Frontier Developments plc (FDEV.L) Q4 2026 Earnings Call Transcript

Alex Bevis : Morning, everyone. We will give everyone just a few more minutes to join. Tommy, are you all right with the slides there? I keep seeing a blue flower, but is that just me? Can you see them all right? Yeah, I can see it now. Yeah. Just give it another 30 seconds to see if anyone else is going to join us. Jo, your background is trumping mine significantly there.

Jo Cooke : I made a special effort.

Alex Bevis : It is very nice. It is not even a virtual one. That is real, is not it?

Jo Cooke : No, it is real. Very much real.

Alex Bevis : Okay, why don't we get started then? Thanks, everyone, for joining us for this FY 2026 financial results presentation. If you could please all turn your cameras off and go on mute, we'll have a Q&A session at the end where you can unmute and ask your question. Let's just flick over, Tom, please, to the agenda. First of all, we'll do a bit of a leadership recap and update. Jo will then take us through her core focus areas and a reminder on the strategy. We'll then talk about the financials and then come back and talk about our games, both the current franchises and the future games. Then we'll have a quick wrap-up and then move to questions. Starting with the leadership section. I think as everyone knows, we've had quite a change in leadership over the last 12 months. In June 2025, we established an executive board to lead the next phase of Frontier's evolution. Jo joined us as CMO in August 2025. Jonny decided to step down after some 27 years at Frontier, so I think he'd certainly done his stint at Frontier by then. The obvious successor there was Jo to step up into that role. Jo, do you want to take over from that timeline point?

Jo Cooke : Yeah, sure. Thanks, Alex. Well, for those who don't know me, I started working in the games industry over 35 years ago, and this is not my first time in Frontier. I originally joined the business to establish the publishing team to launch Elite Dangerous and Planet Coaster, and I returned in 2025 as CMO because I believed really strongly in both the quality of our franchises and the potential of the CMS strategy that was being put in place. Following Jonny's departure early this year, I was delighted to step into the CEO role and lead Frontier into its next phase of growth, hired a new CMO to bolster the exec board in Dan Lazarides, and importantly, this has not meant a change in strategic direction. The confidence in the future direction of management has given David Braben the confidence to step down and take a non-exec and advisory position, and we welcome him to our corporate board. The CMS strategy established over the last few years is working, and our fiscal 2026 results demonstrate that clearly. We have delivered record profitability, strong revenue growth, and significant cash generation. My focus since returning has been on building on that foundation by placing even greater emphasis on our players and on the long-term nurturing of our games and our franchises. We know the greatest value in our business comes from creating games and franchises that players engage with for many years, not just at launch. By listening closely to our communities, using player data more effectively, and delivering a constant cadence of updates, expansions, and premium content, we. Can somebody mute the. Whoever's not on mute, would you mind going on mute? Thank you. Appreciate it. Using player data more effectively, delivering a consistent cadence of updates, expansions, and premium content, we can increase engagement, improve retention, and maximize lifetime value. This player-first approach now sits at the heart of everything we do. It informs how we develop games, how we invest in content, how we prioritize our roadmap, and how we create long-term shareholder value. We have exceptional talent across Frontier, a growing portfolio of world-class CMS franchises, a strong balance sheet, and a clear strategy. This makes me really excited about the opportunities ahead. Strategy and focus, if you move on. Thank you. Our strategy remains clear and highly focused. We are strengthening Frontier's position as a global leader in creative management sim games by putting players first, nurturing existing franchises, and building the next generation of CMS experiences through new game launches. We will continue nurturing our existing games through regular updates, expansions, and premium downloadable content. We will deepen our understanding of player behavior so that we can deliver better experiences, improve retention, and increase engagement across our portfolio. We will continue growing our CMS portfolio through both established franchises and new intellectual property, and we will continue investing in COBRA, which is our proprietary technology platform that provides us with a clear competitive advantage, enables us to deliver increasingly sophisticated CMS experiences efficiently and at scale. Finally, we will continue investing in our people, retaining key talent, and developing future expertise through our graduate program. FY 2026 demonstrates not only a strong growth, but a fundamentally lower risk business model for us. Alex will talk further about the numbers, but you can see on this slide that FY 2026 has been a good year for Frontier. These results have been delivered by proven CMS franchises, recurring nurture revenue, and disciplined execution. We are increasingly becoming a business that is driven by long-term franchise economics. Looking ahead, we have an excellent roadmap. Planet Zoo 2 launches next month. Warhammer 40,000: Chaos Gate - Deathwatch is scheduled for fiscal year 2027. We have already talked about and announced a brand new Planet franchise title, and that is planned for fiscal year 2028. Beyond that, we remain committed to an average cadence of one CMS title a year. We have announced our exciting partnership with Disney last week, and that represents a significant milestone in our growth strategy moving forward. Over to you, Alex.

