Slide 1: 2015 Interim Results
Slide 2: Disclaimer
Disclaimer This presentation and the accompanying slides (the “Presentation”) which have been prepared by IGG INC (the “Company”) do not constitute any offer or invitation to purchase or subscribe for any securities, and shall not form the basis for or be relied on in connection with any contract or
Slide 3: Agenda
Agenda • Company Overview • 2015 Interim Financial Results • Business Review and Prospects 2
Slide 4: Company Profile
Company Profile IGG Group, a leading global mobile gaming developer and operator • Listed on the Main Board of HKEx on July 7, stock code: 799.HK; • To date, the Group has regional offices in 9 countries and regions; 15H1 • Revenue from mobile games accounted for 93%; • The user community of the Gro
Slide 5: Global Branches
Global Branches Well-organized corporate structure and explicit functional division enables the Group to carrying out its global strategy from a macro perspective. Group headquarters; Self-owned ad. platform; Marketing and Singapore USA Localized R&D operation and operation R&D; China Canada Localiz
Slide 6: Major Self-developed and Licensed Games
Major Self-developed and Licensed Games The Group has diversified mobile game genres, including strategy, card, RPG, casino etc., most of which are mid-core. 1.8 Hard-core 1.6 1.4 1.2 1 Mid-core 0.8 0.6 0.4 0.2 Casual 0 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 7.5 8 8.5 9 9.5 10 Dec. 2011··· June
Slide 7: Agenda: 2015 Interim Financial Results
Agenda • Company Overview • 2015 Interim Financial Results • Business Review and Prospects 6
Slide 8: 2015 Interim Financial Highlights
2015 Interim Financial Highlights 14H1 15H1 Change 15Q1 15Q2 Change Revenue USD million 91.9 103.8 +12.9% 53.6 50.2 -6.3% Gross profit USD million 66.6 72.0 +8.1% 36.9 35.1 -4.9% % Gross profit margin 72% 69% -3ppt 69% 70% +1ppt Adjusted net income* USD million 33.7 26.3 -22.0% 14.8 11.5 -22.3% Adju
Slide 9: Revenue of 15H1 vs. 14H1
Revenue of 15H1 vs. 14H1 (USD million) 12.9% The revenue increase of 15H1 vs. 14H1 was primarily due to： • An increase in revenue generated from the mobile game series “Clash of Lords”, average monthly gross billing from this game series (I & II) was approximately 103.8 US$3.5 million in 15H1; 91.9
Slide 10: Revenue of 15Q2 vs. 15Q1
Revenue of 15Q2 vs. 15Q1 (USD million) The revenue decrease of 15Q2 vs. 15Q1 was primarily due to： • Slightly revenue decrease of part of the 53.6 existing games; 50.2 • Most of the Group‟s new games are scheduled for launch in the second half of this year, hence there was less contribution from new
Slide 11: 15H1 Revenue Breakdown by Segment
15H1 Revenue Breakdown by Segment In light of the rich R&D resources and operating experiences the Group has, self-operating business will go on to contribute significantly to the Group’s revenue while collaborating and co-operating with certain superior third-party platforms is a good supplementary
Slide 12: 15H1 Revenue Breakdown by Game
15H1 Revenue Breakdown by Game • The Group’s R&D resources has been allocated to mobile games and mobile related software; • Strategically, the original browser and client-based game business will be maintained without expansion. 14FY 15H1 Client-based Others* Client-based Games 2% Games 0.9% 1% Bro
Slide 13: 15H1 Revenue Breakdown by Game Title
15H1 Revenue Breakdown by Game Title 14FY 15H1 Game title % of total Game title % of total revenue revenue •Major game “Castle Clash” Castle Clash* 62% Castle Clash* 56% maintained steady revenue; Clash of Lords(I&II) 12% Clash of Lords(I&II) 17% •“Clash of Lords” series Texas Poker Deluxe* 5% Deck
Slide 14: 15H1 Revenue Breakdown by Region
15H1 Revenue Breakdown by Region The Group’s revenue comes from over 200 countries and regions, which dilutes the impact from the revenue and exchange rate fluctuation of certain regions. % of by country total revenue Australia 2% % of by country total revenue Other by % of 5% country/region total r
