Guild Esports Plc
Annual Report & Financial Statements
for the year ended 30 September 2023
Company Registration No. 12187837 (England and Wales)
Guild Esports plc – Company Number 12187837
CONTENTS
Company Information
Chairman’s Report
Strategic Report
Directors’ Report
Remuneration Report
Independent Auditor’s Report
Statement of Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cashflows
Notes to the Financial Statements
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Guild Esports plc – Company Number 12187837
COMPANY INFORMATION
DIRECTORS
Mr Derek Lew
Ms Jasmine Skee
Mr Brian Stockbridge
COMPANY SECRETARY
Mr Paul Kingsley
REGISTERED OFFICE
2 Chance Street,
London, E1 6JT
REGISTERED NUMBER
12187837
BROKERS
Tennyson Securities
65 Petty France
London
SW1H 9EU
INDEPENDENT AUDITOR
PKF Littlejohn LLP
15 Westferry Circus
London, E14 4HD
SHARE REGISTRARS
Computershare
The Pavilions
Bridgewater Road
Bristol
BS99 6ZZ
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Guild Esports plc – Company Number 12187837
Chairman’s Report
.
I am delighted to report that Guild Esports welcomed Jasmine Skee as Chief Executive Officer in
January 2023. The team made excellent progress in the year to 30 September 2023, with growing
revenues, expanded esports offerings, audience growth and an increasingly international footprint.
This was accomplished while dramatically cutting costs and refurbishing the state-of-the-art Sky
Guild Gaming Centre, Guild’s London headquarters, which was completed with investment from Sky
Broadband, in addition to its existing sponsorship commitments. Total revenues rose by 24% to
£5.53m (2022: £4.53m) and losses almost halved to £4.5m (2022: £8.75m), reflecting new revenue
streams and a re-evaluation of our cost-base to improve margins, allowing us to deliver the same
high-quality services for our partners at a lower cost.
Our 2022 revenues were created primarily from two elements: sponsorship and prize money. Of the
prize money, the majority was kept by our professional players, with Guild receiving a small
proportion. Our sources of revenue for 2023, by contrast, were more diverse with the launch of Guild
Studios focused on activation and events. Sponsorship revenues grew by more than 20% and remain
a core offering, but we have reduced the costs of servicing contracts and leveraged our sponsorship
and inventory rights more effectively, allowing us to improve gross profit margins. Prize money
remained consistent year on year whilst reducing in share of revenues by nine percentage points.
Importantly, we significantly reduced the fixed costs associated with our esports teams through
increasingly focusing on performance related payments.
We kicked off our financial year by launching Guild College, providing a career pathway for young
people in the esports industry. Guild Studios was launched in early 2023 providing bespoke,
campaign-led solutions for brands and media owners looking to connect with esports, gaming, Gen-Z
and Gen-Alpha audiences, providing a new revenue opportunity.
Alongside new revenue streams, Guild had a successful year for sponsorships, partnering with
world-class brands across entertainment, sports and technology. Guild signed with four brands: Sky
Broadband, Hummel, Fanatec and Secretlab. In the post-period, Guild has signed further commercial
partnerships with Subway, naming them Official Quick-Service Restaurant Partner for the UK and
esports trading platform eNDX.
With Guild part way through a multi-year partnership with Sky, and after having successfully signed a
number of high-profile partnerships in 2023, Guild’s existing sponsorship pipeline as at the year end,
which is the portion of signed contracts yet to be recognised as revenues over the lifetime of the
deals, amounted to £5m, of which £0.2m was price conditional on performance obligations.
Beyond Guild’s commercial partnership agreements with several leading international sponsors, the
company has also signed business partnerships with innovative technology brands to explore
long-term, technology driven revenue opportunities. Our R&D partnership with Gerford AI has seen
us complete our initial research and development phase and we are exploring development of a
digital product surrounding performance in esports and gaming.
The loss before tax fell significantly to £4.5m from £8.75m in 2022, illustrating the success of our
re-organisation programme that supported developing our existing and new revenue streams whilst
greatly reducing the overheads and related cash requirements of our business. Administrative
expenses fell by £3.51m in 2023 to £7.4m, down from £10.91m in 2022.
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Guild Esports plc – Company Number 12187837
Chairman’s Report
Our staff numbers have remained broadly unchanged from 2022, despite costs falling significantly,
which now stand at 32 compared with 36 last year. We expect this number to grow steadily in
2024, with the potential for international expansion in the growth market of MENA.
In the post-period we were delighted to welcome Paul Kingsley as our new CFO and Company
Secretary and Nathan Pillai as Special Advisor to the Board. Nathan has more than two decades’
experience as an operator, builder and investor of blue-chip sport and entertainment properties
including Manchester United, FC Barcelona Chelsea FC, Williams Racing, World Rally Championship
and SailGP. He also has significant exposure to capital markets and high growth territories.
Net cash as at 30 September 2023 amounted to £0.46m compared with £2.73m at the same time in
the previous year. As at 29 January 2024 net cash had increased to £0.8m.
Alongside a strong financial performance, our esports teams have continued to perform strongly at
the highest levels of professional esports. It has been wonderful to watch them compete, and they
have brought pride to the entire company. Next year should be even more exciting as a Guild fan, as
Guild has entered Counter-Strike, Street Fighter and sim racing. Our growing competitive presence
increase our footprint in the overall esports ecosystem and create dynamic spectating
will
opportunities for our worldwide online audiences.
Looking ahead, our effective cost-cutting programme and our growing revenues give great cause to
be optimistic, with MENA a key target for international expansion. We are exploring not only having
our teams compete in the region, but how we can utilise Guild’s esports pedigree to generate value
for shareholders and our wider stakeholders. Guild College is building direct engagement with our
young community and the Guild Academy represents a significant opportunity to provide a clear
path-to-pro for young people in the region.
Our new business pipeline is robust and growing, and we are in discussion with a number of new
partners and sponsors across a variety of sectors and geographies, with some agreements at
advanced stages of discussions.
Guild is well-placed for the next phase of its development and is on track to continue its positive
momentum. On behalf of the Board, I would like to thank all of our staff and partners for their
excellent work, and our investors for their continued support, as we look to 2024 with confidence.
Mr D Lew
Non-Executive Chairman
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Guild Esports plc – Company Number 12187837
Strategic Report
Principal activity
The Company’s principal activity is that of a global fan-focussed team organisation and lifestyle brand
that fields players in professional gaming competitions under the Guild banner. Our in-house training
academy aims to attract and nurture the best esports talent, and our goal is to provide the ultimate
entertainment experience alongside a distinctive lifestyle brand authentic to the esports community
worldwide. Guild is led by an experienced management team of esports veterans. The Company is
headquartered in the UK and its shares are listed on the main market of the London Stock Exchange
(ticker: GILD).
Strategy and operational review
While the esports sector is forecast to grow to $1.87 billion by 2028 (source: Statista, 2023), many
well-established businesses in the sector have faced pressures. Under its new CEO Jasmine Skee, who
started on 1 January 2023, Guild enacted a new strategy to take advantage of the sector’s growth
more effectively.
Gaming is an immensely popular form of entertainment, and there are expected to be more than 3.8
billion gamers worldwide by 2030 (source: Midia Research, 2023). In 2023 Guild transitioned away
from a pure-play esports brand towards a wider gaming focus, which has allowed the Company to
better take advantage of the consistent popularity of video games. By continuing to focus on content
creation, Guild can continue to grow its audience and appeal to new demographics and is well-placed
to take advantage of sector growth.
Despite the strategic refocus towards a more diversified business, our esports strategy remains to
establish Guild as one of Europe’s top three esports teams organisations and brands, driven by strong
esports performances, innovative content and global fans. Good progress was made towards these
goals, as Guild’s audience grew significantly, Guild’s professional players competed across high-level
tournaments and revenues continued to rise.
The Company continues to review its contracted revenue, pipeline, cash balances and committed
expenditure. Based on the directors' assessment of the Company's cash needs and the availability of
financing, the directors consider the Company to be a going concern and anticipate a fundraising
may be required during the year ahead. A further update will be provided in due course. New
initiatives and business pillars
New initiatives and business pillars
In November 2022, the Company launched Guild College in a four-year partnership with post-16
education provider SCL Education, to provide BTEC Level 2 and Level 3 qualifications in esports. Since
Guild College was announced in November 2022, Guild College has filled 21 spaces on the course
versus a target capacity of 125, due to a limit on the number of students Guild was allowed to take
under the regulations from Pearson.
The Company is exploring international expansion, with a particular focus on the MENA region. The
MENA region is a hotspot for gaming, forecasted to have more than 88 million gamers by 2028
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Guild Esports plc – Company Number 12187837
Strategic Report
(source: Statista, 2023). The Company is utilising its community focused initiatives, including Guild
College and the Guild Academy, to establish a clear path-to-pro for young people in the region, as
well as establish new ways to engage with the growing gaming audience.
This was followed by the launch of Guild Studios, the Company's creative and production division.
Guild Studios allows the Company to monetise its in-house experience in esports to support brand
owners on individual campaigns, allowing these brands to authentically engage with their target
audiences. This has proven particularly effective in attracting brands not typically associated with
esports, as these brands look to diversify their customer bases and appeal to younger audiences.
Guild Studios not only widens the Company's offering to brands, but provides a lower barrier to
entry, encouraging brands not typically associated with esports to collaborate with Guild to reach
new audiences.
Since its creation, Guild Studios has delivered campaigns and activations for high profile brands
including Samsung UK, Coca-Cola, Sky Broadband, Subway and blood cancer charity Anthony Nolan.
Guild Studios has organised activations and events including assisting in the launch of the new
Samsung Galaxy S23, launching the first ever mixed-gender VALORANT tournament and launching an
all-female Rocket League tournament.
In the post-period Guild Studios was named the Official Activation Partner of Sky Broadband for their
2024 Gaming Plan. Sky Broadband granted Guild Studios an exclusive mandate to deliver a suite of
activation services in the first half of 2024.
Sponsorships and partnerships
The Company signed or renewed six partners in 2023, taking the total complement of its sponsors
and partners to eight, including Sky Broadband, Hummel, Subway, Secretlab, Fanatec, Pixels AI and
Sky Glass.
On 25 April 2023, the Company won a new three-year sponsorship and merchandising contract with
hummel, a well-known sports and lifestyle brand. Leading sportswear brand hummel has been
appointed as Guild's first ever Technical Kit Partner, generating sponsorship revenues over a
three-year term for Guild, in addition to a double-digit percentage of merchandising sales. The
partnership will develop a new esports professional performance line, as well as consumer-focused
lifestyle ranges and a dedicated kidswear line, with products potentially to be made available in
online stores globally and physical stores in the UK. The Company’s new hummel-created
professional shirt went on sale worldwide in December 2023 with further product ranges to follow in
2024.
In April
it was also announced that Guild and Bitstamp had mutually decided to end their
sponsorship following two years of working together. Bitstamp opted not to take the third year of the
partnership which was optional and it didn’t impact Guild's revenue expectations in the current
financial year and all payments for the first two years have been received in full. Following the end of
the Company’s sponsorship with Bitstamp, Guild adapted its contracting process to have more
innovative and collaborative relationships with our sponsors. This has reduced the costs of servicing
contracts and allowed us to leverage our inventory and sponsorship rights more effectively moving
forward, which contributed to the notable fall in our outgoing expenses.
In June, the Company signed a technical partnership with Fanatec, a leading provider of sim racing
equipment and hardware designed for gaming and motorsport. Fanatec provided Guild with six
state-of-the-art sim racing rigs, along with related hardware and regular technology upgrades.
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Guild Esports plc – Company Number 12187837
Strategic Report
The rigs form the centrepiece of the new Guild Simulator Facility, which opened at the Sky Guild
Gaming Centre in November 2023. As well as serving as a training facility for Guild's professional
esports players, the cutting-edge simulators provide an additional revenue stream to the Company
via experiential sim racing packages available for corporates, the wider public and the esports
community. In the post-period, Guild launched a memberships scheme for the sim facility, where
budding esports professionals receive two monthly sessions at the Sky Guild Gaming Centre as well
as telemetric data showing users individualised areas for improvement.
Other new agreements were signed with Secretlab, naming it the Official Gaming Chair Partner of
the Sky Guild Gaming Centre, and Sky Glass became Guild’s Official Television Partner, providing an
increase in revenue compared to the previous deal with Samsung TV.
Our relationships with our key partners have continued to deepen since the deals were announced,
as we collaborate with them on creating unique content and experiences to reach our fans and
followers, particularly Generation Z (“Gen Z”).
The Company is exploring the use of artificial
intelligence technologies to appeal to greater
audiences, provide more detailed performance feedback to professional players and discover new
professional players. Guild partnered with Artificial Intelligence developer Gerford AI in March 2023,
and since then completed a comprehensive R&D project that will
inform future products and
services.
The Company's pipeline of new business from other potential sponsors is growing , benefiting from
Guild's position as a leading esports brand with access to a hard-to-reach, young and growing
audience.
Update on Strategic Investor
Further to the Company’s announcement on 30 October, the strategic investor in Guild was 00Nation
AS (“00Nation”). 00Nation went live in the Nordics in late 2021 and has combined media and wider
youth culture with esports. Following its success in the wider space, 00Nation established a base in
the UK in 2023, and will continue to focus on youth culture while partnering with Guild on
professional esports.
00Nation has to date invested £500,000 in Guild comprising the two tranches announced on 30
October 2023, which have been delivered in full, making 00Nation a 13.5% shareholder in Guild.
Guild and 00Nation remain in active negotiations concerning the deeper strategic partnership and its
accompanying third tranche of investment, which is dependent on the conclusion of negotiations.
