21 September 2022
Keywords Studios PLC ("Keywords Studios", “Keywords”, the “Group”)
Interim results for the six months to 30 June 2022
Strong Organic Revenue growth and healthy demand
Keywords Studios, the international technical and creative services provider to the global video games
industry, today announces its interim results for the six months to 30 June 2022.
Financial Overview:

Results for the six months ended 30 June
Group revenue
Organic Revenue growth1

Adjusted EBITDA
Adjusted EBITDA margin
EBITDA

2

Adjusted profit before tax
Adjusted profit before tax margin
Profit before tax

3Adjusted earnings per share
Earnings per share

42Interim dividend per share
Adjusted cash conversion rate
Net cash / (net debt)

5

H1 2022

H1 2021% change€ 321.1m+ 21.7%€ 238.7m+ 22.9%+ 34.5%€ 70.1m
21.8%€ 61.0m€ 50.7m
21.2%€ 40.8m+ 38.3%€ 54.8m
17.1%€ 39.1m€ 39.7m
16.6%€ 21.9m+ 38.0%55.89c36.80c41.57c20.86c+ 34.4%+ 76.4%

0.77p

0.70p

57.9%

94.9%

€ 121.3m€ 84.1m+ 49.5%+ 78.2%Highlights:
Strong H1 revenue growth reflecting healthy demand across a diversified service offering••Group revenue up 34.5% to €321.1m (H1 2021: €238.7m), driven by sustained demand for highquality content and a continuing trend towards external service provision
Organic Revenue growth of 21.7% in the first half, with good contributions across all service lines

Profitability and cash generation underpinning strong balance sheet and liquidity
•
•

•

•

Adjusted profit before tax rose 38.0% to €54.8m, with margin increasing to 17.1% (H1 2021: 16.6%)
Adjusted Free Cash Flow of €31.7m (H1 2021: €37.7m) with an Adjusted Cash Conversion rate of
57.9%, lower than H1 2021 (94.9%), reflecting the return to the regular H2 collection cycle of MultiMedia Tax Credits (MMTCs) and working capital phasing. FY Adjusted cash conversion rate
expectations unchanged at ~80%
Net cash of €121.3m (H1 2021: €84.1m), after €13.6m net cash spend on acquisitions, and together
with €150m undrawn Revolving Credit Facility, well positioned to continue pursuing organic andacquisition growth strategies
Interim dividend of 0.77p per share, an increase of 10% on the 2021 interim dividend (H1 2021:
0.70p)-1-

Set out and delivering against strategy to drive sustainable growth, facilitated by simplified
structure to enhance culture and collaboration•••

Intending to drive strategic partnerships, whilst adopting new technologies that enable us to do
more for our clients as well as exploring adjacent markets
Simplified structure to drive culture, collaboration and support talent acquisition
Divisional results now reported across three segments, each of which performed well:o Create (Game Development and Art Services)o Globalize (Audio Services, Localization, and Functional and Localization Testing)o Engage (Player Support and Marketing)

Delivering on our acquisition strategy
•
•
•
•

•

Three acquisitions for a total maximum consideration of €67.2 million
Acquisition of Forgotten Empires completed in August, enhancing the reach and scale of theGroup's Create service line
Acquisition of Mighty Games completed in August, bringing an innovative and proprietary AI-based
Testing technology platform
Acquisition of Smoking Gun Interactive announced today, whose game development expertise andlive operations capabilities will enhance our client offering, and providing access to a high-quality
team in Vancouver
Actively engaging with selective targets from an extensive pipeline of opportunities

Tangible progress against Resposible Business goals•••

Sustainable Studios initiative progressed following completion of an internal review of energy andrecycling practices
Strengthened partnership with Women in Games which seeks to accelerate measurable improvementin opportunities for existing and future women in Keywords and the video games industry
Initiatives making Keywords a great place to work increasingly recognised with studios in Mexico,
Philippines and the UK all receiving industry awards

Current trading and outlook
•
•
•

•

Encouraging start to the second half, with continued healthy demand across all service lines
Mindful of a more uncertain macroeconomic environment and some potential volatility in thescheduling of certain projects
Confident of delivering a performance in line with recently upgraded market expectations with H2organic growth rates moderating and Adjusted PBT margins moving to historic levels of c.15% as
we invest in the business, as previously guided
Well positioned to increase market share and well-funded to continue to deliver on our value
accretive acquisition strategy

Bertrand Bodson, Chief Executive Officer of Keywords Studios, commented:“The Group has delivered a strong performance in the first half, with a heightened focus on high-quality
content and the continued trend towards external service provision in the industry, driving healthy demandacross our service lines. Initial trading in the second half has been encouraging and we are confident ofdelivering a performance in line with the recently upgraded market expectations for the full year.
It has been a busy period, as we set out and started to deliver against our strategy to take Keywords to thenext level by getting closer to our clients, adopting new technologies, driving culture and talent acquisition-2-and exploring adjacent markets. As part of this we have simplified our structure to facilitate deeper
collaboration across the business and enhance our support for our clients whilst continuing to deliver on our
M&A strategy, welcoming Forgotten Empires, Mighty Games and Smoking Gun Interactive to Keywords.
Going forward, Keywords is increasingly well-positioned to capture a greater share of our large addressable
market. We are the clear market leader with unrivalled global scale and a unique service platform acrossthe entire content development life cycle and will continue to cement and build upon our position as thepartner of choice for the global video games industry, and beyond.”
A presentation of the half year results will be made to analysts at 9.45am this morning and the live webcast
can be accessed via this link:
https://stream.brrmedia.co.uk/roadcast/6308c58fda906b287e9a045c

To register for dial in access, or for any enquiries, please contact MHP Communications on
keywords@mhpc.com.
For further information, please contact:
Keywords Studios (www.keywordsstudios.com)
Bertrand Bodson, Chief Executive Officer
Jon Hauck, Chief Financial Officer
Giles Blackham, Investor Relations+353 190 22 730

Numis (Financial Adviser, Nominated Adviser and Corporate
Broker)Stuart Skinner/Kevin Cruickshank/Will Baunton+44 20 7260 1000

MHP Communications (Financial PR)
Katie Hunt/Eleni Menikou/Charles Hirst+44 20 3128 8193
keywords@mhpc.com

About Keywords Studios ( www.keywordsstudios.com )Keywords Studios is an international technical services provider to the global video games industry.
Established in 1998, and now with over 70 facilities in 26 countries strategically located in Asia, Australia, theAmericas and Europe, it provides integrated art creation, game development, testing, localization, audio,
marketing services and player support services across more than 50 languages and 16 games platforms toa blue-chip client base of over 950 clients across the globe.
Keywords Studios has a strong market position, providing services to 23 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 Anthem, Star Wars Jedi: Fallen Order,
Valorant, League of Legends, Fortnite, 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 thebusiness which are not GAAP measures as defined by International Financial Reporting Standards (IFRS). The
Directors believe these measures provide valuable additional information for the users of the financial information tounderstand the underlying trading performance of the business. In particular, adjusted profit measures are used toprovide the users of the accounts a clear understanding of the underlying profitability of the business over time. For full-3-

definitions and explanations of these measures and a reconciliation to the most directly referenceable IFRS line item,
please refer to the APMs section at end of the statement.
1

2

3

4

5
6
7
8

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 prior year 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 for amortisatio n andimpairment of intangible assets, depreciation, and deducting bank charges. Adjusted EBITDA comprises EBITDA, adjusted for sharebased paymentexpense, costs of acquisition and integration and non-controlling interest.
Adjusted profit before tax comprises Profit before taxation as reported in the Consolidated statement of comprehensive income, adjusted
for share-based payment expense, costs of acquisition and integration, amortisation and impairment of intangible assets, non-controllinginterest, foreign exchange gains and losses, and unwinding of discounted liabilities. In order to present the measure consistently yearon-year, other income is excluded.
Adjusted earnings per share comprises the adjusted profit after tax divided by the non-diluted weighted average number of shares asreported. The adjusted profit after tax comprises the adjusted profit before tax, less the tax expense as reported in the Consolidated
statement of comprehensive income, adjusted for the tax impact of the adjusting items in arriving at adjusted profit before tax.
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 (asmeasured by capital expenditure in excess of maintenance capital expenditure).
Pro Forma Revenue is calculated by adding pre-acquisition revenues of current year acquisitions to the current year revenue numbers, toillustrate the size of the Group had the acquisitions been included for a full financial year.
As at 20 September 2022, company compiled analysts' forecasts gave a consensus for FY 2022 of €642m of revenue and €102m ofadjusted profit before tax.

CEO Review
Keywords delivered strong organic growth in the first half, reflecting healthy demand for our services. We also
expanded our solutions, reach and scale through selective acquisitions.
Group revenues increased 34.5% to €321.1m (H1 2021: €238.7m), or 21.7% on an Organic 1 basis, building on
the strong momentum achieved in 2021 (H1 2021: 22.9%), as we continued to benefit from the renewed focus
on high quality content post pandemic, and the structural trend towards external service provision. The strongorganic growth was complemented by contributions from the six acquisitions completed during 2021.
As announced at our Capital Markets Day (CMD) in June, we have simplified our structure to strengthen
collaboration across the business while retaining our inherent culture of entrepreneurialism. As a result, we now
report divisional results in three segments; Create (combining the former Art Services and Game Development
service lines); Globalize (the former Audio Services, Localization, and Functional and Localization Testing
service lines); and Engage (the former Player Support and Marketing service lines).
The Create and Globalize services lines both delivered a strong performance as the focus on developing newcontent which gained momentum 2021, continued into 2022 and started to benefit our post production services(Globalize) to a greater extent. Engage saw more modest growth, with good growth from Player Support
partially offset by Marketing, in part due to its exceptionally strong performance in the first half of last year (H12021 organic growth for Marketing was 50.6%) and the impact of certain project delays moving work into H2and early next year.
I am extremely proud of all our talented Keywordians who have continued to work with such passion andcommitment, delivering the consistently high-quality service we are known for. The Group’s strong start to theyear, combined with our unrivalled scale, reach and breadth of solutions, and our strong financial position,
leave Keywords well placed to continue to increase our share of our large addressable market, including
through selective acquisitions, as we cement our position as the partner of choice for the global video games
industry and beyond.
Delivering on our strategy to capitalise on our market opportunity
The video games market is large, dynamic and growing. In 2021, the overall video games market wasestimated to be c.$240 billion and is expected to grow at a CAGR of 5% between 2021-2024. Of this, $35bn
is estimated to have been spent on video games content in 2021 and this is predicted to grow to $48bn by2026, of which the proportion delivered by external service providers, such as Keywords, is expected to grow-4-

from $11bn in 2021 to $18bn in 2026, representing a 10% CAGR over this period (Source: IDG Consulting2021).
The scale, strength and breadth of our platform positions us to capitalise on this increasing demand for ourcontent development and delivery services, driven by:
•
•
•
•
•
•

ongoing strong demand for AAA console/PC content, with the recently launched next-generation
consoles scaling up content, which is expected to result in an enlarged market;
further development of new and existing video games streaming platforms driving demand for both content
generation and ongoing in-game support, and a constantly evolving platform;
mobile game growth, as global penetration of smartphones increases;
the return to content creation in 2021, which primarily benefitted earlier stage services lines, continuing
into 2022 and flowing through to later stage, postproduction services (Globalize) to a greater extent;
increasing complexity in game development, leading to significantly higher costs and budgets, driving
demand for external providers with more flexible access to talent and technology-enabled solutions; andgrowth in Games as a Service (GaaS) and Live Operations (LiveOps) which drives continuous content
expansion to deepen the gaming experience, extending the lifespan of games and the levels of player
engagement.

