traction
for our Helpshift solution, which we acquired in late 2022. Helpshift, uses intelligent bots integrated in mobile apps
and consoles to automate ~30% of support tickets in real-time, while giving a highly personalised experience andtogether with our player engagement teams, and our KantanMT solution, provides a unique holistic offering forclients.
In Marketing we experienced a tougher period, as the macro-economic environment meant that publishers looked
to reduce activity, and we saw a number of late notice delays of projects from the first half into the second half.
During the period, we saw increased collaboration across the studios following the creation of a London marketing
hub, where we brought all of our studios into one office, and are following the same model in Los Angeles where
we now have three major studios offering differentiated services.
We were delighted to bring two high quality studios into the service line during the period, with Digital MediaManagement and 47 Communications greatly enhancing our social media and PR offering respectively. During theperiod we also enhanced our client service offering, by expanding the team, and are looking to provide a more
holistic offering to our clients, taking advantage of the breath of our capabilities following our recent acquisitions.
Adjusted EBITDA of €7.9m was 2.5% lower than H1 2022 (€8.1m), with the Adjusted EBITDA margin of 10.5% behindthe prior year period (H1 2022: 14.6%). Margins were impacted as the business has relatively fixed costs and wasscaled for growth, but experienced lower utilisation rates as projects were delayed. We have implemented cost
control measures in certain studios and are exploring broader cost saving initiatives across the service line, whilst
retaining our capacity to support growth in future periods.
Outlook
We continue to scale the Engage service line, by building out the full-service capabilities of the marketing offeringand by creating a holistic technology-enabled player engagement offering through the addition of Helpshift’s
automated solutions. Marketing experienced a number of project delays into H2 and has a strong pipeline of workfor the period, although is being impacted by the ongoing entertainment strikes through its US studios, and themobile market, which drives Player Engagement demand, appears to be improving following a period ofcontraction.

10

Financial and operating overview
Revenue
Revenue for H1 2023 increased by 19.4% to €383.5m (H1 2022: €321.1m). This performance included the impact ofacquisitions in 2022 and H1 2023 and a ~2% headwind from the impact of currency movements, when translating
studio results from local currency into the euro reporting currency.
Organic Revenue growth (which adjusts for the impact of acquisitions) was 10.4%. This was driven by continuing
strong performance in Create, offset by more muted performance in Globalize and Engage. Further details of the
trading performances of each of the Service Lines are provided in the Service Line Review.
Gross profit and margin
Gross profit in H1 2023 was €145.2m (H1 2022: €124.5m) representing an increase of 16.6%. The gross margin of
37.9% was slightly below H1 2022 (38.8%) due to lower than planned utilisation rates in the short-term in Globalize
and Engage.
Operating costs
Adjusted operating costs increased by 24.8% to €67.9m (H1 22: €54.4m), reflecting the larger Group, but at 17.7%of revenue were in line with H2 2022, although slightly higher than H1 2022 (16.9%). This was due to continuing
investment in the business, the larger office footprint post COVID-19, and the return to normal of travel andbusiness development costs.
EBITDAEBITDA of €60.5m was in line with H1 2022 (€61.0m). Adjusted EBITDA increased 10.3% to €77.3m comparedwith €70.1m for H1 2022. The Adjusted EBITDA margin in H1 2023 of 20.1% was slightly lower than H1 2022
(21.8%), as expected, reflecting the lower gross margin.
Net finance costs
Net finance costs of €6.1m compared to H1 2022 of €0.4m. The increase was primarily driven by a €3.7m negativeswing in foreign exchange movements, and €1.6m increase in interest costs relating to the drawdown on the RCF.
Alternative performance measures (APMs)
The Group reports a number of APMs to present the financial performance of the business which are not GAAP
measures as defined by IFRS. The Directors believe these measures provide valuable additional information for theusers of the financial information to understand the underlying trading performance of the business. In particular,
adjusted profit measures are used to provide the users of the financial statements a clear understanding of theunderlying profitability of the business over time. A breakdown of the adjusting factors is provided in the tablebelow:
H1 2023€m

H1 2022€m

Share-based payments expense

9.4

8.9

Costs of acquisition and integration

7.3

1.3

Amortisation of intangible assets

12.8

7.5

Foreign exchange and other items

3.1

(2.0)

32.6

15.7

Total

A total 1.21m options were granted under incentive plans in H1 2023. This, together with grants from previous years,
has resulted in a non-cash share-based payments expense of €9.4m in H1 23 (H1 2022: €8.9m).
One-off costs associated with the acquisition and integration of businesses amounted to €7.3m (H1 2022: €1.3m),
mainly due to an increase in deferred consideration related to continuing employment of €4.2m, and restructuring costs associated with exiting Russia of €1.3m. Amortisation of intangible assets increased by €5.3m to€12.8m (H1 2022: €7.5m).
11Foreign exchange and other items amounted to a net loss of €3.1m (H1 2022: gain of €2.0m). This includes €1.8m
for the unwinding of discounted liabilities on deferred consideration (H1 2022: €1.5m) and a net foreign exchange
loss of €1.3m (H1 2022: gain of €2.4m). Keywords does not hedge foreign currency exposures in relation to net
current assets. While more material movements in foreign exchange can be impactful on revenues and expenses,
the net impact on the Group's results of movements in exchange rates and the foreign exchange gains and losses
incurred during the year mainly relate to the effect of translating net current assets held in foreign currencies.
A more detailed explanation of the measures used together with a reconciliation to the corresponding GAAP
measures is provided in the APMs section at the end of the report.
Operating Profit
Operating profit of €29.3m in H1 2023, was 25.8% lower than H1 2022 (€39.5m). Adjusted operating profit, which
adjusts for the items described in the APMs section above increased to €58.9m, 5.2% ahead of H1 2022 (€56.0m).
Adjusted operating profit margin of 15.4% was in line with guidance, and largely in line with the margins achieved in
H2 2022, as we continue to invest into the business, albeit behind H1 2022 (17.5%).
Profit before taxation
Profit before tax of €23.2m in H1 2023 was 40.7% lower than H1 2022 (€39.1m). Adjusted profit before tax, which
adjusts for the items described in the APMs section above increased to €55.8m, slightly ahead of H1 2022(€54.8m). This reflects a reduction in the Adjusted profit before tax margin to 14.6% from H1 2022 of 17.1% due tolower Adjusted Operating margins and increased interest payments linked to acquisition activity.
Taxation
The tax charge reduced to €8.7m from €10.9m in H1 2022, largely reflecting the reduction in the Profit before taxof the business. After adjusting for the items noted in the APMs section above and the tax impact arising on these
items, the Adjusted effective tax rate for H1 2023 was 21.7%, slightly below the rate of 22.0% in H1 2022.
Earnings per share
Basic earnings per share of 18.48c was lower than H1 2022 (36.80c), primarily reflecting the reduction in thestatutory Profit after tax. Adjusted earnings per share, which adjusts for the items noted in the APMs section above
and the tax impact arising on these items was 55.60c (H1 2022: 55.89c), flat year-on-year, with both Adjusted profit
before tax and the basic weighted average number of shares largely in line with the previous year.
Cash flow and net debt

H1 23
€m

H1 22
€m

Change€m

Adjusted EBITDA

77.3

70.1

7.2

MMTC and VGTR

(16.6)(10.4)(6.2)

Working capital and other items(20.9)(12.7)(8.2)

Capex – property, plant and equipment (PPE)(18.8)(10.0)(8.8)

Capex – intangible assets

(1.3)

(0.2)

(1.1)

Payments of principal on lease liabilities

(6.8)

(5.5)

(1.3)

Operating cash flows

12.9

31.3

(18.4)Net interest paid

(2.2)

(0.8)

(1.4)

Free cash flow before tax

10.7

30.5

(19.8)

Tax

(7.9)

(6.2)

(1.7)

Free cash flow

2.8

24.3

(21.5)

12

M&A – acquisition spend(88.9)(13.6)(75.3)

M&A – acquisition and integration costs

(3.0)

(1.3)

(1.7)

Funding EBT Purchases

(4.7)

-

(4.7)

-

1.1

(1.1)

Dividends paid

(1.5)

(1.3)

(0.2)

Shares issued for cash

1.4

2.4

(1.0)

(93.9)

11.6(105.5)

0.7

4.1

(3.4)

Increase in net cash / (debt)(93.2)

15.7(108.9)Opening net cash / (debt)

81.8

105.6

Closing net cash / (debt)(11.4)

