Tinybuild Inc. · LSE:TBLD
Tinybuild — FY2023 Earnings Presentation
28 slides from Tinybuild's earnings presentation, April 2024
Slide 1: FY 2023 Results Presentation
FY 2023 RESULTS PRESENTATION
Slide 2: Disclaimer
DISCLAIMER IMPORTANT: You must read the following disclaimer before continuing. The following disclaimer applies to the following presentation and you are therefore advised to read this disclaimer carefully before reading, assessing or making any other use of the presentation. In accessing the prese
Slide 3: Presenting Today
PRESENTING TODAY Alex Nichiporchik - CEO, Founder 20+ years' industry experience. Pro-gamer, shipped over 20 titles as Producer, discovered pillar titles and built relationships with key influencers. Giasone (Jaz) Salati - CFO 20+ years’ finance experience. Top ranked equity research analyst, and Chie
Slide 4: Agenda - FY 2023
AGENDA - FY 2023 OPERATIONAL REVIEW FINANCIAL REVIEW STRATEGY APPENDIX 4
Slide 5: Operational Review
OPERATIONAL REVIEW Alex Nichiporchik, CEO
Slide 6: 2023 Was the Toughest Year
2023 WAS THE TOUGHEST YEAR ▪ Further revenue compression in H2 (large contracts and delays at Versus Evil) ▪ Upward pressure on costs (amortisation of dev costs, inflation) ▪ Tough decisions taken to reduce costs (nearly $10m annual savings in 2024) ▪ Global settlement ($1.5m paid in Q4 2023 plus $2m
Slide 7: FY 23 Highlights
FY 23 HIGHLIGHTS $44.7m $10.6m >80 games portfolio consolidated revenues Cash from operations 68% 92% $2.5m of sales from Own-IP cash at the end of Dec ‘23 of sales from catalogue 7
Slide 8: Own IP Across Multiple Platforms
OWN IP ACROSS MULTIPLE PLATFORMS OVER 80 GAMES CREATING FRANCHISE POTENTIAL FY23 FY17 68% OWN-IP AS % OF GAMING REVENUE* 8 * Gaming revenues exclude revenues from Development Services and Events
Slide 9: Balanced Mix Back Catalogue / Front List
BALANCED MIX BACK CATALOGUE / FRONT LIST 92% BACK CATALOGUE* AS % OF GAMING REVENUES** * Back catalogue is defined as any games released in the prior financial year and before 9 ** Gaming revenues exclude revenues from Development Services and Events
Slide 10: Financial Review
FINANCIAL REVIEW Giasone (Jaz) Salati, CFO
Slide 11: FY 23, a Reset Year
FY 23, A RESET YEAR Net Game Revenues1 Adj. EBITDA2 Software Development ▪ Net game revenue dropped $19m (-31% ▪ Adj. EBITDA was negative $7.1m in FY 23 as ▪ Capitalised software development costs y-o-y) due to lower platform deals a result of lower revenues, less favourable decreased by $4m (-10% y
Slide 12: Profit & Loss
PROFIT & LOSS ▪ Revenues from game sales relatively stable in a difficult year despite delays at Versus Evil ▪ Development revenues down sharply due to lower contribution from platform deals ▪ Cost of sales increase due to unfavourable revenue mix and higher amortisation of dev costs ▪ G&A increase
Slide 13: Platform Deals Dropped Sharply in 2023
PLATFORM DEALS DROPPED SHARPLY IN 2023 67% DROP IN PLATFORM DEAL REVS TINYBUILD PLATFORM DEALS PEAKED IN 2022 ▪ Revenues from platform deals materially down in 2023 across the industry ▪ tinyBuild saw a peak in 2022 followed by a sharp drop in 2023 (half the 2021 level, as a % of sales) ▪ Mitigating
Slide 14: Cash Flow
CASH FLOW ▪ Net cash generated from operations drops to $10.6 in FY 23, as the net loss more than offset a positive Working Capital contribution ▪ The decrease in receivables is mostly the result of timing differences relating to seasonality ▪ Investments in software development decreased by $4m y-o
Slide 15: Investments Peaked in 2022
INVESTMENTS PEAKED IN 2022 Software development Total investment ▪ Software development investments continued to ▪ Total investments (Software development + M&A) now decline in H2 2023 below 2021 level 15 * 2023E based on consensus for H2 23
Slide 16: Diversified Investments
DIVERSIFIED INVESTMENTS 50+ PROJECTS UNDER DEVELOPMENT BREAKDOWN OF 2023 DEVELOPMENT COSTS ▪ Over 20 projects with annual spend of $500k+ in FY 23, some cancelled ▪ No game accounted for more than 15% of total ▪ 5%+ invested in new tech, media & platforms ▪ Stricter assessment of games’ potential th
Slide 17: Balance Sheet
BALANCE SHEET ▪ The decrease in Intangible assets primarily reflects the impairment of development costs and goodwill ▪ The decrease in receivables is partly the result of timing differences relating to seasonality ▪ Net cash position decreased to $2.5m at 31 December 2023, reflecting lower profit and
Slide 18: Cash Utilisation in FY 23
CASH UTILISATION IN FY 23 $2.5m CASH AT 31 DECEMBER 2023 ▪ $32m investments in development of new games ▪ M&A investment limited to $1.2m ▪ $1.6m paid for global settlement ▪ Cash position at the end of December 2023 was $2.5m (high single digit $m at the end of March 2024) 18
Slide 19: Strategic Review
STRATEGIC REVIEW Alex Nichiporchik (CEO, Founder)
Slide 20: Five Year Plan
FIVE YEAR PLAN IP ORIGINATES FROM REFOCUS ON COST CONTROL, GAMES & ANIMATED SERIES INTERACTIVE MEDIA 1,000 HOUR GAME STRATEGY CO EXIST AND TV SERIES 2023 2024 2025 2026 2027 MORE BIGGER TITLES COMING OUT, CROSS MEDIA FUELED BY LIVE ACTION MEDIA PROFITABLE FRANCHISES 20
Slide 21: Case Study 1: Level Zero
CASE STUDY 1: LEVEL ZERO ▪ Initial traction as a asymmetric multiplayer ▪ Re-announced as extraction horror title ▪ Selected influencers to play the game ▪ Alien Isolation meets Escape from Tarkov -> 2k+ concurrent players, top 120 wishlisted 21
Slide 22: Case Study 2: Kingmakers
CASE STUDY 2: KINGMAKERS ▪ Shooter/real time strategy hybrid ▪ 4-year investment in technology ▪ Millions of views of the announcement trailer -> top 50 wishlisted on Steam in a few weeks 22
Slide 23: Case Study 3: Duckside
CASE STUDY 3: DUCKSIDE ▪ Game announced as April Fools Joke ▪ Shared tech stack with DEADSIDE ▪ Playtest shortly after announcement -> 1k+ concurrent players 23
Slide 24: Announced Pipeline
ANNOUNCED PIPELINE 1. RAWMEN - a light hearted, third person, free-to-play food fighter for 2-8 players 2. Streets of Rogue 2 – an immersive RPG sandbox set in a vast randomly generated open world 3. Ferocious - a survival shooter in which you will discover a lost prehistoric world full of deadly cre
Slide 25: Closing Remarks
CLOSING REMARKS Alex Nichiporchik (CEO, Founder)
Slide 26: Core Strategy
CORE STRATEGY …across Global …creating long …focused on IP multiple developer term scalable ownership… media publisher… franchises… formats 26
Slide 27: Outlook
OUTLOOK The Board remains confident the Company has adopted the right strategy and is on track to deliver results in line with expectations 27
Slide 28: Q&A
Q&A