Devolver Digital, Inc. · LSE:DEVO
Devolver Digital — FY2022 Earnings Presentation
18 slides from Devolver Digital's earnings presentation, 2023
Slide 1: Investor Presentation 2022 Results
INVESTOR PRESENTATION 2022 RESULTS
Slide 2: 2022 Highlights
2022 HIGHLIGHTS REVENUE GROSS PROFIT1 EBITDA2 $134.6m $46.3m $23.2m +37% vs 2021 +18% vs 2021 -10 % vs 2021 Critically acclaimed, CASH BALANCES TITLES RELEASED award winning titles $79.5m 12 Record High Average Metacritic Score: 78 Note: 1) Normalised Gross Profit pre-impairments; 2) Normalised Adju
Slide 3: 2022 Title Releases
Metacritic 2022 TITLE RELEASES Score 77 71 69 87 84 86 75 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 70 79 80 77 N/A 1H Metacritic Average: 76 2H Metacritic Average: 80 Record High Average Metacritic Score: 78 AIM-listed Peers: 71-72_ Note: Title scores calculated as simple average of applicabl
Slide 4: Focus on Operations
FOCUS ON OPERATIONS Devolver Operations Good Shepherd Restructuring • Acted swiftly to identify, correct and recalibrate • Re-focused the business towards publishing issues relating to 1H 2022 releases, and 2H 2022 licensed IP problems that arose at Good Shepherd • Appointment of a new General Manag
Slide 5: Impairments
IMPAIRMENTS US$’m FY22 • All impairments are non-recurring and non-cash Impairments of released games 9.3 • Impairments relate to 1) specific title-related impairments – for underperforming Impairments of cancelled unreleased games 13.5 released games, and for unreleased cancelled games; 2) impairme
Slide 6: The Indie Developer's Publisher
THE INDIE DEVELOPER’S PUBLISHER Normalised Revenue Fall Guys Outperformance $135m +$142m $98m Founded 2009 $71m CAGR1 $59m enue Rev $42m 33% 2009-2017 2009 2018 2019 2020 2021 2022 Normalised Adj. EBITDA2 $5.8m $11.6m $15.8m $25.7m $23.2m Norm. Adj. EBITDA Margin 13.6% 19.8% 22.2% 26.2% 17.2% Note:
Slide 7: Back Catalogue Strength
BACK CATALOGUE STRENGTH Game Sales revenue mix $160m Back Catalogue # Title Releases (cumulative) 109 • Back catalogue growth of 15% in 2022 – $140m New Titles (Front catalogue) primarily driven by FY21 release Back Catalogue Inscryption $120m • Back Catalogue levers: $100m ― Porting to new platform
Slide 8: Evergreen Back Catalogue Titles
EVERGREEN BACK CATALOGUE TITLES Back Catalogue revenue mix $70m Back Catalogue Tier 2 Back Catalogue (Revenue <$1m) • Consistent and strong increase in total Tier 1 Back Catalogue (Revenue >$1m) dollar quantum of back catalogue sales, $60m year over year # Tier 1 Back Catalogue Titles 28% • Tier 1 t
Slide 9: Continuing a Track Record of High-Quality Releases
CONTINUING A TRACK RECORD OF HIGH-QUALITY RELEASES Released 28th March 2023 PC & Netflix Mobile 81 Metacritic “ Beautiful, complex, and ” 565k Streaming hours captivating 13.3m Video views PC Invasion 45.5k Trees planted Released August 2022 Released October 2022 PC, PlayStation, Xbox & Switch PC, P
Slide 10: Exciting Pipeline for 2023 & 2024
EXCITING PIPELINE FOR 2023 & 2024 “I can't stop thinking “I already have its name about The Plucky Squire” branded on my tongue” Games Radar Digital Trends 8.3m video views 1.1m video views 23.5k social engagement 77k streaming hours PC, PlayStation, Xbox & Switch PC & Switch “If I could wave a magi
Slide 11: Financials
FINANCIALS Devolver Digital Investor Presentation 11
Slide 12: Profit & Loss – Statutory Reporting
PROFIT & LOSS – STATUTORY REPORTING US$’m FY20 FY21 FY22 1H 2022 2H 2022 COMMENTARY Net revenue 212.7 98.2 134.6 53.0 81.6 • Annual net revenues up 37% to record Cost of sales (121.0) (58.9) (89.4) (34.0) (55.4) high in FY22 (excluding Fall Guys windfall Impairment of capitalised development cost -
Slide 13: Statutory to Normalised Profit & Loss
STATUTORY TO NORMALISED PROFIT & LOSS US$’m FY20 FY21 FY22 1H 2022 2H 2022 • This table presents the adjustments to Revenue ‘normalised’ revenue, gross profit and Reported Revenue 212.7 98.2 134.6 53.0 81.6 Adjusted EBITDA Normalised revenue adjustment (141.6) - - - - • Record 2H 2022 EBITDA at $16.
Slide 14: Cash Flow
CASH FLOW US$’m FY20 FY21 FY22 1H 2022 2H 2022 Operating activities • Cash from operating activities is Net income 64.1 30.6 (91.5) (16.6) (74.9) primarily driven by the trading of the Amortisation & depreciation 7.0 9.3 112.4 10.9 101.5 business in addition to the changes in Share based payments 2.
Slide 15: Balance Sheet
BALANCE SHEET US$’m FY20 FY21 FY22 Non-Current Assets • The Group’s net asset position was $172.2 Intellectual property 23.3 53.4 25.8 million at 31 December 2022 reflecting: Capitalised developments costs 28.3 44.4 40.1 Goodwill 0.2 66.8 19.2 ― Capitalised development costs reduced Deferred tax ass
Slide 16: Operating Expenses - Trends
OPERATING EXPENSES - TRENDS 1 Forward US$’m FY21 FY22 1H 2022 1H 2022R2 2H 2022 Trend • Headcount – up 12% year-on-year due Payroll 9.3 13.6 6.3 6.9 6.7 Slow rise to acquisitions and scaling for growth through bringing expertise in-house Professional fees 1.6 4.6 2.4 2.4 2.2 Steady fall (finance, ta
Slide 17: Summary and Outlook
SUMMARY Strong revenue growth: 37% in FY22 vs FY21 Record six months EBITDA* in 2H 2022 Record high average Metacritic score of 78 in 2022 *adjusted normalised EBITDA pre-impairments OUTLOOK Balance sheet strength: well positioned to invest in long-term growth Share buyback*: demonstrates value conv
Slide 18: Thank You
THANK YOU Devolver Digital Investor Presentation 18