121.3

Other income and other items

Underlying increase / (decrease) in net cash / (debt)
FX and other items

The Group generated Adjusted EBITDA of €77.3m in H1 2023, an increase of €7.2m from €70.1m in H1 2022. There
was a €6.2m increase in respect of the amounts due for Multi-Media Tax Credits (MMTCs) and Video Game Tax
Credits (VGTRs), higher than H1 2022 (€10.4m), as we saw delays to the receipt of historic VGTRs that had been
expected in H1 2023 and were subsequently received in Q3 2023. In general, MMTCs and VGTRs are subsidies thatare recognised as work is performed but are typically paid in the second half of the following year. Other working
capital saw an outflow of €20.9m, an €8.2m change from H1 2022, mainly due to an increase in trade receivables
and accrued income.
Investment in property, plant and equipment increased by €8.8m to €18.8m (H1 2022: €10.0m) as we continued toinvest in the footprint of the business, the new sites required to exit Russia, and took advantage of favourable
pricing to purchase longer-term software licences. In addition, we incurred €1.3m of capitalised research anddevelopment costs as we developed our technology platform. Property lease payments of principal of €6.8m were
€1.3m higher than the prior period (H2 2022: €5.5m) mainly related to acquisitions in the period.
Operating cash flows of €12.9m were behind H1 2022 (€31.3m), primarily due to the change in working capital andthe increased capex during the period.
There was a €1.7m increase in cash tax paid to €7.9m (H1 2022: €6.2m) as payment schedules return to a morenormal pattern. Net interest payments, which largely relate to interest from drawdowns on the Revolving Credit
Facility (RCF), were €2.2m compared to €0.8m in H1 2022.
This resulted in Free cash flow of €2.8m, €21.5m behind H1 22 (€24.3m). Adjusted free cash flow, which adjusts forcapital expenditure that is supporting growth in future periods was €18.5m in H1 2023, behind H1 2022 (€31.7m).
The Adjusted cash conversion rate of 33.2% was below H1 2022 (57.9%), but would have been approximately 49%
without a delay in receipts of expected VGTR in the UK, which have now largely been received in Q3.
Cash spent on acquisitions totalled €91.9m, of which €12.7m was in respect of the cash component of prior year
acquisitions and €3.0m was in relation to acquisition and integration costs. This was €77.0m higher than the spendin H1 2022 due to the timing of acquisitions.
This resulted in a reduction in net cash of €93.2m in H1 23, leading to closing net debt of €11.4m (Dec 2022: net
cash €81.8m).
Balance sheet and liquidity
The Group funds itself primarily through cash generation and a syndicated RCF. In July 2023, the Group put inplace a new RCF of $400m that matures in July 2027, replacing the previous €150m facility. The new RCF includes
an accordion option to increase the facility up to $500m and an option to extend the term by a further one-year
period (both subject to lender consent). The majority of Group borrowings are subject to two financial covenants
that are calculated in accordance with the facility agreement:13

Leverage: Maximum Total Net Borrowings to Adjusted EBITDA ratio of three times; andInterest cover: Minimum Adjusted Operating Profit to Net Finance Costs ratio of four times.
The Group entered the year with a strong balance sheet and deployed €96.6m of cash in the period to support its
value accretive M&A programme and share purchases on behalf of the Employee Benefit Trust. As such at the endof H1 2023, Keywords had net debt (excluding IFRS 16 leases) of €11.4m (31 December 2022: net cash of €81.8m)
and undrawn committed facilities of $340m. The undrawn facilities, together with cash generation leaves us wellplaced to continue to execute on our M&A programme.
Capital Allocation
The Board is pleased to declare an interim dividend of 0.85p per share (H1 2022: 0.77p) representing an increase of
10.0% on the 2022 interim dividend. This is in line with the Board's progressive dividend policy which seeks toreflect the Group's continued growth in earnings and strong cash generation, balanced with the need to retain the
resources to fund growth opportunities, particularly M&A, in line with our strategy.
Payments will be made on 27 October 2023 to shareholders on the register on 6 October 2023 and will go exdividend on 5 October 2023. The interim dividend payment will represent a total cost of approximately €0.8m of
cash resources.
Keywords has authorised the Link Market Services Trustees Limited (‘Link’) to operate a Dividend Reinvestment
Plan (DRIP) for the Group’s shareholders for the interim dividend and going forward, to provide greater flexibility
for shareholders to manage their dividends. Instructions for shareholders on how to apply for the DRIP will be
included in communications regarding the dividend, and any queries regarding the DRIP should be directed to Link.
The Group also intends to use its Employee Benefit Trust to undertake market purchases of Company shares in H2
2023, amounting to an aggregate of up to €10m, bringing the total purchases in the year to €15m, in order tosatisfy future exercises of LTIPs or stock options pursuant to the relevant share plan.
Guidance for remainder of 2023
We continue to trade robustly across our video gaming focused studios, but have begun to see an impact in H2
from the unforeseen US entertainment strikes on our US media and entertainment exposed businesses. We believethese have the potential to impact organic revenue growth by around 2-2.5% for the full year depending on how
long they persist.
Excluding the impact of the strikes, we expect full year underlying organic revenue growth to be broadly similar to
the first half, with H2 growth weighted to the fourth quarter as clients remain budget conscious. Adjusted
operating margins are expected to remain above 15% in 2023, as we expect cost control measures to largely
mitigate the impact of the strikes on profitability.
During 2022, we benefited from the strength of the US dollar and are mindful that there remains potential volatility
in the foreign exchange markets beyond our control that can impact performance through the year.
The adjusted Effective Tax rate for the full year is expected to be in line with the first half rate of ~22%. We
continue to anticipate capex at a higher level than in 2022 relative to revenue, reflecting some expansionary capexand foreign exchange movements, but we still expect a full year Adjusted Cash Conversion rate of around 80%.

Rob Kingston
Chief Financial Officer

14

Condensed interim consolidated statement of comprehensive income

Revenue from contracts with customers
Cost of sales
Gross profit
Other income
Share-based payments expense
Costs of acquisition and integration
Amortisation of intangible assets
Total of items excluded from adjusted profit measures
Other administration expenses
Administrative expenses
Operating profit
Financing income
Financing cost
Profit before taxation
Taxation
Profit after taxation

Note
5

9

6
6

Unaudited
Half Year
30 Jun 23€'000
383,526(238,344)
145,182(9,438)(7,335)(12,775)(29,548)(86,307)(115,855)
29,327

Unaudited
Half Year
30 Jun 22€'000
321,140(196,642)
124,498
1,107(8,940)(1,284)(7,469)(17,693)(68,459)(86,152)
39,453

AuditedYear
31 Dec 22€'000
690,718(423,452)
267,266
1,098(18,678)(8,413)(16,810)(43,901)(152,653)(196,554)
71,810154(6,292)
23,189(8,669)14,5202,514(2,889)39,078(10,937)
28,141

1,986(5,814)
67,982(20,612)47,370

(150)

-

286

(4,215)872
11,027

11,875
7,148
162
47,326(7,947)
6,144
162
46,015

14,52014,52028,186(45)
28,14147,415(45)
47,37011,027
11,027

47,209117
47,32646,01546,015€ cent18.48
17.80€ cent36.80
35.52€ cent61.54
58.86

Other comprehensive income:Items that will not be reclassified subsequently to profit or loss
Actuarial gain / (loss) on defined benefit plans

Items that may be reclassified subsequently to profit or loss
Exchange gain / (loss) in net investment in foreign operations
Exchange gain / (loss) on translation of foreign operations
Non-controlling interest; recycled on disposal of subsidiary
Total comprehensive income / (expense)
Profit / (loss) for the period attributable to:
Owners of the parent
Non-controlling interest

Total comprehensive income / (expense) attributable to:
Owners of the parent
Non-controlling interest

Earnings per share
Basic earnings per ordinary share
Diluted earnings per ordinary share

7
7

15

Condensed interim consolidated statement of financial position

UnauditedAt
30 Jun 23

Non-current assets
Intangible assets
Right of use assets
Property, plant and equipment
Deferred tax assets
Investments
Current assets
Cash and cash equivalents
Trade receivables
Other receivables
Corporation tax recoverable
Current liabilities
Trade payables
Other payables
Loans and borrowings
Corporation tax liabilities
Lease liabilities
Net current assets / (liabilities)
Non-current liabilities
Other payables
Employee defined benefit plans
Loans and borrowings
Deferred tax liabilities
Lease liabilities
Net assets
EquityShare capital
Share capital - to be issued
Share premium
Merger reserve
Foreign exchange reserve
Shares held in Employee Benefit Trust ("EBT")
Share-based payments reserve
Retained earnings
Total equity

Note

€'000

UnauditedAt
30 Jun 22
Re-stated(note 19)
€'000

9
9
9

574,627
44,29553,55330,657
175
703,307361,51034,01438,31929,886
175
463,904

469,953
37,672
44,784
31,157
175
583,741

43,804
95,04290,253
5,883
234,982

121,395
88,38772,225
6,361
288,368

81,886
81,563
61,415
6,503
231,367

14,798161,093
24,134
15,426215,451
19,531

11,392
122,72364
15,473
11,101
160,753
127,615

15,878139,35545
22,02812,414
189,720
41,647

19,3883,601
55,215
15,772
34,223
128,199594,639

8,007
3,270
31
25,116
24,766
61,190530,329

18,3082,861
617,01730,10568,297557,091

937
2,788
54,439302,146
7,675(974)
71,091
156,537
594,639912
810
40,984275,02131,84455,970124,788
530,329924
2,467
47,021
286,655
11,01865,379143,627
557,091

10
10

13
14
16

13
14
16

11
11
11
11

AuditedAt
31 Dec 22
Re-stated(note 19)
€'000

16

Condensed interim consolidated statement of changes in equity

Share
capitalSharecapital to beissuedRetainedearnings

Total
attributableto ownersof parent

Sharepremium

Noncontrollinginterest

Total
equity

€'000

€'000

€'000

€'000

€'000

€'000

€'000

904

(1,997)48,19397,905472,237(117)

472,120

Profit for the period
Recycled on disposal ofsubsidiary
Other comprehensive
incomeTotal comprehensive
income for the period
Contributions by andcontributions to the owners:
Share-based payments
expense---28,18628,186(45)