Esports teams
During the year Guild’s teams have competed at the upper echelons of esports and have maintained
a consistently high level of performance. Guild Fortnite professional player Anas won the MrBeast's
Extreme Survival Challenge tournament in December 2022 (with official confirmation received in
January 2023), securing the entire prize pool of US$1m, and in the post-period Guild player Chico
won $200,000 in a global Fortnite tournament. Guild received a percentage of these winnings in line
with contractual agreements with its pro-players.
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Guild Esports plc – Company Number 12187837
Strategic Report
In 2023 Guild expanded its esports presence into new games, entering Counter-Strike, Street Fighter
and sim racing for the first time. Guild’s all-female Counter-Strike team, launched in March 2023, is a
particular point of pride for the Company, which has a long-term strategic focus on improving
opportunities for women in esports and gaming alongside its Official Premier Partner, Sky UK, which
is equally committed to promoting viable professional opportunities for women in esports. Guild
furthered its Counter-Strike presence with the signing of a men’s team in August 2023.
Counter-Strike is among the world's most popular esports, with an audience that is continuing to
grow. The Paris Major in March 2023, among Counter-Strike's most competitive tournaments, had an
average viewership of 507,688 across its 116 hours of airtime, peaking at 1,528,724 concurrent
viewers (source: Esports Charts, 2023).
Guild additionally entered Street Fighter, a long-running fighting game with a growing esports scene.
In June 2023, the CR Cup Street Fighter tournament had more than 313,000 concurrent viewers,
making it the most popular video game on streaming site Twitch at the time (source: Dexerto, 2023).
Following the Company’s partnership with Fanatec, the Company successfully completed a £0.62m
fundraise to facilitate investment into the Guild Racing team roster, allowing the Company to field
drivers in professional sim racing. Guild entered Formula 4 Esports, a sim racing category fully
sanctioned by Motorsport UK, the governing body for motorsport in the United Kingdom, in July
2023. Sim racing has attracted interest from major players in traditional motorsport including Aston
Martin Aramco Cognizant, Red Bull Racing and Williams Racing.
Guild now competes across seven esports, which are:
● Counter-Strike, with an all-female team and an open team.
● EA FC 24 (the continuation of the ‘FIFA’ association football game series).
● Street Fighter
● Sim Racing
● Fortnite
● Rocket League
● VALORANT
Guild released its VALORANT teams on 30 November 2023 and currently does not have an active
roster. VALORANT remains an important part of Guild’s long-term esports strategy and the Company
has commenced a search for the teams’ replacement. As at 17 January 2024, the Company’s
professional player roster was 22 compared with 17 in January 2023.
Guild Academy
Guild’s Academy, since its transition to an in-person only experience in early 2023, has moved from
strength to strength, providing world-class esports facilities and coaching to Guild’s existing and
potential esports players.
Guild has adapted its esports strategy to focus on Academy players and building up owned talent, in
contrast to the previous approach of purchasing players already competing at a high level. This has
proven effective, as Guild has continued to perform at a high level but has reduced expenditure and
opened the possibility of improving players at the Academy and then selling them on for profit. The
Academy is beginning to achieve its primary purpose of developing future professional players and
attracting new fans.
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Guild Esports plc – Company Number 12187837
Strategic Report
Guild has received interest in its Academy from overseas jurisdictions and is actively exploring how
the Academy system can be rolled out internationally. Guild is initially focusing on MENA but may
expand to further jurisdictions in 2024.
Strengthened leadership team
Jasmine Skee started as CEO on 1 January 2023, and throughout 2023 Ms Skee has taken steps to
strengthen Guild's executive team. She recruited Luke Jones as Vice President of Commercial, Esports
and Gaming, Nick Westwood as Senior Vice President of Creative and Strategy, and Matthew
"Charlie" Charles as Director of Operations.
Stephen Duval joined as Special Advisor to the Board in July 2023, bringing 25 years of experience in
the sports, media and entertainment sectors in Europe and the US, where he has deployed and
advised on deals with an aggregate value in excess of $5 billion. In the post-period, Nathan Pillai
joined as an additional Special Advisor to the Board, bringing more than two decades' experience as
an operator, builder and investor of blue-chip sport and entertainment properties including
Manchester United, FC Barcelona and Chelsea FC.
Guild’s management team demonstrated their commitment to Guild’s long-term strategy by
participating in a fundraise in June 2023. Guild’s directors subscribed for a total of £95,000 of new
ordinary shares, with subscriptions made by CEO Jasmine Skee, Non-Executive Chairman Derek Lew,
and Non-Executive Directors Brian Stockbridge and Jocelin Caldwell.
In addition to this, members of the Company's senior leadership team comprising Director of
Operations Matthew “Charlie” Charles, Vice President of Commercial, Esports and Gaming Luke
Jones and Senior Vice President of Creative and Strategy Nick Westwood made a combined
contribution of £24,000. In the post-period, Guild’s management made an additional contribution of
£30,000, with contributions from Jasmine Skee, CEO; Nick Westwood, SVP of Creative and Strategy;
Luke Jones, VP of Commercial, Esports and Gaming; Matthew Charles, Director of Operations; and
Kristina Frost, Director of Client Services.
Audience
Guild’s owned audience stands at 2.8m followers. This is an aggregate of Guild’s Facebook,
Instagram, TikTok, Twitch, Twitter and YouTube channels, as well as the Guild Eagles, Guild’s
Counter-Strike team, and Guild owned accounts. The owned accounts include ‘Fortnite24_365’ a
Spanish-language TikTok channel with 1.4 million followers, of which Guild produces the content and
retains full editorial control.
Guild’s significant audience growth on TikTok specifically is in-line with the Company’s long-term
strategy to appeal specifically to the Gen Z and Gen Alpha demographics. 80% of TikTok users are
under the age of 44 and 60% are 16-24 (source: Wallaroo Media, 2024). Guild’s new TikTok channel
has expanded the Company’s international audience and Guild is evaluating how best to generate
further revenue from this new audience to maximise value for shareholders.
All content distributed on Guild's social media channels is created in-house by Guild Studios. Guild's
number of followers across its owned and operated channels increased by 1.7m in H2 2023 and
remains on an upward trajectory.
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Guild Esports plc – Company Number 12187837
Strategic Report
Alongside audience growth, audience engagement has increased significantly. Guild’s owned
channels received 145m impressions in the calendar year 2023, compared with 64m in 2022. The
average daily users engaging with Guild’s channels is 31,000 in 2023, compared with 4,500 in 2022.
Alongside the growth of Guild’s owned channels, Guild Studios has allowed the Company to appeal
to greater audiences through Studios’ campaign-led approach. Guild’s ‘No Room for Abuse’ campaign
with Sky Broadband received 69m impressions and its ‘Sweat Room’ campaign received 1.4m
impressions.
The notable growth in impressions both generally and on a campaign-led basis indicates that Guild’s
audience is increasingly engaged with its content compared with 2022. As such, Guild’s strategy to
become a gaming-led media brand is bearing fruit.
Outlook
Guild made a good start to the new financial year and current trading remains in line with
management expectations. Guild’s new revenue streams started to bear fruit in 2023, which has
made the Company more robust and more consistently cash generative. Guild’s management is
looking to expand Guild’s international footprint in 2024, beginning with MENA, as well as expand
into more sectors including Betting, Motorsport and Counter-Strike brands.
Our pipeline of potential new sponsorship deals also remains robust and several significant deals are
under active negotiations.
Following a significant rationalisation programme, the Company's annual operating costs have been
reduced further year-on-year by approximately £3.5m, thereby significantly reducing the ongoing
cash requirements of the business. As a result, the Board looks to the future with confidence.
Principal risks and uncertainties
The Board considers the principal risks of the Company to revolve around the continued growth of
its fan base and its ability to attract sponsors. The Company mitigates the risk of low fan
accumulation through fielding winning teams in its professional esports league and diversification
of content to appeal to a broad market. The Company engages a wide endemic audience by
operating in multiple esports; working with influencers and content creators; and maintaining an
active presence on several social media platforms. Guild social posts made through David
Beckham’s channels provide a mass market appeal and contribute significantly to the social reach
of the Company. The Company mitigates the risk of not attracting sponsors through forming a
partnerships team consisting of experienced professionals and sector specialists, led by the Chief
Executive Officer. The team has an in-depth understanding of the demographic which sponsors
want to reach, and the market they intend to grow in. Guild attracts top talent in target regions,
and compounds this with the social reach of David Beckham to create opportunities and meet
sponsors’ needs.
The Company operates in a changing environment and is subject to a number of risk factors. The
Board considers the following to be of particular relevance, but this is by no means an exhaustive
list, as there may be other risk factors not currently known.
Risks relating to the esports industry
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Guild Esports plc – Company Number 12187837
Strategic Report
The rapid growth of the esports sector is slowing
The global esports sector grew by 17.5% between 2021 and 2022, reaching USD1,421.89 million in
2022. However the latest forecasts suggest that the cumulative impacts of COVID-19, the
Russia-Ukraine war and high inflation is likely to slow that growth to a CAGR of 8.31% to 2027.
Whilst the Directors believe the esports market will continue to grow with the announcement of
the Esports World Cup in Riyadh as well as a billion dollar investment into Qiddiya to build world
class esports and gaming facilities, there is no guarantee that it will do so, or will do so at a level
that will enable the Company to achieve its strategic objectives. That may result in revenues across
the sector stagnating or reducing and the sponsorship market becoming even more competitive,
both of which would have a material adverse effect on the Company’s business, revenue, financial
condition, profitability, prospects and results of operations. Guilds move into MENA is aligned with
where esports revenue is generated.
The sector is largely unregulated
There is no centralised body for regulation in esports. In the UK the British Esports Federation was
in part to improve standards in the industry. Whilst Guild has a good
established in 2016,
relationship with the British Esports Federation, and has built its business to comply with and
exceed best practice. Guild continues to foster close relationships with game publishers,
tournament organisers and British Esports Federation in order to be able to react quickly to any
regulatory changes as well as offer thought leadership in this area. We have also started to see the
Federations around the world work more closely together to ensure there are consistent
standards.
Risks relating to the Company’s Business strategy
The Company is a relatively new entity with limited operating history, low historical revenues and
there is only a limited basis on which to evaluate the Company’s ability to build a successful esports
business
The Company was incorporated on 3 September 2019 and commenced substantive trading after IPO
in October 2020. The Company lacks an established operating history under current management,
which took over in early 2023, and therefore investors have a limited basis on which to evaluate the
Company’s ability to achieve its objective of growing and developing a successful business.
The Company is a small business which will compete with established competitors who may have
more resources and a more recognisable brand presence in the market. The Directors believe that
they have the experience and connections to ensure that the business is able to compete with
established rivals and take advantage of market opportunities they have identified.
The Company may be unable to continue to recruit esports players of sufficient standing and talent
The Company’s brand is in part built around the success and profile of esports players. The success of
the Company depends on its ability to recruit esports players who have either the potential to be
successful, star players or are already successful, star players. To date Guild however has won 10
World Cups in just three years so it continues to attract good talent. The Directors believe that Guild’s
professional approach to team management and player support, and growing reputation in the
sector will allow the Company to compete for talent in a holistic manner, rather than solely based on
financial compensation.
The Company may be unable to continue to recruit ambassadors of sufficiently high profile
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Guild Esports plc – Company Number 12187837
Strategic Report
The Company’s brand is in part built around the success and profile of key ambassador David
Beckham. The success of the Company depends in part on its ability to attract and retain relevant
ambassadors with the required profile and fanbase, in order to promote the Company and its
mission. With Guild’s influencer agreement with David Beckham due to expire in May 2025, the
Company may want to renegotiate or replace a key ambassador that actively participates in sponsor
activations, however, the Company is growing the number of sponsors and partners without a
reliance on key ambassadors, and this represents an opportunity for additional revenues.
Players may not perform
Whilst the Company aims to sign the best esports players available to it (given its resources), and
aims to provide best in class training and support facilities, there is no guarantee that such
recruitment and development will translate into tournament success. If Guild does not perform to a
reasonably high level in tournaments, it will not generate the publicity to grow further its brand and
following, and to attract additional sponsors, and the Company’s revenue from prize money and
sponsors will be lower than expected, making future or further recruitment more difficult. Guild
however structures its contracts so performance of its players is incorporated.
The Company may not be able to attract sponsors
The global sponsorship market is very competitive, both within the esports sector and generally, with
individuals, teams and tournaments all seeking sponsorship income. The attractiveness of esports to
advertising partners and brands may reduce in the future, particularly if new developments provide a
more direct or engaging way for such parties to reach and capture the attention of the demographic
currently accessed through esports. Guild Studios was launched to support brands that want to try
esports and gaming in their campaigns before committing to sponsorship. This is proving to be
beneficial to Guild as they attract new brands and have created a new revenue stream.
League entry fees may be prohibitive
Increasingly esports leagues are charging entry fees to teams wishing to participate in leagues. These
entry fees can be very substantial (for example, in 2018 the League of Legends Championship Series
required teams to pay a US$10,000,000 fee for entry, with the sale of a slot in 2019 reaching a record
fee of US$33,000,000) and may prove prohibitive to the Company especially if its revenue forecasts
do not meet the Directors’ expectations. If the Company cannot afford to pay the requisite entry
fees, it will not be able to compete in certain leagues meaning that it will not have the opportunity of
winning prize money and that the Company may be less attractive in general to players, fans and
sponsors as a consequence. The Company mitigates against this risk by following a strategy that
excludes games that currently charge high fees to compete and focuses on the games that will be
part of the Esports World Cup in Riyadh. Furthermore, we are seeing the Guild brand and eSports
teams able to secure fees for participation in some competitions.
