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UK developer Frontier is planning to lay off an unknown number of employees as it conducts an organisational review of its business.
The news was announced to investors this morning as part of a trading update, in which the company said it plans to “refocus on its core strengths following a period of disappointing financial performance and more challenging industry conditions.”
The organisational review aims to “reshape Frontier” around this strategy, return the company to profitability and shore up of the business for the future.
One of the key objectives is to reduce annual operating costs by up to 20%, which Frontier says it will achieve by spending cuts, a freeze on recruitment, and an unknown number of redundancies following a consultation period.
The review and any resulting actions are expected to conclude by early 2024, with an update planned to be released alongside Frontier’s financial results in January.
The company’s most recent financial results, published in September, show revenues dropping 8% to £104.6 million for the full year ended May 31, with an operating loss of £26.6 million compared to an operating profit of £1.5 million the year before.
Among the factors behind this decline was the ongoing struggles of the F1 Manager series, with this year’s entry delivering lower than expected sales at launch. There was also an impact from the closure of Foundry, Frontier’s publishing operations, following a reassement of this venture.
Frontier said its existing game portfolio “continues to perform in line with expectations” and is optimistic about its upcoming release Warhammer Age of Sigmar: Realms of Ruin, which debuts on November 17.
The company added: “The Board remains comfortable with market expectations for FY24, with consensus revenue at £108 million and consensus Adjusted EBITDA loss of £9 million. The cost reductions from the Organisational Review are expected to be fully effective for FY25.”