Despite the size of the external service provision market, it remains highly fragmented and characterised by
predominantly local, single-service providers. Keywords has just a ~5% market share yet is three times the sizeof the next largest provider, providing considerable scope for further growth. Our scale and breadth of offeringmeans we can offer solutions that our competitors can’t, enabling us to deepen long-standing relationships withthe leading publishers in the industry which in turn cements our position as the partner of choice.
In order to capitalise on this opportunity, we continue to invest in the business, both organically and throughtargeted acquisitions, to increasingly position the Group as a strategic partner to our clients. As such, we havecontinued to invest in new studios, refurbishing some sites to ensure our studios remain attractive places forour people to come together. During the period, we invested in a new studio in China, expanded in India, andentered a new lease in Ottawa, adding capacity to operations in these locations. We also renovated several
sites, including in Montreal and India Gurgaon, and transitioned our Katowice operation to a new, state-of-theart facility.
We have continued to deliver on our acquisition strategy this year, with the acquisitions of Forgotten Empires,
Mighty Games, and Smoking Gun Interactive. The Forgotten Empires and Smoking Gun Interactive acquisitions
extend the reach and scale of the Group's Create service line with two high-quality game development studios.
Mighty Games brings an innovative and proprietary AI-based Testing technology platform, which will allow us
to do more for our clients and remain at the forefront of our industry, in line with our strategy to develop more
technology-enabled solutions. We continue to actively review a healthy pipeline of acquisition opportunities.
Evolving our strategy
When I joined Keywords in December 2021, it was clear that it is a business with incredibly strong foundations
and a talented, diverse, more than 11,000-strong team delivering highly sought-after expertise. This gives theGroup unrivalled scale, as the only full-service platform spanning the entire content development lifecycle
and with the international scale to bring truly global solutions to our clients. We have strong, long-standing
relationships with our clients, which include almost all the world’s leading developers and publishers, and forwhom we work across all platforms, without carrying the risk associated with individual games.
Having gathered the views of stakeholders and clients across the business, and working closely with thewider senior leadership team, at our CMD in June we set out how we intend to build on these strong
foundations to further unlock Keywords’ considerable potential and deliver an ever-more compelling
proposition globally for our partners in the video games market, and adjacent content industries.
-5-Our key areas of focus to take Keywords forward and to drive sustainable growth are:•Strategic partnerships
We intend to deepen strategic customer partnerships to create and capture more value together and drive
more demand for Keywords’ services.
As the leader in the industry, we already work with 23 of the top 25 games publishers and all of the top
10 mobile publishers but there is a clear theme from discussions with clients that they want to elevate ourrelationships, make them more strategic and enhance our ability to cross-sell solutions that benefit ourcustomers’ needs as the industry evolves.
To facilitate this, we are investing in our Strategic Partnering capability by introducing new client-led roles
which will enable us to develop a deeper understanding of our clients’ longer-term pipelines andobjectives. This will deliver a more coordinated end-to-end approach, including at the title level, facilitating
greater cross service line and studio collaboration to capture more value throughout the Content
Development Lifecycle. We are also adding more structure into the relationships with our clients, including
Annual Business Reviews that we hold with our top clients to facilitate closer collaboration.

•

Technology
We plan to introduce new technologies that will enable Keywords to work smarter, do more for our clientsand stay at the forefront of the industry. This includes strengthening our internal capability to support
ongoing growth and ability to deliver larger, more complex work. While we have robust systems alreadyin place, we are aiming to make our infrastructure more seamless through better integration of oursystems across the business.
We are also seeking to incorporate automation which will enable us to deliver much more for clients. For
example, earlier this year we built an end-to-end automated solution for a key client to enhance theirlocalisation using our Kantan AI technology to deliver translations across a range of titles in over 30
languages. The solution operates continuously, with an expert from our team overseeing it at certain
touch points. This has enhanced our capabilities, allowing us to deliver work we would not previously
have been able to and to provide a solution truly embedded in the client’s workflows.
We continue to innovate to ensure Keywords is well positioned to scale, remains at the forefront of theindustry, and has the best technology in each of our service lines. When appropriate, we will acquireinnovative technology to develop in order to benefit our clients. For example, in August, our acquisitionof Mighty Games brought a proprietary AI-based Testing technology platform to Keywords,
complementing our existing testing capabilities.

•

One Keywords
We plan to galvanise the Group's "One Keywords" culture of entrepreneurialism and collaboration,
through our new simplified structure of three new service lines, Create, Globalize and Engage whichfacilitate more collaboration and scalability.
We recognise that one of the key strengths of our business is its entrepreneurial DNA. To retain this, weare amplifying the voice of the studios to ensure we have a global platform that combines invaluable local
knowledge with the benefits of our strong spine (of shared services) to support the growth of our studios.
Our executive team has been reorganised as part of the simplified structure, with new talent joining theorganisation to support our development. We also have a strong leadership team in place that was deeply
involved in the evolution of the strategy, and we have leveraged this in our studio hub model which isdesigned to both improve the support for the studios and enhance collaboration without adding layers ofmanagement.
-6-•Talent and Capabilities
We are establishing Keywords as the destination for talent and career development in the industry.
We’ve seen a significant improvement in our employee net promoter score in recent years demonstratinghigh levels of engagement and satisfaction across the business and we continue to focus on continuously
improving our employee value proposition. All people matters now sit under our new Culture leadershipteam, including talent acquisition and development, culture, engagement and responsible businessinitiatives.
We are working on aligning and better communicating our incentives and are investing in strategicallyacquiring and developing talent to enable our studios to grow faster, particularly within Game
Development, where demand and competition for talent is more pronounced across the industry. We
have expanded our initiatives to develop new talent through our Academies, which target graduates, andour ‘Bootcamps’ which look to provide those with some industry experience in games with the skills to
become ‘AAA’ game developers.
We are also seeking to replicate the success of our Art Academy, which has been highly successful indeveloping talent for our studios in India, by creating training courses across other services, particularly
game development, to develop a further pool of talent to support our game development studios aroundthe world. As part of this we have signed a Memorandum of Understanding with the National Skill
Development Corporation, one of the divisions of the Ministry of Skill Development and Entrepreneurship,
Government of India. This will help jointly fund, promote, and support the expansion of the Educational
Outreach programme called Keywords inGame Academy, as part of our Destination India initiative.

•

Adjacent Markets
We will leverage the Group’s capabilities to target closely adjacent markets that are increasingly utilising
video games expertise. Having considered a number of adjacent markets, we have decided to focus on
those that naturally fit with our current offering, or where we can transfer our gaming experience to otherclose verticals, many of which we are already working in.
We are developing a LiveOps offering, an interesting growth opportunity that builds on our existing
offering, as an increasing proportion of games are released as Games as a Service (GaaS), where
content is constantly iterated and developed. While we already work on a large number of these games,
we see a clear opportunity to work more strategically with our clients on their GaaS models and we are
excited to seek new ways to support them.
In Media and Entertainment, the TV / film market is predicted to be almost $150bn by 2025 (Source: IDG
Consulting 2021) and we are seeing convergence of both the customer base and the technology, withgame engines increasingly being used to create content. In addition, the TV/film localisation process ismuch the same as in games and we are already working in dubbing and subtitling (€16m revenue in2021), serving streaming platforms such as Netflix and Amazon which we will look to expand further.
Lastly, we are well positioned for the Web 3 / Metaverse and there is an opportunity to leverage ourexisting service propositions (rather than move into new areas such as infrastructure) to meet Metaverse
requirements such as large-scale art, live Q&A, and ‘player/user support’. We also see a role for us as aconsultant to large non-gaming brands and retailers looking to navigate the Metaverse and render their
proposition digitally.

