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Game Digital (GMD)

Business description

Game Digital is the leading omni-channel specialist retailer of video games in the UK and Spain, with 277 stores in the UK, 265 stores in Spain and over 30% market share.

Investment summary

Even as Game Digital (GMD) faces short-term trading pressure, its developing BELONG gaming arena concept is arguably part of the answer of what to do with the UK’s high streets and shopping centres. The first BELONG sites under the February 2018 agreement with Sports Direct are now opening. With GMD’s share price still less than net cash of 32p, neither the existing business, which currently contributes £10m of EBITDA, nor BELONG which we value at 23p, are attributed any value by the market. Our total valuation is 75p.

Last updated on 12/09/2018

Y/E Jul Revenue (£m) EBITDA (£m) PBT (£m) EPS (fd) (p) P/E (x) P/CF (x)
2016A 821.9 26.4 14.8 10.7 2.9 17.4
2017A 782.9 8.0 (4.3) (3.7) N/A 5.8
2018E 780.0 10.1 (3.6) (4.1) N/A 3.8
2019E 778.8 13.2 (1.3) (2.1) N/A 4.9

Last updated on 24/08/2018

Latest video

Bitesize Briefing - Game Digital

Industry outlook

The UK and Spanish console markets (hardware, software, accessories and console digital) are worth c US$2.2bn and US$1.2bn, respectively. The traditional cycle that has peaked every six years since 2000 seems to be moving to shorter intervals. This could signal structural changes analogous to the mobile and PC markets. In addition, the global esports market, currently US$0.7bn, is forecast to grow to US$1.5bn by 2020.

Last updated on 27/07/2018

Key management

John E. Jackson, Chairman
Martyn Gibbs, CEO

Company address

Unity House
Telford Road, Basingstoke
RG21 6YJ
United Kingdom
+44 (0)1256 784000
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