Alex Bevis : Thanks, Jo. A little bit more on the numbers there. I am sure you have all read the statement already, but delighted with that revenue performance driven by the success of Jurassic World Evolution 3, but also the rest of the portfolio doing very well. Jo will talk a bit more about the current franchises in a few minutes on some of the other slides, but really pleased to get to just under GBP 105 million. That is our second highest ever revenue number, so great performance. On gross profit margin, as you all know, I think that tends to vary based on how much we have in terms of licensed IP games versus own IP games. With the success there of Jurassic World Evolution 3, gross margin has just ticked down a few points to just under 67%. Looking ahead to this year, where we have FY 2027, we have Planet Zoo 2 as the big release. We expect that number to come back up maybe to 68%, something like that. Gross operating costs, so this is an adjusted income statement, not an IFRS income statement, so we ignore any capitalization, amortization, share charges. Any of the non-cash accounting charges are excluded from here. So this is gross operating costs on a cash basis, effectively. We only increased by 3% year-over-year, so we are continuing to exhibit very strong cost control. Having said that, we are growing a little bit on headcount cautiously. We are investing in a few other areas to expand our franchises as well. In fact, the biggest cost increase year-over-year was the profit-related bonus because we have an all-staff profit share scheme, and given the strong profitability, pretty much all of that increase year-over-year is driven by that increase in bonus. So GBP 62.5 million on a gross OpEx basis for FY 2026. Probably looking at mid-60s, I would say, for FY 2027 as we just start this financial year. Next line is tax credits. On this adjusted income statement basis, we account for tax credits and tax reliefs directly in the year when the expenditure is incurred. That is a bit different from IFRS accounting in terms of both the location and the timing of those, and I do not want to get too much into IFRS accounting in this presentation today because I know that Jo might fall asleep. We will focus here pretty much on the adjusted income statement basis, and you can see the very substantial tick up year-over-year. I am going to talk about this on a slide coming up, so park it for now, but GBP 12.8 million, obviously very significant in generating that adjusted op profit number at the bottom. Within other operating income, in last year's number, that GBP 3.9 million relates to selling publishing rights for a Foundry game. In FY 2026, towards the start of this financial year, or last financial year in FY 2026, we have started to sublet the ground floor of the building. So that is all the sublet income that we have coming through, and we expect, therefore, a similar number to come back into FY 2027 as well. Adding all that through from gross profit, deduct the gross OpEx, and then add back tax credits and the other operating income, we hit a record adjusted operating profit of GBP 21.4 million, just over 20% profit margin. Really delighted with that performance. Really strong set of numbers. Tom, if you could flick onto the next slide. A bit more here on tax. I know Jo loves talking about tax, so we'll spend a few minutes on this. We've benefited from a long time from video games schemes in the U.K. People probably know Video Games Tax Relief as being the most established one there. That is transitioning to something called Video Games Expenditure Credit. The accounting for those is a bit different, and I'm not going to get into that on this slide. This slide represents the effective benefit we get in the financial year against the expenditure that we incur. You can see there that although VGTR has ticked down because of that transition, VGEC is very substantial now. Some of that relates to some prior year adjustments because we were uncertain about that transition from one scheme to the other. We were pretty prudent in the prior year. About GBP 2.3 million of the VGEC number actually