•

Acquisitions
We will continue to build our platform through M&A, particularly in Game Development, Marketing,technology and selected adjacencies.
-7-M&A remains a core part of our strategy and we will continue to build on our track record of execution,with a disciplined and consistent process. In a highly fragmented market, M&A enables us to build ourplatform and strengthen our leadership position. By deploying capital at attractive valuations we can add
key capabilities, talent, client relationships and new technologies which will all help to accelerate ourgrowth.
We currently have a strong pipeline of opportunities, with a current focus on Create (Game Development
particularly) and Engage (Marketing particularly) capabilities, Technology and selected adjacencies,
albeit we will selectively consider acquisitions which build scale and capabilities in other services lines.
The whole management team is excited about the significant opportunities ahead to build an ever morecompelling proposition for the video games market, and beyond.
Responsible Business
We remain committed to conducting our business responsibly and operating to the highest standards ofhonesty, integrity, and ethical conduct. During the first half, we continued to focus on our priority areas of People(including diversity, equality, inclusion and belonging), Client, Communities, the Planet and Corporate
Governance, and we have continued to make good progress during the period under the guidance of the ESG
Committee of the Board.
During the period, our rating of ‘A’ (on a scale of AAA-CCC) for our 2021 MSCI ESG Ratings was confirmed,
an improvement from BBB in 2020. This rating, which analyses our resilience to long-term, industry material
environmental, social and governance risks, was pleasing, but we recognise that there is more we can do if weare to become a leader within the industry.
Following the quantification of our greenhouse gas emissions for the first time in 2020, in 2021 we developed
the Group's first Environmental Policy covering our energy and recycling practices. During the first half, we
completed our first internal review of practices across our studios, the findings of which will be used to inform
our approach to reducing our carbon intensity. This will help develop our Sustainable Studios programme
further and support our studios in their efforts to minimise energy usage and to reduce, recycle and reuse
wherever possible.
During the review, it became clear that the greatest area of opportunity will be a move to renewable energy
supplies wherever possible, something we are exploring on a studio-by-studio basis. Going forward, we will
also ensure that all new office and studio space meets modern environmental building requirements. We
recognise that our Sustainable Studios initiatives will take time to fully implement. We therefore continue tooffset our carbon impact with credits towards the Ntakata Mountains REDD+ project, which protects forests.
Revenue from the sale of certified carbon credits is paid directly to forest communities in Tanzania.
In 2021 the Group was composed of 25% women and 74% men, with a collective 1% of colleagues identifying
as non-binary or declining to disclose their gender. Gender diversity and addressing under-representation
remain a focus for the Board both across our business and the wider industry. The percentage of women
directors on the Board remains at 29% and we continue to apply inclusive appointment processes in line with
our Board Diversity Policy.
As an ambassador for Women in Games, we have strengthened this partnership in the first half, working on
future events and collaborations that proactively seek to accelerate the measurable improvement ofopportunities for existing and future women in games, both at Keywords and across our industry. We were very
proud to see Keywordians speaking at Women in Games events around the world during the period, and lookforward to planned initiatives that will continue to leverage our global platform and client relationships to support
this partnership in the second half and beyond.

-8-In recognition of our commitment to improving representation and development of women at Keywords, wehave held several events, including our second internal #Breakthebias Women’s Summit in Asia. Working with
Women in Games, our goal is to enhance and accelerate the popular ambassador initiative, enabling it to scale
through additional projects and research, events, exclusive materials, and services for Women in Gamesambassadors.
We continue to work hard to make Keywords a great place to work, with our initiatives increasingly recognised.
As an example of this, we are delighted that both our D3T Studio in Brighton and Indigo Pearl in London were
included in GamesIndustry.biz’s 2022 Best Places to Work Awards. Keywords Studios in Mexico has been
awarded the Socially Responsible Company (SRC) badge and Keywords Studios Manila has recently beenrecertified as one of the Great Place to Work companies in the Philippines with 91% of employees saying it
is a great place to work.
Supporting our people affected by the tragic events unfolding in the Ukraine remains a top priority. Our
employee hardship fund provides support to the small number of colleagues directly impacted by this crisis and
we are doing all that we can to provide broader support to those affected by this tragic situation.
Outlook
The Group has made an encouraging start to the second half and is experiencing healthy demand acrossour three service lines (Create, Globalize and Engage). We are benefitting from the continuing growth in the
broader video game market and the increasing trend for external service provision within the industry. As
such, whilst we acknowledge ongoing uncertainties in the macro-economic environment, the Board remains
confident of delivering a performance in line with recently raised market expectations for the full year.
Our position as the only full-service platform spanning the entire content development lifecycle with theinternational scale to bring truly global solutions to our clients means that we are very well positioned tocapitalise on our large and growing market opportunity. We are confident that the recently announced
strategy will build on our strong foundations and unlock Keywords’ considerable potential and deliver an evermore compelling proposition globally for our partners in the video games market, and adjacent content
industries.
Bertrand Bodson
Chief Executive Officer-9-Service Line Review
As announced at our CMD in June, we have simplified our structure and we now report segmental results inthree service lines; Create (the former Art Services and Game Development service lines); Globalize (theformer Audio Services, Localization, and Functional and Localization Testing service lines); and Engage (theformer Player Support and Marketing service lines). We now report Revenue and Adjusted EBITDA for each of
the three service lines, with H1 2021 and FY 2021 re-classified to present information aligned to the neworganisational and reporting structures and disclosed in Note 5 to the Financial Statements.
All our service lines saw good growth in H1 2022, supported by a strong video games market refocused on
new content creation, and the continued trend towards external service provision. The following table provides
a summary of our revenues by service line, with growth rates on a reported and Organic Revenue growth basis
as well as the Adjusted EBITDA margins for each service line.
% of H1
2022
Group
revenue

124.3
38.7%
141.5
44.1%
55.3
17.2%
321.1 100.0%

H1 2022
Revenue€mCreateGlobalize
EngageTotal

H1 2021
Revenue€mChangeyear onyear%

H1 2022
Organic
Revenue
growth%12 months
to30 June2022
Pro Forma
Revenue€m

H1 2022
Adjusted
EBITDA
margin %H1 2021
Adjusted
EBITDA
margin %

86.0
107.4
45.3
238.7

44.5%
31.8%
22.1%
34.5%

23.3%
25.7%
9.8%
21.7%

226.5
266.0
102.1
594.6

24.9%
22.0%
14.6%
21.8%

26.7%
19.6%
14.6%
21.2%

Create (Art Services and Game Development): 38.7% of Group revenues in H1
The new Create service line combines Art Services and Game Development, encouraging deeper
collaboration between the two to deliver a range of services to clients and partners globally. It represents
over 3,000 people in 24 studios across 46 locations.
H1 2022 Performance
Create performed well in the first half with total revenues up by 44.5% to €124.3m (H1 2021: €86.0m). Organic
Revenue, which excludes the impact of acquisitions, grew by 23.3%, as strong underlying client demand acrossall art and game development studios continued.
A number of Create studios demonstrated strong growth, with some delivering record performances,
particularly in Quebec and India. Since establishing Create, both our Art and Game Development studios havebenefitted from increased collaboration, which has yielded new opportunities with new and existing clients.
Across the Create service line, we have a strong focus on recruitment and retention and have established a
specific talent acquisition team for the service line, complementing local talent acquisition efforts. As
competition for talent continues our extensive geographic footprint allows us to hire from a broad number oflocations for talent around the world.
Despite being the most directly affected by the situation in the Ukraine, our Game Development studios have
performed well during the period. During the period we started the process to relocate people and work fromour single Russia-based business, Sperasoft, to alternative locations, including Poland, together with Serbia,
Armenia and Malta, where we have established new operations. While we have moved a significant numberof people and work, this has had a more limited impact on first half performance, with the second half of thecurrent financial year expected to be the key transition phase for this process. We are focussed on making
the transition as smooth as possible for both our people and international clients. H1 revenues derived from
our Russia-based business represented 5.5% of Group revenues (€17.8m).
Adjusted EBITDA in Create grew 34.3% to €30.9m in H1 2022 (H1 2021: €23.0m), with the Adjusted EBITDA
margin of 24.9% in H1 2022 slightly lower than the previous period (H1 2021: 26.7%) due to the stronger growth- 10 -

in Art changing the mix, and Game Development investing in capacity ahead of demand. The transition ofpeople and work from Russia is expected to hold margins back in H2, in line with our guidance for the Group.
We have welcomed three new Game Development studios this year, Forgotten Empires, the small gamedevelopment team at Mighty Games and the acquisition of Smoking Gun Interactive that has been announced
today. Forgotten Empires, headquartered in Ohio, has been instrumental in creating, designing and growing
the hugely successful Age of Empires series, and its talented team brings significant experience and expertiseto Keywords, particularly in real-time strategy games. Mighty Games’ talented game development team further
strengthens our presence in Australia, following the recent acquisitions of Tantalus and Wicked Witch. We arealso delighted to welcome Smoking Gun Interactive which has a long track record in developing, enhancing
and supporting highly rated, cross platform games and gives us access to a high-quality team in Vancouver.
The market opportunity and outlook
The underlying video games market remains healthy and is expected to have a strong focus on new content
during the second half of the year as developers continue to capitalise on higher player numbers and create
more sophisticated content to engage players for longer.
We expect continued strong demand across our Create service line, as the industry seeks to source more
highly-skilled, project-critical resources with integrated, collaborative approaches and as developers seek
external senior expertise that has traditionally been kept internal. While there are indications that some clientsare taking a more cautious approach to game investments given the current economic backdrop, the Create
service line remains resilient, due to the quality of our studios and talent and its strong client relationships,
globally.

Globalize (Audio, Localization and Testing): 44.1% of Group revenue in H1
Globalize brings together our Audio, Testing and Localization businesses to create a global business with nearly
5,000 people in 35 studios across 45 locations.
H1 2022 Performance
Globalize performed well in the first half with total revenues up by 31.8% to €141.5m (H1 2021: €107.4m).
Organic Revenue, which excludes the impact of acquisitions, grew by 25.7%.
All of the lines of business within Globalize performed well during the period as the benefits from the current
levels of content creation flowed through to the later stages of the development cycle that Globalize serves.
In Functional testing we saw accelerated growth, as our Polish operations relocated to a new state-of-the-art
facility and recruitment increased, and both India and Montreal performed well. We continued to grow ourteams to meet demand and are supporting a ‘follow the sun’ workflow, allowing us to distribute resources
across different geographies. We mitigated the impact of increased costs in some territories throughconsidered pricing adjustments, allowing us to continue to secure talent and maintain high quality output.
In Localisation, Text Localisation more than offset slightly slower Audio Localisation, in part due to thedevelopment of a specific AI driven workflow that was deployed in H1 for a key client. Audio Localisation was
impacted by delays to certain projects during the period.
Adjusted EBITDA in Globalize grew 47.4% to €31.1m in H1 2022 (H1 2021: €21.1m), with the Adjusted EBITDA
margin increasing from 19.6% in H1 2021 to 22.0% in H1 2022. Globalize has benefitted from operating
leverage due to its strong growth and the strength of the US dollar in which we invoice a proportion of our sales.

