Slide 1: CD PROJEKT Group 2015 Financial Results and Summary of Business Strategy
CD PROJEKT GROUP 2015 FINANCIAL RESULTS AND SUMMARY OF BUSINESS STRATEGY ADAM KICIŃSKI President, Joint CEO PIOTR NIELUBOWICZ Member of the Board, CFO
Slide 2: Agenda
AGENDA 2012-2015 business strategy – 2015 financial summary of implementation results 2016-2021 business strategy Q&A session and incentive program
Slide 3: 2012-2015 Business Strategy – Summary of Implementation
2012-2015 BUSINESS STRATEGY – SUMMARY OF IMPLEMENTATION
Slide 4: Sales of Our Games: 20M The Witcher
SALES OF OUR GAMES 20 M THE WITCHER THE WITCHER 2: ASSASSINS OF KINGS THE WITCHES 3: WILD HUNT
Slide 5: 390M PLN Net Result for 2012-2015
NET RESULT FOR 2012-2015 390 M PLN 168% OF INCENTIVE PROGRAM GOAL
Slide 6: 2011-2015 Share Price Increase vs WIG Index
2011-2015 SHARE PRICE INCREASE 353% 25.6% INCREASE IN WIG INDEX
Slide 7: 800 Awards
_ = _z = waned | pr un ~ iw . a! 800 AWARDS i! Sh COUR 3 &* | — ’ re -4
Slide 8: The Witcher 3 – Most Talked-About Game in Online Media
THE WITCHER 3 – MOST TALKED-ABOUT GAME IN ONLINE MEDIA 51 098 S O U R C E : I C O PA R T N E R S
Slide 9: 2015 Financial Results
2015 FINANCIAL RESULTS
Slide 10: CD PROJEKT Group - Profit and Loss
CD PROJEKT GROUP - PROFIT AND LOSS W2 PC W2 X360 W3 2015/2011-2014 2011 2012 2013 2014 2015 annual average Sales revenues 136 210 164 040 142 172 96 194 798 014 5,9 Videogame development 44 058 44 862 22 286 31 093 681 923 Global digital distribution 24 886 42 096 57 634 63 936 115 823 Domestic dist
Slide 11: Group Revenues – Geographic Breakdown
GROUP REVENUES – GEOGRAPHIC BREAKDOWN 4.7% 7% Poland 27.7% 7% USA EU Asia Others 50.3% 56.8% 25% 17% 4%1% 2011 2015
Slide 12: Group Digital Distribution Revenues
CD PROJEKT GROUP DIGITAL DISTRIBUTION REVENUES Digital Physical 29% 39% 71% 61% 2011 2015
Slide 13: 2015 Share of Digital Sales in Total Distribution
2015 SHARE OF DIGITAL SALES IN TOTAL DISTRIBUTION Digital Physical 31.6% 49.8% 50.2% 68.4% The Witcher 3 The Witcher 3 revenues units sold
Slide 14: GOG.com Pricing Policy
GOG.com PRICING POLICY <9,99$ >10$ 20% 46% 54% 80% 2011 2015
Slide 15: GOG.com Sales by Territory
GOG.com SALES BY TERRITORY USA, UK, Canada, Australia Germany, Austria, Switzerland France, Canada Russia + CIS 23.5% 20.9% Others 0.7% 4.3% 3.7% 51.7% 6.2% 6.6% 65.6% 16.9% 2011 2015
Slide 16: CD PROJEKT Group - Assets
CD PROJEKT GROUP - ASSETS W2 PC W2 X360 W3 2011 2012 2013 2014 2015 Fixed assets 90 762 94 202 95 047 93 254 119 187 Current assets 94 964 108 690 122 588 155 691 554 759 Inventories 31 112 33 367 51 966 96 511 34 200 Receivables 34 389 35 882 21 821 17 386 114 234 Other current assets 19 644 12 575
Slide 17: CD PROJEKT Group - Liabilities
CD PROJEKT GROUP - LIABILITIES W2 PC W2 X360 W3 2011 2012 2013 2014 2015 Equity 123 809 151 530 166 987 168 018 513 675 Long-term liabilities 7 590 7 604 5 187 2 137 18 414 Short-term liabilities 54 327 43 758 45 461 78 790 141 857 Credits and loans 13 404 4 745 21 4 0 Liabilities 40 013 38 411 44 9
Slide 18: CD PROJEKT Group - Cash Flows
CD PROJEKT GROUP - CASH FLOWS W2 PC W2 X360 W3 2011 2012 2013 2014 2015 Net cash flows from operating 185 26 695 22 054 -3 231 371 618 activities Net cash flows from investment -6 239 -125 -4 127 -493 -12 403 activities Net cash flows from financial 263 -9 523 -5 109 1 627 27 activities TOTAL NET CA
Slide 19: CD PROJEKT Group - Cash & Inventories
CD PROJEKT GROUP - CASH & INVENTIORIES 500000 Cash and cash equivalents Inventories in videogame development segment Credits and loans 425000 350000 275000 200000 125000 50000 0 -25000 2010 2011 2012 2013 2014 2015
Slide 20: 2016-2021 Business Strategy and Incentive Program
2016-2021 BUSINESS STRATEGY AND INCENTIVE PROGRAM
