Frontier Developments PLC appears on track for another record revenue-breaking year in financial 2023, Shore Capital analysts said.

Analysts upgraded from ’hold’ to ’buy’, retaining its 1,350 pence fair value.

In November, the Cambridge, England-based video game maker and publisher bought 100% of Manitoba, Canada-based game development studio Complex Games Inc, the developer of role-playing game Chaos Gate Daemonhunters, for an upfront cash consideration of £8.3 million.

Shore Capital said the acquisition implies FDEV is able to retain an ‘increased share of profits for the shared work in the group’, and it upgraded its earnings before interest, tax, depreciation and amortisation forecasts by about £500,000 as a result.

In September, Frontier posted a pretax profit of £944,000 for the 12 months ended May, down significantly from £19.2 million the year before.

Revenue grew 26% year-on-year to a record £114.0 million from £90.7 million, driven by the new release of Jurassic World Evolution 2, as well as ongoing momentum from the company’s portfolio of games and Foundry titles, including Warhammer 40,000 Chaos Gate - Daemonhunters.

Shore Capital said: ‘In a tough consumer market we believe gaming companies can remain resilient by having a global fanbase, strong consumer engagement and well-known and liked IP. We expect gaming-related products will have remained a popular gift choice over the holiday period, as well as a pastime activity.’

Shares were up 3.0% at 1,004.00 pence at on Wednesday afternoon in London.

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