- 11 -

The market opportunity and outlook
We are continuing to see the trend towards external service provision continue across the various Globalizelines of business and, with our industry leadership position, are well-positioned to capture increasing demandacross this service line.
Activity levels across the service line remain high and we are continuing to recruit aggressively and distributework across studios to ensure client needs are met. Demand for testing services continues to grow and we are
expecting audio localisation to improve in H2 as projects come through. In parallel with this we will continue tobuild on the Kantan localisation technology.
Engage (Marketing and Player Experience): 17.2% of Group revenue in H1
Our Engage service line brings together our Marketing and Player Experience services to create a service
offering focused on player engagement, encompassing over 2,000 people in 28 studios across 30 locations.
H1 2022 Performance
Engage performed well in the first half with revenues up by 22.1% to €55.3m (H1 2021: €45.3m). Organic
Revenue, which excludes the impact of acquisitions, grew by 9.8% for Engage.
Player Support performed strongly with the addition of a number of new clients and good growth across our
top clients. Social Media and Health and Safety Services also continue to grow and are developing into a key
part of our offering. We are also developing our Kantan AI machine translation capability to extend thenumber of languages that our agents are able to service.
Our Marketing studios delivered a more modest performance in part due to the exceptional performance in
H1 2021, during which the business experienced significant organic growth of over 50%. In addition, the H1
2022 performance was impacted by some client specific project delays, particularly across our North
American studios.
Adjusted EBITDA grew 22.7% to €8.1m in H1 2022 (H1 2021: €6.6m), with the H1 2022 Adjusted EBITDA
margin of 14.6% in line with the previous year period (H1 2021: 14.6%).
The market opportunity and outlook
The creation of the Engage service line, presents an exciting opportunity to better demonstrate the breadthof our offering to publishers. It allows us to offer an improved portfolio of services to clients, supporting deeper
relationships.
We continue to broaden our Marketing service range, with the aim of offering an end-to-end holistic solution
and increase the number of major clients we support. In Player Support, positive first half trends are expected
to continue in H2, with our operations in both Manila and Mexico experiencing significant growth. As
highlighted previously, the successful integration of our Machine Translation AI, Kantan, provides further
opportunities for the business and is something we are looking to build on moving forward.

- 12 -

Financial and Operating Review
Strong revenue growth and margin performance
Revenue
Revenue for H1 2022 increased by 34.5% to €321.1m (H1 2021: €238.7m). This growth was supplemented
by the impact of acquisitions in 2021, and benefited by €17.5m (~7%) from the impact of currency
movements, particularly the strengthening of the US dollar against the Euro in the period.
Organic Revenue growth (which adjusts for the impact of acquisitions) was up 21.7%. This was driven by astrong performance across all service lines, against the comparative period in H1 2021, particularly in ourCreate and Globalize Service Lines. 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 2022 was €124.5m (H1 2021: €91.1m) representing an increase of 36.7%. The grossmargin improved by 0.6% points to 38.8% (H1 2021: 38.2%) compared to the prior period partly driven by a
~1% point benefit from foreign exchange from the strong US dollar during the period in which we invoice a
proportion of our sales.
Operating costs
Adjusted operating costs increased by 34.5% to €54.4m (H1 2021: €40.4m), reflecting the larger Group, but
remained constant at 16.9% of revenue. This was driven by continued good cost control, as the Group looked
to manage the impact of increased travel and entertainment costs as these activities increased with theeasing of COVID-19 restrictions.
EBITDAEBITDA increased 49.5% to €61.0m (H1 2021: €40.8m). Adjusted EBITDA increased 38.3% to €70.1m
compared with €50.7m for H1 2021. The Adjusted EBITDA margin in H1 2022 of 21.8% was 0.6% pts higher
than H1 2021 (21.2%) reflecting the strong growth in revenues whilst managing costs, together with thefavourable foreign exchange impact noted above.
Net finance costs
Net finance costs reduced by €2.0m to €0.4m (H1 2021: €2.4m), primarily driven by a €2.4m foreign exchange
gain compared to a €0.5m foreign exchange loss in H1 2021. This benefit was partially offset by an increasein the unwinding of discounted liabilities relating to deferred consideration of €0.7m compared to H1 2021.
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 the users of the financial information to understand the underlying trading performance of thebusiness. In particular, adjusted profit measures are used to provide the users of the accounts a clear
understanding of the underlying profitability of the business over time. A breakdown of the adjusting factors
is provided in the table below:

Share based payment expense
Costs of acquisition and integration
Amortisation of intangible assets
Foreign exchange and other items

H1-22
€m

H1-21
€m

8.9
1.3
7.5
(2.0)
15.7

8.5
1.5
6.6
1.2
17.8

- 13 -

1.1m options were granted under the Long-Term Incentive Plan in H1 2022. This, together with grants fromprevious years, has resulted in a non-cash share option expense of €8.9m in H1 2022 (H1 2021: €8.5m).
One-off costs associated with the acquisition and integration of businesses amounted to €1.3m (H1 2021:€1.5m). Amortisation and impairment of intangible assets charge increased by €0.9m to €7.5m (H1 2021:€6.6m) reflecting the recent levels of acquisition activity.
Foreign exchange and other items amounted to a net gain of €2.0m (H1 2021: €1.2m charge). Keywords
does not hedge foreign currency exposures. The effect 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 oftranslating net current assets held in foreign currencies. This resulted in a net foreign exchange gain of €2.4m,
recorded within financing income (H1 2021: €0.5m loss).
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 statement.
Profit before taxation
Profit before tax increased by €17.2m (+78.2% year on year) to €39.1m (H1 2021: €21.9m). Adjusted profit
before tax, which adjusts for the items described in the APMs section above increased by €15.1m (+38.0%
year on year) to €54.8m compared with €39.7m in H1 2021. This represents an improvement in Adjusted
profit before tax margin of 0.5% pts to 17.1% (H1 2021: 16.6%), although it includes a ~1% point benefit fromforeign exchange, particularly the strong US dollar during the period as we invoice a proportion of our sales
in US dollars.
Taxation
The tax charge increased by €4.6m to €10.9m (H1 2021: €6.3m) largely reflecting the increase in the Profit
before tax of 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 2022 was 22.0% (H1 2021: 21.5%), slightly
higher than the rate of 21.6% in FY 2021.
Earnings per share
Basic earnings per share increased by 76.4% to 36.80c (H1 2021: 20.86c) primarily reflecting the increasein the statutory Profit after tax of 80.0%. Adjusted earnings per share which adjusts for the items noted in the
APMs section above and the tax impact arising on these items was 55.89c representing an increase of 34.4%(H1 2021: 41.57c), with the rise in Adjusted profit before tax of 38.0% partially offset by a 2.0% increase in
the basic weighted average number of shares.

- 14 -Cash flow and net debt
H1-22
€m
70.1
(10.4)(12.7)(10.0)
(0.2)

H1-21
€m
50.7
(3.8)
1.7
(9.4)
(0.2)

Change
€m
19.4
(6.6)
(14.4)(0.6)-

Payments of principal on lease liabilities

(5.5)

(4.6)

(0.9)

Operating cash flows

31.3

34.4

(3.1)

Interest paid

(0.8)

(0.8)

-

Free cash flow before tax

30.5

33.6

(3.1)

Tax

(6.2)

(9.8)

3.6

Free cash flow
M&A - acquisition spend
M&A - acquisition and integration costs
Other Income
Dividends paid

24.3
(13.6)
(1.3)
1.1
(1.3)

23.8
(44.7)
(1.5)
-

0.5
31.1
0.2
1.1
(1.3)

Adjusted EBITDA
MMTC and VGTR
Working capital and other items
Capex - property, plant and equipment (PPE)
Capex - intangible assets

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

2.4

2.3

0.1

11.6

(20.1)

31.7

4.1

1.3

2.8

Increase in net cash / (debt)

15.7(18.8)

34.5

Opening net cash / (debt)

105.6

102.9

Closing net cash / (debt)

121.3

84.1

The Group generated Adjusted EBITDA of €70.1m in H1 2022, an increase of €19.4m from €50.7m in H1
2021. There was a €10.4m outflow in respect of the amounts due for Multi-Media Tax Credits (MMTC) as we
returned to the regular H2 collection cycle of MMTC and Video Games Tax Relief (VGTR). MMTCs and
VGTRs are subsidies that are recognised as work is performed but are typically paid in the second half ofthe following year. Other working capital increased by €12.7m compared to an inflow of €1.7m in H1 2021
due to the strong growth in the business and working capital phasing.
Investment in property, plant and equipment increased by €0.6m to €10.0m (H1 2021: €9.4m) as we
continued to invest in growing the business. We are opening a number of new facilities in H2 and anticipate
higher capex levels. Property lease payments of principal of €5.5m were 19.6% higher than the prior period(H1 2021: €4.6m) mainly related to acquisitions in the period.
Operating cash flows of €31.3m were below H1 2021 (€34.4m), primarily due to the €21.0m increase inworking capital, partially offset by a €3.6m reduction in cash tax paid to €6.2m (H1 2021: €9.8m) as the Groupbenefitted from timing differences that resulted in less payments in the period in respect of the 2021 tax
payable. Net interest payments were flat at €0.8m.
This resulted in Free cash flow of €24.3m, slightly ahead of H1 2021 (€23.8m). Adjusted free cash flow, which
adjusts for capital expenditure that is supporting growth in future periods was €31.7m in H1 2022, below H12021 (€37.7m) and resulted in an Adjusted cash conversion rate of 57.9% (H1 2021: 94.9%). The lower ratein the first half is largely due to the working capital phasing noted above and we continue to expect Adjusted
cash conversion of ~80% for the full year.
Cash spent on acquisitions totalled €14.9m, of which €13.6m was in respect of the cash component of prioryear acquisitions and €1.3m was in relation to acquisition and integration costs. This was €31.1m lower than
- 15 -

the spend in H1 2021 due to the timing of acquisitions. This, together with foreign exchange and othermovements of €4.1m, resulted in an increase in net cash of €15.7m in H1 2022, leading to closing net cashof €121.3m (H1 2021: net cash of €84.1m, FY 2021: net cash of €105.6m).
Balance sheet and liquidity
The Group funds itself primarily through cash generation and a syndicated revolving credit facility (RCF) of€150m, with an accordion option to increase this up to €200m. The RCF matures in December 2024 with an
option to extend the term by two further one-year periods. The majority of Group borrowings are subject totwo financial covenants that are calculated in accordance with the facility agreement:••

Leverage: Maximum Total Net Borrowings to Adjusted EBITDA ratio of 3 times; andInterest cover: Minimum Adjusted Operating Profit to Net Finance Costs ratio of 4 times.