Slide 21: CD PROJEKT Group Philosophy
BUSINESS STRATEGY AND CD PROJEKT GROUP PHILOSOPHY INCENTIVE PROGRAM ‣ What guides our business activities ‣ What we look for in videogames ‣ Why we remain independent ‣ How we wish to develop our business
Slide 22: CD PROJEKT RED Mission Statement and Business Objectives
BUSINESS STRATEGY AND CD PROJEKT RED MISSION STATEMENT INCENTIVE PROGRAM AND BUSINESS OBJECTIVES CD PROJEKT RED MISSION STATEMENT To create revolutionary RPGs which go straight to the heart of gamers from around the world. CD PROJEKT RED BUSINESS OBJECTIVES To be counted among the world’s top three
Slide 23: CD PROJEKT RED Plans for 2016-2021
BUSINESS STRATEGY AND INCENTIVE PROGRAM CD PROJEKT RED PLANS FOR 2016-2021
Slide 24: CD PROJEKT RED Studio – Plans for 2016
BUSINESS STRATEGY AND CD PROJEKT RED STUDIO INCENTIVE PROGRAM PLANS FOR 2016 ‣ Release of the second expansion pack for The Witcher 3: Wild Hunt – Blood and Wine. ‣ Implementation of new promotional and marketing activities supporting continued sales of The Witcher 3: Wild Hunt. ‣ A new type of vide
Slide 25: CD PROJEKT RED Studio – Plans for 2017-2021 Part I
BUSINESS STRATEGY AND CD PROJEKT RED STUDIO INCENTIVE PROGRAM PLANS FOR 2017-2021 PART I ‣ Release of Cyberpunk 2077. ‣ Release of another AAA RPG title. ‣ Expansion of our core franchises with additional media content and product lines. ‣ Further active marketing and support for our earlier release
Slide 26: CD PROJEKT RED Studio – Plans for 2017-2021 Part II
BUSINESS STRATEGY AND CD PROJEKT RED STUDIO INCENTIVE PROGRAM PLANS FOR 2017-2021 (CONTINUED) PART II ‣ Near-twofold expansion of the CD PROJEKT RED team. Creation of four individual teams, two of which will be tasked with development of games representing new segments. ‣ Establishment of new local
Slide 27: GOG.com Mission Statement and Business Objective
BUSINESS STRATEGY AND GOG.com MISSION STATEMENT INCENTIVE PROGRAM AND BUSINESS OBJECTIVE GOG.com MISSION STATEMENT We combine our passion for videogames and respect for fans to successfully deliver the world’s top videogame releases, supported by online services. GOG.com BUSINESS OBJECTIVE To create
Slide 28: GOG.com Plans for 2016-2021
BUSINESS STRATEGY AND INCENTIVE PROGRAM GOG.com PLANS FOR 2016-2021
Slide 29: GOG.com – Plans for 2016
BUSINESS STRATEGY AND GOG.com INCENTIVE PROGRAM PLANS FOR 2016 ‣ Release of a AAA game developed by an unaffiliated entity with full support for GOG Galaxy, concurrent with its global release date. ‣ Expansion of GOG Galaxy with new features and networking technologies required by new CD PROJEKT RED p
Slide 30: GOG.com – Plans for 2017-2021
BUSINESS STRATEGY AND GOG.com INCENTIVE PROGRAM PLANS FOR 2017-2021 ‣ Additional global releases of major videogames developed by unaffiliated entities with full support for GOG Galaxy. ‣ Technological support for new CD PROJEKT RED development projects, including customized solutions for multiplayer
Slide 31: Incentive Program
BUSINESS STRATEGY AND INCENTIVE PROGRAM INCENTIVE PROGRAM Result goal – 80% of warrants: ‣ 2016-2019 – at least 618.4 million PLN, or ‣ 2016-2020 – at least 855.5 million PLN, or ‣ 2016-2021 – at least 1.09 billion PLN. Market goal – 20% of warrants: ‣ share price increase +100% over WIG during the
Slide 32: Questions and Answers
QUESTIONS AND ANSWERS
Slide 33: Thank You
THANK YOU Investor Relations: KAROLINA GNAŚ karolina.gnas@cdprojekt.com
Slide 34: Legal Disclaimer
LEGAL DISCLAIMER The information contained in this presentation reflects current conditions and projections based upon the status quo (March 2016), which is liable to change. All forecasts and statements concerning future events are based upon subjective opinions, evaluations and assumptions, and ma