15 September 2021
Keywords Studios PLC ("Keywords Studios", “Keywords”, the “Group”)
Interim results for the six months to 30 June 2021
Strong Organic Revenue growth and margin performance
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 2021.
Financial Overview:
Results for the six months ended 30 June

H1 2021

H1 2020% change

Group revenue
Organic Revenue growth1€238.7m+22.9%€173.5m+8.0%+37.6%

Adjusted EBITDA2
Adjusted EBITDA margin
EBITDA2€50.7m21.2%€40.8m€30.8m17.8%€26.2m+64.6%

Adjusted profit before tax3
Profit before tax€39.7m
€21.9m

€21.7m€11.1m+82.9%+97.3%

Adjusted earnings per share4
Earnings per share

41.57c20.86c25.25c9.49c+64.6%+119.8%Interim dividend per share

0.70p

0.00p

Adjusted cash conversion rate5

94.9%

50.2%

Net cash / (net debt)€84.1m€101.0m+55.7%

Highlights:
Strong H1 revenue growth (+37.6% to €238.7m), despite some continued COVID-19 related operational
constraints

Organic Revenue up 22.9% (H1 2020: 8.0%, FY 2020: 11.7%) with all service lines performing wellagainst the comparative period, when a number were held back by COVID-19 constraints
Growth driven by robust demand, supported by a buoyant video games market focused on a returnto developing new content following production delays and disruption in 2020
Some ongoing operational disruption as a result of local COVID-19 measures, but the Group
continues to operate flexibly across all service lines to deliver market-leading service to clients

Continued growth in profitability and cash generation driving strong balance sheet and liquidity

Adjusted EBITDA up 64.6% to €50.7m, with margin up 3.4% pts to 21.2% (H1 2020: 17.8%)
Strong cash conversion with Adjusted Free Cash Flow6 of €37.7m (H1 2020: €10.9m) and an
Adjusted Cash Conversion rate of 94.9% (H1 2020: 50.2%)
Net cash of €84.1m (H1 2020: €101.0m, FY 2020: €102.9m), after €44.7m net cash spend on
acquisitions in H1, and a €100m undrawn Revolving Credit Facility

Resumed progressive dividend policy Interim dividend of 0.70p per share declared representing an increase of 20.7% on the 2019 interim
dividend (H1 2020: 0.00p, H1 2019: 0.58p)
Continued delivery of our acquisition strategy

Four high quality acquisitions completed so far in 2021 for total consideration of up to €105m

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Expanded Game Development services, adding a new presence in the US West Coast, with thecompletion of the acquisition of Heavy Iron Studios in JanuaryEntered Australia with the acquisition of Tantalus in March providing a platform for Game
Development’s expansion in the Pacific region
Added strong capabilities in full game development, co-development, porting and technicalconsulting services with Climax Studios acquisition in April
Entered an attractive market for talent, with a new presence in Romania, and added significant
expertise to Art Creation through the acquisition of AMC in August
We continue to actively review a healthy pipeline with strong financial resources to support further
acquisition opportunities

Making good progress with our Responsible Business agenda

Published a new Group Environmental policy, which will further develop our Sustainable Studios
programme
Established a new partnership with Women in Games, a not-for-profit organisation that seeks agame industry, culture and community free from gender discrimination. The partnership will help
power their 500 strong Ambassador programme across 52 countries and allow Keywords to be
more active in addressing the underrepresentation of women in the Games industry

CEO Succession and Board Update

Following the retirement in June 2021 of Andrew Day the search process for his successor is very
well advanced - further announcement expected in the coming weeks
The Group continues to drive its strategy forward with Jon Hauck, CFO, and Sonia Sedler, COO, as
joint interim CEOs, supported by the broader leadership teamStrengthened the Board with the Non-Executive Director appointments of Marion Sears, who brings
extensive governance and M&A expertise, and Neil Thompson, who brings deep experience in the
sector gained at Microsoft

Current trading and outlook
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Trading has started well in H2, with strong demand for most services driven by the buoyant video
games market and the industry’s renewed focus on new content creation
Expect to benefit from our well-balanced range of services across the game development lifecycle,
with strong demand for early stage service lines such as Game Development, Marketing and Art
Creation throughout H2, and with Testing and Localization service lines benefitting as content
reflows into later stage services as we move through H2Continue to review a strong pipeline of acquisition opportunities, focusing on adding specificexpertise and talent, particularly as we build our Game Development and Marketing service lines
The Board is confident in delivering recently increased market expectations for the full year, with H2growth rates moderating against a stronger comparative as anticipated

Jon Hauck, CFO & Joint Interim CEO of Keywords Studios commented:“The Group has delivered another strong performance and we are seeing ongoing high levels of demandfor our services, driven by a buoyant wider video games market which has a renewed focus on content
creation.
“We have continued our acquisition strategy which is building the Group into the ‘go to’ service provider
globally, with the recent acquisitions of Tantalus Media, Climax Studios and AMC taking us into newgeographies and deepening our Game Development and Art Creation capabilities.
“Looking forward, we expect the strong demand to continue, giving us confidence in delivering a full year
performance in line with recently increased market expectations, and our financial strength leaves us wellplaced to continue to complement organic growth with value-accretive acquisitions.”

Sonia Sedler, COO & Joint Interim CEO of Keywords Studios commented:“We are proud of the Group’s strong organic growth performance in the first half, as our global sales andlocal teams continue to build upon our deep, long-standing relationships with our broad client base. As the
structural trend in the industry towards outsourcing continues, our integrated services are addressing ourclients’ needs more effectively than ever.
“We would like to thank all of our 9,000+ Keywordians across the globe who, despite the ongoing
operational challenges, have continued to tirelessly show resourcefulness, passion and dedication indelivering excellent quality service to support our clients.”
A presentation of Keywords Interim results will be made to analysts at 9.30am this morning and the live
webcast can be accessed via this link: https://www.keywordsstudios.com/H1-2021-results/. 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)
Jon Hauck, Joint Interim Chief Executive Officer
Sonia Sedler, Joint Interim Chief Executive Officer
Joseph Quinn, 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/James Midmer/Charles Hirst+44 20 3128 8100
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 23 countries strategically located in Asia, Australia, theAmericas and Europe, it provides integrated art creation, marketing services, game development, testing,
localization, audio and player support services across more than 50 languages and 16 games platforms to ablue-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 fulldefinitions 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.
12

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 prior year foreign exchange rates to both years.
EBITDA comprises Operating profit as reported in the Consolidated statement of comprehensive income, adjusted foramortisation and impairment of intangible assets, depreciation, and deducting bank charges. Adjusted EBITDA comprises
EBITDA, adjusted for share option expense, costs of acquisition and integration and non-controlling interest. In order to

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4

5
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present the measure consistently year-on-year, the impact of COVID-19 government subsidies claimed in the prior year andinvestment income are also excluded.
Adjusted profit before tax comprises Profit before taxation as reported in the Consolidated statement of comprehensive
income, adjusted for share option expense, costs of acquisition and integration, amortisation and impairment of intangible
assets, non-controlling interest, foreign exchange gains and losses, and unwinding of discounted liabilities. In order topresent the measure consistently year-on-year, the impact of COVID-19 government subsidies claimed in the prior year andinvestment income are also excluded.
Adjusted earnings per share comprises the adjusted profit after tax divided by the non-diluted weighted average number ofshares as reported. 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(as measured by capital expenditure in excess of maintenance capital expenditure). In order to present the measureconsistently year-on-year, the impact of COVID-19 government subsidies claimed in the prior year is also excluded.