The Group entered the year with a strong balance sheet, with net cash (excluding IFRS 16 leases) of €105.6m
as at 31 December 2021. Following €13.6m of cash deployed in the period to support the Group’s value
accretive M&A programme, at the end of H1 2022, Keywords had net cash (excluding IFRS 16 leases) of€121.3m and undrawn committed facilities of €150m.
Dividend
Following a period of robust growth and increased profitability and cash generation, and reflecting the Board’s
confidence in the future, the Board is pleased to declare an interim dividend of 0.77p per share (H1 2021:
0.70p) representing an increase of 10.0% on the 2021 interim dividend. The Board’s progressive dividend
policy seeks to reflect the Group’s continued growth in earnings and strong cash generation, balanced with
the need to retain the resources to fund growth opportunities, in line with our long-term strategy of driving
compounded growth through carefully selected acquisitions.
Payments will be made on 28 October 2022 to shareholders on the register on 7 October 2022 and will go
ex-dividend on 6 October 2022. The interim dividend payment will represent a total cost of approximately€0.7m of cash resources.
Guidance for remainder of 2022
We have made an encouraging start to the second half of the year and expect demand to continue to behealthy across our service lines, albeit with organic growth rates and margins moderating in the second half
as previously guided.
Full year Adjusted Profit Before Tax margins are expected to return towards ~15% as investment in thebusiness and the return of certain costs to pre-COVID levels are expected to offset the FX benefits, while theincreasing transition of our people and work from Russia is also expected to hold back margins in the second
half. 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 2021 relative to revenue, reflecting some
expansionary capex but we are still targeting a full year Adjusted Cash Conversion rate of around ~80%.
Following the trading update in early August, all of the above items are reflected in the recently increased
current revenue and profit market consensus* for 2022.
Jon Hauck
Chief Financial Officer*As at 20th September 2022, company compiled analysts’ expectations gave a consensus for FY 2022 of€642m for revenue and €102m for Adjusted Profit Before Tax (prior to the August trading update €612m and€94m respectively).

- 16 -

Cautionary statement
This press release may contain forward-looking statements. These statements can be identified by the factthat they do not relate only to historical or current facts. Without limitation, forward-looking statements often
use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will, may, should, would,
could or other words of similar meaning. These statements may (without limitation) relate to the Company's
financial position, business strategy, plans for future operations or market trends. No assurance can be giventhat any particular expectation will be met or proved accurate, and shareholders are cautioned not to place
undue reliance on such statements because, by their very nature, they may be affected by a number of known
and unknown risks, uncertainties and other important factors which could cause actual results to differ
materially from those currently anticipated. Any forward-looking statement is made on the basis of information
available to Keywords Studios plc as of the date of the preparation of this press release. All forward-looking
statements contained in this press release are qualified by the cautionary statements contained in thissection. Other than in accordance with its legal and regulatory obligations, Keywords Studios plc disclaims
any obligation to update or revise any forward-looking statement contained in this press release to reflect any
change in circumstances or its expectations.

- 17 -

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

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

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

Unaudited
Half Year
30 Jun 21€'000
238,664(147,541)
91,123(8,454)(1,464)(6,553)(16,471)(50,331)(66,802)
24,321

AuditedYear
31 Dec 21€'000
512,200(312,086)
200,114(16,394)(7,972)(13,688)(38,054)(111,695)(149,749)
50,3652,514(2,889)39,078(10,937)
28,14149(2,442)
21,928(6,286)
15,642

2,045(4,427)47,983(13,875)
34,108

-

(100)

27

11,875
7,148
162
47,326

3,118
8,713
27,3738,228
14,581
56,94428,186(45)
28,141

15,675(33)
15,642

34,175(67)
34,10847,209117
47,326

27,406(33)
27,37357,011(67)
56,944€ cent36.80
35.52€ cent20.86
19.73€ cent45.16
42.98* Other income represents the gain on disposal of the Group’s investment in AppSecTest, made in April 2022 (including related Non-controlling interest re-cycled on disposal).

- 18 -

Condensed interim consolidated statement of financial position

Note
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
Non-controlling interest
Total equity

9
9
9

10
10

13
14
16

13
14
16

11
11
11
11

UnauditedAt
30 Jun 22€'000

UnauditedAt
30 Jun 21€'000

AuditedAt
31 Dec 21€'000

361,51034,01438,31921,786
175
455,804

343,273
39,45331,443
18,494
432,663

353,943
35,99136,01821,468175
447,595

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

84,28562,40546,988
193,678

105,71068,067
49,1106,764
229,651

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

9,060
98,286
9,112
11,353
127,81165,867

11,122
108,423
81
12,635
11,217
143,478
86,173

8,007
3,270
31
17,016
24,76653,090530,329

21,6592,989
165
16,48529,43470,732427,798

18,254
3,088
48
13,84026,41861,648472,120912
810
40,984275,02131,84455,970124,788
530,329
530,329

896
4,808
25,198276,987
1,843(1,997)40,25379,893427,881(83)
427,798

904
2,185
38,549273,677
12,821(1,997)48,19397,905472,237(117)
472,120- 19 -

Condensed interim consolidated statement of changes in equity

Mergerreserve

Foreignexchangereserve

Sharesheld in
EBT

Sharebased
payments
reserve

Retainedearnings

Total
attributableto ownersof parent

Noncontrollinginterest

Total
equity

€'000

€'000

€'000

€'000

€'000

€'000

€'000

€'000

€'000

13,047

22,951

250,276(9,988)(1,997)31,79964,318371,285(50)

371,235

-

-

-

-

-

-

-

-

-

-

-

15,675

15,675(33)

15,642

11,831

-

-

(100)

11,731-

11,731----

11,831--

15,57527,406(33)

27,373

Shares issued for cash
Share-based payments
expense

-

-

-

-

-

-

-

-

-

-

-

-

-

Share options exercised

6

-

-

-

-

-

8,454

-

8,454

-

8,454

2,247

-

-

-

-

-

2,253

-

Employee Share Purchase Plan

-

-

2,253

-

-

-

-

-

-

-

-

Dividends
Acquisition related issuance ofsharesContributions by andcontributions to the owners

-

-

-

-

-

-

-

-

-

-

-

-

11

(8,239)-26,711----

18,483-18,48317(8,239)2,247

26,711

-

-

8,454

-

29,190-29,190

At 30 June 2021

896

4,808

25,198276,987

1,843(1,997)40,25379,893427,881(83)

427,798

Profit / (loss) for the period

-

-

-

-

-

-

-

18,50018,500(34)

18,466

Other comprehensive income
Total comprehensive income
for the period
Contributions by andcontributions to the owners:

-

-

-

-

10,978--127

11,105-

11,105----

10,978--18,62729,605(34)

29,571

Shares issued for cash
Share-based payments
expense

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

7,940

-

7,940

-

7,940

Share options exercised

5

-

2,682

-

-

-

-

-

2,687

-

2,687

Employee Share Purchase Plan

-

-

398

-

-

-

-

-

398

-

398

Dividends
Acquisition related issuance ofsharesContributions by andcontributions to the owners

-

-

-

-

-

-

-

(615)

(615)

-

(615)

3

(2,623)

10,271(3,310)

-

-

-

-

4,341

-

4,341

Share
capitalSharecapital - tobe issued

Sharepremium

€'000

€'000

At 01 January 2021

879

Profit for the period
Other comprehensive income
Total comprehensive income
for the period
Contributions by andcontributions to the owners:

8(2,623)

13,351(3,310)

-

-

7,940

(615)

14,751-

14,751904

2,185

38,549273,677

12,821(1,997)48,19397,905472,237(117)

472,120

Profit / (loss) for the period
Recycled on disposal ofsubsidiary

-

-

-

-

-

-

-

28,18628,186(45)

28,141

-

-

-

-

-

-

-

-

-

162

162

Other comprehensive income
Total comprehensive income
for the period
Contributions by andcontributions to the owners:

-

-

-

-

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

47,326

Shares issued for cash
Share-based payments
expense

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

8,886

-

8,886

-

8,886

Share options exercised

7

-

1,953

-

-

1,997

(1,163)

-

2,794

-

2,794

Employee Share Purchase Plan

-

-

482

-

-

-

54

-

536

-

536

Dividends
Acquisition related issuance ofshares (note 11)
Contributions by andcontributions to the owners

-

-

-

-

-

-

-

(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

At 31 December 2021

At 30 June 2022

- 20 -

Condensed interim consolidated statement of cash flows

Unaudited
Half Year
30 Jun 22€’000

Unaudited
Half Year
30 Jun 21€’000

AuditedYear
31 Dec 21€’000

28,141

15,642

34,108

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

5,347
4,789
6,553
6,286
8,454
736
484
(49)
(136)
433
1,752
34,64911,661
10,473
13,68813,875
16,394
5,567
1,882
985
(62)
419
1,040
583
76,505(19,725)(10,384)(9,935)
11,679(28,365)(6,181)
40,566(8,316)(3,844)(2,340)
11,236(3,264)(9,791)
37,236(15,117)(4,502)
3,341
20,1583,880(23,948)
90,5451713
9
9(13,579)(9,997)(178)
102(23,652)(39,539)(5,158)(9,378)(157)
49(54,183)(48,697)(14,393)(19,360)
(315)
(175)
62
(82,878)

14
16
16

(42)
(5,453)(465)(1,303)
2,435(413)(5,241)
11,673
4,012
105,710
121,395(37)(4,551)
(484)
2,253
(337)
(3,156)(20,103)
1,318
103,070
84,285(80)(9,953)
(985)
(615)
5,338
(1,753)(8,048)(381)
3,021
103,070
105,710

Note
Cash flows from operating activities
Profit after taxation
Income and expenses not affecting operating cash flows
Depreciation - property, plant and equipment
Depreciation - 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
Other investment
Interest received
Net cash generated by / (used in) investing activities
Cash flows from financing activities
Repayment of loans
Payments of principal on lease liabilities
Interest paid on principal of lease liabilities
Dividends paid
Shares 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 period11- 21 -

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 2022.
The interim results for the half year ended 30 June 2022 and the half year ended 30 June 2021 are neither audited nor reviewed by our auditors and theaccounts in this interim report do not therefore constitute statutory accounts in accordance with Section 434 of the Companies Act 2006. They do notinclude 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 2021, which have been filed with Companies House. The report of the auditorson those accounts was unqualified, did not contain any statements under Section 498 (2) or (3) of the Companies Act 2006 and did not contain 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 Reporting Standards(IFRS) and the IFRS Interpretations Committee (IFRIC) interpretations that are expected to be applicable to the consolidated financial statements for theperiod ending 31 December 2022.
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 2021 and are disclosed in the Annual Report for that year. The Directors continue to monitor the impact of COVID-19 and the Ukraine crisison the principal risks and uncertainties.
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 uncertain nature of the current COVID-19 pandemic and also considered the implications of the crisis in
Ukraine, but have noted:
•
•
•
•
•

The strong cash flow performance of the Group through the year;
The continued demand for the Group’s services;
The ability to operate most of its services in a work from home model where studios are temporarily closed;
The historical resilience of the broader video games industry in times of economic downturn; andThe ability of the Group to flex its cost base in response to a reduction in trading activity.

