Ten Square Games Sa · GPW:TEN
Ten Square Games Sa — Q4 2022 Earnings Presentation
32 slides from Ten Square Games Sa's earnings presentation, Mar 29, 2023
Slide 1: Q4 2022 Results
04 2022 RESULTS | March 29th, 2023
Slide 2: Q4 2022 Highlights
O04 2022 HIGHLIGHTS
Slide 3: Stable Q3/Q4 performance
Stable Q3/Q4 Focus on current 1 2 Performance drivers 3 User acquisition 4 products and new games performance +1% Addition of monetization Q3’22 / Q4’22 Bookings of bookings features, competitive Challenges: q-o-q and social components PLN PLN 137.5M +1% q-o-q 138.6M +6% • Post IDFA market environme
Slide 4: Performance Update
PERFORMANCE UPDATE
Slide 5: Fishing Clash performance
Fishing Clash performance Access to the game 35 blocked to Russian and Belarus players Bookings and marketing expenses (PLN M, excl. FC China) Bookings Marketing expenses 30 2023 25 20 32.4 32.7 31.9 15 29.5 30.0 28.8 30.1 29.0 28.2 M PLN 27.8 27.4 24.4 24.9 25.3 22.2 10 5 7.4 7.0 7.0 6.2 6.3 4.9 3.
Slide 6: Hunting Clash performance
Hunting Clash performance 14 Decision to block access to the game Bookings and marketing expenses (PLN M) Bookings Marketing expenses to Russian and Belarus players 2023 12 10 8 6 11.5 11.4 11.9 11.4 11.3 M PLN 11.1 10.7 11.1 10.5 10.2 9.7 9.4 8.5 8.4 4 8.0 5.8 5.6 5.3 4.8 4.8 2 3.5 4.0 3.9 4.0 3.4
Slide 7: Rortos performance
Rortos performance Rortos gross revenue (PLN k) 2023 5 000 4 935 4 894 4 500 1 +29% q-o-q growth of bookings in Rortos in Q4’22 4 509 4 304 4 000 4 110 4 091 Wings of Heroes and RFS were the main drivers of 3 500 3 687 2 Rortos’ growth in Q4’22 supported by increased 3 438 marketing for Wings of Her
Slide 8: TSG in new market segment with growth prospects
TSG in new market segment with growth prospects 100% 90% 80% X-Plane 10 Flight Simulator Wings of Steel 70% Sky Warriors: Blazing Clouds Sky Combat: war planes simulator PVP 60% Modern Warplanes 50% Metalstorm Infinite Flight 40% Flight Pilot Simulator 3D aerofly FS 30% 17% Wings of Heroes Airline C
Slide 9: Wings of Heroes: performance after global launch
Wings of Heroes: performance after global launch Bookings and Marketing expenses (PLN M) 2.5 2023 2 1.5 1 2.2 2.0 2.0 1.8 1.5 1.5 1.5 0.5 0.3 1.2 1.0 1.2 0 0 0.1 0.1 0.1 0.1 0.2 0.1 0.2 0.6 0.6 0 May'22 Jun'22 Jul'22 Aug'22 Sept'22 Oct'22 Nov'22 Dec'22 Jan'23 Feb'23 Mar'23 Bookings Marketing expense
Slide 10: Production Pipeline
PRODUCTION PIPELINE • Marketing tests of the game resulted in • Game addressing more casual audience KPIs below expectations thus the than Clash games. introduction of changes in the game. • February KPIs supporting further • Another round of tests will be development of the game and bringing perfor
Slide 11: Production Pipeline – Social Wars IP
PRODUCTION PIPELINE – Social Wars IP Gamesture gross revenue (PLN k) 2 200 2023 2 000 2 089 2 023 1 970 1 800 1 903 1 854 • Gamesture has developed strong Social Wars 1 776 1 773 1 705 1 600 IP, that may be low-cost transferable into 1 533 1 400 other themes. 1 388 1 476 1 363 • Monthly revenue grow
Slide 12: Financial Results
FINANCIAL RESULTS
Slide 13: Profit and loss dynamics
Profit and loss dynamics M PLN Q1’22 Q2’22 Q3’22 Q4’22 2022 1• Stable bookings in Q4’22 Revenues from sales 150.3 126.6 132.9 131.2 538.6 driven mainly by good performance of Hunting Clash, 1 Bookings 142.6 123.5 137.5 138.6 542.2 Wings of Heroes, Real Flight Gross profit on sales 134.5 106.5 115.7
Slide 14: Breakdown of bookings
Breakdown of bookings Bookings PLN M Bookings breakdown – geographies and products in 2022 Total 50 49 48 45 44 38 43 46 48 45 48 45 46 6% 12% North America 40 45% Europe Asia 33 30 Others 33 32 27 38% 28 28 29 30 30 30 29 25 Bookings breakdown – 20 2022 5% 6% Fishing Clash 11 Hunting Clash 12 11 10
Slide 15: Cash flow generation with a strong cash pool
Cash flow generation with a strong cash pool M PLN Q1’22 Q2’22 Q3’22 Q4’22 Adjusted EBITDA 42.1 28.4 35.0 35.3 Net Cash Flows from Operating Activities 53.4 30.6 31.7 22.3 Net Cash Flows from Investing Activities (23.7) (15.4) (8.0) (8.4) • Cash balance of approx. PLN 127m Net Cash Flows from Financ
Slide 16: Current Focus
CURRENT FOCUS
