After two and a half years in the Australia market, the major shareholders of Gfinity Esports Australia – HT&E Limited and Gfinity PLC of the UK – have announced the business will cease operations in late November 2019. The decision was taken following a strategic review by Gfinity’s UK leadership to “refocus the business on core markets to drive sustainable profit growth and long-term value creation”.
Despite the building of Australia’s premier custom made esports arena in partnership with the Hoyts cinema chain, the launch of the Gfinity Elite Series Australia and record Australian esports sponsorship revenue, the esports market in Australia has not developed to the level forecast when the company was launched in 2017.
“We would like to thank all our stakeholders and the Australian esports community for their support over the last few years. This is a very difficult announcement for all our staff. We will continue to meet our obligations to our existing partners, including Supercars with the upcoming Gfinity Supercars Eseries, and deliver outstanding events until we close later this year,” Dominic Remond, Chief Executive Officer of Gfinity Esports Australia said.
Ciaran Davis, Chief Executive of HT&E said: “Esports remains an exciting industry with significant global interest and activity and HT&E believes it will become a mainstream and significant content-audience-commercial medium in the long term. But, our absolute focus is on our core radio business and the economics of esports in the Australian market are yet to deliver sustainable, positive earnings. It is critical our investments deliver value for shareholders and with esports there is no certainty on when a positive contribution might be achieved.”
Garry Cook, Executive Chairman, Gfinity plc said: “The decision to close the business was not taken lightly. Our team and all key stakeholders are all pioneers in building a market leading, competitive gaming operation in Australia and I would like to thank them for their commitment and dedication.”
All costs relating to Gfinity’s investment in the joint venture have been expensed as incurred. As a result, no material financial write off will be required.
Following the review of its business, Gfinity PLC has taken the decision to prioritise resources and allocate capital to other key business areas and markets where there are clear and significant growth opportunities. The Company says it will continue to expand into the US market, with further investment into proprietary and industry leading technology infrastructure. The Company will also continue to invest in its community building activities.
The home of the Hoyts/Gfinity eSports arena – the Entertainment Quarter in the Sydney suburb of Moore Park – is scheduled for renovations. It is understood Hoyts will re-convert the space back into use as a cinema.