“Very positive”: Animoca Brands co-founder bullish after successful six months
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Special Report: Animoca Brands has had an extremely busy first half of 2019, with revenue increasing 47 per cent in what the company declared the “most successful” period in the company’s history.
The mobile gaming company Animoca Brands (ASX:AB1) has tripled in value in 2019 thanks to a steady stream of announcements about new games, partnerships, acquisitions, and talent hires, and believes digital collectibles “will do for blockchain adoption what physical collectibles did for companies like eBay and Amazon and internet adoption back in the 1990s”.
It released its half-yearly report to investors on Monday, which showed a 177 per cent increase in cash, digital and financial assets, to $16.6 million, and a boost in operating revenue to $8.3 million.
Co-founder and chairman Yat Siu told Stockhead he was very pleased with the “financial strength” of the company.
“Overall the financial position of our business has improved dramatically over the past six months,” Siu said.
“We have made several strategic acquisitions, which has led to higher operational costs, but financially the company is in a stronger position than even the revenue lets on.”
Most recently, Animoca raised $8 million in order to fund an acquisition of Quidd, a world-lead digital collectibles marketplace, giving Animoca access to some of the world’s biggest brands in Disney, Marvel, HBO, CBS and the NBA.
Siu said the company’s focus is now on becoming an industry leader in the growing industries of blockchain gaming and digital collectibles.
“We will continue to grow our distribution infrastructure and capabilities, we will continue to leverage powerful brand partnerships to grow our revenue, we will establish a leadership position in digital collectibles and we will grow our teams to accelerate our growth ahead of competition,” he said.
And while the overall loss increased to $6.8 million, Siu explained the loss was largely due to significant non cash items including receipts of cash from token sales having to be reclassified as unearned revenue and recorded as contract liabilities under Australian accounting standards.
Furthermore, Animoca recorded in its working capital $5.6m of liabilities which are expected to be settled in equity, which further strengthens the company’s cash position.
The company also recorded approximately $1.3 million in amortisation on intangible assets for which the useful life remaining is substantial.