28,141

-

-

-

-

-

-

162

162

-

-

19,023---19,023-19,023--19,023--28,18647,209117

47,326

Share options exercised
Employee Share Purchase
Plan

-

-

-

-

-

8,886

-

8,886

-

8,886

-

1,953

-

-

1,997

(1,163)

-

2,794

-

2,794

Dividends
Acquisition related issuanceof shares
Contributions by andcontributions to the owners

-

-

482

-

-

-

54

-

536

-

536

-

-

-

-

-

-

-

(1,303)(1,303)-(1,303)

1(1,375)

-

1,344

-

-

-

-

(30)

-

(30)

8

(1,375)

2,435

1,344

-

1,997

7,777

(1,303)

10,883-

10,883912

810

40,984275,02131,844-55,970124,788

530,329-

530,329

Profit / (loss) for the period
Other comprehensive
incomeTotal comprehensive
income for the period
Contributions by andcontributions to the owners:
Share-based payments
expense

-

-

-

-

-

-

-

19,22919,229-19,229----(20,826)

-

-

286

(20,540)-(20,540)

-

-

-

-

(20,826)--

19,515(1,311)-(1,311)

-

-

-

-

-

-

9,691

-

9,691

-

9,691

Share options exercised
Employee Share Purchase
Plan

7

-

3,909

-

-

-

(329)

-

3,587

-

3,587

-

-

427

-

-

-

47

-

474

-

474

Dividends
Acquisition related issuanceof shares
Contributions by andcontributions to the owners

-

-

-

-

-

-

-

(676)

(676)

-

(676)

5

1,657

1,701

11,634----

14,997-

14,997

At 01 January 2022

At 30 June 2022

Mergerreserve

Foreignexchangereserve

Sharesheld in
EBT

Sharebased
payments
reserve

€'000

€'000

€'000

€'000

2,185

38,549273,677

12,821

-

-

-

-

-

-

-

-

-

-

-

7

12

1,657

6,037

11,634

-

-

9,409

(676)

28,073-28,073924

2,467

47,021

286,655

11,018-65,379143,627

557,091-

557,091

Profit / (loss) for the period
Other comprehensive
incomeTotal comprehensive
income for the period
Contributions by andcontributions to theowners:Share-based payments
expense

-

-

-

-

-

-

-

14,52014,520-14,520----(3,343)

-

-

(150)

(3,493)-(3,493)

-

-

-

-

(3,343)--

14,37011,027-

11,027

-

-

-

-

-

-

9,438

-

9,438

-

9,438

Share options exercised

6

-

1,432

-

-

4,026

(3,726)

-

1,738

-

1,738

Funding of EBT

-

-

-

-

-

(5,000)--(5,000)-(5,000)

Dividends
Acquisition related issuanceof shares (note 11)
Contributions by andcontributions to theowners

-

-

-

-

-

-

-

(1,460)(1,460)-(1,460)

7

321

5,986

15,491----21,805-21,805

At 31 December 2022

At 30 June 2023

13

321

7,418

15,491

-

(974)

5,712

(1,460)26,521-

26,521937

2,788

54,439302,146

7,675

(974)

71,091

156,537

594,639-594,63917

Condensed interim consolidated statement of cash flows

Note
Cash flows from operating activities
Profit after taxation
Income and expenses not affecting operating cash flows
Depreciation - property, plant and equipment
Depreciation and impairment - right of use assets
Amortisation and impairment of intangible assets
Taxation
Share-based payments expense
Fair value adjustments to contingent consideration
Unwinding of discounted liabilities - deferred consideration
Unwinding of discounted liabilities - lease liabilities
Interest receivable
Fair value adjustments to employee defined benefit plans
Interest expense
Unrealised foreign exchange (gain) / loss

9
9
9

6
6
6
6

Changes in operating assets and liabilities
Decrease / (increase) in trade receivables
Decrease / (increase) in MMTC and VGTR receivable
Decrease / (increase) in other receivables(Decrease) / increase in accruals, trade and other payables
Taxation paid
Net cash generated by / (used in) operating activities
Cash flows from investing activities
Current year acquisition of subsidiaries net of cash acquired
Settlement of deferred liabilities on acquisitions
Acquisition of property, plant and equipment
Investment in intangible assets
Interest received
Net cash generated by / (used in) investing activities
Cash flows from financing activities
Cash proceeds, where EBT shares were utilised for the exercise of shareoptions
Repayment of loans
Drawdown of loans
Payments of principal on lease liabilities
Interest paid on principal of lease liabilities
Dividends paid
Cash advanced to EBTShares issued for cash
Interest paid
Net cash generated by / (used in) financing activities
Increase / (decrease) in cash and cash equivalents
Exchange gain / (loss) on cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period

17
13
9
9

14
14
16
16

11

Unaudited
Half Year
30 Jun 23€’000

Unaudited
Half Year
30 Jun 22€’000

AuditedYear
31 Dec 22€’000

14,52028,14147,37010,907
7,821
12,775
8,669
9,438
4,332
1,817
631
(154)
740
2,231
(4,443)54,764

8,790
5,591
7,469
10,937
8,940
1,478
465
(102)
629
2,774
46,971

18,365
14,585
16,81020,612
18,678
2,282
2,922
969
(309)
514
1,261
766
97,455(9,229)(16,613)(11,504)
4,880(32,466)(7,913)28,905(19,725)(10,384)(9,935)
11,679(28,365)(6,181)
40,566(11,771)(3,591)(6,457)
18,785(3,034)(17,505)
124,286(76,217)(12,704)(18,799)(1,325)
154(108,891)(13,579)(9,997)(178)
102(23,652)(87,494)(25,800)(27,007)(501)
309(140,493)

300(32,730)
89,379(6,822)(631)(1,460)(5,000)1,438(1,745)42,729(37,257)(825)
81,88643,804(42)(5,453)(465)(1,303)
2,435(413)(5,241)
11,673
4,012
105,710
121,395

505(79)(11,361)(969)(1,979)6,785(828)(7,926)(24,133)
309
105,71081,88618

Notes forming part of the Condensed interim consolidated financial statements
1 Basis of Preparation
Keywords Studios PLC (the “Company”) is a company incorporated in the United Kingdom. The Condensed interim consolidated financial
statements include the financial statements of the Company and its subsidiaries (the “Group”) made up to 30 June 2023.
The interim results for the half year ended 30 June 2023 and the half year ended 30 June 2022 are not audited by our auditors and the accounts inthis interim report do not therefore constitute statutory accounts in accordance with Section 434 of the Companies Act 2006. They do not include
all of the information required for full annual financial statements, and should be read in conjunction with the latest annual audited financial
statements of Keywords Studios PLC for the year ended 31 December 2022, which have been filed with Companies House. The report of theauditors on those accounts was unqualified, did not contain any statements under Section 498 (2) or (3) of the Companies Act 2006 and did notcontain any matters to which the auditors drew attention without qualifying their report.
The interim financial statements presented in this financial report have been prepared in accordance with International Financial ReportingStandards (IFRS) and the IFRS Interpretations Committee (IFRIC) interpretations that are expected to be applicable to the consolidated financial
statements for the period ending 31 December 2023 and the Disclosure Guidance and Transparency Rules of the UK’s Financial Conduct Authority.
There have been no changes in the principal risks and uncertainties during the period and therefore these remain consistent with the year ended 31
December 2022 and are disclosed in the Annual Report for that year.
Going Concern Basis of Accounting
After making enquiries, the Directors consider it appropriate to continue to adopt the going concern basis in preparing the interim financial
statements. In doing so, the Directors have considered the following:•
The strong cash flow performance of the Group through the year;•
The continued demand for the Group’s services;•
The historical resilience of the broader video games industry in times of economic downturn; and•The ability of the Group to flex its cost base in response to a reduction in trading activity.
The Directors have also considered the Group’s strong liquidity position with net debt of €11.4m as at 30 June 2023, and committed undrawn
facilities of €94.8m under the €150m Revolving Credit Facility (“RCF”) in place at 30 June 2023. As outlined in note 14, a new RCF was put in place inJuly 2023 with an increased facility of $400m.
The Directors have applied downside sensitivities to the Group’s cash flow projections to assess the Group’s resilience to adverse outcomes. This
assessment included a reasonable worst-case scenario in which the Group’s principal risks manifest to a severe but plausible level. Even under themost severe case, the Group would have sufficient liquidity and remain within its banking covenants. The Directors have a reasonable expectationthat the Company and the Group have adequate resources to continue to operate and meet liabilities as they fall due for the foreseeable future, aperiod considered to be at least twelve months from the date of these financial statements and therefore the going concern basis of preparation
continues to be appropriate.
The Condensed interim consolidated financial statements made up to 30 June 2023 were approved by the Board of Directors on 11 September
2023.