comes from a prior year adjustment. If you strip that out, we're probably looking like a normalized number in FY 2026 across all four of these schemes of something like GBP 10.5 million. That's a bit higher than we would normally expect. There's a couple of differences there. One is that we can get a full benefit for the IP costs where we couldn't under VGTR. That means that we can get a credit back for royalties that we have with Universal for Jurassic, for instance. In the year because of that strong success with Jurassic World Evolution 3, that really helped us quite a lot. I know that people will ask later on the questions about what do you expect going forward? Probably just head it off here. We're probably looking at GBP 8 million-GBP 9 million of total tax credits and reliefs on an adjusted op basis in FY 2027. Not quite as strong as the GBP 12.8 million, but as I said, some of that did include a prior year adjustment. There's one other thing to note at the bottom here, is in addition to that prior year adjustment, we have this one-off transitional credit of GBP 4.4 million. That relates to how the legislation was drafted by HMRC. Again, we weren't sure whether we were going to get this. We claimed it, and we've actually received the cash now into our bank account. That's part of the reason that the cash ticked up to just over GBP 50 million at the end of August. We've excluded that from the calculation of adjusted op profit because, it is one-off in nature, but it has helped with the IFRS numbers, and that's part of the reason you see such a strong growth in the IFRS operating profit. Okay, I think that's enough on tax for now. Hopefully we'll get some questions on it later. On cash flow, this is a cash bridge from start to finish. Fairly straightforward because the adjusted operating profit measure is a pretty good proxy for free cash flow. You can see that GBP 21.4 million flows straight through, a little bit of working capital difference. Sorry, Tom, the slides keep coming in and out. I do not know whether that is something you are up to there. Then we had pretty significant investment in our own shares. So share buybacks were GBP 15.5 million, then we had EBT share purchases as well. So closing balance was GBP 44 million. If you go to the next slide, please, Tom, we will talk a bit more about that capital allocation strategy. Clearly, first priority for us is investing sensibly in the business. As I said earlier, we are cautiously growing headcount. We have some other areas to invest in as well, but I am not expecting any real significant tick-up in the operating cost for the business. We already have a very strong balance sheet and with over GBP 50 million, clearly it is strengthened even more. Then the third bullet there, returning surplus capital to shareholders where appropriate. We certainly think that the buybacks benefits people in the long term. We still believe our valuation is very low given our performance, our strong balance sheet and the prospects that we have going forward. We have invested so far GBP 20.5 million since the 1st of June, including the share buybacks and EBT purchase. We would expect that buybacks would feature within FY 2027. We will be renewing the authority at the AGM in October. But as I said, we really do believe we are significantly undervalued and it makes sense therefore to use that surplus cash to do those buybacks. Then the last point here, special dividend. This is, I think, the first time that Frontier has ever paid a dividend out, certainly since we have been a public listed company. It really reflects the confidence that we have, the very strong financial position and the record financial performance. We also have that kind of windfall one-off from HM Revenue and Customs of GBP 4.4 million, so it pretty much covers that. We are going to be processing this over the next few weeks, and I think the payment date is early October. So, nice to be declaring a special dividend of GBP 5 million. I think it is about GBP 0.14 per share. Okay, I think that is me done. I will pass back to Jo to talk about our franchises in a bit more detail.

