Annual Report and Accounts 2013

Frontier Developments underwent a pivotal strategic transformation during the 2013 fiscal year, shifting from a traditional third-party developer toward a self-publishing model centered on proprietary intellectual property and the Cobra cross-platform technology. This transition was underscored by the successful crowd-funding of Elite: Dangerous and the release of Coaster Crazy, signaling a move to diversify revenue streams and reduce reliance on external publishers. The company’s operational scope expanded internationally with the establishment of a Canadian subsidiary, while its financial foundation was bolstered by a successful AIM listing in July 2013.

Financially, the company demonstrated resilience despite a headline revenue decline from £14.16 million to £12.07 million, reporting an underlying revenue growth of 19% and a 12% increase in adjusted EBITDA to £3.6 million. Profit for the year reached £1.045 million, supported by a robust cash position of £7.16 million. The firm’s financial performance remained heavily concentrated in the United States, which accounted for 94% of total revenue. To manage the risks associated with this growth, the company implemented rigorous financial controls, established formal Remuneration and Nominations Committees, and secured a £3 million revolving credit facility to ensure liquidity.

Investment in research and development remained a primary focus, with £1.36 million allocated to technological advancement and 64-bit cross-platform capabilities. By strengthening its balance sheet and formalizing corporate governance structures, the company positioned itself to scale its internal operations and talent acquisition. These efforts, combined with a conservative approach to currency and liquidity risk, provided the necessary stability to pursue an accelerated growth strategy as a newly public entity, ensuring the firm remained well-capitalized for future development cycles.