2 Changes in Significant Accounting Policies
New Standards, Interpretations and Amendments effective 1 January 2023
The following amendments effective for the period beginning 01 January 2023 are expected to be impactful on the Group moving forward:•
Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2): These amendments relate to the applicationof materiality in relation to the disclosure of accounting policies, requiring companies to disclose their material accounting policies
rather than their significant accounting policies, clarifying that accounting policies related to immaterial transactions, other events orconditions are themselves immaterial and as such need not be disclosed; and clarifying that not all accounting policies that relate tomaterial transactions, other events or conditions are themselves material to a company’s financial statements. The Board will consider
these amendments in the context of the 2023 Annual Report.
•
Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12): These amendments narrow
the scope of the initial recognition exemption so that it does not apply to transactions that give rise to equal and offsetting temporary
differences e.g. Right of use assets and Lease liabilities. As a result, deferred tax assets and liabilities associated with leases are now
recognised gross from the beginning of the earliest comparative period presented. As outlined in note 19, the comparative periods
presented have been re-stated to reflect the impact of adoption on the carrying value of Right of Use Assets and Lease Liabilities, withany cumulative effect recognised as an adjustment to retained earnings or other components of equity.
Other amendments effective for the period beginning 01 January 2023:•
Classification of Liabilities as Current or Non-current – Amendments to IAS 1; and•Definition of Accounting Estimate – Amendments to IAS 8;
The Group does not expect these other amendments, or any other standards issued by the IASB but not yet effective, to have a material impact
on the Group.
New standards, interpretations and amendments not yet effective
There are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in futureaccounting periods that the Group has decided not to adopt early.
The following amendments effective for the period beginning 01 January 2024:•

Lease Liability in a Sale and Leaseback (Amendment to IFRS 16); and19

•IAS 1 Presentation of Financial Statements (Amendment – Classification of Liabilities as Current or Non-Current, with Covenants).

The Group does not expect these amendments, or any other standards issued by the IASB but not yet effective, to have a material impact on
the Group.

3 Significant Accounting Policies
Except as described in note 19, the accounting policies applied in these interim financial statements are the same as those applied in the Group’s
most recent annual financial statements as at and for the year ended 31 December 2022.

4 Critical Accounting Estimates and Judgements
The Group makes certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated based on historicalexperience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future,
actual experience may differ from these estimates and assumptions.
The judgements, estimates and assumptions applied in these interim financial statements, including the key sources of estimation uncertainty, were
the same as those applied in the Group’s last annual financial statements for the year ended 31 December 2022. The only exceptions are:•Tax Liabilities - determined using the estimated annual effective tax rate:o
The estimate of tax liabilities which are determined in these interim financial statements using the estimated annual effective
tax rate applied to the pre-tax income of the interim period.

20

5 Segmental Analysis and Revenue from Contracts with Customers
Segmental Analysis

Revenue from external customers
CreateGlobalize
EngageSegment operating profit
Create ~Globalize ~EngageReconciliation of Segment operating profit
Adjusted EBITDA^
Share-based payments expense
Costs of acquisition and integration
Non-controlling interest
Other income
Amortisation of intangible assets
Depreciation - property plant and equipment
Depreciation and impairment - right of use assets
Bank charges
Operating profit
Financing income
Financing cost
Profit before taxation

Unaudited
Half Year
30 Jun 23€'000

AuditedYear
31 Dec 22€'000

162,916
145,701
74,909383,526

Unaudited
Half Year
30 Jun 22€'000
Re-stated
124,280
141,585
55,275321,140

41,687
27,682
7,881
77,25032,406
29,6308,112
70,14869,74861,577
15,576
146,901

77,250(9,438)(7,335)(12,775)(10,907)(7,821)353
29,327154(6,292)
23,18970,148(8,940)(1,284)(45)
1,107(7,469)(8,790)(5,591)317
39,4532,514(2,889)39,078146,901(18,678)(8,413)
1,098(16,810)(18,365)(14,585)662
71,8101,986(5,814)
67,982

275,570
300,875
114,273
690,718^ The Group reports a number of alternative performance measures (“APMs”), including Adjusted EBITDA, to present the financial performance of the business, that are not GAAP measures
as defined under IFRS. Segmental results are reported in a manner consistent with these measures. A reconciliation of Adjusted EBITDA to the relevant GAAP measure is presented in the
APM’s section below.
~ The prior half year comparatives have been updated to reflect the full year 2022 cost allocation methodology, as the Directors’ consider this to be more precise.

Revenues are recognised as services are delivered by the relevant producing segment, and while there is significant sub-contracting acrossproduction locations around the Group, inter-segment revenues are not significant. Assets and liabilities are not allocated by segment.
Revenue is earned from external customers, with no individual customer accounting for 10% or more of the Group’s revenue in any period
presented.

Geographical analysis of revenues, by production location*

CanadaUnited States
United Kingdom
PolandAustralia
Italy
China
India
Ireland
Japan
Other

Unaudited
Half Year
30 Jun 23€'000
81,13075,94262,934
19,595
18,531
18,10015,017
13,53010,974
9,722
58,051
383,526

Unaudited
Half Year
30 Jun 22€'000
70,151
56,407
57,666
13,917
8,064
17,338
11,47812,2906,727
11,181
55,921
321,140

AuditedYear
31 Dec 22€'000
155,509
120,722
115,01742,731
22,21139,19526,75925,29013,44922,716
107,119
690,718*The prior year comparatives have been re-classified to align to the current year ranking by production location.

21

For Game Development, games are developed to an agreed specification and time schedule, and often have delivery schedules and / or milestones
that extend well into the future. The following are Game Development revenues expected to be recognised for contracts with a schedule of workthat extends beyond one year, representing the aggregate amount of the transaction price allocated to the performance obligations that are
unsatisfied (or partially unsatisfied) as at the end of the reporting period:

Revenue expected to be recognised
At 30 June 2023
At 30 June 2022
At 31 December 2022

Geographical analysis of non-current assets from continuingbusinesses*

United States
United Kingdom
CanadaAustralia
Italy
PolandChina
Switzerland
IrelandFranceOther

Totalundelivered€'000
27,52862,442
82,060

Scheduledcompletion
within 1 year€'000
27,151
48,67977,448

Scheduledcompletion
1-2 years€'000
283
12,7194,612

Scheduledcompletion
2-5 years
€'000
94
1,044
-

Unaudited

Unaudited

AuditedHalf Year

Half YearYear

30 Jun 23€'000
365,989
128,315
56,40549,546
16,246
14,248
10,567
10,025
8,702
7,254
36,010703,30730 Jun 22€'000
176,906
119,682
28,444
48,132
15,6104,070
9,081
10,025
9,994
7,472
34,488463,904

31 Dec 22€'000
264,117
121,556
57,652
51,86916,471
12,561
9,296
10,025
10,311
7,150
22,733
583,741*The prior year comparatives have been re-classified to align to the current year ranking.

Seasonal BusinessHistorically the video games industry has been heavily impacted by sales of new releases of games and platforms during the traditional holiday
season, including the run up to Thanksgiving in the United States and Christmas in other parts of the world. As with all other service providers to thevideo games industry, certain of Keywords’ service lines typically experience significantly higher activity as part of this release cycle, during the six
months from June to November. This activity drives increased revenues in that period and generates higher gross profit margins in the second half
compared with the first half of each calendar year. More recently, the rise of streaming has shifted the video game industry away from a strictseasonal cycle. In addition, as Keywords continues to build on our platform, and our presence in each stage of the games development cycle
increases, the impact of seasonality on our business is reducing over time.
Revenue and Gross profit for the twelve months up to the end of the interim period and comparative information for the prior twelve-month period
are presented below, which include the post-acquisition results of acquisitions completed in the relevant period.

Revenue
Gross profit

UnauditedYear
30 Jun 23
€'m
753
288

UnauditedYear
30 Jun 22
€'m
595
233

22

6 Financing Income and Cost

Financing income
Interest received
Foreign exchange gain
Financing cost
Bank charges
Interest expense
Unwinding of discounted liabilities - lease liabilities
Unwinding of discounted liabilities - deferred consideration
Foreign exchange loss
Net financing income / (cost)

Unaudited
Half Year
30 Jun 23€'000

Unaudited
Half Year
30 Jun 22€'000

AuditedYear
31 Dec 22
€'000

154
154

102
2,412
2,514

309
1,677
1,986

(353)
(2,231)(631)(1,817)(1,260)(6,292)(6,138)

(317)
(629)
(465)
(1,478)(2,889)
(375)

(662)
(1,261)(969)(2,922)(5,814)(3,828)Unaudited
Half Year
30 Jun 23€ cent18.48
17.80

Unaudited
Half Year
30 Jun 22€ cent36.80
35.52

AuditedYear
31 Dec 22€ cent
61.54
58.86

€'000
14,520€'000
28,141€'000
47,370

Number
78,558,801
2,993,709
81,552,510

Number
76,478,194
2,756,818
79,235,012

Number
76,979,596
3,502,301
80,481,897

Number
106,959

Number
34,709Number
67,8027 Earnings per Share

Basic
DilutedEarnings
Profit for the period from continuing operations
Weighted average number of equity shares
Basic (i)Diluting impact of share options (ii)
Diluted (i)(i) Includes (weighted average) shares to be issued:(ii) Contingently issuable ordinary shares have been excluded where the conditions governing exercisability have not been satisfied:
NumberNumber
LTIPs
1,233,865
1,720,825
Share options
519,000
1,233,865
2,239,825

8 Dividends

Dividends recommended
InterimIn
respectof2023

Expected€ centper share
0.99

Pence
STG
per
share
0.85

Expectedinterimdividend€'000
780

Number409,728
511,411921,139

Expected
payment
date
Oct-23

At 30 June 2023, Retained earnings available for distribution (being Retained earnings plus Share-based payments reserve) in the Company were
€84.4m. In addition, the Company has amounts included in the Merger reserve of €123.9m that are considered distributable (note 11).