Chairman’s statement
Keywords has delivered another strong period of growth in the first half, in the face of some operational
constraints relating to the global pandemic, and, on behalf of the Board, I would like to say how grateful weare for the tireless efforts of over 9,000 Keywordians around the globe. It is thanks to their expertise, incredible
hard work and dedication that we have been able to deliver the highest quality of work for our clients andaddress their ever-expanding needs.
Following the announcement of Andrew Day’s retirement as CEO in June this year, the search process forhis successor is very well advanced and has attracted some very high calibre candidates and we areconfident that we will be able to make a further announcement in the coming weeks.
During this interim period, we are very fortunate to have an extremely strong senior management team, with
Jon Hauck and Sonia Sedler continuing as joint interim CEOs, who are well supported by the broader
leadership team across the Group. Together, they have continued to both drive the Company's strategy
forward and enhance its operational performance.
With our interim leadership team in place, our strong performance, leading market position, and strong
balance sheet, we are well placed to continue to capitalise on the organic and acquisitive growth opportunities
in our buoyant video games market and adjacent content industries.
Ross Graham
Chairman
CEO Review
Strong performance, despite some COVID-19 constraints
The Group performed strongly in H1 2021, with revenues up by 37.6% to €238.7m. This performance reflected
our team’s hard work to deliver on the continued robust demand for our services, driven by a return to content
creation following the disruption across the industry in 2020, complemented by growth through the recent highquality acquisitions.
Our remote working capabilities are proving highly effective, enabling us to support customers for as long as
remote working is needed, and where returning to studios is not feasible. We are exceptionally proud of theefforts of our 9,000+ talented Keywordians who have worked tirelessly throughout this period to support ourclients while continuing to deliver the excellent quality of service for which we have become well known.
Organic Revenue grew 22.9% for the Group in H1 (H1 2020: 8.0%, FY 2021: 11.7%), with all service lines
performing well against the comparative period, during which certain service lines were held back by COVID19 constraints. Audio and Testing delivered strong performances, with these service lines having seen more
severe disruption in the prior year, whilst Art Creation, Marketing and Game Development have continued togrow strongly as the industry turned its attention to creating new content to keep its expanded player baseengaged in games.
The Group’s Adjusted EBITDA increased by 64.6% to €50.7m, representing a 3.4% pts improvement in margin
to 21.2%. This was driven by operational leverage and continued good cost control, together with a reductionin certain costs due to COVID-19, primarily resulting from a higher proportion of remote working and lower costs
relating to travel, business development and marketing. This translated into an increase in Adjusted Profit
before Tax of 82.9% to €39.7m and an adjusted net profit before tax margin of 16.6%.
We are pleased that this profit performance has also translated into strong cash generation, with €37.7m of
Adjusted Free Cash Flow (H1 2020: €10.9m) representing a 94.9% Adjusted Cash Conversion rate in the
period (H1 2020: 50.2%). This demonstrates the strong cash generating characteristics of the business andprovides the Group with further resources to fund its acquisition strategy.
We remain very confident in the Group’s opportunity for growth as we capitalise on the continued trend towards
outsourcing, an increased focus on content creation in a growing video games market, and our ability toincrease our market share both through organic growth and the execution of our acquisition strategy.
Delivering on our strategy
The pandemic has only accentuated the opportunities afforded by our strategy, given the acceleration indemand for video games, our clients’ renewed focus on content creation and the impetus for outsourcing
having been exacerbated by clients' need for business continuity.
As we build our services platform, the Group continues to cement its position as the leader in a highly
fragmented market, becoming the partner of choice for games publishers and developers when looking for
global reach and deep expertise in video games. Against the backdrop of predominantly local, single-service
providers, Keywords is increasingly benefitting from being the first choice external development andprofessional service provider of scale which can deliver the quality, flexibility, and security of service required
to meet our global clients’ growing demand for generating ever more sophisticated and immersive content.
We continue to leverage the unique breadth of our platform by bringing the right combination of capabilities
to support customers’ individual objectives, enabling us to cross sell a broader range of our services.
Demand for video games accelerated during the pandemic, with an expansion of both the number of players
and amount of game play, albeit this was primarily driven by the monetisation of existing content, with newcontent being held back and delayed due the production constraints across the industry. In 2021, we haveseen an acceleration in demand for content production, particularly in the ‘early stages’ of the gamedevelopment cycle, benefitting our Game Development and Art Services teams. Industry activity has beenfurther boosted by a continued shift towards ‘Games as a service’, which requires ongoing content expansion
to extend the lifespan of a game, creating continuous demand for the Group’s services.
Demand for our services is also being driven by the launch of next generation games consoles, PlayStation
5 and Xbox Series X|S. Whilst the launch of the new consoles has been held back by supply constraints, we
expect this to drive a refresh of the entire console based gaming sector after a seven year run of the PS4
and Xbox One console generation. This is likely to result in an enlarged market for video games content overthe coming years and an associated demand for new content creation, which in turn drives demand for
Keywords’ services. Further development of new and existing video games streaming platforms also
continues to increase demand for content and its ongoing support in live operation. We note the recent
regulatory developments in the domestic Chinese video game market, and whilst we have a strong andexpanding footprint in China, our work with Chinese customers (<5% of Group revenues) largely relates tocontent targeted at overseas markets and not domestic China.
We continue to invest in the business, both organically and through targeted acquisitions to position theGroup as an increasingly strategic partner to our clients and as the 'go to' provider to the video games industry
across our service lines and key geographies.

We are delighted to have welcomed four new companies to the Keywords family since the beginning of theyear. Heavy Iron Studios, Tantalus and Climax Studios add substantial scale and capabilities to our Game
Development Service line as well as reach into, and access to talent in, the US West Coast and Australia.
Whilst AMC adds significant expertise to Art Creation and access to talent though a new presence in Romania
for the Group.
We continue to actively review a healthy pipeline of further acquisition opportunities.
Embracing new ways of working
Our remote working capabilities are proving highly effective, enabling us to support customers for as long as
remote working is needed, and where returning to studios is not feasible. Having consulted those who reallymatter, our Keywordians, our employee survey showed a spread of opinion, with 43% preferring to continue
to work from home, 10% wishing to return to office based working, and 47% preferring a combination. We
therefore expect that, once we are through COVID-19 restrictions, we will adopt a hybrid model of offering
vibrant, engaging and safe studio space, whilst also enabling our people to work securely and constructively
from home.
We continue to believe that there is a clear role for physical studios for the Group, particularly to allow for theexchange of creative ideas, for training, and in our Testing and Audio service lines. We have, therefore,
continued to invest in new studios in Bangalore and Manila, as well as two new studios in second-tier cities
in China, to support our growth today and into the future.
In the short term, we anticipate maintaining our effective remote working model in the majority of locations
for the rest of the year, whilst retaining a flexible approach tailored to studios’ needs in each of the 70+
locations and prioritising activities in studios that are harder to perform remotely. We have worked hard toengage with and recognise the efforts of our Keywordians and to support their wellbeing in this remote
working environment. This includes increasing the awareness of our Employee Assistance Programmes thatprovide support services and training on wellbeing, and introducing a number of initiatives to help foster
engagement and personal support, such as guest speakers on mental health, wellbeing habits, nutrition talks,
virtual yoga and dance lessons, Friday evening online events, and team quiz nights to name but a few.

Responsible Business
We remain committed to conducting our business responsibly and operating to the highest levels of honesty,
integrity and ethical conduct. We have all been shocked and saddened to see the news stories ofpsychological, physical, and sexual harassment within certain parts of the gaming industry. At Keywords we
do not tolerate any form of abuse, discrimination, or harassment. Human talent is our most valuable asset andas a multi-cultural business we thrive in diversity and continually challenge ourselves to ensure we provide a
working environment that treats people with dignity and respect, is free from any form of discrimination, andpromotes fairness and equal opportunities. We cannot and will not be complacent and, throughout theCompany, we are committed to actions that will protect an inclusive working environment.
We are continuing to make progress on our six priority areas of People, Diversity, Customer Centricity &Innovation, Communities and the Environment, underlined by Corporate Governance and Business Ethics.
We are excited to announce our partnership with Women in Games, which sees Keywords help power their
500 strong Ambassador programme across 52 countries which allow us to be more active in addressing theunderrepresentation of women in our industry. Women in Games is a not-for-profit organisation founded in
2009, with the mission to identify and effect the lasting change needed to bring about full gender equality,
equity and parity of opportunity within the gaming sector and to encourage more women to consider games
and eSports as a career. Through this partnership, we will leverage our global platform and client
relationships to enhance and accelerate the popular ambassador initiative, enabling it to scale throughadditional projects and research, events, exclusive materials and services for Women in Gamesambassadors.

The gender diversity of our Board has continued to improve in the period and female Directors now make up
33% of the Board (versus 25% in January 2021).
Following the quantification of our greenhouse gas emissions for the first time in 2020, in 2021 we havedeveloped the Group’s first Environmental Policy covering our Energy and Recycling practices. The policy
will help further develop our Sustainable Studios programme and support our studios in their efforts tominimise energy usage and to reduce, recycle and reuse wherever possible.
Various initiatives were rolled out to help support colleagues, including through COVID-19 vaccine clinics andmore recently, the support for colleagues impacted by hurricane in New Orleans.
Both our recently announced NEDs, Marion Sears and Neil Thompson, have joined our ESG Board
Committee, bringing strong expertise and experience to the Committee.

Service line review
All our services lines grew during H1 2021, despite the pandemic and the operational challenges it continues
to present.
The following table provides a summary of our revenues by service line, with growth rates on a reported andOrganic Revenue growth basis, and breaking out Marketing for the first time. We have also presented a trailingtwelve month Pro Forma Revenue by service line, which includes the annualised revenue of all acquisitions
made in H1, to provide a better overview of the size and balance of the business at the end of the period. The
service line commentary below reports on the statutory reported revenues, unless otherwise stated.

Revenue% of H1 2021
Group revenue

H1 2021
Revenue€m

H1 2020
Revenue€mChange year onyear%

H1 2021
Organic
Revenue growth%

12 months to 30
June 2021
Pro Forma
Revenue€m

Art Creation*

9.5%

22.7

18.9

20.1%

25.4%

42.7

Marketing*

9.7%

23.2

7.4

213.5%

50.6%

34.2

Game Development

26.5%

63.3

38.7

63.6%

15.5%

123.6

Audio*

11.9%

28.3

20.9

35.4%

36.4%

54.6

Functional Testing

18.1%

43.3

35.8

20.9%

24.3%

86.0

Localization*

9.7%

23.2

21.3

8.9%

10.7%

47.3

Localization Testing

5.3%

12.6

10.7

17.8%

19.6%

25.2

Player Support

9.3%

22.1

19.8

11.6%

17.7%

44.1

Total

100.0%

238.7

173.5

37.6%

22.9%

457.7

*
The prior year comparative has been re-classified to separately report Marketing services, previously reported within the
Art creation service line. In addition, there was a minor re-classification between Audio and Localization.

Art Creation (9.5% of Group revenues for H1)

Our Art Creation service line creates graphical art assets for video games including concept art creation, 2D
and 3D art asset production and animation.
H1 2021 performance
Art Creation performed well with revenues up by 20.1% to €22.7m (H1 2020: €18.9m). Organic Revenue, which
excludes the impact of currency movements and acquisitions, grew by 25.4% for Art Creation, following acontinuation in strong underlying client demand across all art studios.
We have continued to expand this service line, with the addition of two new studios in second-tier cities in
China, which provide us with additional access to talent to support the work for our clients, as well as two
new studios in Bangalore and Manila. While our artists in China have fully returned to studios following theinitial stages of the COVID-19 pandemic in 2020, our Indian artists continue to work from home, delivering
excellent growth despite the ongoing constraints.
In August, we added the Group’s first presence in Romania through the high quality acquisition of AMC. AMC
is a long established, high quality specialist art studio servicing both US and European clients and we believe
it will add significant expertise and experience to this service line, as well as access to an attractive market for
talent in Romania.
The market opportunity and outlook
Art Creation operates in a large addressable market, which remains highly fragmented yet clients seek partners
that are able to deliver increasingly added value through more creative, technical, and managed services.
We expect Art Creation to continue to deliver strong growth in the second half given that we have better thannormal visibility and as this service line is well placed to scale up to meet continued buoyant client demand.