Jo Cooke : Thanks, Alex. One of Frontier's greatest strengths today is the maturity and the quality of our franchise portfolio, which you can see here. Across our major franchises, we have generated hundreds of millions of pounds in lifetime revenue, sold millions of units, and delivered dozens of content releases over many years. Importantly, this revenue has not been generated solely at launch. It has been generated through effective nurturing, through premium content, platform releases, promotions, and ongoing player engagement. We have built recurring revenue streams in a more resilient business model. This means we have a lower dependency on individual launches and better visibility of future cash generation. The scale of engagement in our games is absolutely extraordinary. In Planet Coaster alone, Planet Coaster 2 alone, players have laid more than 23 billion kilometers of tracks, which is enough actually to travel to the moon and back almost 30,000 times. They have also placed more than 260 million items in-game in the last six months, which shows the resilience and the demonstration of the creative engagement and longevity that CMS games can deliver. If you go to the next slide, please. This slide captures how we think about long-term value creation. Everything begins with creating market-leading CMS titles, CMS games. From there, we grow audiences, retain players, deepen engagement through content, and continually optimize lifetime profitability. Our future portfolio combines two complementary growth areas. The first is our own IP strategy, that is the Planet brand, and we will continue to make Planet games in the future and grow that brand further. The second is our licensed IP strategy, which now includes Disney alongside Jurassic World. Beyond these confirmed games that we have, we plan to further expansion, expand rather our own IP portfolio and our licensed IP portfolio. Each new franchise expands our ecosystem and creates additional opportunities for nurture, cross-sell, PDLC, and monetization. Over time, this broadens our revenue base, increases diversification, and reduces risk. This is how we intend to deliver sustainable long-term growth. The success of this strategy can be seen in this revenue mix. CMS games represent 89% of revenue in FY 2026. That is up from 77% in the previous year. Revenue from CMS titles increased 34% year-over-year. Jurassic World Evolution was the largest contributor, but Planet Zoo and Planet Coaster both contributed to make substantial differences to this number. What this demonstrates is the growing strength of our highest performing franchises and validates our strategic focus on CMS. When we talk about nurturing, this also translates into risk reduction and value creation. Successful CMS franchises do not behave like traditional hit-driven games. We attract players, we retain them for years, we deepen engagement through content and continue monetizing through expansions, PDLC platform launches, and further promotions to get new audiences in. Each additional year that a franchise remains healthy extends the return on our original development investment. The result is a more predictable revenue model with strong life cycle economics. This is one of the core reasons our CMS strategy is delivering such strong financial performance. This chart shows why we have such confidence in our strategy. The majority of value generated by our franchises comes after launch, not at launch. Significant value comes at launch, but the majority comes later. Planet Coaster, Planet Zoo, and Jurassic World Evolution have all generated substantial revenue over many years through content support and ongoing player engagement. This significantly reduces dependencies on launch performance and extends the revenue and growth opportunities for every franchise. We believe future CMS releases can and will follow a similar long-term trajectory. This next chart shows an even better picture, how nurture compounds cash returns over time. Development costs are incurred upfront, but successful franchises continue generating attractive cash flow for many years afterwards. This creates stronger return on capital, greater financial flexibility, and a lower risk investment model. Put simply, successful nurture increases both profitability and predictability. Let us see this with a couple of our games. Planet Zoo is one of the clearest examples of our nurture strategy in action. More than six years after launch, the franchise continues to attract players, generate revenue, and deliver exceptional returns. If you think about year one, we generated revenues of GBP 40 million, and now the franchise has generated revenues of GBP 161 million. That is very evident. Across PC, PlayStation, and Xbox, we have now delivered 21 PDLC releases. The franchise has generated 404% return on investment, while PDLC now represents 45% of total franchise revenue. Our community remains engaged, and we are getting new players into the franchise every day. In the past month alone, over 1 million players were playing Planet Zoo. This performance gives us significant confidence as we prepare for the launch of Planet Zoo 2. On the next slide, Jurassic World Evolution franchise remains one of the strongest licensed franchises in the whole management sim category. Across three games, 23 PDLC releases, the franchise has reached almost 20 million players globally. Importantly, each successive title benefits from the audience expertise and infrastructure built by previous releases, and that helps reduce the risk while increasing potential future returns. Players have placed more than 1 billion buildings across the franchise. Maybe not surprisingly for Jurassic World, more than 63 million park guests have been eaten in Jurassic World Evolution 3, including over 18 million by velociraptors alone. These statistics, whilst funny, also highlight the scale and engagement of the audience that we continue to build. Next slide. Thank you. Looking ahead, we believe this is the strongest and most stable pipeline in Frontier's history. In the near term, with Planet Zoo 2 and Chaos Gate: Deathwatch. In FY 2028, we will be adding a new Planet franchise, which will bring long-term growth opportunities in the future. We have longer-term opportunities through Disney and future licensed and own IP development. Combined with our nurture program, this gives us multiple opportunities for growth. The strategic reset implemented in 2023 and 2024 has transformed Frontier into a focused CMS franchise business, delivering record financial performance. We have demonstrated that our games and franchises can generate meaningful revenue and cash flow for many years beyond launch through disciplined nurturing and content support. We now have stronger profitability, stronger cash generation, and a significantly lower operating model. We have proven franchises, an expanding player ecosystem, a disciplined release cadence, and a strong balance sheet. Exciting future opportunities, including Disney. We are becoming a franchise-led CMS business where nurture, recurring revenues, and lifestyle lifecycle management reduce risk while demonstrating long-term growth. I personally feel positive and very confident for the coming years ahead. With that, we will open up to questions.