23

9 Non-current Assets

Movement of the carrying value of Noncurrent assets
Carrying amount at the beginning of the period
Arising on acquisitions
Additions
Depreciation charge
Amortisation charge
Exchange rate movement
Carrying amount at the end of the period

Unaudited
Half Year
30 Jun 23€'000
Property,plant andequipment
44,784970
18,799(10,907)(93)
53,553

Unaudited
Half Year
30 Jun 23€'000
Right of use
assets37,672
6,097
8,058(7,821)289
44,295

Unaudited
Half Year
30 Jun 23€'000
Intangible
assets goodwill
396,733
90,678(800)
486,611

Unaudited
Half Year
30 Jun 23€'000
Intangible
assets other73,22027,317
1,325(12,775)(1,071)88,016

Unaudited
Half Year
30 Jun 23€'000
Intangible
assets total
469,953
117,995
1,325(12,775)(1,871)
574,627

A cash-generating unit (“CGU”) is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash
inflows from other assets or group of assets. The CGU’s represent the lowest level within the Group at which the associated goodwill is assessed forinternal management purposes and are not larger than the operating segments determined in accordance with IFRS 8 Operating Segments. The
Board have determined the lines of business as CGU’s, and Goodwill acquired in business combinations has been allocated to the CGUs that are
expected to benefit from business combinations to date.
A summary of the allocation of the carrying value of goodwill by CGU and by segment is presented below:

Create:Globalize:

Engage:Game Development
Art Services
Functional Testing
Localization Testing
Audio
Localization
MarketingPlayer Engagement

Unaudited
Half Year
30 Jun 23
€'m
232
19
15
14
33
18
119
37
487

Unaudited
Half Year
30 Jun 22
€'m
185
20
15
14
34
19
39
12
338

AuditedYear
31 Dec 22
€'m
218
19
15
14
33
19
35
44
397

While the Group performs a full assessment of the carrying value of goodwill, intangible assets and other assets on an annual basis, at 30 June 2023
an interim assessment by CGU was made based on the same underlying assumptions used in the last Annual Report, but using updated forecasts
and projections. Based on this interim review of the value in use calculations, no impairment is required in the period. The Directors consider that noreasonably probable change in assumptions would result in an impairment.

24

10 Trade and Other Receivables

Trade receivables derived from contracts with customers
Provision for bad debts (i) (ii)
Financial asset held at amortised costAccrued income from contracts with customers - grossAccrued income from contracts with customers - loss allowance
Financial asset held at amortised cost (iii)
Multimedia tax credits / video games tax relief
Prepayments and rent deposits
Tax and social security
Other receivables
Other receivables(i)

AuditedAt
31 Dec 22€'000
85,012(3,449)81,563

20,593(1,819)18,77443,051
14,0858,811
5,532
90,253

15,886
15,88634,452
10,4146,729
4,744
72,225

16,652(3,432)
13,22025,756
10,527
6,538
5,374
61,415

Unaudited
Half Year
30 Jun 23€'000(3,449)
(412)
(237)
81
47
(3,970)
1.0%

The composition of the provision for bad debts at period end was as follows:

Credit impaired
Expected credit losses
Provision at the end of the period(iii)

UnauditedAt
30 Jun 22€'000
90,270(1,883)88,387The movements in the provision for bad debts in the current period were as follows:

Provision at the beginning of the period
Recognition on acquisition of subsidiaries
Impairment of financial assets (trade receivables) charged to otheradministration expenses
Amounts written off against the provision in the period
Exchange rate movement
Provision at the end of the period
Credit loss experience(ii)

UnauditedAt
30 Jun 23€'000
99,012(3,970)95,042

UnauditedAt
30 Jun 23€'000(2,991)(979)(3,970)Accrued income from contracts with customers represent mainly contract assets in process and related items. Excluding
movements in the provision, the movement in the period comprises transfers in and out as items are accrued and subsequently
invoiced to customers, with no significant amounts recognised on the acquisition of subsidiaries. The movements in the provisionin the period were provisions utilised of €1.6m and movement in expected credit losses of €0.04m.

25

11 Share Capital

At 01 January 2023
Acquisition related issuance ofshares:Heavy Iron
Climax Studios
Waste Creative
Digital Media Management
Digital Media Management
Hardsuit Labs
Hardsuit Labs
Tantalus Media
Playboss Interactive
Acquisition related issuance ofsharesIssue of shares on exercise ofshare options
At 30 June 2023

Issue date

Per share€

20-Jan-23
17-Feb-23
15-Mar-23
29-Mar-23
06-Apr-23
10-May-23
30-May-23
15-Jun-23
30-Jun-23

34.67
27.18
31.52
30.92
30.92
28.17
28.17
27.48
24.48

Number ofordinary£0.01
shares77,990,057

Numberofordinary£0.01
shares to beissued87,73893,85621,42826,600301,170
53,482
191,722-

Sharecapital
€’000
924

Share
capital to beissued
€'000
2,467

Share
premium€’000
47,021

Mergerreserve*€’000
286,655

301,170(301,170)
53,482(53,482)
13,118

1
3
1
2
-

9,311
(9,311)
1,507(1,507)
321

5,986
-

3,254
582
841
9,308
1,506
-

688,258

13,118

7

321

5,986

15,491

406,30279,084,617

100,856

6
937

2,788

1,432
54,439302,146* Included in the Merger reserve are amounts of €14.4m (being the premium arising on the share placement in 2015) and €109.5m (being the premium arising on the share placement in 2020),
totalling €123.9m, that are considered distributable. At the time of the placements, the proceeds were not allocated to a specific acquisition or specific purpose, and thus these amounts
included in the Merger reserve are considered distributable.

12 Share Options

At 01 January 2023
Granted
LapsedExercised
At 30 June 2023
Exercisable at 30 June 2023
Weighted average share price at date of
exercise

Analysis of Shares Exercised
Exercised via issuance of new shares
Exercised via utilisation of shares held in
EBT

Share Option Scheme
Average
exercise
Number of
price in £per share
options
18.78
1,585,819
19.57(107,776)
14.80(97,519)19.02
1,380,524
17.43
876,703
26.08

Long Term Incentive Plan
Average
exercise
Number of
price in £per share
options
0.01
3,648,173
0.01
657,157
0.01(65,150)0.01(443,452)
0.01
3,796,728
0.01
1,447,150
23.43

Salary Shares
Average
exercise
Number of
price in £per share
options
0.01
259,6230.01
557,0070.01(17,808)
0.01(7,740)0.01
791,082
0.01
n/a

Number ofoptions
81,269Number ofoptions
317,293

Number ofoptions
7,740

16,25097,519126,159
443,452

7,740

26

13 Other Payables

Current liabilities
Accrued expenses
Payroll taxes
Other payables (ii)Deferred and contingent consideration (i)Deferred and contingent consideration related to continuous employment(i)
Non-current liabilities
Deferred and contingent consideration (i)UnauditedAt
30 Jun 23€'000

UnauditedAt
30 Jun 22€'000

AuditedAt
31 Dec 22€'000

67,9795,068
26,17057,25663,226
3,591
19,88636,02061,155
3,577
26,09944,945

4,620
161,093

122,723

3,579
139,355

19,38819,388

8,007
8,007

18,30818,308Deferred and contingent consideration becomes payable where the purchase agreement includes deferred consideration contingent on bothpre-defined profit and / or revenue targets being exceeded. The valuation of contingent consideration is derived using data from sources thatare not widely available to the public and involves a degree of judgement (Level 3 input in the fair value hierarchy). Liabilities for deferredconsideration are recognised at their fair value on the acquisition date, however where deferred and contingent consideration is also tied to theretention of key staff, these liabilities are considered post-acquisition expenses under IFRS 3, with liabilities for deferred and contingent
consideration related to continuous employment accrued over the post-acquisition retention period.

(i)

The movements in deferred and contingent consideration during the period were as follows:

Unaudited
Half Year
30 Jun 23€'000

Carrying amount at the beginning of the period
Consideration settled by cash
Consideration settled by shares
Unwinding of discount (note 6)
Additional liabilities from current year acquisitions (note 17)
Additional liabilities from prior acquisitions
Exchange rate movement
Carrying amount at the end of the period

Deferred andcontingent
consideration
63,253(10,201)(9,838)1,817
32,656(1,043)76,644

Unaudited
Half Year
30 Jun 23€'000
Deferred andcontingent
consideration
related tocontinuous
employment
3,579(2,503)
(839)
134
4,198
51
4,620

A 10% movement in expected performance would impact the fair value of the contingent consideration as follows:

Increase / (decrease) in carrying amount

UnauditedAt
30 Jun 23€'000

Increase in expected performance - 10%
Decrease in expected performance - 10%

Deferred andcontingent
consideration
7,583(9,681)

UnauditedAt
30 Jun 23€'000
Deferred andcontingent
consideration
related tocontinuous
employment(688)

There are no other reasonably probable changes to the assumptions and inputs (including the discount rate) that would lead to a materialchange to the fair value of the total amount payable.

27

On an undiscounted basis, at period end the Group may be liable for deferred and contingent consideration ranging from €7.9m to a maximumof €95.9m. The contractual maturities (representing undiscounted contractual cash flows) of the Group's deferred and contingent
consideration liabilities were as follows:
UnauditedAt
30 Jun 23€'000

Not later than one year
Later than one year and not later than two years
Later than two years and not later than five years
Total undiscounted contractual cash flows(ii)

Deferred andcontingent
consideration
58,135
19,4183,352
80,905

UnauditedAt
30 Jun 23€'000
Deferred andcontingent
consideration
related tocontinuous
employment
9,558
5,080
350
14,988The Group’s related party transactions are with key management personnel as disclosed in the Group’s Annual Report. There havebeen no material changes to the Group’s related party transactions with key management personnel during the period.

