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This announcement is an advertisement that is being published in connection with the admission of the Company's issued, and to be issued ordinary share capital, to the standard segment of the Official List and to trading on the London Stock Exchange PLC's Main Market for listed securities ("Admission") in respect of which the Company has published a prospectus dated 20 March 2023 which is available from https://worldchess.com/us/investors ("Prospectus"). This announcement is not and does not constitute or form part of, and should not be construed as, an offer of securities for subscription or sale in any jurisdiction nor a solicitation of any offer to buy or subscribe for, any securities in any jurisdiction, nor shall it or any part of it, or the fact of its distribution, form the basis of or be relied on in connection with, any contract or commitment whatsoever. This announcement does not constitute a recommendation regarding any securities. Prospective investors should not subscribe for or purchase any securities on the basis of this announcement.  Investors may invest in the Company's securities solely on the basis of the information in the Prospectus (together with any supplementary prospectus, if relevant,) including the risk factors set out therein, provided that (i) they are not subject to the laws of a jurisdiction in which the release, distribution, publication, directly or indirectly, in whole or in part of this announcement or the Prospectus might constitute a violation of the relevant laws or regulations of such jurisdiction and (ii) their subscription will not place the Company in breach of the laws of the jurisdiction that apply to the prospective investor.

06 April 2023

World Chess Plc

("World Chess" or the "Company" or the "Group")

Admission to trading on the Main Market of the London Stock Exchange

World Chess Plc (LSE: CHSS) is pleased to announce that its entire ordinary share capital will be admitted to the Official List (by way of Standard Listing under Chapter 14 of the Listing Rules) and to trading on the London Stock Exchange's Main Market for listed securities ("Admission") today at 08:00 AM under the ticker "CHSS".

As part of the Admission, the Company has completed a subscription and retail offer (together the "Fundraise") of new ordinary shares, raising gross proceeds of £3.04 million. On Admission, the Company will have a market capitalisation of approximately £41.7 million.

Advisers to the Company include Novum Securities (financial adviser), Marriott Harrison (UK lawyers) and PKF Littlejohn (reporting accountants), whilst the offer of new Ordinary Shares to retail investors was supported by the PrimaryBid platform.

Statistics

Highlights

·    World Chess owns the exclusive rights to the official online chess gaming platform, FIDE Online Arena. The Company has taken chess into the mass market through its new commercial approach to chess competitions, with an innovative approach introducing new products and concepts into the sport.

·   With its experienced management team with extensive experience working in the chess industry, the Company has developed a blend of revenue streams, with 44% of revenues generated through its online playing platform, 28% through events and 28% through its chess clubs and merchandise. 

·    Audited full-year 2021 revenue grew by 28% to €3.22 million while unaudited revenue for the half-year 2022 grew by 120% to €1.98 million.

·    The Company has built a proprietary Fair Play Suite, a complex of anti-cheating tools that allow tracking and identification of fair play violations and also holds the rights to grant paid access to the official ratings and titles to third-party platforms.

·    World Chess is growing brand awareness across multiple markets and has established a presence in key international locations, holding major events in the US, Germany, the UK and UAE.

·   The new funds raised will be used to support the Company's growth strategy, including the further development of the World Chess online playing platform and marketing initiatives.

Ilya Merenzon, Chief Executive Officer of World Chess, said:

"The completion of our IPO comes at an exciting time for chess. The number of players and spectators of the sport is growing and with this new commercial opportunities are opening up. Using our public profile and position as a public company, we are well-placed to capitalise on these opportunities and grow World Chess.

"In an age when people feel disconnected and fear the dumbing down of the global conversation, the sport of chess offers a challenging and engaging way for people across the world to connect and inspire each other. In our view, there is no rival to the intellectual challenge of chess. Whether people play the game online or at our club, watch the tournaments or enjoy following their favourite chess player, our unique ecosystem of products and services is making chess more accessible and widely available at a global level."

