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Trading statements

GMD on track

03 August 2016 07:27

GAME Digital expects its adjusted EBITDA for the 53 weeks ended 30 July to be within the range of current market forecasts.

It says market trends experienced in the first half of the year have continued into the second half, with a challenging UK trading environment set against good growth in Spain. In response to the decline in the UK market the business has implemented a wide-ranging action plan to improve retail performance whilst driving forward the continued progress of strategic growth initiatives across the Group.

In total, the Group's Gross Transaction Value1 was broadly flat in the second half at £316.8 million (H2 2015: £318.3 million), resulting in a total GTV for the 53 week period of £924.8 million (2015: £962.4 million). On a statutory basis, Group revenues for the 53 weeks ended 30 July 2016 are expected to be approximately £815 million (2015: £866.6 million).

On a 52 week comparative basis, total Group GTV of £914.1 million was down £48.3 million or 5.0%, with low margin console sales down £55.9 million in the period.

Over the same period GTV from preowned technology products was up £17.5 million or 65.1% whilst GTV from the Group's Accessories, Toys-to-Life and Other (AT&O) category increased £19.7 million or 19.0%, including a continued strong performance from PC accessories and licensed merchandise. However, combined GTV from mint and preowned content was down £25.5 million or 4.8% across the Group, despite 15.5% growth in digital content GTV, negatively impacting the overall gross profit performance.

Costs, in line with previous guidance, reflect the full year inclusion of Multiplay and the first time inclusion of costs from the newly acquired Spanish esports business and Ads Reality Limited which was acquired in May 2016. Cost savings were made in the core retail businesses in the second half, however overall costs have increased modestly in both the UK and Spain as investment has been made in activities to support the new growth areas.

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