14 Loans and Borrowings and Capital Management
The movements in loans and borrowings (classified as financial liabilities, held at amortised cost under IFRS 9), in the current period were as
follows:

Carrying amount at the beginning of the period
Drawdowns
Repayments
Exchange rate movement
Carrying amount at the end of the period

Unaudited
Half Year
30 Jun 23€'000
5189,379(32,730)(1,485)55,215The carrying amount at the beginning of the period represent loans owed by Keywords Studios QC-Interactive Inc. These balances were repaid
in the period.
During July 2023, the Group negotiated a new unsecured multi-currency revolving credit facility agreement ("RCF") of $400 million. The new
RCF is for an initial four-year tenor, with an option to extend the term by a further one year period, subject to lender consent. The new facility is
supported by a group of seven global lenders and replaces the Group's previous €150 million unsecured multi-currency revolving credit facility.
The RCF's financial covenants remain consistent with the previous facility. The new facility is denominated in US dollars to match the expected
predominant currency of future borrowings.
The previous RCF allowed the Group to access financing of up to €150m, which may be drawn down in euro, sterling, US dollars or Canadiandollars, with an option (subject to lender consent), to increase the facility by up to €50m to a total of €200m, at interest rates based on amargin over currency benchmark rates, plus a separate margin charged for the unutilised facility. Throughout the period, the Group operated
well within the interest cover and leverage ratio terms of the previous RCF agreement.

At the period end the net debt ratio was as follows:

Loans and borrowings
Less: cash and cash equivalents
Net debt / (net cash) position
Total equity
Net debt / (net cash) to capital ratio (%)

UnauditedAt
30 Jun 23€'000
55,215(43,804)
11,411
594,6392%

15 Financial Instruments
28

During the period there has been no change in the measurement basis of the financial assets and liabilities shown in the Condensed interim
consolidated statement of financial position.

16 Lease Liabilities
The movements in lease liabilities in the current period were as follows:

Carrying amount at the beginning of the period
Recognition on acquisition of subsidiaries (note 17)
Liabilities recognised on new leases in the period
Unwinding of discounted liabilities - lease liabilities
Payment of principal and interest on lease liabilities
Exchange rate movement
Carrying amount at the end of the period

Unaudited
Half Year
30 Jun 23€'000
42,519
6,097
8,058
631
(7,453)(203)
49,649The value of leases not yet commenced to which the lessee is committed, which are not included in the lease liability at 30 June 2023, were €nil.

29

17 Business Combinations
Digital MediaManagement
€'000

Other
acquisitions
€'000

2023
€'000

608
5,714
3,321
(23)
14,296(2,458)(5,714)
15,744

362
383
2,491
(389)
3,628
(787)
(383)
5,305

970
6,097
5,812
(412)
17,924(3,245)(6,097)21,04924,806(5,594)
19,212
34,956
62,583
97,539

2,511
5,013
(527)
6,997
12,30228,09540,39727,317
5,013(6,121)
26,20947,25890,678137,936

66,2189,311
22,01097,53927,923
1,507
914
9,732
321
40,397

94,141
10,818914
31,742
321
137,936

624

269

893

Number of shares:
Shares issued on acquisition
Fixed number of shares to be issued

301,170-

53,482
13,118354,652
13,118Net cash outflow arising on acquisition:
Cash paid in the period
Less: cash and cash equivalent balances transferred
Net cash outflow arising on acquisition

66,218(14,296)
51,922

27,923(3,628)24,295

94,141(17,924)
76,217

Details of pro forma revenues and profitability of current acquisitions
Pre-acquisition revenue
Post-acquisition revenue
Pro forma revenue
Pre-acquisition profit / (loss) before tax
Post-acquisition profit / (loss) before tax
Pro forma profit / (loss) before tax

6,413
6,574
12,987
1,650
492
2,142

5,644
6,655
12,299
(393)
2,166
1,773

12,057
13,22925,286
1,257
2,658
3,915

Details of goodwill and the fair value of net assets acquired
Book value:
Property, plant and equipment
Right of use assets
Trade and other receivables - gross
Bad debt provision
Cash and cash equivalents
Trade and other payables
Lease liabilities
Book value of identifiable assets and liabilities acquired
Fair value adjustments:
Identifiable intangible assets - Customer relationships
Deferred tax assets
Deferred tax liabilities
Total fair value adjustments
Net assets acquired
Goodwill from current year acquisitions
Total purchase consideration

Details of purchase consideration and outflows from current acquisitions
Cash
Equity instruments
Deferred cash
Deferred consideration contingent on performance
Shares to be issued
Total purchase consideration
Related acquisition costs charged to the Consolidated statement of comprehensive income:During the period, the Group completed four acquisitions, 47 Communications, Digital Media Management, Hardsuit Labs and Playboss, purchasing
100% of these businesses. The aggregate amounts recognised in respect of the identifiable assets acquired and liabilities assumed on acquisitions
completed in the period are set out in the table above. Details of the purchase consideration and other information relevant to the evaluation of thefinancial effect of the acquisitions are also presented.
Please note that Total purchase consideration excludes €1.2m of Deferred and contingent consideration related to continuous employment, where
the purchase agreement includes deferred consideration contingent on both pre-defined profit and / or revenue targets being exceeded andwhich is also tied to the retention of key staff, that are considered post-acquisition expenses under IFRS 3 (note 13).
The main factors leading to the recognition of goodwill on the acquisitions are the presence of certain intangible assets in the acquired entities,
which are not valued for separate recognition. These include expertise in the acquired entities, enhancing and growing our service capabilities,
broadening our service offering, and extending our geographical footprint, further building out our global platform.
The goodwill that arose from business combinations completed in the period that is expected to be deductible for tax purposes was €22.2m (forwhich a deferred tax asset has been recognised of €5.0m).

30

18 Significant Events
Crisis in Ukraine
Since the crisis in Ukraine began in 2022, our priority has been to support our personnel and freelance suppliers located in the affected area, while
also contributing to broader humanitarian efforts in the region. As our Group had no business operations in Ukraine, the crisis primarily impacted
our Game Development teams in Russia, as well as our collaboration with several freelance suppliers based in Ukraine.
Throughout this period, we have continued to work with our customers supporting their preferences for where their work should be performed,
while also remaining focused on mitigating any potential business interruption or other risks associated with our activities in Russia. As a result, thevolume of work produced in Russia has continued to reduce over time and we have been scaling down our operations accordingly.
In the period, the Group produced €4.2m of Revenue in Russia, which represents approximately 1.1% of Group revenue, down from 5.5% in the halfyear to June 2022, and down on 3.8% in full year 2022. During the period, we continued to transfer projects supported in Russia to other parts of theGroup, as we further ramped up production capacity in these locations with a combination of employees relocating from Russia and local hires. As aconsequence, revenues produced in Russia were approximately 0.3% of Group revenue in June 2023. Production in Russia has now ceased. Costsof acquisition and integration includes severance and rationalisation costs of €1.5m incurred in the period, associated with ceasing operations in
Russia.
The Group has never had significant receivables exposure in Russia, as work produced in Russia was contracted and collected in other territories.
The Group does not have significant amounts of working capital or non-current assets located in Russia. Thus any exposure to impairment of assets
located in Russia is not considered material.

19 Change in Accounting Policy
The Group has adopted Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12) from 01 January
2023. These amendments narrow the scope of the initial recognition exemption so that it does not apply to transactions that give rise to equaland offsetting temporary differences e.g. Right of use assets and Lease liabilities. As a result for leases and decommissioning liabilities, an entity
is required to recognise the associated deferred tax assets and liabilities on a gross basis from the beginning of the earliest comparative period
presented, with any cumulative effect recognised as an adjustment to retained earnings or other components of equity at that date.
The Group previously accounted for the deferred tax on leases and decommissioning liabilities on a net basis. Following the amendments, theGroup has recognised a separate deferred tax asset in relation to its lease liabilities and a deferred tax liability in relation to its right-of-use
assets. There was no impact on the opening retained earnings at 01 January in any period presented, as a result of this change. The impact ondeferred tax assets and liabilities in each comparative period presented, is detailed below.

At 30 June 2022 - as reported
Adoption of Deferred Tax related to Assets and Liabilities arising froma Single Transaction (Amendments to IAS 12)
At 30 June 2022 - as restated

At 31 December 2022 - as reported
Adoption of Deferred Tax related to Assets and Liabilities arising froma Single Transaction (Amendments to IAS 12)
At 31 December 2022 - as restated

Unaudited€'000
Deferred tax
assets21,786

Unaudited€'000
Deferred tax
liabilities
17,016

Unaudited€'000
Retainedearnings
124,788

8,100
29,886

8,100
25,116

124,788

Unaudited€'000
Deferred tax
assets
22,757

Unaudited€'000
Deferred tax
liabilities
8,617

Unaudited€'000
Retainedearnings
143,627

8,400
31,1578,400
17,017

143,627

20 Events after the Reporting Date
During July 2023, the Group negotiated a new unsecured multi-currency revolving credit facility agreement ("RCF") of $400 million. See note 14 forfurther details. There have been no other significant events since the reporting date.