Marketing (9.7% of Group revenues for H1)
Following its recent growth and scale within the Group, we are now reporting Marketing as a standalone
service line for the first time in these results.
Marketing services including game trailers, marketing art and materials, PR and full brand campaign strategies
which we are building through acquisitions, and subsequent organic growth.
H1 2021 performanceMarketing revenues grew by 213.5% to €23.2m (H1 2020: €7.4m) with the benefit of contributions from theacquisitions of Maverick Media, g-Net and Indigo Pearl, made in the second half of 2020. Organic Revenue,
which excludes the impact of currency movements and acquisitions, grew by 50.6% with clients switching theirfocus to online and digital marketing in the absence of physical industry events.
The market opportunity and outlook
The Marketing services sector is particularly fragmented, given the range of services provided both internallyand externally from key art, trailer creation, advertising, PR, branding, campaign management, influencer
marketing and social media management through to marketing analytics and community management.
Our aim is to establish our highly specialised video games Marketing Services business as the partner of choicefor games publishers and developers when looking for global reach and deep expertise in a sector, which is
unique by virtue of the interactive nature of the product and the strength of the gaming communities that formaround the games. The acquisitions of g-Net and Maverick, now the two largest studios in the service line, andIndigo Pearl in 2020 have secured Keywords’ place as the dominant player in the industry for video gamesmarketing and we now have a considerably expanded platform from which to further build the breadth of ourcapabilities, organically and through selective acquisitions.
We expect marketing to build on a successful H1 with continued growth in H2, albeit at a more moderate level
given the exceptional organic growth in H1 and the stronger comparatives in H2 of the prior year.
Game Development (26.5% of Group revenue for H1)
Our largest service line, Game Development, provides external development services to game developers andpublishers including full game development, co-development, porting and general software engineering
consultancy.
H1 2021 performance
Game Development, increased revenues by 63.6% to €63.3m (H1 2020: €38.7m). This increase reflected
contributions from Coconut Lizard and High Voltage acquired in 2020, and Heavy Iron, Tantalus and Climax
which all completed in H1 2021. Game Development is now our largest service line with 16 studios in 9 countries
and over 1,350 developers.
Game Development achieved a 15.5% increase in Organic Revenue (which excludes the impact of currency
movements and acquisitions) with a renewed focus on content creation driving strong demand for our services
despite the curtailment of our usual tradeshow-centric, business development activities. Our ability to meetdemand is constrained by a challenging recruitment climate, where skilled resources are in high demand and
COVID-19 adds additional challenges around training and on-boarding activities.
In H1 2021, we announced two high quality businesses to grow and diversify our Game Development offering
further:

Tantalus - a leading and prolific developer of high quality, multi-platform titles based in Melbourne,
Australia which provides us with access to a new talent pool and offers an excellent entry point into theAustralian market for further expansion in the Pacific region, both organically and through acquisitions.

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Climax - one of the longest established game development businesses in the UK, offering full gamedevelopment, co-development, porting and technical consulting services to some of the world’s largest
games publishers through a team of 109 talented developers.

The market opportunity and outlook
Game Development is our largest addressable market. The market is growing strongly and has the lowest
proportion of services outsourced of all of the Group’s service lines.
Demand remains very strong and we expect continued good growth for Game Development in H2 as we focus
on talent acquisition, and using the resources we have globally, to enable the business to service as much ofthat demand as possible. We remain a highly attractive prospect for games developers, who recognise theopportunities that Keywords provides for a sustainable variety of exciting work, as well as good careeradvancement, including the option to work across our expanding international footprint, and to be part of astrong culture amongst like-minded, games-passionate colleagues. Given the strong demand for talent, we
expect to see some wage inflation as we move through the second half and beyond and we will continue totake account of our cost structure as we negotiate each project with our clients, who are only too aware of thetalent challenge themselves.
As previously communicated, Game Development remains an area of particular focus in our M&A programme,
where we continue to assess companies that provide access to strong pools of talent to help support the fast
pace of organic growth.

Audio (11.9% of Group revenue for H1)
Our Audio service line provides multi language voice-over, original language voice recording, music, sounddesign, accessibility and related services to the Video Games and Film and TV industries.
H1 2021 performance
Audio revenues rose by 35.4% in the period to €28.3m (H1 2020: €20.9m), with Organic Revenue, which
excludes the impact of currency movements and acquisitions, increasing by 36.4% compared to H1 2020.
Our Audio services business recovered strongly following COVID-19 impacts throughout 2020 but particularlyin H1 2020 when a number of our recording studios closed during the lockdowns and as it took time to put inplace remote solutions. Our music management services, sound design and sound effects businesses havecontinued to grow, as did our work in subtitling and dubbing of film and TV content where we serve clients suchas Netflix and other streaming providers, albeit growth has been constrained by ongoing delays to filming of
new content.
The market opportunity and outlook
Demand for our Audio services remains strong albeit we are expecting growth rates to moderate in H2 due tothe stronger comparatives in H2 of the prior year. Whilst all of our recording studios have now reopened, ourinvestment in a reliable remote recording solution enables us to continue to deliver on our clients’ needs in theevent of further Studio closures.
Beyond the near term, the audio services market remains highly fragmented in terms of service provision, withclients and voice actors favouring professional, high quality sound studios for optimal voice recording. This
represents an opportunity for us to grow our market share organically, as well as make select acquisitions overtime, as audio content increases for both console and mobile games.
Functional Testing (18.1% of Group revenue for the year)
Functional Testing is our second largest service line and provides quality assurance, including discovery anddocumentation of game defects and testing to verify the game’s compliance with hardware manufacturers’ anddistribution platforms’ specifications, as well as test automation tools and services, crowd-based and focus
group testing solutions.
H1 2021 performance
Functional Testing revenues increased by 20.9% to €43.3m (H1 2020: €35.8m). Organic Revenue, which
excludes the impact of currency movements and acquisitions, increased by 24.3%. This strong performance
was delivered against softer comparators given the service line was considerably constrained at the beginningof the lockdowns in H1 2020, as we needed to work through our agreements with our clients to reflect the new
security protocols required in a remote working environment, rather than our norm of conducting these services
in our secure testing studios.
The market opportunity and outlook
We remain a leading player in this large and growing area of the market that is seeing an accelerating trend
towards outsourcing. Our scale, flexibility, geographical spread and proven robustness, even in the mostchallenging of circumstances, positions us well as games companies continue to increase the proportion offunctional testing that they outsource.
Our testing services operate at the later stages of the game development cycle and are experiencing somedelays in content flowing to us following the previous disruption to earlier stage content creation. As the content
production cycle works through, we expect testing activity to pick up we move through the second half and weremain ready to scale quickly as demand returns.

Localization (9.7% of Group revenue for the year)
Our Localization service line provides translation of in-game text, audio scripts, cultural and local adaptation,accreditation, packaging and marketing materials in over 50 languages. It includes our proprietary
technologies for content management, machine translation, crowd sourcing and workflow management.
H1 2021 performance
Localization revenues were up 8.9% to €23.2m (H1 2020: €21.3m). Organic Revenue, which excludes theimpact of currency movements and acquisitions, was up by 10.7%, against softer comparatives. This
improvement reflects the reflow of projects delayed in 2020, when production schedules were disrupted at someof our clients.

The market opportunity and outlook
The Localization market remains highly fragmented and characterized by most competitors being single
language providers without the scale to deliver simultaneous multi-jurisdictional localization projects for our
global video games customer base. Our clients are increasingly looking to Keywords for a more streamlined
and distributed production process, resulting in the adoption of our game asset management system, XLoc,
which in turn ensures we are ever more integrated into their workflows. Combining the market leading expertise
we have built up in localization over the past 20 years, with proprietary software tools, like XLoc, and Artificial
Intelligence (AI) and Machine Learning (ML) technology from Kantan, enables us to effectively manage agreater volume of content for our clients.
Having strengthened our sales efforts last year, we expect to continue to deliver growth into H2 2021 reflecting
underlying momentum moderated by some delays in the flow of content to this late stage service line, as is
being seen in Testing.
Localization Testing (5.3% of Group revenue for the year)
Our Localization Testing service line identifies out of context translations, truncations, overlaps, spelling,grammar, age rating issues, geopolitical and cultural sensitivities, and console manufacturer compliancerequirements in over 30 languages using native speakers.
H1 2021 performance
Localization Testing revenue increased by 17.8% to €12.6m (H1 2020: €10.7m). On an Organic basis, which
excludes the impact of currency movements, Localization Testing was 19.6% higher compared to H1 2020.
This better performance was delivered against softer comparators as Localization Testing experienced thesame initial operational disruption and constraints seen in our Functional Testing division during H1 2020, but
compounded by some lack of availability of native language resources due to people returning to be with theirfamilies in their home countries and the subsequent travel restrictions.
The market opportunity and outlook
In this service line, the Group’s scale, breadth of languages, multi-location operations and resourcing agility
enable it to offer a cost effective, flexible and high quality service which is difficult for smaller competitors to
replicate. Our market leadership positions us well for further growth as we continue to develop our operations
in Montreal, Dublin, Katowice, Milan, Singapore and Tokyo.
As with Functional testing, we are not expecting to see the typically higher seasonal activity in the second halfof the year due to a shift in the flow of content into these later stage service lines, which will hold back revenue
growth in H2 overall but is expected to recover as content reflows in to these services lines during H2.

Player Support (9.3% of Group revenue for the year)
Our Player Support service line provides multi-lingual, cost effective and flexible customer care services
including managing communities of gamers across all forms of social media, within the games themselves andon the official game forums, ensuring our customers have a safe player environment.
H1 2021 performance
Player Support increased revenue by 11.6% to €22.1m (H1 2020: €19.8m) and Organic Revenue, which is on
a constant currency basis, by 17.7%.
The nature of Player Support’s services mean that it has benefitted more directly from the increase in gameplayers that the industry has seen, as it continues to deliver further client growth and strengthen its services
in areas such as social media, quality control and consulting. Having successfully transitioned teams in 2020
to remote working that enabled us to provide continuous support to our clients, we are planning to retain someflexibility between working in the office and from home.
The market opportunity and outlook
Player Support’s growth demonstrates the benefits of our strategy to differentiate it from the large generalist
call centre operators and immerse ourselves even further into gaming communities with complete player
experience coverage. This has been achieved by extending our services to cover more ‘touch points’ of gamer
engagement, and by developing our systems and tools to enable us to manage increased volumes oftransactions efficiently.
Our specialist video games “DNA”, extensive range of capabilities and fundamental understanding of what is
important to players, continues to position us well in terms of the quality of our service delivery compared tomore generalist providers, and we expect to make further progress in H2, albeit at a more moderate growthrate.

