Shares in video game developer Team17 (LSE: TM17) plunged 42% on Friday after the company warned that 2023 earnings will significantly undershoot last year’s figures.
The FTSE AIM All-Share listed firm now expects full-year adjusted EBITDA of at least £28.5 million, including non-cash asset impairments of up to £11.5 million. This compares to adjusted EBITDA of £48.8 million in 2022.
Team17 said the downgrade follows project budget overruns, delays to cost savings initiatives and some games underperforming expectations.
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However, the Yorkshire-based company still expects 2023 revenues to modestly exceed analyst forecasts, building on total sales of £137.4 million last year.
Going forward, Team17 stated that its release schedule for 2024 is strong and back catalogue investment will continue to drive growth. The firm vowed to deliver an “improved underlying trading performance” next year.
Shares in Team17 year to date are down 57%.
