)
After recently announcing an $8.2 million capital raise that its CEO described as demonstrating "strong belief" in its people, one of Australia's largest independent game developers Mighty Kingdom (ASX: MKL) is letting go 28 per cent of its workforce in pursuit of profitability.
The Adelaide-based company has recently undergone a shareholder overhaul with an enormous level of dilution to secure the funding needed to stay afloat, bringing in fresh investments from gaming industry veterans who have been or are currently affiliated with such names as Activision Blizzard King and Animoca Brands.
At the same time the company's former CEO Shane Yeend, whose business Gamestar became involved with Mighty Kingdom less than two years ago as part of a restructure, is canvassing for interest in a class action against the company for allegedly "burning what must be today close to $40 million with nothing to show for it".
Mighty Kingdom announced this morning it had completed an initial operational review and organisational restructure, aimed at optimising the gaming operations for profitability while streamlining the organisational structure.
The company has declined requests to clarify approximately how many staff would lose their jobs, but has announced estimated annualised cost savings of around $2.1 million. In FY23 its payments to suppliers and employees stood at more than $17 million.
Mighty Kingdom claims the revised structure will ensure it can continue to execute on existing projects with key partners whilst providing flexibility to build and scale as new opportunities are secured.
"These decisions are exceptionally difficult but one we have been forced to make to ensure the future sustainability of the company," says Mighty Kingdom's new CEO David Yin, a former Google Play exec.
"We understand the impact these decisions have on the individuals impacted and we will be looking to support them as best as possible.
"We need to be diligent in making the necessary decisions to deploy our existing capital effectively to grow the company. I want to take the opportunity to thank all staff who have worked through a very difficult period, and I look forward to a more sustainable future."
Founded in 2010 by Phil Mayes, who stepped aside in 2023 to make for Yeend who then resigned after just four months, Mighty Kingdom has worked with top tier entertainment and gaming companies to release more than 50 games including Shopkins, LEGO Friends: Heartlake Rush, Gabby’s Dollhouse, Wild Life and Ava’s Manor.
Enjoyed this article?
Don't miss out on the knowledge and insights to be gained from our daily news and features.
Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.
Support independent journalism and stay informed with stories that matter to you.
)
)
)
)
)