Outlook
Trading has started well in H2, as we continue to see strong demand across most of our service lines andthe benefit from a highly diversified range of services which are well balanced across the game development
lifecycle. We expect growth rates to moderate in H2, given stronger comparatives in H2 2020, and we areworking to mitigate recruitment constraints as we seek to meet strong demand. Whilst it is encouraging to beable to start utilising our physical studio locations, our flexible hybrid working model is now well establishedacross all of our service lines and 70+ locations, so we would not expect our ability to service our clients tobe as operationally constrained as we saw last year, even if further government restrictions are applied.
The underlying drivers of growth in the video games market remain in place, with strong growth in player
numbers, the impact of newly launched consoles, and a renewed focus on new and ever more sophisticatedcontent, following the delays caused by COVID-19, all creating significant demand for our services. Our
Game Development, Marketing and Art Creation service lines, which work at the earlier stages andthroughout the content creation cycle, are particularly expected to benefit from this increased activity
throughout H2. Whilst we anticipate that demand for our later stage services, Testing and Localization, willbuild as content flows into them as we move through the second half and beyond.
Beyond those underlying growth drivers, the strong trend towards outsourcing has only been accentuated by
COVID-19, which brought in to focus our clients’ need for high quality, flexible support from scale operators
who can deliver their needs, even in the most extreme circumstances. As we continue to build our platform,
we are actively reviewing acquisitions that would add expertise, particularly in Game Development andMarketing, access to talent or meaningful synergies, whilst retaining an interest in adjacent markets such asfilm and television services, which are increasingly converging towards video game development technology.

The Board is confident in delivering recently increased expectations for the full year and we believe ourstrategy, our sought after team of 9,000+ specialists, and strong structural drivers leave Keywords well
positioned to benefit from the buoyant video games market.

Jon Hauck and Sonia Sedler
Joint Interim CEOs

Financial and Operating Review
Strong revenue growth and margin performance
Revenue
Revenue for H1 2021 increased by 37.6% to €238.7m (H1 2020: €173.5m). This growth was supplemented
by the impact of acquisitions in 2020 and 2021, but offset by the impact of currency movements, particularly
the weakening of the US dollar against the Euro in the period.
Organic Revenue growth (which adjusts for the impact of currency movements and acquisitions) was up
22.9%. This was driven by a robust performance across all service lines, against the comparative period in
H1 2020 where certain service lines were more severely held back by COVID-19 constraints, particularly in
our Testing and Audio businesses. Further details of the trading performances of each of the Service Lines
are provided in the CEO Review.
Gross margin
Gross margin in H1 2021 was €91.1m (H1 2020: €62.9m) representing an increase of 44.8%. The grossmargin improved by 1.9% pts to 38.2% (H1 2020: 36.3%) compared to the prior period that was held back by
the revenue shortfalls in the early stages of the pandemic, particularly in our Testing, Audio and Localization
service lines.
Operating costs
Adjusted operating costs increased by 25.9% to €40.4m (H1 2020: €32.1m), reflecting the larger Group, but
reduced to 16.9% of revenue versus 18.5% in H1 2020. This reduction was driven by continued good cost
control, together with reductions in certain costs due to COVID-19, primarily resulting from remote working andlower travel, business development and marketing costs.
EBITDA
Adjusted EBITDA increased 64.6% to €50.7m compared with €30.8m for H1 2020. The EBITDA margin in
H1 2021 reflects the improved revenue noted above and this, combined with the benefit of a full six monthsof the ongoing reduction in certain costs due to COVID-19, resulted in an improvement in Adjusted EBITDA
margin of 3.4% pts to 21.2% (H1 2020: 17.8%).
Net finance costs
Net finance costs increased by €0.8m to €2.4m (H1 2020: €1.6m), driven by an €0.7m increase in unwindingof discounted liabilities and a €0.3m increase in net foreign exchange loss (which is described in more detailbelow) offset by a €0.2m decrease in underlying interest costs on bank debt (which excludes unwinding of
discounted liabilities, bank charges and foreign exchange) to €0.4m (H1 2020: €0.6m). This reflected therepayment of drawings on the RCF following the placing in May 2020 and, since then, the Group has
maintained a strong net cash position despite the Group’s acquisition spend.
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:

H1 2021
€m
8.5
1.5
6.6
1.2
17.8

Share option expense
Acquisition and integration costs
Amortisation and impairment of intangible assets
COVID-19 government subsidies claimed
Foreign exchange and other items

H1 2020
€m
6.8
1.2
5.7
(3.4)
0.3
10.6

1.5m of options were granted under the Share Option Scheme and Long Term Incentive Plan in H1 2021.
This, together with grants from previous years, has resulted in a non-cash share option expense of €8.5m in
H1 2021 (H1 2020: €6.8m). The increase is largely due to an increase in the fair value charge for the more
recent grants compared to previous years reflecting the increase in the share price.
One-off costs associated with the acquisition and integration of businesses amounted to €1.5m (H1 2020:€1.2m). Amortisation and impairment of intangible assets charge increased by €0.9m to €6.6m (H1 2020:€5.7m) reflecting the recent levels of acquisition activity.
Foreign exchange and other items amounted to a net charge of €1.2m (H1 2020: €0.3m). This includes €0.7m
for the unwinding of discount liabilities on deferred consideration. 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 of translating net current assets held in
foreign currencies. This resulted in a net foreign exchange loss of €0.5m, recorded within financing cost (H1
2020: €0.3m 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 €10.8m (+97.3% year on year) to €21.9m (H1 2020: €11.1m). Adjusted Profit
Before Tax, which adjusts for the items described in the APMs section above increased by €18.0m (+82.9%
year on year) to €39.7m compared with €21.7m in H1 2020. This represents an improvement in Adjusted profit
before tax margin of 4.1% pts to 16.6% (H1 2020: 12.5%). This is above the Group’s historical margin deliveryof between 14-15% and partly reflects the short-term benefit from certain costs savings as a result of COVID19 that are not expected to be sustainable.
Taxation
The tax charge increased by €1.6m to €6.3m (H1 2020: €4.7m) 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 2021 was 21.5% (H1 2020: 21.5%), in linewith the rate of 21.5% in 2020.
Earnings per share
Basic earnings per share increased by 119.8% to 20.86c (H1 2020: 9.49c) reflecting the increase in thestatutory profit after tax of 144.3%, partially offset by an 11.1% increase in the basic weighted average
number of shares following the 10.5% equity placing in May 2020. Fully diluted earnings per share, reflecting
the impact of unvested share options, increased by 116.6% to 19.73c (H1 2020: 9.11c)
Adjusted earnings per share which adjusts for the items noted in the APMs section and the tax impact arisingon these items above was 41.57c representing an increase of 64.6% (H1 2020: 25.25c).

Cash flow and net debt
Cash flow statement
Adjusted EBITDA

H1 2021€m
50.7

H1 2020€m
30.8

Change€m
19.9

MMTC and VGTR
Working capital and other items
Capex - property, plant and equipment (PPE)
Capex - intangible assets
Payments of principal on lease liabilities
COVID-19 employment support subsidies

(3.8)
1.7
(9.4)
(0.2)
(4.6)
-

(4.3)
(6.6)
(4.9)
(3.9)
3.4

0.5
8.3
(4.5)
(0.2)
(0.7)
(3.4)

Operating cash flows
Net Interest paid

34.4
(0.8)

14.5
(0.9)

19.9
0.1

Free cash flow before tax
Tax

33.6
(9.8)

13.6
(2.0)

20.0
(7.8)

Free cash flow
M&A - acquisition spend
M&A - acquisition and integration costs
Dividends paid
Shares issued for cash
Underlying increase / (decrease) in net cash /(debt)FX and other items

23.8(44.7)
(1.5)
2.3

11.6
(1.3)
(1.2)
110.7

12.2
(43.4)(0.3)(108.4)(20.1)
1.3

119.8
(0.9)

(139.9)2.2

Increase in net cash / (debt)
Opening net cash / (debt)(18.8)
102.9

118.9(17.9)(137.7)

Closing net cash / (debt)

84.1

101.0

The Group generated Adjusted EBITDA of €50.7m in H1 2021, an increase of €19.9m from €30.8m in H1
2020. There was a €3.8m outflow in respect of the amounts due for Multi-Media Tax Credits (MMTC) that areearned in the year of production, and are collected a year in arrears, and Video Games Tax Relief (VGTR).
Other working capital improved by €8.3m compared to H1 2020 due to trade receivable days improving by 5days to 41 days (H1 2020: 46 days).
Investment in property, plant and equipment increased by €4.5m (91.8%) to €9.4m (H1 2020: €4.9). This
reflects a return to more normal levels of spending following the COVID-19 disruption in the prior period that
resulted in a reduction in both the level of equipment expenditure and expansionary capex. Property lease
payments of principal of €4.6m were 17.9% higher than the prior period (H1 2020: €3.9m) mainly related toacquisitions in the period.
The Group received no COVID-19 government employment retention subsidies in H1 2021, resulting inoperating cash flows of €34.4m (H1 2020: €14.5m), an increase of €19.9m on H1 2020.
Net interest payments were €0.8m, a decrease of €0.1m on H1 2020 as a result of the repayment of drawings
on the RCF following the placing in May 2020. Tax payments amounted to €9.8m (H1 2020: €2.0m) an
increase of €7.8m on the same period when the Group benefitted from timing differences that resulted in lesspayments in the period in respect of the 2020 tax payable.
This resulted in Free Cash Flow of €23.8m (H1 2020: €11.6m), an increase of €12.2m on the prior period.
Adjusted Free Cash Flow, which adjusts for capital expenditure that is supporting growth in future periods
and the COVID-19 government employment retention subsidies in the prior year, was €37.7m in H1 2021,
an increase of €26.8m (+245.9%) on the levels delivered in H1 2020. This resulted in an Adjusted Cash
Conversion rate of 94.9% (H1 2020: 50.2%).
Cash spent on acquisitions totalled €46.2m of which €44.7m was in respect of the cash component of bothcurrent and prior year acquisitions and €1.5m was in relation to acquisition and integration costs. These
items, together with foreign exchange movements of €1.3m resulted in a decrease in net cash of €18.8m in
H1 2021 (H1 2020: increase in net cash: €118.9m) and a closing net cash of €84.1m (H1 2020: net cash
€101.0m, FY 2020: net cash €102.9m).