Alex Bevis : Thanks, Jo. If you could put your hand up if you have got a question, please, and we will start with Andrew Renton.

Andrew Renton : Yeah, morning both. Thank you for-

Jo Cooke : Hi, Andrew.

Andrew Renton : that great set of results. So yeah, a few from me. Any ideas on how pre-orders are going for Planet Zoo 2 versus Planet Zoo 1? Anything around sort of revenue mix between Deathwatch and Planet Zoo 2? Be good. Anything on that? Also if you could give us an idea just on the development costs for a new franchise versus a follow-on game.

Alex Bevis : Okay. So maybe I'll tackle those. Do we have any numbers on pre-orders for Planet Zoo 2? The answer is yes, of course we do. I think we'll just say, we're feeling good about that launch. It's coming together really well. There's an event coming up this weekend, which will be very important. So we're comfortable with where we are right now. Do you have anything to add?

Jo Cooke : Yeah, I don't think we did pre-orders with Planet Zoo, but after such a long period of time, that wouldn't be a measurement for us to compare one to the other anyway. Pre-orders for Planet Zoo 2, yes, are very, very positive. This weekend we're doing a very similar event to the event that we did for JWE3 last year, where we've got our major stakeholders of players, influencers, press, all coming together at Chester Zoo to play a couple of hours of the game. We'll see how they enjoy it. We're very happy with the game itself, so it's going to be great validation seeing them play the game.

Alex Bevis : On the second question, on revenue mix, between the two launches, certainly Planet Zoo 2 is the significant one. That's the big CMS. Of course, we're very focused on the CMS. We're looking for that one to do certainly more than the first game did. It's going to be multi-platform. The first game was PC only. We're looking for GBP 30 million+, I would say would be a good number. It's got potential for more, but that sort of range. I think in the analyst numbers, people are maybe sensibly being a bit cautious, maybe GBP 25 million or something. The Chaos Gate game, Deathwatch, is a smaller game. It's coming out later in the year. That's probably more in the maybe a GBP 5 million-GBP 10 million revenue contribution in this financial year. It's coming together really well. The game's looking good. But just naturally, the budget for that is smaller, so it's a smaller audience. On dev costs, we've talked about this quite a lot on calls before about the range of outcomes. We've had quite a lot of differences over the few years with the different franchises. For Planet Zoo 2, we're probably looking at a dev budget of somewhere around GBP 17 million, so it has been a bit more. Part of that is making sure we really put a lot of investment into the animals, they're the stars of the show. We've gone again on pretty much all of the animal tech, and you'll see that when the game launches and you see the behavior, and the visuals for those animals. I think a normal CMS maybe going forward, probably around that level, maybe a bit lower, sort of the GBP 13 million-GBP 15 million mark, I would say. The Disney game, probably more like GBP 20 million. That's a very substantial opportunity. We want to make sure we put our backs into that and put some cost behind it and make it a really good game.