The Company may be harmed by the adverse actions of players
The Company has and is expecting to recruit esports players that either have, or will develop, an
online profile that will prove attractive to fans, sponsors and esports viewers. As a player’s profile
increases, there is a greater risk that the player’s adverse behaviour could have a negative effect on
the Company, whether by damage to its reputation and good standing and/or by way of the
termination of contracts for breach. Whilst the Company will put in place policies emphasising the
need for esports players to be positive brand ambassadors, the Company will not be able to control
its players at all times. As can be seen commonly in sport, comments, rumours and suggestions
regarding a player by other players, coaches and industry figures can have an adverse effect on the
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Guild Esports plc – Company Number 12187837
Strategic Report
Company’s profile. The Company values actively seek to promote the right behaviours and mitigate
these risks.
Player and student safeguarding
Amongst the Company’s professional and academy player rosters are some individuals who are
under 18 years of age. Further, the Company commenced a BTEC education programme from
September 2023 which is aimed at 16- and 17-year-olds. As greater numbers of under-18s are
welcomed into Guild’s HQ, there is a greater risk that safeguarding issues may arise which, along with
negative consequences for the individuals involved, could have a negative effect on the Company
through damage to its reputation and good standing. The Company has put in place robust
safeguarding policies and procedures and will keep these under regular review and is the only
esports organisation who has a full time Head of Safeguarding.
Preventing access by minors is difficult
Some of the esports in which the Company will participate carry PEGI (Pan European Game
Information) ratings of 16 or 18. A game is rated “16” once the depiction of violence (or sexual
activity) reaches a stage that looks the same as would be expected in real life. The use of bad
language in games with a PEGI 16 rating can be more extreme, while games of chance, and the use of
tobacco, alcohol or illegal drugs can also be present. A game is rated “18” when the level of violence
reaches a stage where it becomes a depiction of gross violence, apparently motiveless killing, or
violence towards defenceless characters. The glamorisation of the use of illegal drugs and explicit
sexual activity will also fall into this age category.
Even when applying strict parental and other controls, restricting internet access to age appropriate
games is difficult. If minors gain access to coverage of Guild participating in leagues or games with
age classifications above that of the minor, the Company may receive adverse publicity which would
make it less attractive to sponsors and players and which could also result in the termination of
sponsor and/or player contracts.
Intellectual property offices or third parties may object to the registration of the Company’s brand
name
The Company has and will continue to incur time and expense in establishing and refining its brand
and its associated range of branded products. The Company has obtained trademark registrations in
the UK for the word marks “GUILD” and “GUILD ESPORTS” and logo marks “G” and “GUILD” (in
stylised form) for esports team-related services which were approved with renewal date of June
2030. The Company has applied for trademark registrations in the EU for the word mark “GUILD” and
in the US for the logo mark “GUILD” (in stylised form) which are currently pending. The EU mark has
been challenged by a third party in Estonia, Guild Atelier OU, which has also filed for “GUILD” in Class
35, and which the Company has lodged opposition. Guild Atelier has filed an opposition, which has a
cooling off period expiring March 24 and a deadline of May 24 to substantiate their opposition. No
opposition has been received for the US application.
With regard to any further applications (including in the EU, or other territories that may be of
interest, such as the USA), trademark registries have the power to object to registration of a mark on
various grounds. Given the meaning of the name “GUILD”, there is a risk that an attempt to register
the mark in connection with esports team-related services could be met with objections by registries
on the basis that the mark is descriptive or lacks distinctiveness. The acceptance of the applications
it did not perceive any problem with descriptiveness or
by the UK registry means that
non-distinctiveness with the applications as filed. Any difficulty and/or inability to obtain trademark
registrations on this basis may not prevent the Company continuing to use the brand but could be a
13
Guild Esports plc – Company Number 12187837
Strategic Report
disadvantage to the long term value of the brand. However, it may be possible to overcome such
issues through ensuring that trademark specifications are drafted appropriately and by making
representations to the registries.
The Company may be required to defend third party claims
Firstly, in the process of the Company applying to register its brand name as a trademark, third
parties wishing to oppose the registration of the mark may commence proceedings with the relevant
trademark registry, as has been done for the Company’s EU registration. Preliminary trademark
searches were carried out, which displayed a number of existing registered trademarks in the UK and
the EU that include the word “GUILD” for identical and/or similar goods and services to those
proposed by the Company (including computer software and electronic games). There is a risk that
the proprietors of such earlier marks may oppose the Company’s application of the GUILD mark.
However, this is not guaranteed and may depend on a number of factors such as whether the third
party has the resources to oppose the mark. There is also no guarantee that an opposition for
registration of the mark would be successful, and the Company would seek to defend itself against
any such opposition proceedings. If a third party was successful in opposing registration of the mark,
this could result in a disadvantage to the long term value of the brand, in particular as the Company
would have fewer rights in terms of defending itself from third party infringement of the brand. This
may also result in an award of the opponent’s costs being payable by the Company.
Secondly, there is also a risk that the Company’s use of the brand and intellectual property
(“Company IP”) may result in legal action being pursued against the Company for intellectual
property infringement by third party proprietors of existing registered or unregistered rights in the
Company IP. Such a claim could be made whether or not the Company has successfully registered its
intellectual property rights.
Notably, if a third party were successful in claiming that the use of the brand name “GUILD” infringed
its intellectual property rights, this could result in the Company being ordered to cease all use of the
mark in trade and having to rebrand its entire operation, which may require significant costs and
resources. Should the Company be found to have infringed the intellectual property rights of a third
party, the Company may also be liable to the third party for damages and their legal fees and
expenses. Any claims could therefore have a material adverse effect on the Company’s business,
revenue, financial condition, profitability, prospects and results of operations. Again, the risks of a
particular claim would be highly fact-specific, and depend upon the resources, belligerence and
trading position of any claimant.
The Company’s headquarters may be materially damaged
The Company’s headquarters, the Sky Guild Gaming Centre in Shoreditch, East London is both a
revenue generating and partner activation space. If the building or contents are significantly
damaged that may adversely impact the Company’s revenues from public-facing activities such as
events and Sim Racing hire, as well as impinge upon its ability to fulfil its partner obligations. Such
restriction in access or availability would have a material adverse effect on the Company’s business,
revenue, financial condition, profitability, prospects and results of operations, however, the Company
continues to evaluate the appropriate level of insurance as protection.
The Company may be required to take action against a third party
There is a risk that third parties may seek to copy the Company’s brand and produce unlicensed,
counterfeit goods and that the Company is unable to protect its intellectual property. Such goods
may damage the Company’s brand and goodwill if they are of poorer quality than the Company’s
14
Guild Esports plc – Company Number 12187837
Strategic Report
licensed products as well as having a material adverse effect on the Company’s business, revenue,
financial condition, profitability, prospects and results of operations.
The Company may identify such third parties who have infringed its intellectual property which may
result in litigation between the parties. Such litigation would necessarily require the Company to
devote time and attention to pursuing the matter and defending its intellectual property and would
likely require the Company to incur costs in doing so (which can often be substantial). If unsuccessful,
the Company could also be liable to the third party for their legal fees and expenses.
The Company, its players or a supplier on which it relies, may suffer a security breach
Security breaches, computer malware and computer hacking attacks have become more prevalent.
Many companies have been the targets of such attacks. Any security breach caused by hacking which
involves efforts to gain unauthorised access to information or systems, or to cause intentional
malfunctions or loss or corruption of data, software, hardware or other computer equipment, and
the inadvertent transmission of computer viruses could harm the business. Though it is difficult to
determine what harm may directly result from any specific interruption or breach, any failure to
reliability, security and availability of network infrastructure to the
maintain performance,
satisfaction of fans may harm the Company reputation and its ability to retain existing fans and
attract new fans.
The Company’s ability to generate revenue may be adversely affected as a result of deteriorating
economic conditions
Due to a number of factors, including but not restricted to high inflation, supply chain issues as a
result of Covid-19, Brexit and war in Ukraine, high interest rates and slow wage growth, the outlook
for the UK economy is deteriorating. As a result, companies are cutting their marketing budgets
which may have a knock-on impact on the Company’s ability to secure sponsors and clients for its
Guild Studios and Events businesses. These factors are also seen in a number of world economies
which may impact the Company’s success in proposed overseas expansion markets.
The Company’s operations may be materially and adversely affected as a result of constitutional
change in the United Kingdom
Subsequent to the United Kingdom exiting the European Union on 31 January 2020, there have been
several renegotiations of the terms of the new relationship, including on trade. The most recent of
these was agreed in February 2023, but there continue to be calls for changes from various
stakeholders within the UK.
There continue to be significant uncertainties as to what the long term impact will be on the fiscal,
monetary and regulatory landscape in the UK, including among other things, the UK’s financial
regulation, the conduct of cross-border business and export and import tariffs. There is also
uncertainty in relation to how, when and to what extent these developments will impact the
economy in the UK, the future growth of its various industries, on levels of investor activity,
confidence on market performance and on exchange rates. There is also a risk that the vote by the
United Kingdom to leave could result in other member states reconsidering their respective
memberships in the European Union. Although it is not possible to fully predict the effects of the exit
of the United Kingdom from the European Union, any of these risks, taken singularly or in the
aggregate, could have a material adverse effect on the Company’s business, revenue, financial
condition, profitability, prospects and results of operations.
15
Guild Esports plc – Company Number 12187837
Strategic Report
Promotion of the Company for the benefit of the members as a whole
The Directors believe they have acted in the way most likely to promote the success of the
Company for the benefit of its members as a whole, as required by s172 of the Companies Act
2006.
The requirements of s172 are for the Directors to:
● Consider the likely consequences of any decision in the long term,
● Act fairly between the members of the Company,
● Maintain a reputation for high standards of business conduct,
● Consider the interests of the Company's employees,
● Foster the Company’s relationships with suppliers, customers and others, and
● Consider
the impact of
the Company’s operations on the community and the
environment.
The Company operates as an esports organisation, within a fast-growing and developing
environment, and at times may be dependent on fund-raising for continued operation and/or
growth. The nature of the business is understood by the Company’s members, employees and
suppliers, and the Directors are transparent about the cash position and funding requirements.
The Company’s employees are fundamental to the success of the business. The directors
understand that it is critical to engage with and understand their views and to ensure that all
employees’ interests are considered. To strengthen employee engagement, the Directors promote
and encourage all employees to raise any concerns or suggestions with senior management
without hesitation. The Company fields anonymous employee satisfaction surveys on a quarterly
basis and shares results and trends with all employees.
Stakeholder engagement is fundamental to the Company’s strategy. The Company makes
extensive use of Social Media to provide Stakeholders with information on the Company’s
activities
The application of the s172 requirements can be demonstrated in relation to the some of the key
decisions made during the period:
Significant events / decisions
Signing sponsorship deals with global
partners
Investment into operational infrastructure,
securing talent for creation of content and
entering into new competitive game titles
Actions and
Consequences
Increasing the brand
awareness of the
Company on a global scale
To ensure the Company
has the ‘platform’ that will
ensure it can support
Key s172
matter(s)
affected
Shareholders
and Business
Relationships
Shareholders
and Business
Relationships
16
Guild Esports plc – Company Number 12187837
Strategic Report
to grow an audience and generate media
value for current and future partners
Commencement of the Guild College BTEC
programme in September 2023
Community
expansion on a global
scale
Engaging with students to
provide skills and support
their career development.
17
Guild Esports plc – Company Number 12187837
Directors’ Report
General information
The Directors present the Annual Report and audited financial statements for the year ended 30
September 2023.
The Company’s Ordinary Shares were admitted to the Official List (by way of a Standard Listing
under Chapter 14 of the Listing Rules) and to trading on the London Stock Exchange’s main
market for listed securities on 2 October 2020. The Company is registered in England and Wales.
Dividends
The directors do not propose a dividend in respect of the year ended 30 September 2023 (2022:
nil).
Directors
The Board is responsible for the Company’s objectives and business strategy and its overall
supervision. Acquisition, divestment and other strategic decisions will all be considered and
determined by the Board.
Attendance at Board meetings during the year ended 30 September 2023 were as follows:
Member
D Lew
B Stockbridge
M Edwards (resigned 17 November 2022)
J Caldwell (appointed 17 November 2022)
K Hourd (resigned 1 January 2023)
J Skee (appointed 1 January 2023)
Meetings attended
7 of 7
7 of 7
0 of 7
7 of 7
0 of 7
7 of 7
The Board will provide leadership within a framework of appropriate and effective controls. The
Board will set up, operate and monitor the corporate governance values of the Company, and will
have overall responsibility for setting the Company’s strategic aims, defining the business
objective, managing the financial and operational resources of the Company and reviewing the
performance of the officers and management of the Company’s business. The Board will take
appropriate steps to ensure that the Company complies with Listing Principles 1 and 2 as set out
in Chapter 7 of the Listing Rules and (notwithstanding that they only apply to companies with a
Premium Listing) the Premium Listing Principles as set out in Chapter 7 of the Listing Rules.
The Company supports the concept of an effective Board leading and controlling the Company.
The Board is responsible for approving Company policy and strategy. It meets when required, and
has a schedule of matters specifically reserved to it for decision. Management supply the Board
with appropriate and timely information and the Directors are free to seek any further
information they consider necessary. All Directors have access to advice from independent
professionals at the Company’s expense. Training is available for new Directors and other
Directors as necessary. All Directors are subject to re-election annually and, on appointment, at
the first AGM after appointment.
18
Guild Esports plc – Company Number 12187837
Directors’ Report
Communications with shareholders
Communications with shareholders are given a high priority. In addition to the publication of an
annual report and an interim report, there is regular dialogue with shareholders and analysts.
The Annual General Meeting is viewed as a forum for communicating with shareholders,
particularly private investors. Shareholders may question the Chairman and other members of
the Board at the Annual General Meeting. All published information for shareholders is also
available on the Company website,
including annual and interim reports, circulars,
announcements and significant shareholdings.
Accountability and Audit
The Board presents a balanced and understandable assessment of the Company's position and
prospects in all interim and price sensitive reports to regulators as well as in the information
required to be presented by statutory requirements.
