Earnings call transcript: Frontier Developments jumps on record profit in H2 2026
Frontier Developments announced record adjusted operating profit and robust cash generation for fiscal year 2026. The company's shares surged 8.66% to $484.61 in pre-market trading, up from a previous closing price of $446. Investors were particularly enthusiastic about the company's first-ever special dividend and plans for continued share buybacks.
The highlights for fiscal 2026 were a revenue of GBP 104.8 million, a record adjusted operating profit of GBP 21.4 million, and a 20.4% operating margin. The company's financial health was rated "great" by InvestingPro, with a strong emphasis on cash flow quality and a healthy balance sheet. Frontier expects a pipeline of strong releases, including Planet Zoo 2, to support consistent revenue growth.
The company's CMS portfolio, which accounts for 89% of total revenue, has seen a 34% year-on-year growth. Management highlighted the importance of cost discipline, with adjusted operating costs on an adjusted cash basis rising by only 3%.
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