Andrew Renton : And then just finally, just on an entirely new CMS franchise, is that significantly different to, say, a follow-on game in a previous franchise?

Jo Cooke : I will take that if you want. With a new franchise, we have obviously looked at the size of that market. We would probably spend a little less on the first iteration of it, because we want to make sure that we can grow an audience in that space. And then subsequent ones will no doubt have greater investment if it grows. So we are very confident in introducing new Planet franchises into our portfolio because that gives us years to come of growth.

Andrew Renton : That is great. Thank you.

Alex Bevis : Thanks, Andrew. Katie, over to you.

Speaker 3 : Thank you. Good morning.

Alex Bevis : Morning.

Speaker 3 : Can you add any guidance around the capitalization rate, obviously fallen to 66% this year, and how should we think about that as you work your way through the pipeline? Then just on surplus cash, obviously it is great that you are declaring a special dividend and talk about further buybacks, but how should we think of what defines surplus cash at Frontier and how much do you need for investment? Then finally, just on the Disney game, I know it is fully funded by you guys, but should we expect marketing help from Disney? Are they going to be able to put advertise in on the streaming service in their parks or exhibitions and the like? Just the way we kind of got the film release help with the Jurassic games in the past. So anything around that that you could share? Thank you.

Jo Cooke : Well, I will start on that one and just talk about the Disney game for a moment. Disney are no strangers to having IP partners, and they have a great program for shared marketing opportunities. They also have many, many different assets that you can use in order to be able to do that. So we anticipate good partnership with Disney going forward, and we will take every opportunity we can to reach wider Disney audience.

Alex Bevis : Yeah, I think just to add that on the sort of contractual side, the deals we tend to do are always based on us producing a game and then publishing that game. I do not think in any of the agreements that we have had there is an obligation-

Speaker 3 : Yeah

Alex Bevis : for the party to sort of support us. Generally, we have got good support. Just so you are aware, it is not like a contractual thing, it just makes sense for them because of course they are getting a royalty, so the more they push the game, the more they are going to benefit. The first question you had was on capitalization rate, proper finance question. Thank you very much. Just a reminder for anyone on the call, we tend to capitalize game developments once they are into proper production, so past the pre-production and scoping phase, entering production. The rate was relatively low, I suppose. We have had anything between sort of 70% and 80% in the past, only 66%. Part of that is our decision to stop capitalizing any content for Planet Coaster 2. Now we put a lot of effort into free content. Of course, that means that we are expending that even where we have started to develop paid content, we are not capitalizing that based on that initial performance. So that sort of moved us down a bit. The other thing in the year was the development for the new Planet game. Because we really, as Jo sort of alluded to earlier, we really want to make sure we invest sensibly and get that right. We have had quite a long pre-production phase, and that means we have not started capitalization. So I think probably for this financial year we just started now, we will have a similar rate, I think, in the 60%-65% bracket. I would have thought we are continuing to support Planet Coaster 2, as you have seen, and we are really pleased with the results for that. Some good PDLC responses that we have seen there. The game for 2028 is now into full production, so we will start capitalizing that. But then obviously Disney, which we have just signed, is in pre-production, so that game won't start to capitalize that yet. Hopefully that answers your question, Katie.

Speaker 3 : Yeah.

Alex Bevis : The second one you had was on surplus cash. I certainly think we do not really need too much more than, say, GBP 20 million. We have a bit of working capital flow around big launches. We will tend to build up big receivables, and then the game launches, and then we collect that cash in. But certainly GBP 50 million is pretty substantial for us. I would get a bit nervous if we were sort of getting back to below GBP 20 million. We are limited as to what we can do on the buybacks. There is a sort of 10% limit on that. I think we will be looking to do buybacks again, seeing today the share price has ticked up a little bit, but when you consider that we made, adjusted our profit of over GBP 20 million, and you look at the enterprise value, take off the cash number, the multiple is really low. I think it makes sense to keep going with those programs.

