Ten Square Games Sa · GPW:TEN
Ten Square Games Sa — Q1 2024 Earnings Presentation
34 slides from Ten Square Games Sa's earnings presentation, May 28, 2024
Slide 1: Q1 2024 Presentation
— & ten square games 012024 i) PRESENTATION ih
Slide 2: Beyond Boundaries: TSG's Evolution in Mobile Gaming
BEYOND BOUNDARIES: TSG'S EVOLUTION IN MOBILE GAMING
Slide 3: 2023 - The Foundation year
2023 - The Foundation year various different feedback from new marketing channels gameplay new features game genres players modes Current target group New target group We learned what we have to change to We learned about large target group interested address the needs of Fishing Clash and in fishin
Slide 4: Unlock the potential of growth
unlock the potential of growth 2024 Monetization Quality Acceleration of growth New LiveOps & marketing Automation & AI to eliminate strategy human mistakes TSG Store Better segmentation & more Testing & iteration personalized experience Wings of Heroes Data informed process - R&D Technological exce
Slide 5: Embrace expanding universe of gamers
embrace expanding universe of gamers 2024 2030 Simulation games in TOP 10 most popular game genres in the world billion people 9 billion people Simulation games to grow faster than mobile gaming market billion billion TSG wants to answer to the needs gamers gamers of new groups of players interested
Slide 6: Prototyping for success
PROTOTYPing for success Decision about Technical launch Soft launch the product till the end of 2024 Hunting Next June ■ Tests of simple ■ Adding monetization gameplay on features ■ Testing phase will selected markets not be carried out ■ Small & agile teams under TSG brand ■ Time to market ■ Time t
Slide 7: Q1 2024
O01 2024
Slide 8: Q1 2024 Performance
Q1 2024 PERFORMANCE Core portfolio performance Financial performance -11% of bookings Q4’23 / Q1’24 Q4’23 / Q1’24 q-o-q G&A recurring costs Net profit -10% PLN -8.7% q-o-q PLN PLN PLN of bookings (1.7)M 17.9M q-o-q 6.9M 6.3M +52% of bookings Q4’23 / Q1’24 Q4’23 / Q1’24 q-o-q Adj. EBITDA Net cash flo
Slide 9: TSG Store - Sustainable Growth
TSG STORE - SUSTAINABLE GROWTH TSG Store % share in Group’s bookings 17% share of TSG Store bookings in FC (April 2024) Growth of revenues flow through TSG Store in both products Improvement of quality and segmentation of offers New channels to effectively promote TSG Store Introduction of special c
Slide 10: Product Performance Update
PRODUCT PERFORMANCE UPDATE
Slide 11: Fishing Clash performance
Fishing clash performance ■ Q1’24 level of bookings results from the focus on retention and smaller number of in-game events after very intensive Q4’23 ■ Main focus of the team was on improvement of user experience and main M PLN systems of the game to improve game’s efficiency ■ UA activity focused
Slide 12: Hunting Clash performance
Hunting clash performance ■ Dynamic increase in MAU; large inflow of organic traffic due to effective marketing campaigns and cooperation with brands as Beretta; great potential for future monetization. M PLN ■ Lower level of bookings in Q1’24 was related to smaller number of in-game events due to i
Slide 13: Wings of Heroes Growth - retention
WINGS OF HEROES GROWTH - retention 50% 48% 30 day retention 2023.06 vs 2024.03 40% 14 day retention 19% 2023.06 vs 2024.03 7 day retention 2023.06 vs 2024.03 7% 3 day retention 2023.06 vs 2024.03 1 day retention 2023.06 vs 2024.03 AI 13
Slide 14: Wings of Heroes Growth - monetization
WINGS OF HEROES GROWTH - monetization Monthly Revenue Monthly Revenue Per User Per Paying User 116% 101% AI 14
Slide 15: Wings of Heroes performance
Wings of Heroes performance ■ Growth of bookings and other main KPIs of the game since introduction of changes in the game in 2Q 2023 52% ■ Increased UA spending due to improvement in monetization and changes in M PLN marketing strategy ■ All planned features delivered according to the plan: leagues
Slide 16: Summary
SUMMARY
Slide 17: Corporate information