The Directors have applied downside sensitivities to the Group’s cash flow projections to evaluate the Group’s ability to withstand a further prolonged
period of studio closures as a result of the COVID-19 pandemic, leading to a reduction in production capability and a worst case scenario of withdrawing
from the Group’s operations in Russia. Under this severe case, the Group would have sufficient liquidity and remain within its banking covenants. The
Directors have a reasonable expectation that the Company and the Group have adequate resources to continue to operate and meet liabilities as theyfall due for the foreseeable future, a period 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.
In doing so, the Directors have also considered the Group’s strong liquidity position with net cash of €121.3m as at 30 June 2022, and committed
undrawn facilities of €150m under the Revolving Credit Facility (“RCF”).
The Condensed interim consolidated financial statements made up to 30 June 2022 were approved by the Board of Directors on 20 September 2022.

2 Changes in Significant Accounting Policies
New Standards, Interpretations and Amendments effective 1 January 2022
A number of new amendments and interpretations to accounting standards are effective from 1 January 2022 including:••••

Onerous Contracts – Cost of Fulfilling a Contract - amendments to IAS 37;
Property, Plant and Equipment: Proceeds before Intended Use - amendments to IAS 16;
Annual Improvements to IFRS Standards 2018-2020 - amendments to IFRS 1, IFRS 9, IFRS 16 and IAS 41; andReferences to Conceptual Framework - amendments to IFRS 3.

These amendments and interpretations have not resulted in the accounting applied by the Group changing and have not had a mat erial effect on
the Group’s financial statements.
Other accounting pronouncements which have become effective from 1 January 2022 have not had 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 1 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 application ofmateriality 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 or conditions
are themselves immaterial and as such need not be disclosed; and clarifying that not all accounting policies that relate to materialtransactions, other events or conditions are themselves material to a company’s financial statements. The Board will consider theseamendments in the context of the 2023 Annual Report.
Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12): Amendments effective 1
January 2023, narrow the scope of the initial recognition exemption so that it does not apply to transactions that give rise to equal andoffsetting temporary differences e.g. Right of use assets and Lease liabilities. As a result in 2023, deferred tax assets and liabilities
associated with leases will need to be recognised gross 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 estimated impact of- 22 -

adoption based on the carrying value of Right of Use Assets and Lease Liabilities at 30 June 2022 would result in additional Deferred tax
assets of €8.5m and Deferred tax liabilities of €8.1m being recognised.

Other amendments effective for the period beginning 1 January 2023:••

Classification of Liabilities as Current or Non-current – Amendments to IAS 1;
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.

3 Significant Accounting Policies
These financial statements have been prepared in accordance with the accounting policies adopted in the Group’s most recent annual financial
statements for the year ended 31 December 2021, with the exception of the issues highlighted in note 4 below.

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 thesame as those applied in the Group’s last annual financial statements for the year ended 31 December 2021. 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.
Operating Segments:oWhile previously it was considered that the Group’s activity, as a single source supplier of services to the gaming industry,
constituted one operating and reporting segment (as defined under IFRS 8 Operating Segments), following on recent executive
and organisational changes, the Board consider it more meaningful to present information by segment aligning to the neworganisational and reporting structures:▪
▪
▪

Create – Game Development and Art Creation;
Globalize – Functional Testing, Localization Testing, Audio and Localization; and,Engage – Marketing and Player Support.

The Operating segments are reported in note 5, in a manner consistent with the new internal organisational and management
structure, and the internal reporting information provided to the Chief Operating Decision Maker (“CODM”) who is responsible forallocating resources and assessing performance of the operating segments. The CODM has been identified as the executive
management team made up of the Chief Executive Officer and the Chief Financial Officer.
As a corollary, the Board also considered how the change in segmental reporting impacted the Group’s cash generating units(CGUs). CGUs represent the lowest level at which goodwill is monitored for internal management purposes and are not larger thanthe operating segments determined in accordance with IFRS 8. While previously the Group was considered to have one CGU, thechange in segmental reporting requires the Group’s CGU’s to be re-considered. The Board determined that monitoring goodwill for
impairment at the line of business level (i.e. Art, Game Development etc.) would be the most appropriate (see note 9).

- 23 -

5 Segmental Analysis and Revenue from Contracts with Customers
Segmental Analysis*
Unaudited
Half Year
30 Jun 22€'000

Unaudited
Half Year
30 Jun 21€'000

AuditedYear
31 Dec 21€'000

124,280
141,585
55,275321,140

85,962
107,41045,292
238,664

188,178
231,901
92,121
512,200

30,906
31,1308,112
70,14823,03921,051
6,622
50,712

49,73047,383
12,987110,100

70,148(8,940)(1,284)(45)
1,107(7,469)(8,790)(5,591)317
39,4532,514(2,889)39,07850,712(8,454)(1,464)(33)(6,553)(5,347)(4,789)249
24,32149(2,442)
21,928110,100(16,394)(7,972)(67)(13,688)(11,661)(10,473)520
50,3652,045(4,427)47,983

Revenue from external customers
CreateGlobalize
EngageSegment operating profit
CreateGlobalize
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 - right of use assets
Bank charges
Operating profit
Financing income
Financing cost
Profit before taxation*The prior year comparatives have been re-classified to present information by segment, aligning to the new organisational and reporting structures (see note 4).
^ 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 relevan t GAAP measure is presented in the APM’ssection below.

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 producing location*

CanadaUnited Kingdom
United States
Russia
Italy
Poland
India
China
Japan
Other

Half Year
30 Jun 22€'000
70,151
57,66656,407
17,83817,33813,917
12,29011,478
11,181
52,874
321,140

Half Year
30 Jun 21€'000
46,78344,74444,30915,244
16,331
7,936
8,762
9,646
10,62334,286
238,664Year
31 Dec 21€'000
97,74894,426
96,06029,42432,44821,397
18,64020,35021,89879,809512,200*The prior year comparatives have been re-classified to align to the current year presentation and ranking by production location.

- 24 -

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 work that
extends beyond one year, representing the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied (orpartially unsatisfied) as at the end of the reporting period:

Revenue expected to be recognised
At 30 June 2022
At 30 June 2021
At 31 December 2021

Geographical analysis of non-current assets from continuing businesses

United States
United Kingdom
Australia
CanadaItaly
Switzerland
Ireland
China
FranceJapan
Other

Total undelivered€'000
62,442
22,79955,294

Scheduledcompletion
within 1 year€'000
48,67914,61744,973

Scheduledcompletion
1-2 years€'000
12,7197,190
9,319

Scheduledcompletion
2-5 years
€'000
1,044
992
1,002

Unaudited
Half Year
30 Jun 22€'000
176,906
119,682
48,13228,444
15,61010,025
9,994
9,081
7,472
4,795
25,663455,804

Unaudited
Half Year*
30 Jun 21€'000
169,855
118,436
40,12425,937
15,771
10,025
9,594
8,736
7,970
6,296
19,919432,663

AuditedYear
31 Dec 21€'000
171,126
114,871
45,52831,096
15,612
10,025
8,422
8,296
7,548
6,955
28,116447,595*The prior year comparatives have been re-classified to align to the current year presentation, as the Directors consider this measure to be more meaningful.

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 the video
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 comparedwith the first half of each calendar year. However, 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 arepresented below, which include the post-acquisition results of acquisitions completed in the relevant period.

Revenue
Gross profit

UnauditedYear
30 Jun 22
€'m
595
233

UnauditedYear
30 Jun 21
€'m
439
170

- 25 -

6 Financing Income and Cost

Unaudited
Half Year
30 Jun 22€'000

Unaudited
Half Year
30 Jun 21€'000

AuditedYear
31 Dec 21
€'000

102
2,412
2,514

49
49

62
1,983
2,045

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

(249)
(433)
(484)
(736)
(540)
(2,442)(2,393)(520)(1,040)(985)(1,882)(4,427)(2,382)

Unaudited
Half Year
30 Jun 22€ cent36.80
35.52

Unaudited
Half Year
30 Jun 21€ cent20.86
19.73

AuditedYear
31 Dec 21€ cent
45.16
42.98

€'000
28,141€'000
15,642€'000
34,108

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

Number
74,980,344
4,312,961
79,293,305

Number
75,526,296
3,826,990
79,353,286

Number
34,709Number254,383

Number219,146(ii) Contingently issuable ordinary shares have been excluded where the conditions governing exercisability have not been satisfied:
NumberNumber
LTIPs
1,720,825
862,000
Share options
519,000
2,239,825
862,000

Number903,656
903,656

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)

7 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:

8 Dividends

Dividends recommended
InterimIn
respectof2022

Expected€ cent
per
share
0.90

Pence
STG pershare
0.77

Expectedinterimdividend€'000
690

Expected
payment
date
Oct-22

At 30 June 2022, Retained earnings available for distribution (being Retained earnings plus Share-based payments reserve) in the Company were€46.5m. In addition, the Company has amounts included in the Merger reserve of €123.9m that are considered distributable (note 11).

- 26 -

9 Non-current Assets

Movement of the carrying value of Non-current
assetsCarrying amount at the beginning of the period
Additions
Depreciation charge
Amortisation charge
Exchange rate movement
Carrying amount at the end of the period

Unaudited
Half Year
30 Jun 22€'000
Property,plant andequipment
36,018
9,997(8,790)1,094
38,319Unaudited
Half Year
30 Jun 22€'000
Right of use
assets35,991
1,978(5,591)
1,636
34,014

Unaudited
Half Year
30 Jun 22€'000
Intangible
assets goodwill
324,890
13,146
338,036

Unaudited
Half Year
30 Jun 22€'000
Intangible
assets other
29,053
178(7,469)1,712
23,474

Unaudited
Half Year
30 Jun 22€'000
Intangible
assets total
353,943
178(7,469)14,858361,510A 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 for internalmanagement purposes and are not larger than the operating segments determined in accordance with IFRS 8 Operating Segments. As outlined in note
4, 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:

Segment
Create:Globalize:

Engage:CGU
Game Development
Art Creation
Functional Testing
Localization Testing
Audio
Localization
MarketingPlayer Support

UnauditedAt
30 Jun 22€'m
Intangible
assets goodwill
185.0
19.7
15.2
14.4
33.6
18.5
39.4
12.2
338.0

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 2022 aninterim assessment by CGU was made based on the same underlying assumptions used in the last Annual Report, but using updated forecasts andprojections. 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.