Speaker 3 : Thank you.

Alex Bevis : Thanks, Katie. Over to Ollie.

Speaker 3 : Hi, guys. I know you briefly touched on it, but in terms of framing a new franchise, how does it differ in terms of market scoping and assessing your target market? How much have you looked at the existing Frontier player base? I know you have quite a good cross-sell in terms of a player will buy two or three of your games, multiple games, but how much are you targeting that existing base for that franchise, and how much are you looking to bring in new players? Because I guess anyone new you bring in, you then have a chance to cross-sell your existing games to as well.

Jo Cooke : Exactly. CMS is quite broad, content and management, so people behave differently and look for different kind of gameplay styles. What we do though is we start with the CMS audience as a whole, so that's everything from creative stuff right the way through to tycoon, and look where the opportunities are there. Within that, we'll then look at what the subject matter might be and start looking at not just our player data, but players within those interest areas and look at their affinity titles. There are a whole load of different places where we can go now to look at Steam data, to look at other data, and we do our own research. In doing that, we get a sense of where the interest might lie within the audience that we know will buy a CMS game, and where that might be. Is it a more management style game? Is it more a creative styled game? Then we'll think about how we layer the commonalities across all our games so that we get that crossover from our games. The key is for us, we don't want to cannibalize our own audience, but we do want to bring new audiences in, and every time we introduce a new subject matter, it brings new audiences in, and it gets people into our ecosystem. Our price promotions do the same. We've got Planet Zoo players now who've probably bought at 90%, 95% discount. They'll be future players for Planet Zoo 2, they'll be future players for our new franchises that we launch. We look across that whole area, and we kind of create a continuum of interest from highly engaged players through to they may be possibly interested in the subject matter. We'll target them at different stages during the life cycle of that game.

Speaker 3 : Brilliant. Thank you.

Alex Bevis : Thanks, Ollie. Sean's up next.

Jo Cooke : Hi, Sean.

Speaker 3 : Hi. Morning, Alex. Morning, Jo. Sorry, I don't think my camera's quite working. I'm having a bit of an issue with that. Thank you for taking questions. I've got just two if it's all right. I think last year you announced Planet Zoo 2 around November time. Is that a reasonable timeframe to expect announcement for the FY 2028 game? Secondly, Alex, I know you wanted some questions on tax, so here's one for you.

Alex Bevis : Good.

Speaker 3 : Actually, first part tax, second part maybe broader. I know you've been able to offset the Jurassic licensing costs, or that you can get a tax credit towards that. Do you expect that to be the same for the Disney IP licensing cost? Then relating to that, I know you won't disclose exact commercials on the partnership with Disney, but would it be fair to assume that the gross margin on the Disney game should probably be a similar sort of level to Jurassic, or could there be any differences from there?

Jo Cooke : I'll take the first question then. Announcing in November, probably not, because we want to give Planet Zoo its space, because people will be very excited about the next game. So we'll wait probably until around about January, I would think. Who knows? We might change our mind on that, but I think it's more likely to be January than November.

Alex Bevis : I think that one thing to add there is, for those people that have followed us for a few years, we tended to always have a ta-da moment. We'd keep very quiet and then start the launch campaign. Something that Jo encouraged us to do, and I think it has worked really well, is to call things out much earlier, because then we get the player feedback. Actually worked very well for Jurassic. We think it's going to work well for Zoo as well. So gathering up that feedback from players, because we think we know what players want, but actually them telling us is really very valuable.

Jo Cooke : Yeah.

Alex Bevis : It helps the dev teams if we can do that early.

Jo Cooke : Yeah. I will say, though, with that game, the unannounced Planet game, we have already started testing it with players, so we have been getting feedback and introducing it behind closed doors. So that will help with that process.

