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Codemasters - Walloping expectations again

November 2020

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • CDM
  • Price:
  • 400p
Codemasters’ H1 update shows record financial results and major growth, with sales up >100% to £80.5m and ebitda the same at £21m. Net cash has also doubled to £49.8m.Trading has benefited from the stand out performance of the F1 2020 Grand Prix game (up >50% on the previous version helped by a plethora of new features including split screen to allow players to compete with friends and family). Digital strategies have also increased the monetisation of the back catalogue. Digital sales as a proportion of revenue have reached 73% from 62% a year ago as COVID-19 accelerated the shift to digital delivery. Gross margin has improved by 3.6% to a record 92.9%.The exposure and brand awareness from the v ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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