- 27 -

10 Trade and Other Receivables

Trade receivables derived from contracts with customers
Provision for bad debts (i) (ii)
Financial asset held at amortised cost

UnauditedAt
30 Jun 22€'000
90,270(1,883)88,387

UnauditedAt
30 Jun 21€'000
64,752(2,347)62,405

AuditedAt
31 Dec 21€'000
69,835(1,768)68,067

15,886
10,414
4,744
34,452
6,729
72,225

12,152
5,128
4,134
21,671
3,903
46,988

9,997
7,114
4,203
22,8604,936
49,110Accrued income from contracts with customers
Prepayments
Rent deposits and other receivablesMultimedia tax credits / video games tax relief
Tax and social security
Other receivables(i)

The movements in the provision for bad debts in the current period were as follows:

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

Unaudited
Half Year
30 Jun 22€'000(1,768)(150)
827(1,883)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

UnauditedAt
30 Jun 22
€'000
(980)
(903)
(1,883)- 28 -

11 Share Capital

Issue date

At 01 January 2022
Acquisition related issuance of shares:
Waste Creative
Heavy Iron
Jinglebell
Acquisition related issuance of shares
Employee Share Purchase Plan
Issue of shares on exercise of shareoptions
At 30 June 2022

Per share €24-Jan-22
03-Feb-22
11-Mar-22

Number ofordinary£0.01 shares

Number ofordinary£0.01 shares to be issued

Share capital€’000

Share capital- to be issued
€'000

Share
premium€’000

Mergerreserve*€’000

76,275,775

70,144904

2,185

38,549273,677

20,585
12,967
11,564
45,116
19,468(20,585)(12,914)(11,564)(45,063)
-

1
1
-

(634)
(411)
(330)
(1,375)
-

482

633
411
300
1,344
-

586,198
76,926,557

25,081

7
912

810

1,953
40,984275,021

30.78
31.84
26.41

* 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 2022
Granted
LapsedExercised
At 30 June 2022
Exercisable at 30 June 2022
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 EBTShare Option Scheme
Average
exercise
price in £ per
Number ofshareoptions
15.68
2,423,568
19.11(119,964)
4.34(473,437)
18.38
1,830,167
15.28
705,167
22.38

Long Term Incentive Plan
Average
exercise
price in £ per
Number ofshareoptions
0.01
3,704,898
0.01
859,6900.01(96,116)0.01(447,643)
0.01
4,020,829
0.01
1,052,157
23.43

Number ofoptions(173,012)(300,425)(473,437)

Salary Shares
Average
exercise
price in £ per
Number ofshareoptions
0.01
26,7380.01
229,676
0.01(1,638)
0.01
(543)
0.01
254,233
0.01
22.78

Number ofoptions(412,643)(35,000)(447,643)

Number ofoptions
(543)
(543)

- 29 -

13 Other Payables

Current liabilities
Accrued expenses
Payroll taxes
Other payables (ii)Deferred and contingent consideration (i)Non-current liabilities
Deferred and contingent consideration (i)(i)

UnauditedAt
30 Jun 22€'000

UnauditedAt
30 Jun 21€'000

AuditedAt
31 Dec 21€'000

63,226
3,591
19,88636,020122,723

38,591
3,067
20,34636,282
98,28653,526
2,666
16,34335,888108,423

8,007
8,007

21,65921,65918,254
18,254The movements in deferred and contingent consideration (Level 3 input in the fair value hierarchy), in the current period were as follows:

Carrying amount at the beginning of the period
Consideration settled by cash
Unwinding of discount (note 6)
Exchange rate movement
Carrying amount at the end of the period

Unaudited
Half Year
30 Jun 22€'000
54,142(13,579)
1,478
1,986
44,027

In general, in order for contingent consideration to become payable, pre-defined profit and / or revenue targets must be exceeded. The valuation ofcontingent consideration is derived using data from sources that are not widely available to the public and involves a degree of judgement (Level 3
input in the fair value hierarchy).
A 10% movement in expected performance would impact the fair value of the contingent consideration as follows:

Increase / (decrease) in carrying amount
Increase in expected performance - 10%
Decrease in expected performance - 10%

UnauditedAt
30 Jun 22€'000
634(2,291)

There are no other reasonably probable changes to the assumptions and inputs (including the discount rate) that would lead to a material change tothe fair value of the total amount payable.
On an undiscounted basis, at period end the Group may be liable for deferred and contingent consideration ranging from €0.2m to a maximum of€49.0m. The contractual maturities (representing undiscounted contractual cash flows) of the Group's deferred and contingent consideration
liabilities were as follows:

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)

UnauditedAt
30 Jun 22€'000
36,0201,671
6,336
44,027

The Group’s related party transactions are with key management personnel as disclosed in the Group’s Annual Report. There hav e been
no material changes to the Group’s related party transactions with key management personnel during the period.

- 30 -

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

Unaudited
Half Year
30 Jun 22
€'000
129
(42)
8
95

These balances represent loans owed by Keywords Studios QC-Interactive Inc.
The Syndicated Bank revolving credit facility (“RCF”) remains in place allowing the Group to access financing of up to €150m, which may be drawn
down in euro, sterling, US dollars or Canadian dollars, 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 a margin over currency benchmark rates, plus a separate margin charged for the unutilised facility. The RCF
extends to December 2024, with an option to extend the term by two further one-year periods. Throughout the period, the Group operated wellwithin the interest cover and leverage ratio terms of the 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

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

15 Financial Instruments

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
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 22€'000
37,635
1,978
465(5,918)1,707
35,867The value of leases not yet commenced to which the lessee is committed, which are not included in the lease liability at 30 June 2022, were €Nil.

- 31 -

17 Business Combinations / Events after the Reporting Date
Acquisition of Forgotten Empires, LLC
On 08 June 2022, the Group announced that it had entered into a conditional agreement (subject to certain closing conditions) to acquire Forgotten
Empires, LLC ("Forgotten Empires"), a full service game development studio, for a total consideration of up to US$32.5m. Headquartered in Ohio in the
United States, the studio comprises 53 game developers and specialises in the development of real time strategy games. Forgotten Empires generated
revenue of US$7.2m in 2021. Under the terms of the acquisition, the Group will pay a maximum amount of US$32.5m, comprised of initial cash
consideration of US$15.75m, the equivalent of US$3.75m in new ordinary shares to be issued one year post completion (US$2m of which is contingent
on targets being met in the first six months from completion), and up to US$13m, in a mix of cash and new ordinary shares based on growth targets
being met over the year following completion. The new ordinary shares to be issued are subject to one-year orderly market provisions. On 03 August
2022, the Group announced that it had completed the acquisition of Forgotten Empires under the terms previously announced.
Acquisition of Mighty Games Group Pty Ltd
On 03 August 2022, the Group announced the acquisition of Mighty Games Group Pty Ltd ("Mighty Games"). Based in Melbourne, Australia, the studiospecialises in the development of automated games testing solutions including its "Build and Test" platform. Build and Test uses AI technology deployedon multiple machines to automatically test code, detect bugs and defects and report errors on a 24/7 basis. In addition to games testing solutions, the 21
person team provides game development services for clients including global mobile game developers as well as Australian developers and publishers.
Under the terms of the Mighty Games acquisition, Keywords will pay a maximum amount of AUD$10.0m, comprised of initial cash consideration of
AUD$4.8m, the equivalent of AUD$1.2m in new ordinary shares to be issued within 30 days of completion, and up to AUD$4.0m in a mix of cash andnew ordinary shares based on growth targets being met over the three years following completion. The new ordinary shares to be issued are subject toone-year lock in periods and orderly market provisions for a further year.

18 Significant Events
Crisis in Ukraine
In 2022 the Group’s operations have been impacted by the tragic events in Ukraine. Whilst the Group do not have operations in Ukraine, the Group
does have Game Development teams in Russia, and also works with a number of freelance suppliers in Ukraine. Our priority has been to support ourpeople and our freelance suppliers in the territory, whilst contributing to the wider humanitarian efforts in the region.
Revenues produced in Russia are presented in note 5. In the period, the Group produced €17.8m of Revenue in Russia, up from €15.2m in H1 2021,
and represents approximately 5.5% of Group revenue. During the period, a number of projects supported in Russia have been transferred to other partsof the Group. We continue to work with our customers supporting their preferences for where their work should be performed. We also remain focusedon mitigating any potential business interruption or other risks associated with our activities in Russia. As a consequence, we expect the volume of work
produced in Russia to continue to reduce over time.
Geographical analysis of non-current assets from continuing businesses is also presented in note 5. Approximately €0.3m of the amount presented
within the “Other” category relates to the carrying value of Russian located Property, plant and equipment, being mainly computer equipment. The
Group does not have significant receivables exposure in Russia, as work produced in Russia is contracted and collected in other territories. In addition,
the Group does not have significant amounts of net current assets located in Russia. Thus any exposure to impairment of assets located in Russia is
not considered material.
As a consequence of the crisis, an additional impairment assessment was performed in the Game Development CGU, to evaluate any potential
Goodwill impairment resulting from the crisis. The result of the value in use calculations was that no impairment would be required even in a worst casescenario where the contribution from all Russian located production capacity was excluded from projections, assuming no further work is able to betransferred to other parts of the Group.