Alex Bevis : Second question was about tax and licensing costs. Yes, we do expect that the IP royalties that we can claim at the moment with Universal, they would extend to Disney as well. So there is some real benefit from the transition from VGTR to Video Games Expenditure Credit. You asked about the commercial terms. Most of the agreements that we have done with license partners have tended to be similar in the sort of 10%-20% of net revenue, in terms of royalties. So, midpoint of around 15%. So I would say that that is a pretty good expectation going forward. It is not on the gross revenue, that sort of 10%-20% rate is applied after deducting the Steam commission and Microsoft and PlayStation commissions.

Speaker 3 : Brilliant. Thank you both very much.

Alex Bevis : Thanks, Sean. Will?

Will Larwood : Yeah, morning.

Jo Cooke : Morning, Will.

Will Larwood : Thanks very much for the presentation. One just on platforms, sort of relationships with platforms, particularly ahead of the Planet Zoo 2 release. When can we expect a deal, potentially, and the feedback you have been getting there? Secondly, just in terms of, we have spoken a lot about CMS games, but obviously you have Elite Dangerous within the portfolio. How does that fit in in terms of sort of the medium-term plans? Will you continue to invest in that game? Then finally, I think you called out on slide 4 just about investing more into technology and your engine in COBRA. Wondering if you could just expand that a little bit more. and then particularly around how you are integrating things like AI into the business.

Alex Bevis : Yeah

Jo Cooke : Why don't I start with COBRA then, as I am thinking about it while you said. So our COBRA platform, it has been specifically designed to support our core runs, so to help us create deep simulation games. It is very effective at handling large amounts of interacting systems, which is how we do our piece by piece, and it also works incredibly well for Elite Dangerous for the same reason when you are talking about billions of star systems. In terms of continuing investing in it, what I think we are going to be looking at now is finessing some of the tools, making sure that we have a strong tool chain running all the way through, improving the way that we can get people using it more quickly, because we want our graduates to all become COBRA specialists very quickly, and optimizing its core performance overall. That helps us using it across different games, so what we do in one game, then we can move to the other, and so it is always iterating all the way through. Which is actually an advantage of using our own engine, because if you are using a non-proprietary engine, you are not in a position necessarily to iterate each time with every game. You are waiting for them to iterate the engine. It is very helpful for us to do that. In terms of AI for us is we are thinking about it not from a creative point of view, and I think we have had these conversations before on these calls. It is around efficiencies and what we can do to use it to drive efficiencies. We are looking at it and we are thinking about how that works. AI is really good in operational efficiencies, and that is the area that I think we will be seeing what we can do to integrate it into our overall corporate systems. As for the engine, that is one for us to discuss at a later date, and we will probably, if anybody is coming to our capital markets day later at the beginning of next year, we will talk about COBRA a lot more in more detail and get some of the team along to explain in much more fluency than I do on our engine. Just while I am talking, I will just mention Elite. Elite continues to grow its revenues for us, so it sits, yes, it sits outside of our CMS strategy, but it is a very special part of our business. And I think the brand equity of Elite is baked into Frontier's history. As long as Elite continues to, we are able to monetize it and make sure that we can continue to support it, we will. We are looking at all sorts of things that we can do with Elite that will continue to grow the franchise.

Alex Bevis : I think the first bit of the question was around platforms as well and relationships.

Jo Cooke : Yeah

Alex Bevis : It is fair to say that Jo, you had an extremely positive gamescom. The platforms are very excited about

Jo Cooke : Yeah

Alex Bevis : the roadmap. We have got a great potential with the platforms there.

Jo Cooke : Yeah. That was it.

Will Larwood : Great, thanks.

Jo Cooke : Was that the last question?

Alex Bevis : Okay, let's see. Anyone else got a burning question about tax credits? No. There are some great tax slides at the back of the deck if anyone wants to take a look at those. No? Still no questions. Okay, well, thank you everyone for making the time. Great to have you on board on the call. If anyone has follow-ups, feel free to reach out. We've got some time during the schedule. Thank you very much.

Jo Cooke : Thank you, everybody.

Speaker 3 : Thanks, guys. Bye. Thanks a lot.