The Company’s audit committee is comprised of Brian Stockbridge (as chair) and Derek Lew. The
audit committee met twice during the reporting period to consider the integrity of the financial
statements of the Company, including its annual and interim accounts; the effectiveness of the
Company's internal controls and risk management systems; auditor reports; and terms of
appointment and remuneration for the auditor.
Internal control
The Directors acknowledge they are responsible for the Company's systems of internal control
and for reviewing the effectiveness of these systems. The risk management process and systems
of internal control are designed to manage rather than eliminate the risk of the Company failing
to achieve its strategic objectives. It should be recognised that such systems can only provide
reasonable and not absolute assurance against material misstatement or loss.
Political donations
The Company did not make any political donations or expenditure (2022: £0)
Directors and directors’ interests
The directors who held office during the year and up to the date of signature of the financial
statements were as follows:
Mr Derek Lew
Ms Jocelin Caldwell (appointed 17 November 2022 and resigned 30 November 2023)
Ms Jasmine Skee (appointed 1 January 2023)
Mr Brian Stockbridge
Mr K Hourd (resigned 1 January 2023)
Mr Michael Edwards (resigned 17 November 2022)
19
Guild Esports plc – Company Number 12187837
Directors’ Report
Directors’ shareholdings
Derek Lew
Brian Stockbridge
Jocelin Caldwell
Jasmine Skee
Directors’ warrant holdings
Derek Lew
Brian Stockbridge
Jocelin Caldwell
Jasmine Skee
Ordinary
Shares
14,133,333
1,666,667
833,333
3,333,333
19,966,666
Percentage of
issued share
capital 30
September
2023
%
2.27
0.27
0.13
0.54
3.21
Warrants
over ordinary
shares at 30
September
2023
7,500,000
7,500,000
10,250,000
22,000,000
47,250,000
No Director held warrants in the Company as at 30 September 2022.
Going concern
The Directors, having made due and careful enquiry, are of the opinion that the Company has
adequate working capital to meet its obligations over the next 12 months. The Directors believe,
given the progress the Company has made in the past 12 months,
including the cost
rationalisation actions taken by the new management team, that there is a well defined path to
profitability. As per note 2.2, the Directors have stated that there is a material uncertainty on the
Company's ability to continue as a going concern. However, following previous successful
fundraising, the Directors are confident that sufficient additional capital will be raised to ensure
adequate funds are available to the Company to execute on its strategy The Directors therefore
have made an informed judgement, at the time of approving the financial statements, that there
is a reasonable expectation that the Company will have adequate resources to continue in
operational existence for the foreseeable future. As a result, the Directors have adopted the
going concern basis of accounting in the preparation of the annual financial statements.
20
Guild Esports plc – Company Number 12187837
Directors’ Report
Financial Risk Management
The Company has a simple capital structure and its principal financial asset is cash. The Company
has a limited number of transactions with Europe, the United States and Canada and is therefore
subject to market risk by way of being exposed to variations in foreign exchange rates. The
Company has little exposure to credit risk due to holding its cash reserves with credible
institutions. The Company may also be exposed to liquidity and capital risk, due to the nature of
operations and the requirements for operating an esports organisation. The Company manage
these risks through maintenance of sufficient working capital.
Substantial Shareholdings
At 19 January 2024, the Company had been informed of the following substantial interests over
3% of the issued share capital of the Company:
00Nation AS
Hargreaves Lansdown, stockbrokers (EO)
Toro Consulting Ltd
Interactive Investor (EO)
HSDL, stockbrokers (EO)
Mirabaud Bank, Geneva (PB)
Mr T Orange
Mr D Beckham
Mr J Rice-Jones
Number of
Shares
100,000,000
83,102,061
49,350,000
33,598,747
30,980,063
26,894,846
26,300,000
24,573,529
23,315,167
Percentage
Holding %
13.54
11.26
6.68
4.55
4.20
3.64
3.56
3.33
3.16
Controlling shareholder
The Company does not have a controlling shareholder.
Greenhouse gas emissions
As at the year end, the Directors, staff and esports teams operate both from their respective
homes, with little to no travel, and from Guild HQ in Shoreditch, London to which Directors, staff
and esports teams travel using public transport wherever possible. The Company limits
international travel, preferring to use video conferencing technology where possible. Given its
size, there is limited scope for the Company to have a major impact on environmental matters,
however the Directors are mindful of their responsibilities in this regard and strive to seek
opportunities where improvements may be made.
Climate-related Financial Disclosures
The Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD)
recommendations serve as a global foundation for effective reporting on the operational and
21
Guild Esports plc – Company Number 12187837
Directors’ Report
financial implications of the interrelationship between climate change and business, and set out
recommended disclosures structured under four core elements:
-
-
-
Governance – The organisation’s governance around climate-related risks and opportunities;
Strategy – The actual and potential impacts of climate-related risks and opportunities for an
organisation’s businesses, strategy, and financial planning;
Risk Management – The processes used by the organisation to identify, assess, and manage
climate-related risks; and
- Metrics and Targets – The metrics and targets used to assess and manage relevant
climate-related risks and opportunities.
These are supported by recommended disclosures that build on the framework with information
intended to help investors and others understand how reporting companies assess climate-related
risks and opportunities.
The table below shows our current progress against the TCFD recommendations.
TCFD Pillar
Recommended Disclosure
Guild Esports Summary
Governance
- Board’s
climate-related
opportunities
- Management’s
assessing
climate-related
opportunities
and
oversight
risks
of
and
role
in
managing
and
risks
current
of
stage
At
its
development,
the Company’s
operations are at a small scale and
its environmental impact is also
small scale. However, the Board
responsibility to
recognises
environment,
protect
particularly
the Company
grows.
its
the
as
The Board has oversight of
climate-related matters, including
risks and opportunities.
The
Board is supported by the Audit
Committee, which is responsible
review the
for keeping under
adequacy and effectiveness of the
Group’s internal control and risk
management systems,
including
those related to climate.
The Company is committed to a
healthier net zero planet, and
considers this in development of
its long-term strategy.
The Board is committed to strive
for environmental sustainability,
the Company’s
ensuring that
facilities optimise energy usage,
minimise waste
protect
nature and people.
and
The Company will continue to
identify and consider ESG risks
Strategy
- Climate-related
risks
and
opportunities identification
- Climate-related
risks
and
opportunities impacts
- Resilience
of
the
organisation’s strategy
22
Guild Esports plc – Company Number 12187837
Directors’ Report
Risk
Management
-
Identifying
climate-related risks
and
assessing
- Managing climate-related risks
Integration into overall
risk
-
management
Metrics
Targets
and
- Climate-related metrics
-
Scope 1, Scope 2 and Scope 3
emissions
- Climate-related targets
and opportunities in development
of its strategy.
to
small
is
company, Guild
As
a
Esports
embed
able
climate-related risk management
into its overall
internal control
environment from an early stage,
thus hugely reducing transition
risk.
the Company grows,
assessment
the
As
identification,
and
management of climate-related
risks and opportunities will be
actively discussed during Board
and management meetings.
As the Company grows, it will
continue to monitor its energy
use. The Company will seek to
collect, structure, and effectively
disclose related performance date
for
the material climate-related
risks and opportunities identified
where relevant.
The Board will also look to adopt
SASB recommended disclosures
in the next 2-3 years.
and
travel,
use
The Company already minimises
and therefore
business
energy
emissions,
through the use of internet based
communications tools.
It has a
policy of switching off devices
when not in use.
Electricity consumption at the HQ in Shoreditch for the year ending 30 September 2023 was
88,292kWh.
UK energy use kWh (1)
Associated Greenhouse gas emissions
Tonnes CO2 equivalent (2)
Emissions per turnover
Emissions per employee
Emissions per surface area
2023
88,292
18.28
0.016 kWh / £
2,759 kWh / person
5.52 kWh / Sq feet
23
Guild Esports plc – Company Number 12187837
Directors’ Report
(1) UK energy covers electricity usage at the company HQ in Shoreditch
(2) Associated Greenhouse gases have been calculated using the 2023 kg CO2e per unit
amount - 0.20707
The company does not have any gas usage and does not own or rent any vehicles. There were no
fugitive emissions from refrigerant leaks or maintenance in the year.
The significant electricity consumption of the company is mainly driven by the heating and air
conditioning system. The company is looking at various insulation improvements to the building in
order to reduce the levels of electricity consumed.
Equal Opportunity
The Company promotes a policy for the creation of equal and ethnically diverse employment
opportunities including with respect to gender. The Company promotes and encourages employee
involvement wherever practical as it recognises employees as a valuable asset and is one of the key
contributions to the Company’s success.
Provision of information to auditor
So far as each of the Directors is aware at the time this report is approved:
-
-
there is no relevant audit information of which the Company’s auditor is unaware; and
the Directors have taken all steps that they ought to have taken to make themselves aware
of any relevant audit information and to establish that the Company’s auditor is aware of
that information.
Auditors
The auditors, PKF Littlejohn LLP, have indicated their willingness to continue in office, and a
resolution that they be re-appointed will be proposed at the annual general meeting.
Directors’ Responsibility Statement
The directors are responsible for preparing the Annual Report and the financial statements in
accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial period.
Under that law the directors have prepared the Company financial statements in accordance with
UK-adopted international accounting standards. Under company law the directors must not
approve the financial statements unless they are satisfied that they give a true and fair view of the
state of affairs of the Company and of the profit and loss of the Company for that period.
In preparing these financial statements, the directors are required to:
●
Select suitable accounting policies and then apply them consistently;
● Make judgements and accounting estimates that are reasonable and prudent;
●
●
State whether applicable accounting standards have been followed, subject to any
material departures disclosed and explained in the financial statements; and
Prepare the financial statements on the going concern basis unless it is
24
Guild Esports plc – Company Number 12187837
Directors’ Report
inappropriate to presume that the Company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show
and explain the Company’s transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that the financial statements comply
with the Companies Act 2006. They are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the prevention and detection of fraud and
other irregularities.
Website publication
The directors are responsible for ensuring the annual report and the financial statements are
made available on a website. Financial statements are published on the Company’s website in
accordance with legislation in the United Kingdom governing the preparation and dissemination of
financial statements, which may vary from legislation in other jurisdictions. The maintenance and
integrity of
the Company’s website is the responsibility of the directors. The directors’
responsibility also extends to the ongoing integrity of the financial statements contained therein.
Directors’ responsibilities pursuant to DTR4 (Disclosure and Transparency Rules)
Each of the directors confirm to the best of their knowledge:
● The Company financial statements have been prepared in accordance with UK-adopted
international accounting standards and give a true and fair view of the assets, liabilities,
financial position and profit and loss of the Company; and
● The Annual report includes a fair review of the development and performance of the
business and financial position of the Company together with a description of the principal
risks and uncertainties that it faces.
This report was approved by the board on 31 January 2024 and signed on its behalf by:
Ms J Skee
Chief Executive Officer
25
Guild Esports plc – Company Number 12187837
Remuneration Report
This remuneration report sets out the Company’s policy on the remuneration of executive and
non-executive directors together with details of Directors’ remuneration packages and service
contracts for the year ended 30 September 2023.
The Company’s remuneration committee is comprised of Derek Lew (as committee chair) and
Jocelin Caldwell. The remuneration committee is to meet at least twice a year and has as its remit
the determination and review of, among others, the remuneration of executives on the Board and
any share incentive plans of the Company.
Total remuneration for Directors and employees for the year ending 2023 was £1.6m (2022:
£1.7m) Please refer to note 6 below.
Remuneration Policy
In setting the policy, the Board has taken the following into account:
● The need to attract, retain and motivate individuals of a calibre who will ensure successful
leadership and management of the Company;
● The Company’s general aim of seeking to reward all employees fairly according to the
nature of their role and their performance
● Remuneration packages offered by similar companies within the same sector;
● The need to align the interests of shareholders as a whole with the long-term growth of
the Company; and
● The need to be flexible and adjust with operational changes throughout the term of this
policy.
Future Policy Table
Element
Purpose
Policy
Operation
Opportunity &
Performance
Conditions
N/A
N/A
N/A
N/A
Executive Directors
Base salary
Pension
Benefits
Annual Bonus
N/A
N/A
N/A
To award
for
services
provided
the
Based on recommendations of
with
remuneration
comparison with other companies of a
similar size & sector
committee,
Paid
monthly &
reviewable
annually
N/A
N/A
N/A
Statutory, where appropriate
Health and dental plans
Based on recommendations of
the
remuneration committee in relation to
the contributions of the Company
Based on recommendations of
the
remuneration committee as part of a
management
where
appropriate
incentive,
26
Share options
N/A
N/A
N/A
Guild Esports plc – Company Number 12187837
Remuneration Report
Non-Executive
Directors
Base salary
Pension
Benefits
Annual Bonus
Share options
To award
for
services
provided
N/A
N/A
N/A
N/A
The Board as a whole determines the
remuneration of Non-exec Directors
based on the recommendations of the
Chairman & Comparison with other
companies of a similar size & sector
Statutory where appropriate
of
remuneration
None provided
No
element
performance
Based on recommendations of
the
remuneration committee as part of a
management
where
appropriate
incentive,
for
Paid
monthly &
reviewable
annually
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Notes to the future policy table
The Directors shall also be paid by the Company all travelling, hotel and other expenses as they may
incur in attending meetings of the Directors or general meetings or otherwise in connection with the
discharge of their duties.
