PlaySide Studios (ASX:PLY) Announces Operations Restructure
Operational Restructure
PlaySide Studios Limited (ASX:PLY) is restructuring its operations, primarily affecting its Work for Hire teams and non-project specific workforce. This move addresses delays in securing anticipated Work for Hire contracts, resulting in latent staff capacity. The company remains confident in winning new contract work, though the timeline is uncertain. Progress on major Original IP projects, including MOUSE: P.I. for Hire and the Game of Thrones real-time strategy game, remains unaffected. Development on the Dumb Ways to Die console title continues at its current pace.
Cost Savings & FY25 Guidance
The proposed redundancies are expected to deliver annual cost savings of $4-5 million, with an upfront restructuring cost of approximately $1.5 million anticipated in the June quarter. PlaySide’s existing Work for Hire contract book remains unchanged, and negotiations on several contract opportunities are ongoing. Management maintains its FY25 guidance, projecting revenue of $50-54 million, an EBITDA loss of $6-10 million, and a closing cash balance of $10-15 million.
Executive Comments
CEO Benn Skender stated, “Today we’ve made the decision to commence a consultation process across our studios. We will be offering outplacement support and counselling services to personnel whose employment ends as a result of the restructure, and our thoughts are with affected staff on what is a difficult and sad day for all PlaySiders. While a prolonged period with no new contract signings has been the catalyst, it is an appropriate time to reflect on our obligation to employees and shareholders to ensure that we strive to build resilience into the Company’s business model. We will continue to look for ways to convert successful Original IP launches into a stronger balance sheet and a more valuable business.”
Motley Fool contributor Aaron Shaw has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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