corporate information Appointment of the Management 12-22 February 2024 Board for the next 3-year term of Buyback of shares as an alternative to dividend for 2023: office ■ 954.166 bought shares ■ purchase price: PLN 120 per share ■ PLN 114.5m - record high amount of buyback Andrzej Ilczuk Magdalena
Slide 18: Summary
sUMMARY Prototypes Acceleration of growth ■ Decision to verify 2 concepts instead of one ■ Acceleration of growth in Wings of Heroes ■ Agile approach to projects development in 2H 2024 ■ Growing share of TSG Store in the Group’s total bookings Clear roadmap for unlocking growth in main products ■ Re
Slide 19: Investor's Calendar
INVESTOR’S CALENDAR
Slide 20: Investor's calendar
Investor’s calendar Company news flow: ■ Q2 2024 Sales Update – early July 2024 ■ 1H 2024 Financial Report – 26th August, 2024 ○ Conference call on TSG’s performance in 1H 2024 - 27th August 2024 at 12:00 P.M. ○ Chat with individual investors on TSG’s performance in 1H 2024 - 27th August 2024 ■ Futu
Slide 21: Q&A Session
O&A SESSION
Slide 22: Contact details
Contact details: Nina Graboś – IR, PR & ESG Director nina.grabos@tensquaregames.com
Slide 23: Financial Results
FINANCIAL RESULTS
Slide 24: Profit and loss dynamics
Profit and loss dynamics M PLN Q1’23 Q2’23 Q3’23 Q4’23 2023 Q1’24 Revenues from sales 117.4 104.9 105.6 108.1 436.1 100.1 1 1 Bookings 123.6 101.2 110.4 108.5 443.7 99.7 Slight decrease in bookings q-o-q, due to a weaker performance of Fishing Clash and Gross profit on sales 98.1 86.0 87.8 91.4 363.
Slide 25: Profit and loss report
Profit and loss report Selected positions in k PLN Q1’23 Q2’23 Q3’23 Q4’23 2023 Q1’24 Revenues from sales 117,450 104,932 105,572 108,122 436,076 100,118 Fishing Clash 72,558 63,194 69,738 68,743 274,232 61,219 Let’s Fish 2,172 1,852 1,614 1,890 7,529 1,732 Wild Hunt 2,353 1,998 1,813, 1,967 8,131 2
Slide 26: General and administrative costs
General AND administrative costs General administrative costs (PLN k) Q1’23 Q2’23 Q3’23 Q4’23 2023 Q1’24 Recurring costs 10,573 7,510 6,454 6,860 31,398 6,287 Salaries, subcontractor services 4,535 3,683 3,207 3,070 14,495 3,039 Subsidiaries costs 1,613 1,135 1,074 ,972 4,794 926 Office rental and m
Slide 27: Cash flow generation with a strong cash pool
Cash flow generation with a strong cash pool M PLN Q1’23 Q2’23 Q3’23 Q4’23 Q1’24 Adjusted EBITDA 27.6 21.9 33.7 35.3 27,489 Net Cash Flows from Operating Activities 29.9 28.6 32.5 30.5 32.4 Net Cash Flows from Investing Activities (14.7) (9.5) (2.0) (0.3) (1.4) Net Cash Flows from Financing (1.5) (5
Slide 28: Balance sheet
Balance sheet Selected positions in k PLN* 31.03.23 30.06.23 30.09.23 31.12.23 31.03.24 ASSETS Fixed assets 297,613 279,861 285,980 215,779 214,234 Receivables 41,096 31,606 36,293 38,937 36,253 Cash and cash equivalents 140,249 105,379 133,820 162,826 76,784 Current assets 225,594 180,653 215,517 2
Slide 29: Cash flow report
Cash flow report Selected positions in k PLN Q1’23 Q2’23 Q3’23 Q4’23 Q1’24 OPERATING ACTIVITIES Profit/loss before tax (16,022) 10,049 23,205 (0,184) 20,720 Total adjustments 49,203 9,273 11,372 27,985 13,803 Amortisation 5,289 5,143 4,969 4,809 4,506 Cash from operations 33,181 19,321 34,577 27,801
Slide 30: Method of determining adjusted EBITDA
Method of determining adjusted EBITDA Selected items of the P&L Statement in k PLN Q1’23 Q2’23 Q3’23 Q4’23 Q1’24 Operating profit IFRS (14,414) 9,639 25,032 (16,739) 19.108 Amortisation +4,978 +5,143 +4,969 +4,809 +4,506 Write-down for impairment +26,573 +5,117 - +46,528 0 EBITDA IFRS 17,137 19,795
Slide 31: 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 32: 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 33: Profit distribution to shareholders
profit DiSTRIBUTION TO shareholders Pln 200 M* Of Dividend Paid Out By TSG 2022 Profit Distribution almost 100% of consolidated net profit for 2022 paid out to shareholders; (exceeding 75% threshold of TSG’s dividend policy**) 2023 Profit Distribution PLN 114.5 M buyback of own shares in February 20
Slide 34: 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