Directors Remuneration (audited)
Details of Directors’ remuneration during the year ended 30 September 2023 is as follows:
Name
Benefits
Base
Salary (£)
60,000
36,750
135,000
42,000
37,500
3,500
314,750
D Lew
J Caldwell
J Skee
B Stockbridge
K Hourd
M Edwards
Total
Terms of appointment
Pension
Contribution
(£)
Othe
r (£)
-
-
550
1,073
-
-
-
-
-
-
12,500
-
Total (£)
60,000
36,750
137,050
43,073
50,000
3,500
(£)
-
-
1,500
-
-
-
1,500
1,623
12,500
330,373
The services of the Directors, provided under the terms of agreement with the Company are
dated as follows:
Director
J Caldwell
J Skee
Year
appointment
of
Number
completed
of
years
Date
of
engagement letter
current
2022
2023
1
1
27
17 November 2022
1 January 2023
Guild Esports plc – Company Number 12187837
Remuneration Report
D Lew
B Stockbridge
2019
2022
4
1
3 December 2019
31 March 2022
Consideration of shareholder views
The Board will consider shareholder feedback received and guidance from shareholder bodies.
This feedback, plus any additional feedback received from time to time, is considered as part of
the Company’s annual policy on remuneration.
Policy for new appointments
Base salary levels will take into account market data for the relevant role, internal relativities, the
individual’s experience and their current base salary. Where an individual is recruited at below
market norms, they may be re- aligned over time (e.g. two to three years), subject to
performance in the role. Benefits will generally be in accordance with the approved policy.
For external and internal appointments, the Board may agree that the Company will meet certain
relocation and/or incidental expenses as appropriate.
Historical Share Price Performance Comparison
The table below compares the share price performance (based on a notional investment of £100)
of Guild Esports plc against the FTSE Small Cap index for the period 2 October 2020 to 30
September 2023. The FTSE Small Cap index has been chosen to provide a wider market
comparator containing companies of an appropriate size.
30 September 2023
30 September 2022
30 September 2021
2 October 2020
FTSE Small Cap
£120.52
£116.16
£145.96
£100.00
Company
£7.19
£26.88
£63.75
£100.00
Guild Esports was listed on 2 October 2020 so there is no historical share price data prior to this
date.
Corporate Governance Statement
The Company intends to comply with the provisions of the Corporate Governance Code published
by the Quoted Companies Alliance (QCA Corporate Governance Code) insofar as is appropriate
having regard to the size and nature of the Company and the size and composition of the Board.
The Company’s Standard Listing means that it is also not required to comply with those provisions of
the Listing Rules which only apply to companies on the Premium List. The FCA will not have the
authority to (and will not) monitor the Company’s compliance with any of the Listing Rules which
the Company has indicated that it intends to comply with on a voluntary basis, nor to impose
sanctions in respect of any failure by the Company so to comply. However, the FCA would be able to
28
Guild Esports plc – Company Number 12187837
Remuneration Report
impose sanctions for non-compliance where the statements in a prospectus are themselves
misleading, false or deceptive.
The QCA has identified 10 principles that focus on the pursuit of medium to long-term growth in
value for shareholders without stifling the entrepreneurial spirit in which a company was created.
Companies need to deliver growth in long-term shareholder value. This requires an efficient,
effective and dynamic management
framework and should be accompanied by good
communication which helps to promote confidence and trust.
Deliver growth
Principle 1: Establish a strategy and business model which promote long-term value for
shareholders.
The Company’s strategy and business model were initially established and set out in the Company’s
IPO Admission Document. The strategy is reviewed, assessed and revised at Board meetings as
required. The Company’s strategy, business model and progress are communicated through the
Strategic Report of each Annual Report.
Principle 2: Seek to understand and meet shareholder needs and expectations.
The Group’s Chair meets with existing shareholders from time to time as does the Executive
Director.
The Company has an active social media presence which seeks to keep all stakeholder groups
informed of progress.
The Company welcomes all attendees to its Annual General Meetings (“AGMs”) and seeks to
engage with them both formally and informally on the day.
Principle 3: Take into account wider stakeholder and social responsibilities and their implications for
long-term success.
As a people-centric business, much of their ‘day job’ involves communication/meetings with both
external third parties and the Company’s staff. Minimising the environmental impact of these
activities is actively encouraged through the Group’s:
● Employment policies e.g. travel, use of public transport, working from home
● Use of Google Meet and Slack, web-based communications facilities.
Principle 4: Embed effective risk management, considering both opportunities and threats,
throughout the organisation.
The Company’s approach to risk management together with the principal risks and uncertainties
applicable, their possible consequences and mitigation are set out in the Principal Risks and
Uncertainties section of the Company’s Annual Report. The Board reviews, evaluates and prioritises
risks to ensure that appropriate measures are in place to effectively manage and mitigate those
identified.
Maintain a dynamic management framework
Principle 5: Maintain the Board as a well-functioning, balanced team led by the Chair.
The Corporate Governance section of the Company’s Annual Report details the composition of its
Board and Committees. These are also included within the Investor Relations section of its website.
29
Guild Esports plc – Company Number 12187837
Remuneration Report
All of the Directors (both Executive and Non-executive) are committing the time necessary to fulfil
their roles. Non-executive Directors sit on the Audit and Risk and Remuneration Committees. The
Board meets formally at least six times a year. During the year to 30 September 2023, the Board
met 7 times.
Principle 6: Ensure that between them the Directors have the necessary up-to-date experience,
skills and capabilities.
A biography of each Board member is included within the Investor Relations section of its website.
These list current and past roles of each Board member and also describe the relevant business
experience that each Director brings to the Board, plus their academic and professional
qualifications.
The biographies show the balanced blend of skills and experience required to enable the Company
to execute its strategic objectives within a corporate governance framework which has been
tailored to its business activities.
Principle 7: Evaluate Board performance based on clear and relevant objectives, seeking continuous
improvement.
The Corporate Governance section of the Annual Report describes the function of the Board and its
Committees. Whilst the Company does not have a Nominations Committee, the Directors regularly
review the structure, size, composition (including the skills, knowledge, experiences and diversity)
of the Board and make recommendations to the Board with regard to any changes.
Principle 8: Promote a corporate culture that is based on ethical values and behaviours.
Within the Annual Report, the Chairman’s statement provides further evidence of the iteration and
implementation of the framework that continues to develop the Company’s culture and support
both existing and new employees. This sets out the Company’s purpose, values and culture.
Principle 9: Maintain governance structures and processes that are fit for purpose and support good
decision-making by the Board.
The Investor Relations area of the Company’s website includes a Corporate Governance section
which, in addition to the high-level explanation of the application of the QCA Code, describes the
composition of the Board and its Committees, together with a brief biography of each Board
member.
The roles of Committees are described, along with their terms of reference and matters reserved by
the Board for its consideration.
The Corporate Governance section of the Annual Report also details the composition of the Board
and its Committees, and the role of each Committee.
Build trust
Principle 10: Communicate how the company is governed and is performing by maintaining a
dialogue with shareholders and other relevant stakeholders
The Corporate Governance section of the Annual Report includes disclosure of Board Committees,
their composition and where relevant, any work undertaken during the year. It includes a detailed
Remuneration Report. The s172 Statement section of the Annual Report provides details of
stakeholder communication practices.
30
Guild Esports plc – Company Number 12187837
Remuneration Report
The website includes all historic Annual Reports, results announcements and presentations, and
other governance-related material. These can be found in the Investor Relations section, under
Regulatory News. This section of the website also includes the results of all AGMs.
This report was approved by the board on 31 January 2024 and signed on its behalf by:
J Skee
Chief Executive Officer
31
Guild Esports plc – Company Number 12187837
INDEPENDENT AUDITORS REPORT
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF GUILD ESPORTS PLC
Opinion
We have audited the financial statements of Guild Esports Plc (the ‘company’) for the year ended 30
September 2023 which comprise the Statement of Comprehensive Income, the Statement of
Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows and notes to the
financial statements, including significant accounting policies. The financial reporting framework that
has been applied in their preparation is applicable law and UK-adopted international accounting
standards.
In our opinion, the financial statements:
● give a true and fair view of the state of the company’s affairs as at 30 September 2023 and of
its loss for the year then ended;
● have been properly prepared in accordance with UK-adopted international accounting
standards; and
● have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section of our report. We are independent of
the company in accordance with the ethical requirements that are relevant to our audit of the
financial statements in the UK, including the FRC’s Ethical Standard as applied to listed public interest
entities, and we have fulfilled our other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Material uncertainty related to going concern
We draw attention to note 2.2 in the financial statements, which discloses that events or conditions
have been identified that may cast significant doubt on the entity’s ability to continue as a going
concern. The company incurred a net loss of £4,497,000 during the year ended 30 September 2023
and, as of that date, the company’s current liabilities exceeded its current assets by £1,858,000. As
stated in note 2.2, these events or conditions, along with the other matters as set forth in note 2.2,
indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to
continue as a going concern. Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the director's use of the going concern
basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of
the directors’ assessment of the company’s ability to continue to adopt the going concern basis of
accounting included:
● Review of management’s assessment of the going concern basis, together with the cash
flow forecast for at least 12 months following the reporting date. The forecasts demonstrate
32
Guild Esports plc – Company Number 12187837
INDEPENDENT AUDITORS REPORT
that the company will require additional funding during the going concern period from a
combination of additional equity raises, securing new sponsorship arrangements and other
commercial contracts, which are not currently contracted or committed, in order to meet
their liabilities as they fall due. A material uncertainty has been disclosed above in respect of
this.
● Review of the key inputs into the cash flow forecast,
including checking mathematical
accuracy of the cash flow and discussion of significant assumptions used by management
and comparing these with current and post year end performance. Stress testing the
forecasted cash flows by stripping out sources of income that are not at the current time
guaranteed, as well as critically reviewing fixed expenditure, in order to evaluate reasonably
possible downside scenarios.
● Assessment of the levels of cash available to the company post year end and whether they
are sufficient to cover expected outgoing costs over the cash flow period.
● Review of the latest available post year end general ledgers, bank statements, regulatory
announcements and board minutes.
Our responsibilities and the responsibilities of the directors with respect to going concern are
described in the relevant sections of this report.
Our application of materiality
The scope of our audit was influenced by our application of materiality. The quantitative and
qualitative thresholds for materiality determine the scope of our audit and the nature, timing and
extent of our audit procedures.
Materiality for the company financial statements was set at £134,000 (2022 - £250,000). Overall
materiality was calculated based on 3% (2022: 3%) of the loss for the year, which we determined, in
our professional
judgement, to be the key principal benchmark within the financial statements
relevant to members of the company in assessing financial performance. We set performance
materiality at 70% (2022:70%) of overall financial statement materiality at £93,800 (2022 - £175,000)
based upon the required coverage from testing key items and the absence of audit adjustments in
prior periods.
We agreed to report to those charged with governance all corrected and uncorrected misstatements
we identified through our audit with a value in excess of £6,700 (2022 - £12,500). We also agreed to
report any other audit misstatements below that threshold that we believe warranted reporting on
qualitative grounds.
Our approach to the audit
As part of our planning we assessed the risk of material misstatement including those that required
significant audit consideration for the company. Procedures were then performed to address the
most significant assessed risks of material misstatement. The procedures performed are outlined
below in the Key Audit Matters section of this report. We addressed the risk of management override
of internal controls, including among other matters consideration of whether there was evidence of
bias that represented a risk of material misstatement due to fraud.
33
Guild Esports plc – Company Number 12187837
INDEPENDENT AUDITORS REPORT
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the current period and include the most significant assessed
risks of material misstatement (whether or not due to fraud) we identified, including those which
had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and
directing the efforts of the engagement team. These matters were addressed in the context of our
audit of the financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. In addition to the matter described in the Material
uncertainty related to going concern section we have determined the matters described below to be
the key audit matters to be communicated in our report.
Key Audit Matter
How our scope addressed this matter
Revenue recognition (note 2.3)
Under
ISA (UK) 240 there is a rebuttable
presumption that revenue recognition is a fraud
risk.
The company’s revenue streams have different
performance obligations and recognition criteria,
and as such there is a significant risk that revenue
has not been recognised appropriately in the year.
The risk assertions principally relate to accuracy
and cut-off.
Our work in this area included:
● Updating our understanding of
the
internal control environment in which
the company operates for material
income streams and undertaking a
walkthrough to ensure that the key
controls within these systems have
been operating effectively in the period
under audit;
● Substantive
of
income
testing
recognised in the financial statements,
including deferred and accrued income
balances recognised at the year-end;
all
sponsorship
agreements, ensuring revenue (both
cash and in kind) has been recognised in
line with the performance obligations,
underlying agreements and recorded in
the correct accounting period;
key
● A review of
● Agreeing prize winnings in the year
from an independent source to those
recorded in the accounting system; and
the presentation and
disclosures are in accordance with IFRS
15.
● Assessing that
Based upon our audit procedures, we did not
identify any matters to indicate that revenue was not
34
Guild Esports plc – Company Number 12187837
INDEPENDENT AUDITORS REPORT
appropriately recorded and disclosed in the financial
statements in accordance with IFRS 15.
Other information
The other information comprises the information included in the annual report, other than the
financial statements and our auditor’s report thereon. The directors are responsible for the other
information contained within the annual report. Our opinion on the financial statements does not
cover the other information and, except to the extent otherwise explicitly stated in our report, we do
not express any form of assurance conclusion thereon. Our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with
the financial statements or our knowledge obtained in the course of the audit, or otherwise appears
inconsistencies or apparent material
to be materially misstated.
misstatements, we are required to determine whether this gives rise to a material misstatement in
the financial statements themselves. If, based on the work we have performed, we conclude that
there is a material misstatement of this other information, we are required to report that fact.
If we identify such material
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the directors’ remuneration report to be audited has been properly
prepared in accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
● the information given in the strategic report and the directors’ report for the financial year
for which the financial statements are prepared is consistent with the financial statements;
and
● the strategic report and the directors’ report have been prepared in accordance with
applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the
course of the audit, we have not identified material misstatements in the strategic report or the
directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act
2006 requires us to report to you if, in our opinion:
● adequate accounting records have not been kept, or returns adequate for our audit have not
been received from branches not visited by us; or
● the financial statements and the part of the directors’ remuneration report to be audited are
not in agreement with the accounting records and returns; or
● certain disclosures of directors’ remuneration specified by law are not made; or
● we have not received all the information and explanations we require for our audit.