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

For more information please visit wordchess.com/us/investors or contact:

Notes to Editors

About World Chess Plc

World Chess Plc was established in January 2017 together with the key operational company of the group World Chess Events Limited (UK). World Chess Plc subsequently acquired World Chess US, Inc. (USA) and World Chess Rus LLC (RUS), two companies that participated in the World Chess project prior to the registration of the holding. These acquisitions took place respectively in 2017 and 2018. World Chess Digital Limited (Hong Kong) was acquired in June 2019 and later ceased its operations following the transfer of its business out of the UK operational entity.

In October 2021, World Chess Europe GmbH was established in Germany to address the Brexit bureaucratic complexities. In 2022 following the Russian invasion of Ukraine, World Chess relocated all its business activities out of Russia, selling all its Russian assets and with all Russian staff relocated. The Company incorporated World Chess Sakartvelo Limited in Tbilisi (Georgia) to continue its projects in the Eastern region. All of the companies listed above, with the exception of World Chess Rus LLC which has been sold, are 100% owned by World Chess Plc.

Whilst the Company was incorporated as a holding company in 2017, the origins of the World Chess project, and first activities, date back to 2012. The relationship with FIDE commenced in 2012 with which Ilya Merenzon and other core members of the current team were involved.

Business Model

Currently, the World Chess eco-system develops and commercialises chess on a global level using product verticals that fit into seven categories:

1.    Online Platform

The World Chess online platform offers multiple opportunities for chess players to interact and develop through chess gaming, educational and news content, and broadcasting of offline chess events. The platform incorporates the official FIDE online gaming, FIDE Online Arena (FOA), and is the only place for chess players across the globe to obtain online ratings and titles recognized by FIDE. It also allows players to participate in online-rated tournaments. 

The global online chess market remains relatively undeveloped as a share of the estimated 600 million adult players globally*, but monthly traffic to chess websites grew by as much as 75% at the end of H1 of 2020 compared to the end of 2019**. Chess gaming has also seen strong growth on Twitch.com, a global streaming platform, where broadcast hours of chess increased by 150% in the past year. 

*A 2012 study by YouGov indicated that more than 600 million adults play chess regularly, and at least 70% of the adult population of countries including US, UK, Germany, Russia, and India have played chess at some point during their lives.

**Playmagnus Annual Report of 2019

2.    Tournaments

World Chess organised three World Chess Championship cycles, including FIDE Championship Matches in New York and London.

Recent changes in the sport have encouraged new forms of chess events and the Company intends to continue developing its own events which will not be bound by the limitations of official events. World Chess has developed a signature format, Armageddon, that is fast paced yet organised according to conventional chess rules and regulations.

3.    Merchandise

World Chess develops and sells official World Chess merchandise, including the official World Chess Championship Chess Set designed by Pentagram. The chess sets cover a range of price points from US$32 to US$639, all based on the official and patented design.

4.    World Chess Clubs

In 2022 a new chess club, called World Chess Club Berlin, will open in Berlin to act as a central European hub for World Chess activities. The new venue will feature opportunities to host amateur and top-level tournaments all year round. The venue already hosted FIDE Grand Prix in 2022. It is the Director's intention to open further chess clubs in major cities in due course.

5.    Sponsorship

Sponsorship has been the main source of revenue for the Group since its inception.  Initially, sponsorship was linked to events organised by World Chess, however more recently the Group has expanded its sponsorship opportunities to the online platform.

World Chess has a growing portfolio of long-term and repeat event sponsors including, but not limited to,  Algorand, Unibet, Mercedes Benz and BMW. These relationships, coupled with the growing media and online interest in World Chess have enabled the Group to raise amounts ranging from €10,000 to over €1,000,000 per sponsor often with multi-year arrangements.  

6.    Media

World Chess has developed a brand that is recognisable, appealing, and represents a younger, more image conscious side of the global chess community. This brand has grown through broadcasting, media partners, and a continued strong social media presence. The Armageddon series, a series  established and developed by World Chess, has also helped to increase awareness of the World Chess brand.

7.    Talent

The Group has established Chess & Co, an agency to partner brands with individual chess players. Chess & Co. has been created in response to corporate interest in partnering their brands with individual chess players. Unlike other major sports, very few chess players are able to support themselves to become professionals and the chess community remains largely self-funded.

The Directors believe there are significant opportunities in partnering players with brands, utilising the reputation of World Chess and leveraging the pre-existing relationships of World Chess.