SUMO.L Share News (SUMO)

(Sharecast News) - Sumo Group updated the market on its trading on Thursday, saying it had continued to perform well since its final results announcement in April, trading "comfortably in line" with market expectations.
The AIM-traded firm, which was holding its annual general meeting, said it was "well-positioned" to benefit from increased activity in the video games market.

It said the Covid-19 lockdown restrictions were positively impacting its underlying market, with video gaming activity and console purchases accelerating faster than previously forecast.

The company's most recent game launch was on 12 June, when Little Orpheus, an adventure game from one of its digital studios, The Chinese Room, was made available on Apple Arcade.

It followed the success of Spyder on Apple Arcade, which achieved "consistently high" user feedback ratings since launch on 20 March.

On 11 June, Sony announced Sackboy A Big Adventure at the PlayStation 5 reveal event.

Sumo said it was generating a "strong pipeline" of new business development opportunities across both client work and its own intellectual property, despite restrictions on travel and face-to-face contact.

"Our teams are continuing to work very effectively, and safely, from home, with only minor disruption to and, in most cases similar productivity to that achieved when based in our offices," the board said in its statement.

"While the reopening of our studios is not planned in the near-term, we are exploring the options on how and when to do this."

On 15 May, Sumo announced the acquisition of Lab42 - a cross-platform work-for-hire studio, providing co-development and full game development services, for total cash of $0.6m (£0.48m).

The board said the acquisition supported the company's growth ambitions, increasing its capacity and adding new talent.

It also strengthened its presence in a "talent hot spot", Leamington Spa, and brought a number of new client relationships to the group.

The business holds an exclusive licence to use the World Snooker Tour brand, and was the sole developer on Snooker 19 for all major consoles and PC.

Lab42 was continuing development on World Snooker products, and expected to launch additional games on new devices later in the year.

Other well-known titles on which Lab42 had worked included Yakuza 0 and Yakuza Kiwami, Football Manager Touch 18, Sonic Mania, Terratech and Fishing Sim World.

"The integration of Lab42 is going to plan and the business is already performing well, in the short period since acquisition," the board said.

In its 2019 results, Sumo referred to the challenge of recruiting new talent in the current remote-working environment.

"This is ongoing and we expect recruitment to remain challenging for some time.

"Whilst we are continuing to execute our stated organic growth strategy, given the fragmented nature of our market and opportunities arising from the Covid-19 situation, we are currently focused on accelerating the Group's expansion through specifically targeted acquisitions."

The board said it was "pleased" with the progress that the group had made to date, and was "looking forward" to capitalising on the new business opportunities which were presented themselves.

"Trading in the year to date is comfortably in line with market expectations, and the group is well-positioned to continue to take advantage of the strong growth in the global video games market.

"The board continues to view the future of the Group with confidence, despite the backdrop of Covid-19, and remains optimistic about the prospects for the business in the current financial year and beyond."

At 1032 BST, shares in Sumo Group were up 3.06% at 202p.