35
Guild Esports plc – Company Number 12187837
INDEPENDENT AUDITORS REPORT
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, the directors are responsible for
the preparation of the financial statements and for being satisfied that they give a true and fair view,
and for such internal control as the directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors either intend to liquidate the
company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s
report that includes our opinion. Reasonable assurance is a high level of assurance but is not a
guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect material misstatements in
respect of irregularities, including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below:
● We obtained an understanding of the company and the sector in which it operates to
identify laws and regulations that could reasonably be expected to have a direct effect on the
financial statements. We obtained our understanding in this regard through discussions with
management, application of cumulative audit knowledge and experience of the sector.
● We determined the principal laws and regulations relevant to the company in this regard to
be those arising from Companies Act 2006, International Accounting Standards, London
Stock Exchange Rules and the Disclosure and Transparency Rules.
● We designed our audit procedures to ensure the audit team considered whether there were
any indications of non-compliance by the company with those laws and regulations. These
procedures included, but were not limited to:
o
o
o
Enquiries of management
Review of legal and professional fees
Review of Board minutes
● We also identified the risks of material misstatement of the financial statements due to
fraud. We considered, in addition to the non-rebuttable presumption of a risk of fraud arising
from management override of controls, the potential for management bias in relation to
revenue recognition. This was addressed through updating our understanding of the internal
control environment, performing walkthrough tests, analysing the sponsorship agreements
36
Guild Esports plc – Company Number 12187837
INDEPENDENT AUDITORS REPORT
for the year and substantive testing of revenue recognised. See Key Audit Matters section
above.
● We addressed the risk of fraud arising from management override of controls by performing
audit procedures which included, but were not limited to: the testing of journals; reviewing
accounting estimates for evidence of bias; reviewing bank payments and receipts in the year;
and evaluating the business rationale of any significant transactions that are unusual or
outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities,
including those leading to a material misstatement in the financial statements or non-compliance
with regulation. This risk increases the more that compliance with a law or regulation is removed
from the events and transactions reflected in the financial statements, as we will be less likely to
become aware of instances of non-compliance. The risk is also greater regarding irregularities
occurring due to fraud rather than error, as fraud involves intentional concealment, forgery,
collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.
Other matters which we are required to address
We were appointed by the Board on 7 December 2020 to audit the financial statements for the
period ending 30 September 2020 and subsequent financial periods. Our total uninterrupted period
of engagement is 4 years, covering the periods ending 30 September 2020 to 30 September 2023.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the company
and we remain independent of the company in conducting our audit.
Our audit opinion is consistent with the additional report to the audit committee.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of
Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to
the company’s members those matters we are required to state to them in an auditor’s report and
for no other purpose.
To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone, other than the company and the company's members as a body, for our
audit work, for this report, or for the opinions we have formed.
David Thompson (Senior Statutory Auditor)
For and on behalf of PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
Canary Wharf
London E14 4HD
37
Guild Esports plc – Company Number 12187837
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2023
Continuing Operations
Revenue
Cost of sales
Gross profit
Administrative expenses
Depreciation & amortization
Operating loss
Finance costs
Loss before taxation
Taxation
Year ended
30 September
2023
£’000
Year ended
30 September
2022
£’000
Note
3
4
4
8
7
5,525
(1,538)
3,987
(7,397)
(844)
(4,254)
(243)
(4,497)
-
4,453
(1,686)
2,767
(10,913)
(430)
(8,576)
(172)
(8,748)
-
Loss after taxation
(4,497)
(8,748)
Other comprehensive income
-
-
comprehensive
Total
the year
attributable to shareholders from continuing
operations
loss
for
(4,497)
(8,748)
Basic and diluted earnings per share - pence
9
(0.82)
(1.69)
The accompanying notes on pages 41 to 63 form part of the financial statements.
38
Guild Esports plc – Company Number 12187837
STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2023
Note
10
11
12
13
14
15
19
19
20
18
12
16
17
12
NON-CURRENT ASSETS
Property, plant and equipment
Intangible assets
Right of use assets
Other receivables
TOTAL NON-CURRENT ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
TOTAL CURRENT ASSETS
TOTAL ASSETS
EQUITY
Share capital
Share premium
Share based payment reserve
Retained earnings
TOTAL EQUITY
NON-CURRENT LIABILITIES
Provisions
Lease liability
TOTAL
LIABILITIES
NON-CURRENT
CURRENT LIABILITIES
Trade and other payables
Deferred revenue
Lease liability
TOTAL CURRENT LIABILITIES
TOTAL LIABILITIES
TOTAL
EQUITY
LIABILITIES
AND
As at
30 September 2023
As at
30 September 2022
£'000
1,452
130
3,046
143
4,771
459
320
779
5,550
622
23,061
838
(24,752)
(231)
346
2,781
3,127
1,526
707
421
2,654
5,781
5,550
£'000
1,552
220
3,457
143
5,372
2,730
4,049
6,779
12,151
519
22,644
650
(20,255)
3,558
323
3,204
3,527
3,401
1,406
259
5,066
8,593
12,151
The accompanying notes on pages of 41 to 63 form part of the financial statements
The financial statements were approved by the board on 31 January 2024 by:
Derek Lew, Non Executive Chairman _____________________________
39
Guild Esports plc – Company Number 12187837
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2023
Issued Share
Capital
Share
Premium
SBP
Reserve
Retained
Earnings
£'000
519
£'000
£'000
£'000
22,643
419
(11,507)
Total
Equity
£'000
12,074
As at 1 October 2021
Loss for the year
Total comprehensive loss for the
year
Share-based payments
Warrants cancelled during the year
Total transactions with owners
-
-
-
-
-
-
-
-
1
1
As at 30 September 2022
519
22,644
Loss for the year
Total comprehensive loss for the
year
-
-
-
-
Shares issued during the year
103
519
Share-based payments
Exercised and lapsed warrants
Share issue costs during the year
Total transactions with owners
As at 30 September 2023
-
-
-
103
622
-
-
(102)
417
23,061
-
-
232
(1)
231
650
-
-
-
191
(3)
-
188
838
(8,748)
(8,748)
(8,748)
(8,748)
-
-
-
232
-
232
(20,255)
3,558
(4,497)
(4,497)
(4,497)
(4,497)
-
-
-
-
-
(24,752)
622
191
(3)
(102)
708
(231)
The accompanying notes on pages 41 to 63 form part of the financial statements
40
Guild Esports plc – Company Number 12187837
STATEMENT OF CASHFLOW
FOR THE YEAR ENDED 30 SEPTEMBER 2023
Note
8
Cash flow from operating activities
Loss for the financial year
Adjustments for:
Lease liability finance charge
Amortisation and impairment of intangible assets
Depreciation on property, plant and equipment
Depreciation on right of use assets
Loss on disposal of fixed assets
Services settled by issue of warrants
Changes in working capital:
Decrease / (increase) in trade and other receivables
(Decrease) / increase in trade and other payables
(Decrease) / increase in deferred revenue
Net cash used in operating activities
Cash flows from investing activities
Purchase of intangible assets
Purchase of property, plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares - net
Payment of lease liabilities
Net cash (used in)/generated from financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
14
Year ended
30 September
2023
£'000
Year ended
30 September
2022
£'000
(4,497)
(8,748)
243
90
300
453
5
188
3,641
(1,875)
(611)
(2,063)
-
(205)
(205)
520
(523)
(3)
(2,271)
2,730
459
172
36
91
303
6
232
(560)
2,564
534
(5,370)
(206)
(1,620)
(1,826)
-
(146)
(146)
(7,342)
10,072
2,730
The accompanying notes on pages 41 to 63 form part of the financial statements
41
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
1
GENERAL INFORMATION
Guild Esports PLC is a public limited company incorporated in England and Wales and domiciled in
the United Kingdom. The registered office is 2 Chance Street, London, E1 6JT. The Company was
incorporated on 3 September 2019 originally under the name “The Lords Esports Plc” before
changing its name on 17 April 2020.
The Company's principal activities and nature of its operations are disclosed in the Directors' Report.
2
ACCOUNTING POLICIES
IAS 8 requires that management shall use its judgement in developing and applying accounting
policies that result in information which is relevant to the economic decision-making needs of users,
that are reliable, free from bias, prudent, complete and represent faithfully the financial position,
financial performance and cash flows of the entity.
2.1
Basis of preparation
The financial statements have been prepared in accordance with UK-adopted international
accounting standards and with those parts of the Companies Act 2006 applicable to companies
reporting under IFRS, except as otherwise stated.
The financial statements are prepared in sterling, which is the functional currency of the Company.
Monetary amounts in these financial statements are rounded to the nearest £’000.
The financial statements have been prepared under the historical cost convention. The principal
accounting policies adopted are set out below.
The Company has adopted the applicable amendments to standards effective for accounting periods
commencing on 1 October 2022. The nature and effect of these changes as a result of the adoption
of these amended standards did not have an impact on the financial statements of the Company
and, hence, have not been disclosed. The Company has not early adopted any standards,
interpretations or amendments that have been issued but are not yet effective.
2.2
Going concern
The Company has prepared monthly cash flow forecasts based on reasonable estimates of key
variables including revenue and operating costs that supports the conclusion of the Directors that
they expect sufficient funding to be available to meet the Company’s anticipated cash flow
requirements over the next 12 months.
These cash flow forecasts are subject to a number of risks and uncertainties, including the ability of
the Company to achieve additional funding. The Company's cash flow forecast includes new
revenues streams related to the in-house consulting and production capability launched in 2023 that
are difficult to forecast with certainty due to the project nature of the work. However, not all planned
new revenue streams in the current financial year have been included in the Company forecast,
where revenues are related to performance at major competitions, including the eSports World Cup
in Saudi Arabia. The forecast will be updated when more information is released on the eSports
World Cup in the near future.
42
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Following previous successful fundraising the Directors are confident that sufficient additional capital
will be raised to ensure adequate funds are available to the Company to execute on its strategy.
However, this does constitute a material uncertainty that may cast significant doubt on the
Company's ability to continue as a going concern.
2.3
Revenue
Revenue is measured based on the consideration specified in a contract with a customer and
excludes amounts collected on behalf of third parties. The Company recognizes revenue when it
transfers control of a product or service to a customer.
When cash inflows are deferred and represent a financing arrangement, the fair value of the
consideration is the present value of the future receipts. The difference between the fair value of the
consideration and the nominal amount received is recognised as interest income.
Sale of goods
Revenue is recognised when the significant risks and rewards of ownership have been transferred to
the customer, recovery of the consideration is probable, the associated costs and possible return of
goods can be estimated reliably, there is no continuing management involvement with the goods and
the amount of revenue can be measured reliably. Revenue is measured net of returns, trade
discounts and volume rebates.
Royalties
The Company receives royalties from in-game digital products branded with the Guild logo. The
rights to the digital products are held by the game developers, and Guild is not deemed to be the
in such transactions. Therefore, the revenue recognised from the sale of these digital
principal
products is the net amount of commission earned by the Company.
Prize money
The Company operates esports teams in several game titles which each have multiple tournaments
with varying amounts of prize pools. The Company recognises total prize winnings as revenue at the
point that its esports teams' placing is confirmed in a tournament. Prize pool amounts payable to the
Company's esports teams as part of the players' contracts are shown in cost of sales.
Long-term partnership contracts
The Company enters into partnership deals which provide rights over services and assets operated
and owned by Guild. Contracts may include both fixed-price and variable-price services. Revenue
from providing services is recognised in the accounting period in which the services are rendered. For
fixed-price contracts, revenue is recognised based on the actual service provided to the end of the
reporting period as a proportion of the total services to be provided, because the customer receives
and uses the benefits simultaneously. This is determined based on actual services provided relative
to the total expected services expected as part of the contract. The rights over services and assets
are subject to minimum monthly commitments and as such, these fixed-price contracts accrue
materially evenly over the life of the contract. Contributions in kind are included in revenue at the
fair value of the goods and services agreed.
43
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
2.4
Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision makers. The chief operating decision maker, who are responsible for
allocating resources and assessing performance of the operating segments, has been identified as
the executive Board of Directors.
2.5
Intangible assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently
measured at cost less accumulated amortisation and accumulated impairment losses.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values
over their useful lives. Website costs are amortised on a 33% per annum, straight-line basis.
2.6
Impairment of tangible and intangible assets
At each reporting end date, the Company reviews the carrying amounts of its tangible and intangible
assets to determine whether there is any indication that those assets have suffered an impairment
loss. If any such indication exists, the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any). Where it is not possible to estimate the
recoverable amount of an individual asset, the Company estimates the recoverable amount of the
cash-generating unit to which the asset belongs.
2.7
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and demand deposits with banks and
other financial institutions, that are readily convertible into known amounts of cash and which are
subject to an insignificant risk of changes in value. The Company monitors both short-term and
long-term credit ratings of the financial institutions it banks with. During the period, the Company
banked with National Westminster Bank Plc which has a high rating from Fitch Ratings Inc, being 'F1'
short-term and 'A+' long-term.
2.8
Financial assets
Financial assets are recognised in the Company's statement of financial position when the Company
becomes party to the contractual provisions of the instrument. Financial assets are classified into
specified categories, depending on the nature and purpose of the financial assets.
At initial recognition, financial assets classified as fair value through profit and loss are measured at
fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as
fair value through profit and loss are initially measured at fair value plus transaction costs.
