Gaming Sector Overview
The origin of the gaming industry dates to 1980s. Ever since that time, the industry has seen several ups and downs; however, it continued to sail through the increasing competition. Owing to its vibrant culture, the entertainment sector has maintained flourish, especially in recent years, thanks to the growing technology and youth involvement. Few elements of the gaming industry are expected to increase its revenue drastically over the coming years. We have seen in the history that merger and acquisition activities in the gaming industry grew to a decent level with increased level of interest among the youngsters in the gaming industry.
In the competitive global sphere, the Australian gaming industry has been performing at its best, highlighted by several industry awards. Australia is a booming country for industries such as films, art, publishing and gaming.
Few Types of Gamers -
- Hardcore
Hardcore gamers spend on gaming equipment, including hardware and software. Generally, these gamers are of 28 years and above (male) and approximately 70-80 per cent of the total sales volume in the gaming industry comes from this section of gamers.
- Casual
This category includes gamers who are not professional but play games on a regular basis. Additionally, this section accounts for around 15-25 per cent of the total sales revenue in the industry.
- Mass Market
The people who fall under this category do not invest a lot of time in gaming. They actively seek games that are free of charges. This section contributes approximately 5 per cent to the total market.
Few Gaming Models
- Serious Games
The main motive behind these types of games is not to entertain the users but motivate them to achieve the tedious and boring tasks or to learn.
- Freemium
The service that can be used for free is categorised under this section. However, there are premium services that can be accessed after making payments.
- Gamification
This category attempts to add games such as elements into tasks. Despite being a new term, gamification is becoming more apparent in the daily life of people.
Crown Resorts Limited
Crown Resorts Limited (ASX:CWN) is an Australia based gaming and entertainment group, which is engaged in operating and owning two leading integrated resorts in the country. Apart from Crown Melbourne and Crown Perth (the resorts), the company also has one high-end licensed casino in London. Additionally, it has two projects in the development pipeline and interest in numerous digital businesses.
On 20 September 2019, the company announced that its annual general meeting (AGM) would be held on 24 October 2019. CWN has asked the members who would be unable to attend the AGM to vote by proxy on the resolutions scheduled for consideration at AGM.
Financial Highlights for the period ended 30 June 2019
- Normalised revenue of the group decreased by 9.9 per cent to A$3,139.2 million in FY2019 compared with A$3,483.4 million posted in the previous corresponding period.
- Normalised EBITDA also declined by 8.7 per cent year-on-year to A$802.1 million.
- Reported net profit after tax after significant items decreased by 28.1 per cent to A$401.8 million.
- The group also announced a final dividend of A$0.30 per share (25% franked), bringing the full year dividend to A$60 per share. Record date for the final dividend is 20 September 2019, while payment is scheduled on 4 October 2019.
Stock Performance
The stock of CWN closed the dayâs trading at A$12.120 on 27 September 2019, up 0.832 per cent from its previous closing price. The company has a market cap of A$8.14 billion and approx. 677.16 million outstanding shares. The 52-week high and low value of the stock is at A$14.370 and A$11.010, respectively. The stock has generated a positive return of 4.07 per cent in the last six months and a positive return of 2.74 per cent on a year-to-date basis.
Emerge Gaming Limited
Based in Western Australia, Emerge Gaming Limited (ASX: EM1) is an esports and casual gaming tournament company, which operates ArcadeX, a platform that enables users to enjoy skill-based tournaments, series and live matchmaking. The company was officially listed on ASX in 1971.
Financial Highlights for the year ended 30 June 2019
On 2 September 2019, the company announced preliminary financial results for FY2019.
- Revenue from ordinary activities up by 850 per cent to A$155,000 from the same period of the previous year.
- Loss for the reported year reached A$2.95 million, owing to an accounting impairment loss of A$898,443.
- Cash at the end of the year stood at A$3.18 million.
- During the year, the company posted first revenues from the platform through corporate sponsorships.
- Emerge Gaming also entered multiple agreements during the year.
Stock Performance
The stock of EM1 settled at A$0.015 on 27 September 2019, down 6.25% from its previous closing price. The company has a market cap of A$10.49 million and approx. 655.59 million outstanding shares. The 52-week high and low value of the stock is at A$0.045 and A$0.006, respectively. The stock has generated a negative return of 54.29 per cent in the last six months and a positive return of 128.57 per cent on a year-to-date basis.
Esports Mogul Limited
Based in Melbourne, Esports Mogul Limited (ASX: ESH) is the most advanced pure-play online esports tournament and matchmaking platform provider across the globe. The esports media and software company, which was listed on the ASX in 2011, is focused on the markets of Australia and Southeast Asia.
On 27 September 2019, the company announced to have received a waiver from the ASX concerning the ASX Listing Rule 6.24 in relation to option expiry notices.
Partnership with Wizards of the Coast
Esports Mogul, on 25 September 2019, announced to have entered a partnership with Wizards of the Coast, which is a publisher of fantasy games. Under the partnership, Mogul and Wizards rolled out MTG Arena Branded Hub on the same day. Additionally, the partners are launching the MTG Arena Mogul Championship 2019.
The championship, which will commence on 7 October 2019, has invited any player from Australia and New Zealand to compete for a prize pool of more than A$50,000 (cash and prizes).
First Branded League Hosted on Mogul
In another update on 10 September 2019, the company announced to host the Alliance League DOTA 2, which would start in Southeast Asia and Europe on 13 September 2019. The Alliance League is the first Branded League hosted on the Mogul platform.
Stock Performance
The stock of ESH traded flat at A$0.012 on 27 September 2019. The company has a market cap of A$19.57 million and approx. 1.63 billion outstanding shares. The 52-week high and low price of the stock is A$0.029 and A$0.010, respectively. The stock has generated a negative return of 7.69 per cent in the last six months and a negative return of 25.00 per cent on a year-to-date basis.
Ainsworth Game Technology Limited
Based in New South Wales, Ainsworth Game Technology Limited (ASX:AGI) is a provider of gaming machines in addition to other related equipment and services. AGI is engaged in activities including design, production, development, lease, sale and servicing with respect to its offerings. The company, which was founded in 1995, has ~200-500 employees and caters to 50 countries.
Board Changes
On 26 September 2019, AGI announced following board changes:
- Mr Danny Gladstone, the companyâs director and previous CEO has been appointed as Chairman at the conclusion of the AGM, scheduled on 26 November 2019.
- Mr Graeme Campbell, who is the current chairman of the company, would step down from his position and assume the role of Lead Independent Director at the conclusion of the AGM.
Consolidated Financial Highlights for the year ended 30 June 2019
Ainsworth Game Technology announced financial results for FY2019 on 27 August 2019, reporting
- Total sales revenue decreased by 12 per cent to A$234.3 million compared to the previous corresponding year.
- Net profit after tax declined to A$10.9 million from A$31.9 million in FY2018
- Net cash stood at A$6.2 million
Stock Performance
The stock of AGI settled at A$0.750 on 27 September 2019, down 1.961 per cent from its previous close. The company has a market cap of A$257.65 million and approx. 336.79 million outstanding shares. The 52-week high and low price of the stock is A$1.240 and A$0.610, respectively. The stock has generated a negative return of 10.53 per cent in the last six months and a negative return of 3.16 per cent on a year-to-date basis.
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