Balance sheet and liquidity
The Group funds itself primarily through cash generation and a syndicated revolving credit facility (RCF) of€100m, with an accordion option to increase this up to €140m. The RCF matures in October 2022 with an
option to extend it for up to a further year.
The majority of Group borrowings are subject to two financial covenants that are calculated in accordancewith 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 €102.9m
as at 31 December 2020. Following €46.2m of cash deployed in the period to support the Group’s value
accretive M&A programme, at the end of H1 2021, Keywords had net cash (excluding IFRS 16 leases) of€84.1m and undrawn committed facilities of €100m.
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 0.70p per share (H1 2020: 0.00p,
H1 2019: 0.58p) representing an increase of 20.7% on the 2019 interim dividend. The Board’s progressive
dividend policy seeks to reflect the Group’s continued growth in earnings and strong cash generation, balancedwith the need to retain the resources to fund growth opportunities, in line with our strategy.
Payments will be made on 29 October 2021 to shareholders on the register on 8 October 2021 and will go exdividend on 7 October 2021. The interim dividend payment will represent a total cost of approximately €0.6m
of cash resources.
Guidance for remainder of 2021
We have made a strong start to the year and expect demand to continue across most service lines, albeit
with organic growth rates and margins moderating against stronger H2 2020 comparatives, and as somecosts return with the easing of restrictions.
Full year adjusted profit before tax margins are now expected to exceed our 14 – 15% historical range but
we expect margins to return towards this range in 2022 as we continue to invest in the business and with areturn of certain costs with the easing of restrictions. Adjusted Effective Tax rate is expected to be remain inline with the 2020 rate of ~21%.
We continue to anticipate capex at a higher level than in 2020 relative to revenue, reflecting some
expansionary capex and investment in equipment to support the new console cycle, and we are targetingan overall Adjusted Cash Conversion rate in excess of 80%.
Following the trading update in early August, all of the above items are reflected in the current revenue andprofit market consensus* for 2021.
Jon Hauck
Chief Financial Officer*As at 14th September 2021, company compiled analysts’ expectations gave a consensus for FY 2021 of €498m of revenue and€79m of adjusted profit before tax.

Condensed interim consolidated statement of comprehensive income

Revenue from contracts with customers
Cost of sales
Gross profit
Investment income
Share option expense
Costs of acquisition and integration
Amortisation and impairment of intangible assets
COVID-19 government subsidies claimed
Total of items excluded from adjusted profit measures
Other administration expenses
Administrative expenses
Operating profit
Financing income
Financing cost
Profit before taxation
Taxation
Profit

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

Unaudited
Half Year
30 Jun 20€'000
173,485(110,565)
62,920(6,750)(1,185)(5,662)
3,411(10,186)(39,997)(50,183)
12,737

AuditedYear
31 Dec 20€'000
373,538(231,766)
141,772
1,437(15,350)(2,650)(8,808)9,231(17,577)(84,513)(102,090)
41,11949(2,442)
21,928(6,286)
15,64231(1,674)
11,094(4,691)
6,403

76(8,701)32,494(11,027)
21,467

(100)

(82)

(421)

3,118
8,713
27,373(304)(7,297)(1,280)(4,909)(10,843)5,294

15,675(33)
15,642

6,453
(50)
6,403

21,552(85)
21,467

27,406(33)
27,373(1,230)(50)(1,280)

5,379
(85)
5,294

€ cent20.86
19.73€ cent9.49
9.11€ cent30.32
28.71

Condensed interim consolidated statement of financial position

Note

UnauditedAt
30 Jun 21€'000

UnauditedAt
30 Jun 20€'000

AuditedAt
31 Dec 20€'000

Non-current assets
Property, plant and equipment
Right of use assets
Intangible assets
Deferred tax assets

99
931,44339,453
343,273
18,494
432,663

21,98831,321
188,657
5,698
247,664

26,41927,807
240,810
14,649309,685

Current assets
Trade receivables
Other receivables
Cash and cash equivalents

10
1062,40546,98884,285
193,678

44,941
43,941
101,213
190,095

47,832
38,665103,070
189,567

Current liabilities
Trade payables
Other payables
Loans and borrowings
Corporation tax liabilities
Lease liabilities

13
14

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

6,434
42,703
76
5,984
8,186
63,383
126,712

8,170
62,95873
12,568
7,361
91,13098,43721,6592,989
165
16,48529,43470,732427,798

11
2,049
142
8,879
23,801
34,882
339,494

1,994
2,693
122
10,57521,50336,887371,235

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

872
3,033
21,836244,845(1,837)(1,997)23,19949,558339,509(15)
339,494879
13,047
22,951
250,276(9,988)(1,997)31,79964,318371,285(50)
371,235

Net current assets / (liabilities)
Non-current liabilities
Other payables
Employee defined benefit plans
Loans and borrowings
Deferred tax liabilities
Lease liabilities

16

13
14
16

Net assets
EquityShare capital
Share capital - to be issued
Share premium
Merger reserve
Foreign exchange reserve
Shares held in Employee Benefit Trust ("EBT")
Share option reserve
Retained earnings
Non-controlling interest
Total equity

11
11
11
11

Condensed interim consolidated statement of changes in equity

Retainedearnings

Total
attributableto ownersof parent

Noncontrollinginterest

Total
equity

€'000

€'000

€'000

€'000

€'000

(1,997)

16,44943,187

222,92335

222,958

-

-

-

6,453

6,453

(50)

6,403

(7,601)

-

-

(82)

(7,683)-(7,683)(7,601)

-

-

6,371

(1,230)(50)(1,280)109,459

-

-

-

-

109,536-

109,536

-

-

-

6,750

-

6,750

-

6,750

1,118

-

-

-

-

-

1,131

-

1,131

(2,277)

-

2,674

-

-

-

-

399

-

399

92

(2,277)

1,118

112,133

-

-

6,750

-

117,816-

117,816

872

3,033

21,836244,845(1,837)(1,997)23,19949,558339,509(15)

339,494

Profit for the period

-

-

-

-

-

-

-

15,09915,099(35)

15,064

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

-

-

-

-

(8,151)

-

-

(339)

(8,490)-(8,490)

-

-

-

-

(8,151)--

14,760

6,609

(35)

6,574

Shares issued for cash

-

-

-

(87)

-

-

-

-

(87)

-

(87)

Share option expense

-

-

-

-

-

-

8,600

-

8,600

-

8,600

Share options exercised
Acquisition related issuance ofsharesContributions by andcontributions to the owners

3

-

1,115

-

-

-

-

-

1,118

-

1,118

4

10,014

-

5,518

-

-

-

-

15,536-

15,536

SharecapitalSharecapital - tobe issued

Mergerreserve

Foreignexchangereserve

Sharesheld in
EBT

Share
optionreserveSharepremium

€'000

€'000

€'000

€'000

€'000

€'000

At 01 January 2020

780

5,310

20,718132,712

5,764

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

-

-

-

-

-

-

-

-

-

-

-

-

Shares issued for cash

77

-

-

Share option expense

-

-

-

Share options exercised
Acquisition related issuance ofsharesContributions by andcontributions to the owners

13

-

2

At 30 June 2020

7

10,014

1,115

5,431

-

-

8,600

-

25,167-25,167

At 31 December 2020

879

13,047

22,951

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

371,235

Profit for the period

-

-

-

-

-

-

-

15,675

15,675(33)

15,642Other comprehensive income
Total comprehensive income
for the period
Contributions by andcontributions to the owners:

-

-

-

-

11,831

-

-

(100)

11,731-

11,731----

11,831--

15,57527,406(33)

27,373

Shares issued for cash

6

-

2,247

-

-

-

-

-

2,253

-

2,253

Share option expense
Acquisition related issuance ofshares (note 11)
Contributions by andcontributions to the owners

-

-

-

-

-

-

8,454

-

8,454

-

8,454

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

Condensed interim consolidated statement of cash flows
Unaudited
Half Year
30 Jun 21€’000

Unaudited
Half Year
30 Jun 20€’000

AuditedYear
31 Dec 20€’000

15,642

6,403

21,467

5,347
4,789
6,553
6,286
8,454
736
484
(49)
(136)
433
1,752
34,649

4,209
3,935
5,662
4,691
6,750
(34)
239
119
344
(31)
84
645
(378)
26,235

8,983
8,402
8,808
11,027
15,350
(66)
434
132
843
(76)
354
1,071
1,874
57,136(8,316)(3,844)(2,340)
11,236(3,264)(9,791)
37,236(2,276)(4,267)(6,033)
2,028(10,548)(1,961)
20,129(4,255)555(3,902)9,878
2,276(4,459)76,4201713
9
9(39,539)(5,158)(9,378)(157)
49(54,183)(1,027)(237)(4,888)31(6,121)(37,447)(2,489)(13,908)(259)
76(54,027)14(37)(4,551)
(484)
2,253
(337)
(3,156)(64,022)4,500(3,930)(344)
110,667(553)
46,318(64,030)
4,500(8,170)(843)
111,698(879)
42,276(20,103)
1,318
103,070
84,28560,326(940)
41,827
101,21364,669(3,426)
41,827103,070