31

Alternative performance measures
The Group reports a number of alternative performance measures (“APMs”) to present the financial performance of the business, that are not
GAAP measures as defined under IFRS. The Directors believe that these measures, in conjunction with the IFRS financial information, provide
the users of the financial statements with additional information to provide a more meaningful understanding of the underlying financial andoperating performance of the Group. The measures are also used in the Group’s internal strategic planning and budgeting processes and forsetting internal management targets. These measures can have limitations as analytical tools and therefore should not be considered in isolation,or as a substitute for IFRS measures.
The principal measures used by the Group are set out below:
Organic revenue growth – Acquisitions are a core part of the Group’s growth strategy. Organic revenue growth measures are used to help
understand the underlying trading performance of the Group excluding the impact of acquisitions. Organic revenue growth is calculated byadjusting the prior year revenues, adding pre-acquisition revenues for the corresponding period of ownership to provide a like-for-likecomparison with the current year, and applying the prior year’s foreign exchange rates to both years, when translating studio results into theeuro reporting currency.
Constant exchange rates (“CER”) – Given the international nature of the Group’s operations, foreign exchange movements can have an impact
on the reported results of the Group when they are translated into the Group’s reporting currency, the euro. In order to understand theunderlying trading performance of the business, revenue is also presented using rates consistent with the prior year in order to provide yearover-year comparability.
Adjusted profit and earnings per share measures – Adjusted profit and earnings per share measures are used to provide management andother users of the financial statements with a clear understanding of the underlying profitability of the business over time. Adjusted profit
measures are calculated by adding the following items back to the equivalent GAAP profit measures:
•

•

•

•

•

Amortisation of intangible assets – Customer relationships and music licence amortisation commences on acquisition, whereas
intellectual property / development costs amortisation commences when the product is launched. These costs, by their nature, canvary by size and amount each year. As a result, amortisation of intangibles is added back to assist with the understanding of theunderlying trading performance of the business and to allow comparability across regions and categories.
Costs of acquisition and integration – The level of acquisition activity can vary each year and therefore the costs associated withacquiring and integrating businesses are added back to assist with the understanding of the underlying trading performance of theGroup.
Share-based payments – The Group uses share-based payments as part of remuneration to align the interests of senior management
and employees with shareholders. These are non-cash charges and the charge is based on the Group’s share price which can change.
The costs are therefore added back to assist with the understanding of the underlying trading performance.
Foreign exchange gains and losses – The Group does not hedge foreign currency translation exposures. The effect on the Group’s
results of movements in exchange rates can vary each year and are therefore added back to assist with understanding the underlying
trading performance of the business.
Other income – Other income comprises gains on investments or other non-trading income. As the gains have arisen outside thenormal trading activities of the Group, the income has been added back to assist with the understanding of the underlying trading
performance.

Free cash flow measures – The Group aims to generate sustainable cash flow (free cash flow) in order to support its acquisition programme andto fund dividend payments to shareholders. Free cash flow is measured as net cash generated by / (used in) operating activities after capital
expenditure, payments of principal on lease liabilities, interest and tax payments, but before acquisition and integration cash outlay, otherincome and dividend payments. Adjusted free cash flow is a measure of cash flow adjusting for capital expenditure that is supporting growth infuture periods (represented by capital expenditure in excess of depreciation).
Net debt – The Group manages capital by monitoring debt to capital and net debt ratios. Net debt is calculated as loans and borrowings lesscash and cash equivalents, and excludes lease liabilities. The debt to capital ratio is calculated as net debt as a percentage of total equity.
The remainder of this section provides a reconciliation of the APMs with the relevant IFRS GAAP equivalent.

32Service line analysis
The following table presents revenue growth by service line at both actual exchange rates (“AER”) and constant exchange rates (“CER”).
Constant exchange rates are calculated by retranslating current-year reported numbers at the corresponding 2022 foreign exchange rates, inorder to give management and other users of the financial statements better visibility of underlying trading performance against the prioryear.

Half Year
30 Jun 23
Revenue
AER
€m
162.9
145.7
74.9
383.5

CreateGlobalize
EngageHalf Year
30 Jun 23
Revenue
CER
€m
166.8
148.2
76.2
391.2

Half Year
30 Jun 22
Revenue
AER
€m
124.3
141.5
55.3
321.1

Half Year
30 Jun 23
Growth
AER
%
31.1%
3.0%
35.4%
19.4%

Half Year
30 Jun 23
Growth
CER
%
34.2%
4.7%
37.8%
21.8%

Pro forma revenue
Pro forma revenue is calculated by adding pre-acquisition revenues of current year acquisitions to the current year revenue numbers, to illustrate
the size of the Group had the acquisitions been included from the start of the financial year.

Half Year
30 Jun 23

CreateGlobalize
EngageHalf Year
30 Jun 23

Year
30 Jun 23

Revenue

Half Year
30 Jun 23
Preacquisition
revenue

Pro forma
revenue

Pro forma
revenue

AER

AER

AER

AER

€m
162.9
145.7
74.9
383.5

€m
7.4
4.7
12.1

€m
170.3
145.7
79.6
395.6

€m
321.6
305.0
138.6
765.2

Organic revenue at constant exchange rates
Organic revenue at constant exchange rates is calculated by adjusting the prior year revenues, adding pre-acquisition revenues for thecorresponding period of ownership, and applying the 2022 foreign exchange rates to both years, when translating studio results into the euro
reporting currency.

Half Year
30 Jun 22

CreateGlobalize
EngageRevenue
AER
€m
124.3
141.5
55.3
321.1

Half Year
30 Jun 22
Preacquisition
revenue
AER
€m
12.3
20.9
33.2

Half Year
30 Jun 22
Like forlikerevenue
AER
€m
136.6
141.5
76.2
354.3

Half Year
30 Jun 23

Half Year
30 Jun 23

Revenue
growth
CER
€m
30.2
6.7
36.9

Revenue
CER
€m
166.8
148.2
76.2
391.2

Half Year
30 Jun 23
Organic
revenue
growth
CER
%
22.1%
4.7%
10.4%

33

Adjusted operating costs
This comprises Administrative expenses as reported in the Consolidated statement of comprehensive income, adding back share-based
payments expense, costs of acquisition and integration, amortisation of intangible assets, depreciation and impairment, non-controlling interestand deducting bank charges.

Calculation
Administrative expenses
Share-based payments expense
Costs of acquisition and integration
Amortisation of intangible assets
Depreciation - property, plant and equipment
Depreciation and impairment - right of use assets
Non-controlling interest
Bank charges
Adjusted operating costs
Adjusted operating costs as a % of revenue

Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Note 9Note 9Consolidated statement of comprehensive income
Note 6

Half Year
30 Jun 23€'000(115,855)
9,438
7,335
12,775
10,907
7,821(353)(67,932)
17.7%

Half Year
30 Jun 22€'000(86,152)
8,940
1,284
7,469
8,790
5,591
45
(317)
(54,350)
16.9%

Year
31 Dec 22€'000(196,554)
18,678
8,413
16,81018,365
14,585(662)(120,365)
17.4%

Adjusted operating profit
The Adjusted operating profit consists of the Operating profit as reported in the Consolidated statement of comprehensive income, adjusted
for share-based payments expense, costs of acquisition and integration, and amortisation of intangible assets. In order to present the measureconsistently year-on-year, the impact of other income is also excluded.

Calculation
Operating profit
Share-based payments expense
Costs of acquisition and integration
Amortisation of intangible assets
Other income
Adjusted operating profit
Adjusted operating profit as a % of revenue

Consolidated statement of comprehensive
incomeConsolidated statement of comprehensive
incomeConsolidated statement of comprehensive
incomeConsolidated statement of comprehensive
incomeConsolidated statement of comprehensive
incomeHalf Year
30 Jun 23€'000

Half Year
30 Jun 22
€'000

Year
31 Dec 22€'000

29,32739,45371,810

9,438

8,940

18,678

7,335

1,284

8,413

12,775

7,469

16,81058,87515.4%(1,107)56,03917.5%(1,098)
114,613
16.6%

EBITDAEBITDA comprises Operating profit as reported in the Consolidated statement of comprehensive income, adjusted for amortisation of intangible
assets, depreciation and impairment, and deducting bank charges.

Calculation
Operating profit
Amortisation of intangible assets
Depreciation - property plant and equipment
Depreciation and impairment - right of use assets
Bank charges
EBITDA

Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Note 9Note 9Note 6

Half Year
30 Jun 23€'000
29,327
12,775
10,9077,821(353)
60,477

Half Year
30 Jun 22€'000
39,453
7,469
8,790
5,591
(317)
60,986Year
31 Dec 22€'000
71,81016,81018,365
14,585(662)
120,908

34

Adjusted EBITDA
Adjusted EBITDA comprises EBITDA, adjusted for share-based payments expense, costs of acquisition and integration and non-controllinginterest. In order to present the measure consistently year-on-year, the impact of other income is also excluded.

Calculation
EBITDA
Share-based payments expense
Costs of acquisition and integration
Non-controlling interest
Other income
Adjusted EBITDA
Adjusted EBITDA as a % of revenue

As above
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income

Half Year
30 Jun 23€'000
60,477
9,438
7,335
77,250
20.1%

Half Year
30 Jun 22€'000
60,986
8,940
1,284
45
(1,107)
70,14821.8%

Year
31 Dec 22€'000
120,908
18,678
8,413(1,098)146,901
21.3%

Adjusted profit before tax
Adjusted profit before tax comprises Profit before taxation as reported in the Consolidated statement of comprehensive income, adjusted forshare-based payments expense, costs of acquisition and integration, amortisation of intangible assets, non-controlling interest, foreignexchange gains and losses, and unwinding of discounted liabilities. In order to present the measure consistently year-on-year, the impact ofother income is also excluded.