Slide 15: 15H1 Expenses Breakdown
15H1 Expenses Breakdown 14FY 15H1 ✓ Channel cost is the major constituent of cost of sales, the channel cost of our mobile game business is approximately 30%, which is higher Gross profit margin 71% 69% than that of browser and client-based games; ✓ The revenue percentage of mobile games Selling & d
Slide 16: Net Cash and Capex
Net Cash and Capex USD million Cash & cash equivalents 161 Net cash USD173 m Time deposit over three months 12 Healthy cash - Short-term borrowings position and low 0 capex business nature set the USD million stage for potential M&As over the PP&E such as servers and 0.80 Capex next few years comput
Slide 17: Tax Rate
Tax Rate IGG Singapore The Preferential corporate tax rate • About 99% of our total revenue 17% was recognized through IGG 5% Singapore in 15H1, and this percentage is expected to be stable in the foreseeable future; • From 2010-2016, IGG Singapore is entitled to a preferential tax rate of 5%, subje
Slide 18: Dividend
Dividend Total Share Dividend Dividend Declaration amount numbers* per share Type Date (USD million) (million) (HK cents) 2015 Aug. 27, 2015 7.4 1394 4.0 interim dividend •The outstanding ordinary share numbers as at the end of the corresponding report period. ✓ The total amount of 2015 interim divi
Slide 19: Agenda: Business Review and Prospects
Agenda • Company Overview • 2015 Interim Financial Results • Business Review and Prospects 18
Slide 20: Human Resource
Human Resource • As at June 30 2015, the Group had 803 employees, in addition, the Group hired an exclusive outsourcing R&D team of over 100 team members. by function by location Management Philippines 9% Korea 1% 3% Finance & Canada 4% admin. 9% Operation & Customer service Singapore 30% 7% U.S. 4%
Slide 21: Operational Data Excerpts of Major Games
Operational Data Excerpts of Major Games CC COL II DH (Castle Clash) (Clash of Lords II) (Deck Heroes) Launched in July 2013 Dec. 2013 July 2014 Numbers of language versions 15 9 6 (as at the end of July 2015) Registered users 114.0 mn 39.0 mn 6.3 mn (as at the end of July 2015) Monthly active users
Slide 22: M&A Project
M&A Project The group acquired major stake of an American game developer Nerd Kingdom at the end of 2014 and might make additional investment in Nerd Kingdom in the second half of 2015. Nerd Kingdom was established in 2010 by a team comprising a data scientist, an economist, a nuclear engineer and c
Slide 23: Took Part in the 13th ChinaJoy
Took Part in the 13th ChinaJoy In the end of July 2015, IGG took part in the 13th China Digital Entertainment Expo and Conference (ChinaJoy) and had its own booth to showcase its products; Compared to the mature markets in North America and Europe, Asian market has tremendous growth potential. The G
Slide 24: New Title
New Title ✓“Final Fable” is a self- developed semi-realtime RPG card game adopting the themes of fairy-tale fantasies; ✓ Launched in June 2015, the first month MAU of “Final Fable”has surpassed 1 million. ✓ The Group will test the water in Japanese market in the coming few months with regard to this
Slide 25: New Title
New Title War-strategy RPG game “Lords Online" 24
Slide 26: Global Mobile Gaming Market
Global Mobile Gaming Market • Mobile game revenue (Smartphone & • The APAC region’s 760 million mobile Tablet) will grow to US$30 billion and gamers generated US$13.6 billion, or 55% account for 1/3 of the global games of the total market in 2014, and will grow industry in 2015； with a CAGR of 21.3%
Slide 27: Prospect
Prospect ✓ To further enhance the mobile game development ability through recruiting local talents in each regional offices and strengthening the internal competition; ✓ Encouraging face-to-face communication among staffs from each branches; ✓ To supplement the Group's existing R&D force by outsourc
Slide 28: Thank you!
Thank you! IR Contact • yolanda.gao@igg.com 27