Financial assets held at amortised cost
instruments are classified as financial assets measured at amortised cost where the
Financial
objective is to hold these assets in order to collect contractual cash flows, and the contractual cash
flows are solely payments of principal and interest. They arise principally from the provision of goods
and services to customers (e.g. trade receivables). They are initially recognised at fair value plus
transaction costs directly attributable to their acquisition or issue, and are subsequently carried at
amortised cost using the effective interest rate method, less provision for impairment where
necessary.
44
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Impairment of financial assets
Financial assets, other than those measured at fair value through profit or loss, are assessed for
indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more
events that occurred after the initial recognition of the financial asset, the estimated future cash
flows of the investment have been affected.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset
expire, or when it transfers the financial asset and substantially all the risks and rewards of
ownership to another entity.
Trade and other receivables
Trade and other receivables are initially recognised at fair value when related amounts are invoiced
then carried at this amount less expected credit losses.
IFRS 9 “Financial instruments” requires an expected credit loss model. The expected credit loss (ECL)
model requires the company to account for expected credit losses and changes in those expected
credit losses at each reporting date to reflect changes in credit risk since initial recognition of the
financial assets. The credit event does not have to occur before credit losses are recognised. IFRS 9
“Financial Instruments” allows for a simplified approach for measuring the loss allowance at an
amount equal to lifetime expected credit losses for trade receivables and contract assets.
The company believes there isn’t any credit risk in relation to any of the company’s trade and other
receivables balance.
2.9
Financial liabilities
The Company recognises financial debt when the Company becomes a party to the contractual
provisions of the instruments. Financial liabilities are classified as 'other financial liabilities'.
Other financial liabilities
Other financial liabilities, including trade payables and other short-term monetary liabilities, are
initially measured at fair value net of transaction costs directly attributable to the issuance of the
financial liability. They are subsequently measured at amortised cost using the effective interest
method. For the purposes of each financial liability, interest expense includes initial transaction costs
and any premium payable on redemption, as well as any interest or coupon payable while the
liability is outstanding.
Derecognition of financial liabilities
Financial
discharged, cancelled, or they expire.
liabilities are derecognised when, and only when, the Company's obligations are
2.10 Leases
45
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Leases are recognised as a right-of-use asset and a corresponding lease liability at the date at which
the leased asset is available for use by the Company.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease
liabilities include the net present value of the following lease payments:
-
-
-
-
-
Fixed payments (including in-substance fixed payments), less any lease incentives receivable;
Variable lease payment that are based on an index or a rate, initially measured using the
index or rate as at the commencement date;
Amounts expected to be payable by the Company under residual value guarantees;
The exercise price of a purchase option if the Company is reasonably certain to exercise that
option; and
Payments of penalties for terminating the lease, if the lease term reflects the Company
exercising that option.
Lease payments to be made under reasonably certain extension options are also included in the
measurement of the liability.
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be
readily determined, the lessee’s incremental borrowing rate is used, being the rate that the individual
lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the
right-of-use asset in a similar economic environment with similar terms, security and conditions.
Lease payments are allocated between principal and finance cost. The finance cost is charged to
profit or loss over the lease period. Right-of-use assets are measured at cost which comprises the
following:
-
-
-
-
The amount of the initial measurement of the lease liability;
Any lease payments made at or before the commencement date less any lease incentives
received;
Any initial direct costs; and
Restoration costs.
Right-of-use assets are depreciated over the shorter of the asset’s useful life and the lease term on a
straight line basis.
If the Company is reasonably certain to exercise a purchase option, the
right-of-use asset is depreciated over the underlying asset’s useful life.
Payments associated with short-term leases (term less than 12 months) and all leases of low-value
assets (generally less than £5k) are recognised on a straight-line basis as an expense in profit or loss.
The Company has applied this exemption to £81,897 (2022: £41,971) worth of rental expenses
relating to short-term leases.
2.11 Provisions
Provisions have been recognised in relation to leasehold dilapidations. This provision relates to the
estimated cost of returning a leasehold property to its original state at the end of the lease in
accordance with the lease terms. The provision cost is recognised as depreciation of right of use
46
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
property assets over the remaining term of the lease. The main uncertainty relates to estimating the
cost that will be incurred at the end of the lease.
2.12 Equity and reserves
Share capital is determined using the nominal value of shares that have been issued.
Shares to be issued relates to monies received in advance ahead of the issue of shares that was
completed post period end following the admission to the London Stock Exchange. Upon the issue of
these shares this reserve will be split between share capital and share premium reserves.
The Share premium account includes any premiums received on the initial issuing of the share
capital. Any transaction costs associated with the issuing of shares are deducted from the Share
premium account, net of any related income tax benefits.
The share-based payment reserve is used to recognise the grant date fair value of options and
warrants issued but not exercised.
Retained losses includes all current and prior period results as disclosed in the income statement.
2.13 Earnings per share
The Company presents basic and diluted earnings per share data for its Ordinary Shares.
Basic earnings per Ordinary Share is calculated by dividing the profit or loss attributable to
Shareholders by the weighted average number of Ordinary Shares outstanding during the period.
Diluted earnings per Ordinary Share is calculated by adjusting the earnings and number of Ordinary
Shares for the effects of dilutive potential Ordinary Shares.
2.14 Taxation
Tax currently receivable or payable is based on taxable profit or loss for the period. Taxable profit or
loss differs from profit or loss as reported in the income statement because it excludes items of
income and expense that are taxable or deductible in other years and it further excludes items that
are never taxable or deductible. The liability for current tax is calculated using tax rates that have
been enacted or substantively enacted by the balance sheet date.
Deferred tax is proved in full on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statement. Deferred tax is determined using tax
rates (and laws) that have been enacted or substantively enacted by the balance sheet date and are
expected to apply when the related deferred income tax asset is realised of the deferred tax asset or
liability is settled.
47
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
2.15 Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and any accumulated
impairment losses.
When the Company acquires any plant and equipment it is stated in the accounts at its cost of
acquisition less a provision.
Depreciation is charged to write off the costs less estimated residual value of plant and equipment
on a straight basis over their estimated useful lives being:
- Office equipment
33% straight-line per annum
- Office equipment (furniture)
33% straight-line per annum
-
-
Computer equipment
33% straight-line per annum
Leasehold improvements
10% straight-line per annum
The gain or loss arising on the disposal of an asset is determined as the difference between the sale
proceeds and the carrying value of the asset, and is recognised in the income statement.
2.16 Critical accounting judgements and key sources of estimation uncertainty
The preparation of
the financial statements requires management to make estimates and
judgements and form assumptions that affects the reported amounts of the assets, liabilities,
revenue and costs during the periods presented therein, and the disclosure of contingent liabilities at
the date of the financial information. Estimates and judgements are continually evaluated and based
on management's historical experience and other factors, including future expectations and events
that are believed to be reasonable.
During the year, the Company issued warrants. The directors have applied the Black-Scholes pricing
model to assess the costs associated with the share-based payments. The Black-Scholes model is
dependent upon several
inputs where the directors must exercise their judgement, specifically:
risk-free investment rate; expected share price volatility at the time of the grant; and expected level
of redemption. The assumptions applied by the directors, and the associated costs recognised in the
financial statements are outlined note x in these financial statements.
2.17 Foreign currency
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing
at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are
denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date.
Gains and losses arising on translation in the period are included in profit or loss.
2.18 New standards, amendments and interpretations
At the date of approval of these financial statements, the following standards and interpretations
which have not been applied in these financial statements were in issue but not yet effective (and in
some cases have not yet been adopted by the UK):
Standard
Impact on initial application
Periods commencing
48
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
IAS 1
IAS 1
IAS 1
IAS 8
IAS 12
IAS 12
IFRS 16
IFRS 17
Presentation of Financial
Statements and Disclosure of
Accounting Policies
Presentation of Financial
Statements: Classification of
Liabilities as Current or
Non-current
1 January 2023
1 January 2024
Accounting policies, Changes in
Accounting Estimates and Errors –
Definition of Accounting Estimates
1 January 2023
Accounting estimates
Deferred tax arising from a single
transaction
International Tax Reform – Pillar
Two Model Rules
Lease liability in a Sale and
Leaseback
1 January 2023
1 January 2023
1 January 2023
1 January 2024
Insurance contracts
1 January 2023
The effect of these amended Standards and Interpretations which are in issue but not yet
mandatorily effective is not expected to be material.
The directors are evaluating the impact that these standards may have on the financial statements of
Company.
3.
REVENUE
including revenue from contracts with
The Company derives revenue from various sources,
customers. These revenue sources involve the transfer of goods and/or services over time and at a
point in time in the following major product lines and geographical regions.
Revenue analysed by class of business
Sponsorship revenue – over time *
Sponsorship revenue – value in kind – point in time
Guild Studios – point in time
Prize winnings – point in time
Other revenue – point in time
Year ended
30 Sep 2023
£’000
Year ended 30
Sep 2022
£’000
3,823
35
259
1,026
382
5,525
2,983
165
-
1,275
30
4,453
*2023: Sky 39% / Bitstamp 35% / Subway 16% (2022: Bitstamp 34% / Subway 50%)
49
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Revenue analysed by geographical market
UK
EMEA
USA
4.
OPERATING COSTS AND ADMINISTRATIVE EXPENDITURE
Cost of sales
Player prize money
Sponsorship direct costs
Other direct costs
Total cost of sales
Administrative costs
Directors fees and payments
Esports and content creator costs
Ambassador fees
Academy costs
Legal, professional and regulatory fees
Marketing, promotion and content production costs
Staff and operations costs
Share based payment charge
Total administrative costs
5.
AUDITORS REMUNERATION
Fees payable to the Company’s auditor for the audit of the Company
financial statements
6.
STAFF COSTS AND DIRECTORS’ EMOLUMENTS
50
Year ended
30 Sep 2023
£’000
2,079
Year ended 30
Sep 2022
£’000
655
2,479
967
5,525
2,833
965
4,453
Year ended
30 Sep 2023
£’000
Year ended
30 Sep 2022
£’000
(883)
(477)
(178)
(1,538)
(353)
(1,099)
(1,750)
(197)
(284)
(588)
(2,938)
(188)
(7,397)
(1,190)
(477)
(19)
(1,686)
(487)
(2,345)
(2,729)
(177)
(777)
(894)
(3,272)
(232)
(10,913)
Year ended 30
Sep 2023
£’000
Year ended 30
Sep 2022
£’000
34
34
28
28
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Directors’ remuneration and employee costs for the Company is set out below and as per Directors
Remuneration report.
The aggregate remuneration of employees comprised:
Wages and salaries
Social security
Pension costs
Share Based Payments
Year ended
30 Sep 2023
£’000
1,605
Year ended
30 Sep 2022
£’000
1,654
185
24
188
2,002
220
26
231-
2,131
Settlement and termination agreements during the period amounted to £15,925 (2022: £nil),
included within the totals above.
Directors’ remuneration and fees
Amounts paid in respect of departure agreement
Company pension contributions to defined contribution schemes
Year ended
30 Sep 2023
£’000
316
Year ended
30 Sep 2022
£’000
485
12
2
330
-
2
487
The highest paid director received remuneration of £137,050 (2022: £150,000) including pension
contributions of £550.
On average, including non-executive directors, the Company employed 32 staff members (2022: 36)
of which 6 were in management positions (2022: 5)
Gender Analysis as at 30th Sep 23
Directors
Senior Managers
Employees
Male
2
3
17
22
Female
2
1
10
13
51
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
7.
TAXATION
No liability to corporation taxes arise in the period.
The (charge)/credit for the year can be reconciled to the loss per the statement of comprehensive
income as follows:
The charge for year is made up as follows:
Corporation tax on the results for the year
A reconciliation of the tax charge appearing in the income statement to the
tax that would result from applying the standard rate of tax to the results
for the year is:
Loss before tax
Tax credit at the weighted average of the standard rate of corporation
tax in UK of 22% (2022: 19%)
Impact of costs disallowed for tax purposes
Unutilised tax losses carried forward
Corporation tax charge for the year
30 Sep 2023
£’000
30 Sep 2022
£’000
-
-
(4,497)
(8,748)
(989)
(1,662)
276
713
-
49
1,613
-
The Company has total carried forward losses of £24,546,749 (2022: £19,634,235) available to be
carried forward against trading profits arising in future periods. No deferred tax assets in respect of
tax losses have been recognised in the accounts because there is currently insufficient evidence of
the timing of suitable future taxable profits against which they can be recovered.
On 23 September 2022 the Chancellor announced that he has cancelled the planned corporation tax
increase and rather than rising to 25 per cent from April 2023, the rate will remain at 19 per cent for
all firms, regardless of the amount of profit made. This was subsequently reversed by the Chancellor
on 17 October 2022, confirming corporation tax increased
to 25% from April 2023.
8.
FINANCE COSTS
Finance charge on leased assets
9.
EARNINGS PER SHARE
30 Sep 2023
£’000
(243)
30 Sep 2022
£’000
(172)
(243)
(172)
The calculation of the basic and diluted earnings per share is calculated by dividing the profit or loss
for the year by the weighted average number of ordinary shares in issue during the period.
30 Sep 2023
30 Sep 2022
52
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Loss for the year from continuing operations – £’000
(4,497)
(8,748)
Weighted number of ordinary shares in issue (number)
547,596,540
518,617,362
Basic earnings per share from continuing operations – pence
(0.82)
(1.69)
There is no difference between the diluted loss per share and the basic loss per share presented due
to the loss position of the Company. Share options and warrants could potentially dilute basic
earnings per share in the future, but were not included in the calculation of diluted earnings per
share as they are anti-dilutive for the year presented. See note 20 for further details.
10.