Note
Cash flows from operating activities
Profit after tax
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 option expense
Fair value adjustments to contingent consideration
Fair value adjustments to right of use assets
Unwinding of discounted liabilities - deferred consideration
Unwinding of discounted liabilities - lease liabilities
Interest receivable
Fair value adjustments to employee defined benefit plans
Interest expense
Unrealised foreign exchange (gain) / loss

9
9
9

6
6
6
6

Changes in operating assets and liabilities
Decrease / (increase) in trade receivables
Decrease / (increase) in MMTC and VGTR receivable
Decrease / (increase) in other receivables(Decrease) / increase in accruals, trade and other payables
Taxation paid
Net cash generated by / (used in) operating activities
Cash flows from investing activities
Current year acquisition of subsidiaries net of cash acquired
Settlement of deferred liabilities on acquisitions
Acquisition of property, plant and equipment
Investment in intangible assets
Interest received
Net cash generated by / (used in) investing activities
Cash flows from financing activities
Repayment of loans
Drawdown of loans
Payments of principal on lease liabilities
Interest paid on principal of lease liabilities
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 period

16
16
11

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 2021.
The interim results for the half year ended 30 June 2021 and the half year ended 30 June 2020 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 2020, 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 2021.
The principal risk and uncertanties are disclosed in the Annual Report for the year ended 31 December 2020. The directors continue to monitor
principal risks and uncertainties including the ongoing impact of COVID-19. There have been no changes in the principal risks and uncertainties during
the period but the Directors recognise the increasing prevalence of cyber attacks and security threats to businesses generally, and advances intechnology in our industry.

Going Concern Basis of Accounting
After making enquiries, the Directors consider it appropriate to continue to adopt the going concern basis in preparing the Condensed interim
consolidated financial statements. In doing so, the Directors have considered the uncertain nature of the COVID-19 pandemic, but have noted:
the strong cash flow performance of the Group;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; and,

the ability of the Group to flex its cost base in response to a reduction in trading activity.
The Directors have also considered the Group’s strong liquidity position with net cash of €84.1m as at 30 June 2021, and committed undrawn
facilities of €100m under the Revolving Credit Facility (“RCF”).
The Directors have applied downside sensitivities to the Group’s cash flow projections to evaluate the Group’s ability to withstand a significant andprolonged downturn in trading (being a 25% reduction in Group revenue in 2022). 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 they fall due for the foreseeable future, a period considered to be at least 12 months from the date ofthese interim financial statements and therefore the going concern basis of preparation continues to be appropriate.
The Condensed interim consolidated financial statements made up to 30 June 2021 were approved by the Board of Directors on 14 September 2021.

2 Changes in Significant Accounting Policies
New Standards, Interpretations and Amendments effective 1 January 2021
A number of new amendments and interpretations to accounting standards are effective from 1 January 2021 including:

COVID-19-Related Rent Concessions – amendment to IFRS 16;
Interest Rate Benchmark Reform – amendments to IFRS 9, IAS 39 and IFRS 7.

These amendments and interpretations have not resulted in the accounting applied by the Group changing and have not had a material effect on
the Group’s financial statements.
Other accounting pronouncements which have become effective from 1 January 2021 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 are effective for the period beginning 1 January 2022:


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.

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

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 2020, 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 2020. 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.
Business Combinations – combination of put and call options over Non-controlling interest in connection with the Tantalus acquisition:o The Group acquired an 85% interest in Tantalus in March 2021, with the sellers retaining a minority shareholding. The shareholder
agreement (signed with the purchase agreement), includes put and call options (“the Forward”), that require the sellers to sell, or
require the Group to buy the remaining 15% shareholding in 3 years using a pre-determined valuation methodology linked to postacquisition performance. IFRS 3 does not provide specific guidance on how such contracts should be accounted for in a businesscombination. The Board determined, taking into consideration all the contracts’ terms and conditions, that the impact of the
Forward put the Group in a similar position as if the Group had acquired a 100% interest in the subsidiary on the acquisition date,with deferred contingent consideration payable at a future date. In doing so, the Board considered whether the risks and rewards ofownership reside with the Non-controlling interest or had effectively transferred to the Group, and concluded that the Noncontrolling interest arising on the acquisition had been extinguished by a combination of the Forward, and other conditions in theagreements. Therefore, the Group has accounted for the acquisition as if a 100% interest was acquired on acquisition, accounting
for the initial investment and the Forward as a single linked transaction in which 100% control is gained, with the Forward
recognised at fair value, as a financial liability within Deferred and contingent consideration (note 13), and no Non-controllinginterest recognised on the acquisition. Any subsequent re-measurement required due to changes in the fair value of the liability will
be recognised in the statement of comprehensive income.

5 Revenue from Contracts with Customers and Segmental Analysis

Revenue from Contracts with Customers
Revenue by line of business

Unaudited
Half Year
30 Jun 21€'000
22,69523,16463,26728,262
43,34523,21912,584
22,128
238,664

Art Creation*
Marketing*Game Development
Audio*
Functional Testing
Localization*
Localization Testing
Player Support

Unaudited
Half Year
30 Jun 20€'000
18,875
7,405
38,71520,90735,78921,287
10,701
19,806
173,485

AuditedYear
31 Dec 20€'000
38,903
18,42180,01747,23278,47945,35723,32341,806
373,538*The prior year comparatives has been re-classified to separately report Marketing services, previously reported within the Art Creation service line. In addition, there was a minor re-classification between Audioand Localization in the Half Year 2020.

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

Unaudited
Half Year
30 Jun 21€'000
46,78344,74444,30916,331
15,244
10,623
9,646
8,762
7,936
6,260
6,155
4,552
4,049
3,689
2,899
6,682
238,664

CanadaUnited Kingdom
United States
Italy
Russia
Japan
China
India
PolandIreland
Philippines
Spain
FranceSingapore
MexicoOther

Unaudited
Half Year*
30 Jun 20€'000
41,59827,73023,20910,932
14,691
9,645
8,850
5,017
3,683
6,601
6,041
3,240
3,572
3,104
1,210
4,362
173,485

AuditedYear*
31 Dec 20€'000
88,71358,64550,50425,21029,83920,944
18,42911,36910,26912,291
12,021
7,642
7,771
6,798
3,549
9,544
373,538*The prior year comparatives have been re-classified from billing entity to producing entity to align to the current year presentation, as the directors consider this measure to be more meaningful.

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 2021
At 30 June 2020
At 31 December 2020

Total undelivered€'000
22,79918,571
13,538

Scheduledcompletion
within 1 year€'000
14,617
16,065
12,991

Scheduledcompletion
1-2 years
€'000
7,190
2,219
547

Scheduledcompletion
2-5 years
€'000
992
287
-

Segmental Analysis

Geographical analysis of non-current assets from continuing businesses

United States
United Kingdom
Australia
CanadaItaly
Switzerland
Ireland
China
FranceJapan
Germany
Spain
India
PolandMexicoPhilippines
Other

Geographical analysis of non-current assets from continuing businesses
Deferred tax assets
Non-current assets

Unaudited
Half Year
30 Jun 21€'000
165,615
99,50040,12428,88815,464
10,025
8,524
8,294
7,867
6,201
5,186
4,954
3,180
3,151
2,247
1,820
3,129
414,169

Unaudited
Half Year
30 Jun 20€'000
86,12955,18729,424
11,90010,381
8,732
8,249
6,729
3,436
5,227
5,333
2,350
1,547
1,783
2,449
3,110
241,966

AuditedYear
31 Dec 20€'000
131,405
57,611
27,094
13,480
10,116
13,514
7,491
7,302
5,551
5,291
5,101
2,182
1,777
1,901
2,110
3,110
295,036

414,169
18,494
432,663

241,966
5,698
247,664

295,036
14,649309,685

Seasonal Business
The video games industry is 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, certainof Keywords Group's service lines typically experience significantly higher activity as part of this release cycle, during the six months from June toNovember. This activity drives increased revenues in that period and generates higher gross profit margins in the second half compared with the firsthalf of each calendar year.
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 current period.

Revenue
Gross profit

UnauditedYear
30 Jun 21
€'m
439
170

UnauditedYear
30 Jun 20
€'m
347
128

6 Financing Income and Cost

Unaudited
Half Year
30 Jun 21€'000

Unaudited
Half Year
30 Jun 20€'000

AuditedYear
31 Dec 20
€'000

49
49

31
31

76
76

(249)
(433)
(484)
(736)
(540)
(2,442)(2,393)

(302)
(645)
(344)
(119)
(264)
(1,674)(1,643)(552)(1,071)(843)(132)(6,103)(8,701)(8,625)

Unaudited
Half Year
30 Jun 21€ cent20.86
19.73

Unaudited
Half Year
30 Jun 20€ cent9.49
9.11

AuditedYear
31 Dec 20€ cent
30.32
28.71

€'000
15,642

€'000
6,403

€'000
21,467

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

Number
67,506,245
2,770,558
70,276,803

Number
70,800,455
3,959,878
74,760,333

Number254,383

Number259,900

Number
242,077(ii) Contingently issuable Ordinary Shares have been excluded where the conditions governing exercisability have not been satisfied:
NumberNumber
LTIPs
862,000
1,910,100
Share options
289,397
862,000
2,199,497

Number-Financing income
Interest received
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
respectof
2021

Expected€ cent
per
share
0.82

Pence
STG pershare
0.70

Expected
total
dividend€'000
616

Expected
payment
date
Oct-21

At 30 June 2021, Retained earnings available for distribution (being Retained earnings plus Share option reserve) in the Company were €30.3m. In
addition, the Company has amounts included in the Merger reserve of €123.9m that are considered distributable (note 11).
Interim accounts for the Company have been filed at Companies House to support the payment of an interim dividend in 2021.