Calculation
Profit before taxation
Share-based payments expense
Costs of acquisition and integration
Amortisation of intangible assets
Non-controlling interest
Foreign exchange (gain) / loss
Unwinding of discounted liabilities - deferredconsideration
Other income
Adjusted profit before tax
Adjusted profit before tax as a % of revenue

Consolidated statement of comprehensive
incomeConsolidated statement of comprehensive
incomeConsolidated statement of comprehensive
incomeConsolidated statement of comprehensive
incomeConsolidated statement of comprehensive
incomeNote 6Note 6
Consolidated statement of comprehensive
incomeHalf Year
30 Jun 23€'000

Half Year
30 Jun 22
€'000

Year
31 Dec 22€'000

23,18939,07867,982

9,438

8,940

18,678

7,335

1,284

8,413

12,775

7,469

16,8101,260

45(2,412)(1,677)

1,817

1,478

2,922

55,81414.6%(1,107)54,77517.1%(1,098)112,030
16.2%

Adjusted effective tax rate
The Adjusted effective tax rate is the Taxation expense as reported in the Consolidated statement of comprehensive income, adjusted for thetax impact of the adjusting items in arriving at Adjusted profit before tax, as a percentage of the Adjusted profit before tax.

Calculation
Adjusted profit before tax
Taxation
Effective tax rate before tax on adjusting items
Tax arising on bridging items to Adjusted profit
before tax^
Adjusted taxation
Adjusted effective tax rate

As above
Consolidated statement of comprehensive
incomeTaxation / Adjusted profit before tax

Adjusted taxation / Adjusted profit before tax

Half Year
30 Jun 23€'000
55,814

Half Year
30 Jun 22€'000
54,775Year
31 Dec 22€'000
112,030

8,669
15.5%

10,93720.0%

20,612
18.4%

3,464
12,13321.7%

1,092
12,02922.0%

4,043
24,65522.0%^Being mainly the tax impact of share-based payments expense €1.5m and amortisation of intangible assets €1.9m, with the prior period being mainly the tax impact of share-based payments
expense €0.9m, amortisation of intangible assets €0.9m, less foreign exchange €0.9m.

35Adjusted earnings per share
The Adjusted profit after tax comprises the Adjusted profit before tax, less the Taxation expense as reported in the Consolidated statement ofcomprehensive income, adjusted for the tax impact of the adjusting items in arriving at Adjusted profit before tax.
The Adjusted earnings per share comprises the Adjusted profit after tax divided by the non-diluted weighted average number of shares asreported in note 7.
Half Year
Half YearYear
30 Jun 23
30 Jun 22
31 Dec 22
Calculation
€'000
€'000
€'000
Adjusted profit before tax
As above
55,81454,775
112,030
Consolidated statement of comprehensive
Taxationincome(8,669)(10,937)(20,612)
Tax arising on bridging items to Adjusted profit
before tax^
(3,464)(1,092)(4,043)Adjusted profit after tax
43,68142,74687,375
Denominator (weighted average number of
equity shares)
Note 778,558,801 76,478,194 76,979,596€c€c€c
Adjusted earnings per share
55.60
55.89
113.50Adjusted earnings per share % growth(0.5%)
34.4%
27.2%^Being mainly the tax impact of share-based payments expense €1.5m and amortisation of intangible assets €1.9m, with the prior period being mainly the tax impact of share-based payments
expense €0.9m, amortisation of intangible assets €0.9m, less foreign exchange €0.9m.

Return on capital employed (ROCE)ROCE represents the Adjusted profit before tax (excluding net interest costs, unwinding of discounted lease liabilities and bank charges, andalso adjusted to include pre-acquisition profits of current-year acquisitions), expressed as a percentage of the capital employed. As the Group
continues to make multiple acquisitions each year, the calculation further adjusts the Adjusted profit before tax and the capital employed as if
all the acquisitions made during each year were made at the start of that year. In order to present the measure consistently, the half year adjusted
profits are presented on a rolling 12 month basis.
Capital employed represents Total equity as reported on the Consolidated statement of financial position, adding back employee defined benefit
plan liabilities, cumulative amortisation of intangible assets (customer relationships), acquisition-related liabilities (deferred and contingent
consideration), together with loans and borrowings, while deducting cash and cash equivalents.

Calculation
Adjusted profit before tax
Interest received
Bank charges
Interest expense
Unwinding of discounted liabilities - lease liabilities
Pre-acquisition profits of current year acquisitions
Adjusted profit before tax including preacquisition profit excluding interest for the period
Rolling 12 month adjustment
Adjusted profit before tax including preacquisition profit and excluding net interest
Total equity
Employee defined benefit plans
Cumulative amortisation of intangibles assets(customer relationships)
Deferred and contingent consideration
Loans and borrowings
Cash and cash equivalents
Capital employed

Return on capital employed

Half Year
30 Jun 23€'000
55,814
(154)
353
2,231
631
1,257

Half Year
30 Jun 22€'000
54,775
(102)
317
629
465
-

Year
31 Dec 22€'000
112,030
(309)
662
1,261
969
1,601

60,13260,13056,084
48,115116,214-120,262

104,199

116,214

Consolidated statement of financial position
Consolidated statement of financial position

594,6393,601

530,3293,270

557,091
2,861

Note 13
Note 14
Consolidated statement of financial position

67,49076,64455,215(43,804)
753,785

51,08744,027
95(121,395)
507,41358,301
63,25351(81,886)
599,671

16.0%

20.5%

19.4%

As above
Note 6Note 6Note 6Note 6Note 17

Adjusted profit before tax including preacquisition profit and excluding net interest
expense / capital employed36

Free cash flow
Free cash flow represents Net cash generated by / (used in) operating activities as reported in the Consolidated statement of cash flows,
adjusted for acquisition and integration cash outlay, capital expenditure, net interest paid, payments of principal on lease liabilities and ispresented both before and after taxation paid. In order to present the measure consistently year-on-year, the impact of other income is also
excluded.

Calculation
Net cash generated by / (used in) operating
activities
Acquisition and integration cash outlay:
Costs of acquisition and integration
Fair value adjustments to contingent
consideration
Non-cash movements in Deferred and contingent
consideration related to continuous employment
Acquisition of property, plant and equipment
Investment in intangible assets
Other income
Interest received
Interest paid
Payments of principal on lease liabilities
Free cash flow after tax
Taxation paid
Free cash flow before tax

Half Year
30 Jun 23€'000

Half Year
30 Jun 22
€'000

Year
31 Dec 22€'000

Consolidated statement of cash flows

28,90540,565

124,286

Consolidated statement of comprehensive
income

7,335

1,284

8,413

-

-

(2,282)(4,332)(18,799)(1,325)(9,997)(178)(3,000)(27,007)(501)

154(2,376)(6,822)
2,740
7,913
10,653(1,107)102(878)(5,453)24,3386,181
30,519(1,098)309(1,797)(11,361)
85,962
17,505
103,467

Consolidated statement of cash flows

Consolidated statement of cash flows
Consolidated statement of cash flows
Consolidated statement of comprehensive
incomeConsolidated statement of cash flows
Consolidated statement of cash flows
Consolidated statement of cash flows
Consolidated statement of cash flows

Adjusted free cash flow
Adjusted free cash flow is a measure of cash flow adjusting for capital expenditure that is supporting growth in future periods (as measured bycapital expenditure in excess of maintenance capital expenditure).

Calculation
Free cash flow before tax
Capital expenditure in excess of depreciation:
Acquisition of property, plant and equipment
Depreciation - property, plant and equipment
Capital expenditure in excess of depreciation
Adjusted free cash flow

As above
Consolidated statement of cash flows
Consolidated statement of cash flows

Half Year
30 Jun 23€'000
10,653

Half Year
30 Jun 22€'000
30,519Year
31 Dec 22€'000
103,467

18,799(10,907)
7,892
18,545

9,997(8,790)1,207
31,72627,007(18,365)
8,642
112,109

Half Year
30 Jun 23€'000
18,54555,814

Half Year
30 Jun 22€'000
31,72654,775Year
31 Dec 22€'000
112,109
112,030

33.2%

57.9%

100.1%

Adjusted cash conversion rate
The Adjusted cash conversion rate is the Adjusted free cash flow as a percentage of the Adjusted profit before tax:

Calculation
Adjusted free cash flow
Adjusted profit before tax

Adjusted cash conversion ratio

As above
As aboveFree cash flow before tax and capital expenditure
in excess of depreciation, as a % of Adjusted
profit before tax

Net debt
The Group manages capital by monitoring debt to capital and net debt ratios. Net debt is calculated as Loans and borrowings (as shown in theConsolidated statement of financial position) less Cash and cash equivalents, and excludes Lease liabilities.

Calculation
Loans and borrowings
Cash and cash equivalents
Net debt / (net cash) position

Consolidated statement of financial position
Consolidated statement of financial position

Half Year
30 Jun 23€'000
55,215(43,804)
11,411

Half Year
30 Jun 22€'000
95(121,395)(121,300)

Year
31 Dec 22€'000
51(81,886)(81,835)37