- 32 -

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 usersof the financial statements with additional information to provide a more meaningful understanding of the underlying financia l and operating
performance of the Group. The measures are also used in the Group’s internal strategic planning and budgeting processes and for setting internalmanagement targets. These measures can have limitations as analytical tools and therefore should not be considered in isolation, or as a substitutefor 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 by adjusting
the prior year revenues, adding pre-acquisition revenues for the corresponding period of ownership to provide a like-for-like comparison with thecurrent year, and applying the prior year’s foreign exchange rates to both years, when translating studio results into the euro 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 the underlying
trading performance of the business, revenue is also presented using rates consistent with the prior year in order to provide year over year
comparability.
Adjusted profit and earnings per share measures – Adjusted profit and earnings per share measures are used to provide management and otherusers of the financial statements with a clear understanding of the underlying profitability of the business over time. Adjusted profit measures arecalculated 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, can varyby size and amount each year. As a result, amortisation of intangibles is added back to assist with the understanding of the underlying
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 the Group.
•
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 under lying
trading performance of the business.
•
Other income – Other income comprises gains on investments or other non-trading income. As the gains have arisen outside the normal
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 program and to
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, other income
and dividend payments. Adjusted free cash flow is a measure of cash flow adjusting for capital expenditure that is supporting growth in future periods(represented by capital expenditure in excess of depreciation). In the prior year, the measure has also been adjusted for COVID-19 subsidies claimed
given the one-time nature of this income.
Net debt – The Group manages capital by monitoring debt to capital and net debt ratios. Net debt is calculated as Loans and borrowings l ess cash
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.

- 33 -

Service line analysis
The following table presents revenue growth by service line at both actual exchange rates (“AER”) and constant exchange rates (“CER”). Constantexchange rates are calculated by retranslating current year reported numbers at the corresponding 2021 foreign exchange rates , in order to give
management and other users of the financial statements better visibility of underlying trading performance against the prior year .

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

CreateGlobalize
EngageHalf Year
30 Jun 22
Revenue
CER
€m
116.0
135.0
52.6
303.6

Half Year
30 Jun 21
Revenue
AER
€m
86.0
107.4
45.3
238.7

Half Year
30 Jun 22
Growth
AER
%
44.5%
31.8%
22.1%
34.5%

Half Year
30 Jun 22
Growth
CER
%
34.9%
25.7%
16.1%
27.2%

*The prior year comparatives have been re-classified to the current year presentation as the Directors consider this to be more meaningful.

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 22

CreateGlobalize
EngageHalf Year
30 Jun 22Year
30 Jun 22

Revenue

Half Year
30 Jun 22
Preacquisition
revenue

Pro forma
revenue

Pro forma
revenue

AER

AER

AER

AER

€m
124.3
141.5
55.3
321.1

€m
-

€m
124.3
141.5
55.3
321.1

€m
226.5
266.0
102.1
594.6

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 the corresponding
period of ownership, and applying the 2021 foreign exchange rates to both years, when translating studio results into the euro reporting currency.

Half Year
30 Jun 21

CreateGlobalize
EngageRevenue
AER
€m
86.0
107.4
45.3
238.7

Half Year
30 Jun 21
Preacquisition
revenue
AER
€m
8.1
2.6
10.7

Half Year
30 Jun 21

Half Year
30 Jun 22

Half Year
30 Jun 22

Like for likerevenue
AER
€m
94.1
107.4
47.9
249.4

Revenue
growth
CER
€m
21.9
27.6
4.7
54.2

Revenue
CER
€m
116.0
135.0
52.6
303.6

Half Year
30 Jun 22
Organic
revenue
growth
CER
%
23.3%
25.7%
9.8%
21.7%

*The prior year comparatives have been re-classified to the current year presentation as the Directors consider this to be more meaningful.

- 34 -

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, non-controlling interest and 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 - 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 22€'000(86,152)
8,940
1,284
7,469
8,790
5,591
45
(317)
(54,350)
16.9%

Half Year
30 Jun 21€'000(66,802)
8,454
1,464
6,553
5,347
4,789
33
(249)
(40,411)
16.9%

Year
31 Dec 21€'000(149,749)
16,394
7,972
13,688
11,661
10,47367(520)(90,014)
17.6%

Adjusted operating profit
The Adjusted operating profit consists of the Operating profit as reported in the Consolidated statement of comprehensive inc ome, adjusted forshare-based payments expense, costs of acquisition and integration, and amortisation of intangible assets. In ord er 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 income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income

Half Year
30 Jun 22€'000
39,453
8,940
1,284
7,469
(1,107)56,03917.5%

Half Year
30 Jun 21€'000
24,321
8,454
1,464
6,553
40,792
17.1%

Year
31 Dec 21€'000
50,365
16,394
7,972
13,68888,41917.3%

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

Calculation
Operating profit
Amortisation of intangible assets
Depreciation - property plant and equipment
Depreciation - 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 22€'000
39,453
7,469
8,790
5,591
(317)
60,986

Half Year
30 Jun 21€'000
24,321
6,553
5,347
4,789
(249)
40,761Year
31 Dec 21€'000
50,365
13,688
11,661
10,473(520)
85,667- 35 -

Adjusted EBITDA
Adjusted EBITDA comprises EBITDA, adjusted for share-based payments expense, costs of acquisition and integration and non-controlling interest.
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 22€'000
60,986
8,940
1,284
45
(1,107)
70,148
21.8%

Half Year
30 Jun 21€'000
40,761
8,454
1,464
33
50,712
21.2%

Year
31 Dec 21€'000
85,667
16,394
7,972
67
110,100
21.5%

Adjusted profit before tax
Adjusted profit before tax comprises Profit before taxation as reported in the Consolidated statement of comprehensive income, adjusted for sharebased payments expense, costs of acquisition and integration, amortisation of intangible assets, non-controlling interest, foreign exchange gains
and losses, and unwinding of discounted liabilities. In order to present the measure consistently year-on-year, the impact of other 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 income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income
Note 6Note 6
Consolidated statement of comprehensive income

Half Year
30 Jun 22€'000
39,078
8,940
1,284
7,469
45
(2,412)

Half Year
30 Jun 21€'000
21,928
8,454
1,464
6,553
33
540

Year
31 Dec 21€'000
47,983
16,394
7,972
13,68867(1,983)

1,478(1,107)54,77517.1%

736
39,70816.6%

1,882
86,00316.8%

Adjusted effective tax rate
The Adjusted effective tax rate is the Taxation expense as reported in the Consolidated statement of comprehensive income, adjusted for the tax
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 income
Taxation / Adjusted profit before tax

Adjusted taxation / Adjusted profit before tax

Half Year
30 Jun 22€'000
54,775
10,93720.0%

Half Year
30 Jun 21€'000
39,708
6,286
15.8%

Year
31 Dec 21€'000
86,003
13,87516.1%

1,092
12,029
22.0%

2,252
8,538
21.5%

4,729
18,604
21.6%^Being mainly the tax impact of share-based payments expense €0.9m and amortisation of intangible assets €0.9m less foreign exchange €0.9m, with the prior period b eing mainly the tax impact
of share-based payments expense €1.3m and amortisation of intangible assets €1.6m.

- 36 -

Adjusted earnings per share
The Adjusted profit after tax comprises the Adjusted profit before tax, less the Taxation expense as reported in the Consolid ated 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 as reported
in note 7.

Calculation
Adjusted profit before tax
TaxationTax arising on bridging items to Adjusted profit before
tax^
Adjusted profit after tax
Denominator (weighted average number of equity shares)

As above
Consolidated statement of comprehensive income

Note 7

Adjusted earnings per share
Adjusted earnings per share % growth

Half Year
30 Jun 22€'000
54,775(10,937)

Half Year
30 Jun 21€'000
39,708(6,286)Year
31 Dec 21€'000
86,003(13,875)(1,092)
42,74676,478,194
€c
55.89
34.4%

(2,252)
31,17074,980,344
€c
41.57
64.6%

(4,729)67,39975,526,296
€c
89.24
46.5%

^Being mainly the tax impact of share-based payments expense €0.9m and amortisation of intangible assets €0.9m less foreign exchange €0.9m, with the prior period b eing mainly the tax impact
of share-based payments expense €1.3m and amortisation of intangible assets €1.6m..

Return on capital employed (ROCE)ROCE represents the Adjusted profit before tax (excluding net interest costs, unwinding of discounted lease liabilities and b ank charges, and also
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 pre acquisition profit
excluding interest for the period
Rolling 12 month adjustment
Adjusted profit before tax including pre-acquisition
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 22€'000
54,775
(102)
317
629
465
-

Half Year
30 Jun 21€'000
39,708
(49)
249
433
484
2,119

Year
31 Dec 21€'000
86,003
(62)
520
1,040
985
2,573

56,084
48,11542,944
43,58991,059-104,199

86,53391,059Consolidated statement of financial position
Consolidated statement of financial position

530,3293,270

427,7982,989

472,120
3,088

Note 13
Consolidated statement of financial position
Consolidated statement of financial position

51,08744,027
95(121,395)
507,41332,411
57,941
165(84,285)
437,019

40,70854,142
129(105,710)
464,477

20.5%

19.8%

19.6%

As above
Note 6Note 6Note 6Note 6

Adjusted profit before tax including pre acquisition
profit and excluding net interest expense (on a rolling
12 month basis) / capital employed- 37 -

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 is presented 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
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

Consolidated statement of cash flows

Half Year
30 Jun 22€'000
40,565

Half Year
30 Jun 21€'000
37,236Year
31 Dec 21€'000
90,545

1,284(9,997)(178)(1,107)102(878)(5,453)24,3386,181
30,5191,464(9,378)
(157)
49
(821)
(4,551)
23,842
9,791
33,633

7,972(5,567)(19,360)(315)
62(2,738)(9,953)60,64623,94884,594

Consolidated statement of comprehensive income
Consolidated statement of cash flows
Consolidated statement of cash flows
Consolidated statement of cash flows
Consolidated statement of comprehensive income
Consolidated 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 by capital
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

Half Year
30 Jun 22€'000
30,519Half Year
30 Jun 21€'000
33,633Year
31 Dec 21€'000
84,594

9,997(8,790)1,207
31,726

9,378(5,347)
4,031
37,664

19,360(11,661)
7,699
92,293

Half Year
30 Jun 22€'000
31,72654,775

Half Year
30 Jun 21€'000
37,66439,708Year
31 Dec 21€'000
92,29386,003

57.9%

94.9%

107.3%

Consolidated statement of cash flows
Consolidated statement of cash flows

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 inexcess of depreciation, as a % of Adjusted profit
before tax- 38 -

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 22€'000
95(121,395)(121,300)

Half Year
30 Jun 21€'000
165(84,285)(84,120)Year
31 Dec 21€'000
129(105,710)(105,581)- 39 -