9 Non-current Assets

Movement of the carrying value of Non-current
assetsCarrying amount at the beginning of the period
Recognition on acquisition of subsidiaries (note 17)
Other additions
Depreciation charge
Amortisation charge
Exchange rate movement
Carrying amount at the end of the period

UnauditedAt
30 Jun 21€'000
Property,plant andequipment
26,419277
9,378(5,347)716
31,443

UnauditedAt
30 Jun 21€'000

UnauditedAt
30 Jun 21€'000
Intangible
assets goodwill
212,017
89,391
8,853
310,261

Right of use
assets27,807
1,179
14,325(4,789)931
39,453

UnauditedAt
30 Jun 21€'000
Intangible
assets other
28,793
9,651
157(6,553)964
33,012

UnauditedAt
30 Jun 21€'000
Intangible
assets total
240,810
99,042
157(6,553)
9,817
343,273

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 2021 aninterim assessment was made based on the same underlying assumptions used in the last Annual Report, but using updated forecasts and projections.
Based on this interim review of the value in use calculations, no impairment is required in the period.

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 21€'000
64,752(2,347)62,405

UnauditedAt
30 Jun 20€'000
45,940(999)
44,941

AuditedAt
31 Dec 20€'000
49,814(1,982)
47,832

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

10,5694,714
4,346
20,8383,474
43,941

9,202
4,608
4,816
16,6683,371
38,665

Accrued 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 21€'000(1,982)
(451)
108
(22)
(2,347)
0.5%

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 21€'000(2,023)(324)(2,347)

11 Share Capital

At 01 January 2021
Acquisition related issuance of shares:
High Voltage Software
Heavy Iron
Tantalus
Climax Studios
ICHI
Coconut Lizard
Acquisition related issuance of shares
Issue of shares on exercise of shareoptions
At 30 June 2021

Number ofordinary£0.01
shares74,079,243

Numberofordinary£0.01
shares - tobe issued532,985

Sharecapital
€’000
879

Share
capital to beissued€'000
13,047

Sharepremium€’000
22,951

Mergerreserve*€’000
250,276

Issue date

Per share€

12-Jan-21
12-Jan-21
15-Apr-21
17-May-21
28-May-21
25-Jun-21

26.06
31.84
27.87
33.53
15.94
20.23

307,597368,750
232,517
14,635
19,739943,238(307,597)
12,914(14,635)(19,739)(329,057)

3
4
3
1
11

(8,017)
411
(233)
(400)
(8,239)-8,013
10,271
7,794
233
400
26,711

4.37

514,990
75,537,471

203,928

6
896

4,808

2,247
25,198276,987* 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 2021
Granted
LapsedExercised
At 30 June 2021
Exercisable at 30 June 2021
Weighted average share price at date of exercise

Share Option Scheme
Average
exercise
price in £ per
Number ofshareoptions
12.66
2,345,238
25.48
618,000
15.79(14,478)9.75(200,616)
15.74
2,748,144
8.17
846,810
25.59

Long Term Incentive Plan
Average
exercise
price in £ per
Number ofshareoptions
0.01
3,692,817
0.01
862,000
0.01(150,400)
0.01(314,374)
0.01
4,090,043
0.01
838,907
26.09

13 Other Payables

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

UnauditedAt
30 Jun 21€'000

UnauditedAt
30 Jun 20€'000

AuditedAt
31 Dec 20€'000

38,591
3,067
20,34636,282
98,28623,382
2,886
10,081
6,354
42,70331,0862,563
10,50118,80862,95821,65921,659

11
11

1,994
1,994

The 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)
Additional liabilities from current year acquisitions (note 17)
Combination put / call options to acquire residual 15% of Tantalus (note 4, 17)
Exchange rate movement
Carrying amount at the end of the period

Unaudited
Half Year
30 Jun 21€'000
20,802(5,158)736
36,0104,768
783
57,941

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 21
€'000
2,956
(11,471)

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 €Nil to a maximum of€70.2m. 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 21€'000
40,477
20,873
8,828
70,178The Group’s related party transactions are with key management personnel and other related parties as disclosed in the Group’s Annual
Report. There have been no material changes to the Group’s related party transactions with key management personnel during theperiod, while there were no transactions with other related parties in the period.

14 Loans and Borrowings and Capital Management

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

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

Unaudited
Half Year
30 Jun 21
€'000
195
(37)
7
165

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 €100m (with an option toincrease this by up to €40m to a total of €140m), extending to October 2022 (with an option to extend this maturity date by up to a further 2 years).
Throughout the period, the Group operated well within the interest cover and leverage ratio terms of the RCF agreement.

At the period end the net debt and the debt to capital ratio were as follows:

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

UnauditedAt
30 Jun 21€'000
165(84,285)(84,120)
427,798(20%)

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

Unaudited
Half Year
30 Jun 21€'000
28,864
1,179
14,324484(5,035)971
40,787The value of leases not yet commenced to which the lessee is committed, which are not included in the lease liability at 30 June 2021, were €Nil.

17 Business Combinations / Acquisitions Completed in the Current Period

During the period the Group completed three acquisitions, Heavy Iron, Tantalus and Climax Studios, purchasing 100% of the share capital of thesebusinesses, except in the case of Tantalus where the Group acquired an 85% interest. A combination of put and call options are in place requiring thesellers to sell, or the Group to buy the remaining 15% shareholding in 3 years. The Group has recognised a contingent consideration liability at fairvalue, being the Group’s estimate of the present value of the amount required to settle the liability, and has accounted for the acquisition as if a 100%interest was acquired on acquisition (see note 4).
The aggregate amounts recognised in respect of the identifiable assets acquired and liabilities assumed on acquisitions completed in the period are set
out in the table below. Details of the purchase consideration and other information relevant to the evaluation of the financial effect of the acquisitions, arealso presented.
The main factors leading to the recognition of goodwill on the acquisitions are the presence of certain intangible assets in the acquired entities, which
are not valued for separate recognition. These include expertise in the acquired entities, enhancing and growing our services capabilities, broadening
our service offering, and extending our geographical footprint, further building out our global platform.
UnauditedAt
30 Jun 21€'000
Details of goodwill and the fair value of net assets acquired
Book value:
Property, plant and equipment
Right of use assets
Trade and other receivables - gross
Bad debt provision
Cash and cash equivalents
Trade and other payables
Lease liabilities
Book value of identifiable assets and liabilities acquired
Fair value adjustments:
Identifiable intangible assets
Deferred tax assets
Deferred tax liabilities
Total fair value adjustments
Net assets acquired
Goodwill from current year acquisitions
Total purchase consideration

9,651
2,629
(2,654)
9,626
18,13789,391
107,528

Details of purchase consideration and cash outflows from current acquisitions
Cash
Deferred cash
Deferred consideration contingent on performance
Combination put / call options to acquire residual 15% of Tantalus
Shares to be issued
Total purchase consideration

48,267
1,270
34,7404,768
18,483
107,528

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

601,267
12,914

Cash paid in the period
Less: cash and cash equivalent balances transferred
Net cash outflow arising on acquisition

48,267(8,728)39,539Related acquisition costs charged through to the statement of comprehensive income
Details of pro forma revenues and profitability of current acquisitions
Pre-acquisition revenue
Post-acquisition revenue
Pro forma revenue
Pre-acquisition profit before tax
Post-acquisition profit before tax
Pro forma profit before tax

277
1,179
5,432
8,729
(5,927)(1,179)
8,511

645

5,067
8,093
13,160
2,119
3,616
5,735

The goodwill that arose from business combinations completed in the period that is expected to be deductible for tax purposes was €9.4m.

18 Events after the Reporting Date

Acquisition of AMC Ro Studio SRL
On 12 August 2021 the Group announced the acquisition of AMC Ro Studio SRL (“AMC”), a video game art creation studio for a total consideration of€2.8m. Founded in 2009 and based in Bucharest, Romania, AMC is a long established, high quality specialist art studio servicing both US andEuropean clients. Under the terms of the acquisition, Keywords will pay an initial cash consideration of €2.0m and the equivalent of €0.8m in new
ordinary shares to be issued on the first anniversary of completion. The new ordinary shares to be issued are subject to one-year orderly market
provisions.

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 financial 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.
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 of Euros. 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 underlying
trading performance of the business.
COVID-19 government subsidies claimed – In 2020 the Group applied for COVID-19 government subsidies in various jurisdictions,introduced in response to the global pandemic. These subsidies have been added back in order to present adjusted profit and cash flow
measures consistently year-on-year.
Investment income – The Group acquired a minor holding in Hutch Games Limited, when Keywords purchased Liquid Development
studio in 2015. In 2020 Hutch Games Limited was acquired and the Group received €1.4m proceeds in December. As the gain has 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, investment
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 the income.
The remainder of this section provides a reconciliation of the APMs with the relevant IFRS GAAP equivalent.

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 2020 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 21
Revenue
AER
€m
22.7
23.2
63.3
28.3
43.3
23.2
12.6
22.1
238.7

Art creation*
Marketing*Game development
Audio*
Functional testing
Localization*
Localization testing
Player support

Half Year
30 Jun 21
Revenue
CER
€m
23.7
24.1
66.3
29.2
44.5
23.8
12.8
23.3
247.7

Half Year
30 Jun 20
Revenue
AER
€m
18.9
7.4
38.7
20.9
35.8
21.3
10.7
19.8
173.5

Half Year
30 Jun 21
GrowthAER%
20.1%
213.5%
63.6%
35.4%
20.9%
8.9%
17.8%
11.6%
37.6%

Half Year
30 Jun 21
GrowthCER%
25.4%
225.7%
71.3%
39.7%
24.3%
11.7%
19.6%
17.7%
42.8%

*The prior year comparatives has been re-classified to separately report Marketing services, previously reported within the Art Creation service line. The equivalent organic growth rates for the half year to 30 June
20 were 30.8% for Marketing and 13.0% for Art creation respectively. Please also note, there was a minor re-classification between Audio and Localization in the Half Year 2020.