PROPERTY, PLANT AND EQUIPMENT
2023
Cost
At 30 September 2022
Additions
Disposals
At 30 September 2023
Depreciation
At 30 September 2022
Charge for the year
Disposals
At 30 September 2023
Net book value at 30 September 2022
Net book value at 30 September 2023
2022
Cost
At 30 September 2021
Additions
Disposals
Office
Equipment
£’000
Leasehold
improvements
£’000
574
42
(14)
602
(67)
(188)
9
(246)
507
356
1,072
163
-
1,235
(27)
(112)
-
(139)
1,045
1,096
Office
Equipment
£’000
Leasehold
improvements
£’000
38
548
(12)
-
1,072
-
53
Total
£’000
1,646
205
(14)
1,837
(94)
(300)
9
(385)
1,552
1,452
Total
£’000
38
1,620
(12)
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
At 30 September 2022
574
1,072
1,646
Depreciation
At 30 September 2021
Charge for the year
Disposals
At 30 September 2022
Net book value at 30 September 2021
Net book value at 30 September 2022
(8)
(65)
6
(67)
30
507
-
(27)
-
(27)
-
1,045
(8)
(92)
6
(94)
30
1,552
11.
INTANGIBLE ASSETS
2023
Cost
At 30 September 2022
Additions
At 30 September 2023
Amortisation & impairment
At 30 September 2022
Charge for the year
At 30 September 2023
Carrying amount
As at 30 September 2022
As at 30 September 2023
2022
Website costs
£’000
Total
£’000
280
-
280
Website costs
£’000
(60)
(90)
(150)
280
-
280
Total
£’000
(60)
(90)
(150)
220
130
220
130
Website costs
£’000
Total
£’000
54
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Cost
At 30 September 2021
Additions
At 30 September 2022
Amortisation & impairment
At 30 September 2021
Charge for the year
At 30 September 2022
Carrying amount
As at 30 September 2021
As at 30 September 2022
12.
LEASES
The Company had the following lease assets and liabilities:
Right of use asset
Properties
Equipment
Lease liabilities
Current
Non-current
74
206
280
74
206
280
Website costs
£’000
Total
£’000
(24)
(36)
(60)
50
220
(24)
(36)
(60)
50
220
30 Sep 2023
£’000
30 Sep 2022
£'000
2,688
358
3,046
421
2,781
3,202
3,010
447
3,457
259
3,204
3,463
Total cash outflow in relation to leases for the year was £523,317 (2022: £49,270)
55
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Right of use assets
A reconciliation of the carrying amount of the right-of-use asset is as follows:
Right of use assets
Properties
Opening balance
Additions in period
Depreciation
Equipment
Opening balance
Additions in period
Depreciation
TOTAL
Lease liabilities
30 Sep 2023
£’000
30 Sep 2022
£'000
3010
9
(331)
2,688
447
33
(122)
358
3,046
-
3,284
(274)
3,010
-
477
(30)
447
3,457
A reconciliation of the carrying amount of the lease liabilities is as follows:
Lease liabilities
Opening balance
Additions in period
Payment made
Finance charge
Maturity on lease liabilities
Current
Due between 1-2 years
Due between 2-5 years
Due beyond 5 years
30 Sep 2023
£’000
3,463
42
(523)
220
3,202
30 Sep 2022
£'000
-
3,356
(50)
157
3,463
30 Sep 2023
£’000
Sep 2022
£'000
616
584
1,076
1,854
4,130
519
598
1,267
2,232
4,616
56
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
The Company also incurred expenses during the year of £76,785 (2022: £25,735) which related to
leases that were either short term in nature (12 months of less) or of low value in nature (less than
£2,000 per annum), thus being excluded from treatment under IFRS 16: Leases.
13. OTHER RECEIVABLES
Rental deposit - property
14.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents
15.
TRADE AND OTHER RECEIVABLES
Trade receivables
Accrued revenue
VAT recoverable
Prepayments
Other receivables
16.
TRADE AND OTHER PAYABLES
Trade payables
Accruals
Social security and other taxation
Other payables
57
30 Sep 2023
£’000
143
30 Sep 2022
£’000
143
143
143
30 Sep 2023
£’000
459
30 Sep 2022
£’000
2,730
459
2,730
30 Sep 2023
£’000
187
25
-
107
1
320
30 Sep 2022
£’000
1,375
88
660
1,870
56
4,049
30 Sep 2023
£’000
1,102
30 Sep 2022
£’000
3,150
337
81
6
242
-
9
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
17.
DEFERRED REVENUE
Arising from sponsorship income
1,526
3,401
30 Sep 2023
£’000
707
30 Sep 2022
£’000
1,406
707
1,406
All deferred revenues are expected to be recognised within 12 months from the reporting date.
18.
PROVISIONS
2023
At 1 October 2022
Unwinding of discount
At 30 September 2023
As at 30 September 2022
As at 30 September 2023
2022
At 1 October 2021
On acquisition of lease
Unwinding of discount
At 30 September 2022
As at 30 September 2021
As at 30 September 2022
Leasehold
dilapidation
£’000
Total
£’000
323
23
346
323
346
-
307
16
323
-
323
323
23
346
323
346
-
307
16
323
-
323
The Company is required to restore the leased premises to their original condition at the end of the
lease term. A provision has been recognised for the present value of the estimated expenditure
required to remove any leasehold improvements. The costs of the leasehold improvements have
been capitalised as part of the cost of the right of use asset and are amortised over the shorter of the
term of the lease and the useful life of the assets.
58
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
19.
SHARE CAPITAL
Issued and fully paid ordinary shares with a nominal value of 0.1p
Number of shares
Nominal value (£’000)
Change in issued Share Capital and Share Premium:
30 Sep 2023
£’000
30 Sep 2022
£’000
622,317,362
518,617,362
622
519
Ordinary shares
Balance at 1 October 2022
Share issue1
Balance at 30 September 2023
Number of
shares
518,617,362
103,700,000
622,317,362
Share
capital
£’000
519
103
622
Share
premium
£’000
22,644
417
Total
£’000
23,163
520
23,061
23,683
1 In June 2023 the Company completed a £622,200 fundraise, before direct costs, by way of a share
placing and subscription for 103,700,000 new ordinary shares at a price of £0.006 per share. The
placement was supported by new and existing investors, as well as by the Company’s directors and
executive management. The directors subscribed for an aggregate total of 15,833,333 of these new
ordinary shares at £0.006 per share representing a total contribution of £95,000.
20.
SHARE BASED PAYMENTS
Balance as at 1 October 2022
Warrants issued in the period1
Warrants lapsed/expired during the period
Balance as at 30 September 2023
£’000
650
191
(3)
838
1 On 1 November 2022 the Company granted 14,750,000 warrants to staff and contractors. The
warrants have an expiry date of 5 years from the date of agreement and an exercise price of 1.4
pence. The warrants vest 50% 6 months after the agreement and the remaining 50% 18 months
after the agreement. Agreements for 11,250,000 of these warrants include exercise conditions such
that a valid services agreement must be in place at time of exercise. The remaining agreements have
no exercise conditions.
On 20 June 2023 the Company granted 50,350,000 warrants to staff and directors. The warrants
have an expiry date of 5 years from the date of agreement and an exercise price of 0.67 pence.
59
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Warrants for non executive directors vest immediately and have no exercise conditions. Warrants for
executive directors vest over 3 years, warrants for senior management vest over 2 years, and
warrants for the remaining staff vest over 1 year. These warrants all require a services agreement to
be in place on exercise date.
The estimated fair values of options which fall under IFRS 2, and the inputs used in the Black-Scholes
pricing model to calculate those fair values are as follows:
Date of grant
Number of
warrants
Share
price
Exercise
price
Expected
volatility
Expected
life
Risk free
rate
Expected
dividends
1 November 2022
14,750,000
£0.0165
£0.014
31.16%
20 June 2023
50,350,000
£0.0067
£0.0067
78.29%
5
5
3.43%
0.00%
4.60%
0.00%
The following warrants over ordinary shares have been granted by the Company and are
outstanding:
Grant
date
18-Feb-20
Expiry period
Exercise
price
24 months from the first anniversary
of admission
13-Mar-20
36 months from the first vesting date
18-Jun-20
36 months from the first vesting date
19-Jun-20
5 years from issue
29-Jun-20
36 months from the first vesting date
07-Jul-20
36 months from the first vesting date
07-Aug-20
36 months from the first vesting date
14-Aug-20
36 months from the first vesting date
17-Aug-20
36 months from the first vesting date
20-Aug-20
36 months from the first vesting date
28-Aug-20
36 months from the first vesting date
02-Oct-20
5 years from issue
27-Sep-22
5 years from grant
01-Nov-22
5 years from agreement
20-Jun-23
5 years from agreement
£0.01
£0.01
£0.06
£0.06
£0.06
£0.06
£0.06
£0.06
£0.06
£0.06
£0.06
£0.10
£0.027
£0.014
£0.0067
60
Outstanding at 30
September 2023
3,250,000
Exercisable at
30 September
2023
3,250,000
75,000
75,000
1,666,666
1,666,666
6,963,000
6,963,000
250,000
225,000
500,000
750,000
1,000,000
1,000,000
150,000
20,584,694
25,930,868
14,750,000
50,350,000
166,667
150,000
333,333
500,000
666,667
666,667
100,000
20,584,694
25,930,868
7,375,000
20,000,000
127,445,228
88,428,562
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
Outstanding at the beginning of the year
Lapsed during the year (warrants)
Vested during the year
Issued during the year
Outstanding at the end of the year
Exercisable at the end of the year
21.
FINANCIAL RISK MANAGEMENT
As at 30 Sep 2023
Weighted average
exercise price
Number of options
5.8p
2.2p
0.9p
0.8p
3.3p
4.3p
62,845,228
(1,350,000)
27,375,000
65,100,000
126,595,228
88,003,562
Equity instruments issued by the Company are recorded at the proceeds received, net of transaction
costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer
at the discretion of the Company. Incremental costs directly attributable to the issue of new shares
or options are shown in equity as a deduction, net of tax, from the proceeds.
Financial risk factors
The Company’s activities expose it to a variety of financial risks: market risk (price risk), credit risk
and liquidity risk. The Company’s overall risk management programme seeks to minimise potential
adverse effects on the Company’s financial performance. The Company has no borrowings but is
exposed to market risk in terms of foreign exchange risk. Risk management is undertaken by the
board of directors.
Market risk - price risk
The Company is exposed to price risk primarily for the costs of operating in the Esports industry.
Credit risk
No credit risk arises from outstanding receivables, which stood at £187k at period close (see note
15). Management does not expect any losses from non-performance of these receivables. The
amount of exposure to any individual counter party is subject to a limit, which is assessed by the
board. The Company considers the credit ratings of banks in which it holds funds in order to limit risk
of loss of assets.
Liquidity risk
Liquidity risk arises from the Company’s management of working capital. It is the risk that the
Company will encounter difficulty in meeting its financial obligations as they fall due. Controls over
expenditure are carefully managed, in order to maintain its cash reserves.
Capital risk management
The Company’s objectives when managing capital is to safeguard the Company’s ability to continue
as a going concern, in order to provide returns for shareholders and benefits for other stakeholders,
61
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
and to maintain an optimal capital structure. The Company has no borrowings. In order to maintain
or adjust the capital structure, the Company may adjust the amount of dividends paid to
shareholders.
22.
FINANCIAL ASSETS AND FINANCIAL LIABILITIES
30 Sep 2023
Financial assets / liabilities
Trade and other receivables
Cash and cash equivalents
Trade and other payables
Lease liabilities (current)
30 Sep 2022
Financial assets / liabilities
Trade and other receivables
Cash and cash equivalents
Trade and other payables
Lease liabilities (current)
Financial assets
at amortised cost
Financial
liabilities at
amortised cost
£’000
188
459
-
-
647
£’000
-
-
(1,174)
(3,202)
(4,376)
Financial assets
at amortised cost
Financial
liabilities at
amortised cost
£’000
1,574
2,730
-
-
4,304
£’000
-
-
(3,159)
(3,463)
(6,622)
Total
£’000
188
459
(1,174)
(3,202)
(3,729)
Total
£’000
1,574
2,730
(3,159)
(3,463)
(2,318)
23.
CAPITAL COMMITMENTS & CONTINGENT LIABILITIES
Rental lease agreement
The Company signed a 10 year lease beginning on 22 November 2021. The Company had a rent free
period from signing until 1 December 2022 and a break clause after five years. There is a further 13
month rent free period available following the break date. Rental payments commenced on 1
December 2022 and there are committed cashflows of £570,000 (including VAT) due in the 12 month
period from October 2023. Maturity on these liabilities can been referenced at Note 12.
There were no contingent liabilities at 30 September 2023.
62
Guild Esports plc – Company Number 12187837
NOTES TO THE FINANCIAL STATEMENTS
FOR YEAR ENDED 30 SEPTEMBER 2023
24.
RELATED PARTY TRANSACTIONS
On 17 November 2022, Jocelin Caldwell was appointed as a Director of the Company. Reimagine
Work Ltd, a company incorporated in Canada is controlled by Ms Caldwell and provided HR
consultancy and recruitment services to Guild Esports plc from May 2022 until April 2023. During
the period from 17 November 2022, the Company paid Reimagine Work Ltd HR consultancy and
recruitment fees and expenses totalling £195,805.
25.
EVENTS SUBSEQUENT TO PERIOD END
Fundraise
In November 2023, the Company completed a £580,000 fundraise by way of a share placing and
subscription for 116,000,000 new ordinary shares at a price of £0.005 per share. The placement was
supported by new and existing investors,
including the Company’s directors and executive
The directors and executive management subscribed for an aggregate total of
management.
6,000,000 of these new ordinary shares at £0.005 per share representing a total contribution of
£30,000.
Following the fundraise, 00 Nation AS held 100,000,000 ordinary shares, representing 13.5% of the
enlarged share capital.
26.
CONTROL
In the opinion of the Directors as at the year end and the date of these financial statements there is
no single ultimate controlling party.
63