Slide 17: Current focus
Current focus PORTFOLIO PERFORMANCE Focus on the growth of current portfolio: Fishing Clash, Hunting Clash, Wings of Heroes PIPELINE Focus on finishing projects in development: Fishing Masters and Undead Clash POST MERGER INTEGRATION AND M&A Focus on integration and value unlocking of the acquired p
Slide 18: Investor's Calendar
INVESTOR’S CALENDAR
Slide 19: Investor's calendar
Investor’s calendar Company news flow: • Q1 2023 Sales Update: early April 2023 • Q1 2023 Financial report: 22 May 2023 • Strategic Update: together with Q1 2023 Financial results presentation Market conferences: • 1st, June - 7th edition of Future in CEE - ERSTE Consumer & Technology Conference • 6
Slide 20: Q&A Session
O&A SESSION
Slide 21: Contact details
Contact details: Nina Graboś – IR & PR Director nina.grabos@tensquaregames.com
Slide 22: Backup
BACKUP
Slide 23: Portfolio diversification
Portfolio diversification Bookings’ structure (%) Q1’22 Q2’22 Q3’22 Q4’22 5% 6% 5% 6% 4% 5% 7% 9% 23% 20% 24% 23% 63% 65% 67% 68% Fishing Clash Hunting Clash Rortos Other MJ 23
Slide 24: TSG's 2022 quarterly results
TSG’s 2022 quarterly results Bookings Adj. EBITDA 145 45 40 Outbreak of war in 140 Ukraine Outbreak of war in Ukraine 35 135 30 130 25 PLN M PLN M 143 42 20 125 138 139 35 35 15 28 120 10 124 115 5 110 0 1Q22 2Q22 3Q22 4Q22 1Q22 2Q22 3Q22 4Q22 24
Slide 25: Profit and loss report
Profit and loss report Selected positions in k PLN 2020 Q1’21 Q2’21 Q3’21 Q4’21 2021 Q1’22 Q2’22 Q3’22 Q4’22 2022 Revenues from sales 578,195 174,114 164,885 147,951 147,095 634,045 150,335 124,143 132,913 131,167 538,558 Fishing Clash 562,335 131,659 114,983 114,371 121,868 482,882 95,827 84,385 88
Slide 26: Balance sheet
Balance sheet Selected positions in k PLN Q1’20 Q2’20 Q3’20 Q4’20 Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 Q2’22 Q3’22 Q4’22 ASSETS Fixed assets 11,215 11,604 14,395 16,101 19,091 23,994 291,171 298,866 320,497 326,192 340,728 314,138 Receivables 34,447 58,724 57,205 47,589 57,331 45,946 50,624 62,041 38,709 3
Slide 27: Cash flow report
Cash flow report Selected positions in k PLN Q1’20 Q2’20 Q3’20 Q4’20 Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 Q2’22 Q3’22 Q4’22 OPERATING ACTIVITIES Profit/loss before tax 39,192 28,814 65,849 37,091 58,432 37,034 31,291 35,225 30,975 18,289 20,860 (6,685) Total adjustments -7,735 -6,675 2,220 49,366 5,172 22,
Slide 28: Method of determining adjusted EBITDA
Method of determining adjusted EBITDA Selected items of the Profit and Loss Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 Q2’22 Q3’22 Q4’22 Statement in k PLN Operating profit IFRS 55,919 38,696 31,192 40,413 29,392 17,444 21,636 4,220 Amortisation +941 +978 +3,305 +2,360 +2,742 +3,725 +3,414 +5,977 Write-down for
Slide 29: General administrative costs and one-offs
General administrative costs and one-offs General administrative costs (PLN k) Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 Q2’22 Q3’22 Q4’22 One-off costs MSOP 7,291 7,294 7,294 9,361 11,305 761 6,033 5,930 M&A 0 0 3,669 18 1,760 3 1 -3 Croatia costs 0 0 2,054 0 0 0 0 0 Normal costs Salaries 1,872 3,097 2,284 4,1
Slide 30: Accounting principles for revenues – IFRS 15
Accounting principles for revenues – IFRS 15 Virtual currency • Payment -> a player purchases virtual currency Payment Sales revenue • Revenue -> the player uses the virtual currency to purchase a +/ - virtual goods (e.g. rods, lure packs) Deferred revenue/ Unearned revenue • Deferred revenue -> unu
Slide 31: Marketing expenses policy
Marketing expenses policy Marketing expenses „We invest in marketing provided we get positive returns throughout user lifetime” Marketing expenses model cumulative approach • The Group invests in marketing at point „0”. Cohort acquired in this period analyzed throughout user lifetime (period „0” to
Slide 32: Legal disclaimer
Legal disclaimer • Neither this presentation (the “Presentation”, references to which shall be deemed to include any information which has been or may be supplied in writing or orally in connection herewith or in connection with any further enquiries) nor any copy of it nor the information contained