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 21
Revenue

AER
€m
22.7
23.2
63.3
28.3
43.3
23.2
12.6
22.1
238.7

Art creation
MarketingGame development
Audio
Functional testing
Localization
Localization testing
Player support

Half Year
30 Jun 21
Preacquisition
revenue
AER
€m
5.1
5.1

Half Year
30 Jun 21
Pro forma
RevenueYear
30 Jun 21
Pro forma
Revenue

AER
€m
22.7
23.2
68.4
28.3
43.3
23.2
12.6
22.1
243.8

AER
€m
42.7
34.2
123.6
54.6
86.0
47.3
25.2
44.1
457.7

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 2020 foreign exchange rates to both years.
Half Year
30 Jun 20
Revenue

Art creation*
Marketing*Game development
Audio*
Functional testing
Localization*
Localization testing
Player support

AER
€m
18.9
7.4
38.7
20.9
35.8
21.3
10.7
19.8
173.5

Half Year
30 Jun 20
Preacquisition
revenue
AER
€m
8.6
18.7
0.5
0.2
28.0

Half Year
30 Jun 20
Like for likerevenue

Half Year
30 Jun 21
Revenue
growthHalf Year
30 Jun 21
Revenue

AER
€m
18.9
16.0
57.4
21.4
35.8
21.5
10.7
19.8
201.5

CER
€m
4.8
8.1
8.9
7.8
8.7
2.3
2.1
3.5
46.2

CER
€m
23.7
24.1
66.3
29.2
44.5
23.8
12.8
23.3
247.7

Half Year
30 Jun 21
Organic
revenue
growth
CER
%
25.4%
50.6%
15.5%
36.4%
24.3%
10.7%
19.6%
17.7%
22.9%

* The prior year comparatives has been re-classified to separately report Marketing services, previously reported within the Art Creation service line. In addition, there was a minor re-classification between Audioand Localization in the Half Year 2020.

Adjusted operating costs
This comprises Administrative expenses as reported in the Consolidated statement of comprehensive income, adding back share option expense,
costs of acquisition and integration, amortisation and impairment of intangible assets, depreciation, non-controlling interest and deducting bankcharges. In order to present the measure consistently year-on-year, the impact of COVID-19 government subsidies claimed is also excluded.

Calculation
Administrative expenses
Share option expense
Costs of acquisition and integration
Amortisation and impairment of intangible assets
Depreciation - property, plant and equipment
Depreciation - right of use assets
Non-controlling interest
Bank charges
COVID-19 government subsidies claimed
Adjusted operating costs
Revenue from contracts with customers
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
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income

Half Year
30 Jun 21€'000(66,802)
8,454
1,464
6,553
5,347
4,789
33
(249)
(40,411)238,664
16.9%

Half Year
30 Jun 20€'000(50,183)
6,750
1,185
5,662
4,209
3,935
50
(302)
(3,411)(32,105)
173,485
18.5%

Year
31 Dec 20€'000(102,090)
15,350
2,650
8,808
8,983
8,402
85
(552)
(9,231)(67,595)
373,538
18.1%

Adjusted operating profit
The Adjusted operating profit consists of the Operating profit as reported in the Consolidated statement of comprehensive income, adjusted for shareoption expense, costs of acquisition and integration and amortisation and impairment of intangible assets. In order to present the measureconsistently year-on-year, the impact of investment income and COVID-19 government subsidies claimed are also excluded.

Calculation
Operating profit
Share option expense
Costs of acquisition and integration
Amortisation and impairment of intangible assets
Investment income
COVID-19 government subsidies claimed
Adjusted operating profit
Revenue from contracts with customers
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
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income

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

Half Year
30 Jun 20€'000
12,737
6,750
1,185
5,662
(3,411)
22,923Year
31 Dec 20€'000
41,11915,3502,650
8,808(1,437)(9,231)
57,259238,664
17.1%

173,485
13.2%

373,538
15.3%

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

Calculation
Operating profit
Amortisation and impairment 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 21€'000
24,321
6,553
5,347
4,789
(249)
40,761

Half Year
30 Jun 20€'000
12,737
5,662
4,209
3,935
(302)
26,241Year
31 Dec 20€'000
41,119
8,808
8,983
8,402
(552)
66,760Adjusted EBITDA
Adjusted EBITDA comprises EBITDA, adjusted for share option expense, costs of acquisition and integration and non-controlling interest. In orderto present the measure consistently year-on-year, the impact of investment income and COVID-19 government subsidies claimed are also excluded.

Calculation
EBITDA
Share option expense
Costs of acquisition and integration
Non-controlling interest
Investment income
COVID-19 government subsidies claimed
Adjusted EBITDA
Revenue from contracts with customers
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
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income

Half Year
30 Jun 21€'000
40,761
8,454
1,464
33
50,712
238,664
21.2%

Half Year
30 Jun 20€'000
26,241
6,750
1,185
50
(3,411)30,815
173,485
17.8%

Year
31 Dec 20€'000
66,76015,3502,650
85(1,437)(9,231)
74,177
373,538
19.9%

Adjusted profit before tax
Adjusted profit before tax comprises Profit before taxation as reported in the Consolidated statement of comprehensive income, adjusted for shareoption expense, costs of acquisition and integration, amortisation and impairment 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 investment income
and COVID-19 government subsidies claimed are also excluded.

Calculation
Profit before taxation
Share option expense
Costs of acquisition and integration
Amortisation and impairment of intangible assets
Non-controlling interest
Foreign exchange (gain) / loss
Unwinding of discounted liabilities - deferredconsideration
Investment income
COVID-19 government subsidies claimed
Adjusted profit before tax
Revenue from contracts with customers
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
Consolidated statement of comprehensive income
Consolidated statement of comprehensive income

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

Half Year
30 Jun 20€'000
11,094
6,750
1,185
5,662
50
264

Year
31 Dec 20€'000
32,494
15,350
2,650
8,808
85
6,103

736
39,708
238,66416.6%

119(3,411)
21,713
173,48512.5%

132(1,437)(9,231)
54,954
373,538
14.7%

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 21€'000
39,7086,286
15.8%

Half Year
30 Jun 20€'000
21,713
4,691
21.6%

Year
31 Dec 20€'000
54,954
11,027
20.1%

2,252
8,538
21.5%

(21)
4,670
21.5%

785
11,812
21.5%^Being mainly the tax impact of amortisation of intangible assets €1.6m and share option expense €1.3m, with the prior Half Year being mainly the tax impact of amortisation of intangible assets €0.90m and COVID19 government subsidies claimed €0.92m.

Adjusted earnings per share
The Adjusted profit after tax comprises the Adjusted profit before tax, less the Taxation expense as reported in the Consolidated statement ofcomprehensive income, adjusted for the tax impact of the adjusting items in arriving at Adjusted profit before tax.
The Adjusted earnings per share comprises the Adjusted profit after tax divided by the non-diluted weighted average number of shares 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 21€'000
39,708(6,286)

Half Year
30 Jun 20€'000
21,713(4,691)Year
31 Dec 20€'000
54,954(11,027)(2,252)
31,17074,980,344
€c
41.57
64.6%

21
17,04367,506,245
€c
25.25
17.3%

(785)
43,14270,800,455
€c
60.93
24.9%

^Being mainly the tax impact of amortisation of intangible assets €1.6m and share option expense €1.3m, with the prior Half Year being mainly the tax impact of amortisation of intangible assets €0.90m and COVID19 government subsidies claimed €0.92m.

Return on capital employed (ROCE)ROCE represents the Adjusted profit before tax (excluding net interest costs, unwinding of discounted lease liabilities and bank 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 21€'000
39,708
(49)
249
433
484
2,119

Half Year
30 Jun 20€'000
21,713
(31)
302
645
344
181

Year
31 Dec 20€'000
54,954
(76)
552
1,071
843
9,399

42,944
43,58923,15423,827

66,743-86,533

46,981

66,743

Consolidated statement of financial position
Consolidated statement of financial position

427,7982,989

339,494
2,049

371,235
2,693

Note 13
Note 14
Consolidated statement of financial position

32,411
57,941
165(84,285)
437,019

23,157
6,354
218(101,213)
270,059

25,17820,802
195(103,070)
317,033

19.8%

17.4%

21.1%

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

Adjusted profit before tax including pre acquisition
profit and excluding net interest expense (on a rolling
12 month basis) / capital employed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 investment 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
Fair value adjustments to right of use assets
Acquisition of property, plant and equipment
Investment in intangible assets
Investment 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 21€'000
37,236

Half Year
30 Jun 20€'000
20,129Year
31 Dec 20€'000
76,4201,464(9,378)
(157)
49
(821)
(4,551)
23,842
9,791
33,6331,185
34(4,888)31(897)(3,930)11,664
1,961
13,625

2,650
66
(434)
(13,908)(259)(1,437)76(1,722)(8,170)53,282
4,459
57,741

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
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). In order to present the measure consistently year-on-year, the impact of COVID-19
government subsidies claimed is also excluded.

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
COVID-19 government subsidies claimed
Adjusted free cash flow

As above

Half Year
30 Jun 21€'000
33,633

Half Year
30 Jun 20€'000
13,625Year
31 Dec 20€'000
57,741

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

4,888(4,209)679(3,411)
10,893

13,908(8,983)
4,925(9,231)53,435

Half Year
30 Jun 21€'000
37,66439,708Half Year
30 Jun 20€'000
10,893
21,713Year
31 Dec 20€'000
53,43554,954

94.9%

50.2%

97.2%

Consolidated statement of cash flows
Consolidated statement of cash flows
Consolidated statement of comprehensive income

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

Net debt
The Group manages capital by monitoring debt to capital and net debt ratios. This debt to capital ratio is calculated as net debt to total equity. Net
debt is calculated as Loans and borrowings (as shown in the Consolidated statement of financial position) less Cash and cash equivalents, andexcludes Lease liabilities. At the period end the net debt and the debt to capital ratio were as follows:

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

Note 14
Consolidated statement of financial position
Consolidated statement of financial position

Half Year
30 Jun 21€'000
165(84,285)(84,120)
427,798(19.7%)

Half Year
30 Jun 20€'000
218(101,213)(100,995)
339,494(29.7%)

Year
31 Dec 20€'000
195(103,070)(102,875)
371,235(27.7%)