U.K. Game Maker Famous for Worms Takes Pass on Apple Arcade

(Bloomberg) -- Team17 Group Plc, the British video game maker that just posted a 97% gain in first-half revenue, is in no hurry to sign up to Apple Inc.’s upcoming games subscription service, Apple Arcade.

“We have plenty of cash so we’re not looking to people like Apple for development financing in exchange for periods of exclusivity on games,” Chief Executive Officer Debbie Bestwick in an interview on Tuesday. “It’s not our model.”

The company -- famous for the Worms games franchise where heavily armed earthworms battle their way across different landscapes -- said that gross profit rose 119% to 15.1 million pounds ($18.6 million), and adjusted earnings per share up 356% to 7.31 pence. Blasphemous, a highly anticipated new game for PCs and games consoles, was also released on Tuesday.

Team17 “launched a lot of new IP this year, and that’s one of the most difficult jobs in this industry,” Bestwick said. “But we’ve also focused on releasing updates to back catalog titles, such as Worms WMD.”

The company also benefitted from gamers playing on home computers. Bestwick said titles released for PCs had now overtaken Nintendo Co.’s Switch to be the most popular single platform for Team17’s releases, driven in part by the growth of Epic Games Inc.’s download store, a rival to Valve’s Steam.

Shares of Wakefield, England-based Team17 were up 2.5 pence to 304.5 pence at 9:38 a.m. in London after earlier rising as much as 6%. The stock has risen about 56% so far this year, giving the company a market value of about 400 million pounds.

Jefferies Financial Group Inc. analysts Ken Rumph and Lyra Li, who recommending holding, wrote in a note to clients that the results were “encouraging,” and said they were raising their price target for the stock to 290 pence from 235 pence. Of the six analyst recommendations tracked by Bloomberg, four maintain a buy position while two advise holding.

To contact the reporter on this story: Nate Lanxon in London at nlanxon@bloomberg.net

To contact the editors responsible for this story: Giles Turner at gturner35@bloomberg.net, Amy Thomson

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