A rumour arose this weekend, suggesting that Cloud Imperium was facing some financial issues. It appears however that this rumour was false, as Cloud Imperium has issued an official statement about this whole thing.
According to the statement, Cloud Imperium has partnered with a highly regarded, very selective, and specialized UK bank, Coutts, in order to obtain a regular advance against its monthly tax rebates that are payable by the UK Government in the fall of the next following year when Cloud Imperium files its tax returns. As the team noted, this will allow it to avoid converting unnecessarily other currencies into GBP.
Keep in mind that Brexit is right around the corner. Cloud Imperium is based in UK and since no one knows what will happen with the currencies once UK leaves EU, Cloud Imperium appears to be trying to save some money.
In other words, Cloud Imperium will take a loan to obtain money from a UK tax rebate for game companies early. Cloud Imperium will take the loan money now and when the tax rebate comes in, it will go to the bank. The catch here is that Cloud Imperium will pay in GBP. As such, and given the fact that its collections are mostly in USD and EUR, if GBP drops below current currency levels, Cloud Imperium will pay less. And to be honest, that’s a really smart business move.
Here is the full statement:
“Our UK companies are entitled to a Government Game tax credit rebate which we earn every month on the Squadron 42 development. These rebates are payable by the UK Government in the fall of the next following year when we file our tax returns. Foundry 42 and its parent company Cloud Imperium Games UK Ltd. have elected to partner with Coutts, a highly regarded, very selective, and specialized UK banking institution, to obtain a regular advance against this rebate, which will allow us to avoid converting unnecessarily other currencies into GBP. We obviously incur a significant part of our expenditures in GBP while our collections are mostly in USD and EUR. Given today’s low interest rates versus the ongoing and uncertain currency fluctuations, this is simply a smart money management move, which we implemented upon recommendation of our financial advisors.”