Ten Square Games Sa · GPW:TEN
Ten Square Games Sa — Q3 2019 Earnings Presentation
24 slides from Ten Square Games Sa's earnings presentation, November 2019
Slide 1: Q3 2019 results
Q3 2019 results November 2019
Slide 2: Highlights
Highlights 200 people F2P Games > 90% STRONGER TEAM 8 BIG PROJECTS SALES OUTSIDE POLAND PLN 68 M HUNTING CLASH GAMES FOR LADIES Record sales in Q3 2019 New hobby game Two new titles in soft launch 2
Slide 3: Q3 2019 results
Q3 2019 results 3
Slide 4: Q3 2019 – executive summary
Q3 2019 – executive summary • Record results in Q3 2019 • Another quarter in a row of record Fishing Clash revenues • PLN 67,6 M total revenues in Q3 2019 – increase by 91% y/y and 35% q/q • PLN 18 M net profit in Q3 – increase by 77% y/y and 39% q/q • Strengthened team - already 200 specialists on
Slide 5: Fishing Clash – constant improvement of results
Fishing Clash – constant improvement of results Payments (M PLN) • 34% increase of payments q/q in Q3 2019 57,9 • Successful Closed Beta tests on Chinese market, awaiting 43,1 34,8 37,5 full license 28,8 17,5 • Constant live-ops 7,6 2,7 • Constant development of the game by adding new fish, 4Q 1Q 2Q
Slide 6: Fishing Clash – effective marketing policy
Fishing Clash – effective marketing policy Payments and marketing expenditures (M PLN) 21,7 • Record setting months resulting from effective marketing policy 20,4 20,7 • In Q3 2019 almost PLN 21 M spent on Fishing Clash promotion 16,7 • Marketing expenditures scaled based on statistical models (high
Slide 7: Let's Fish – return to growth path
Let’s Fish – return to growth path Payments (M PLN) 4,3 4,7 • PLN 3,6 M revenues in Q3 2019 compared to PLN 4,3 M in 4,2 4,1 3,7 3,7 3,6 3Q 2018 – decrease by 16% y/y, increase by 9% q/q 3,3 • Challenging technology shift in Q2 2019 – transfer from Flash to Html5 • Stable MAU and ARPU in Q3 2019, de
Slide 8: Wild Hunt – ongoing good monetisation
Wild Hunt – ongoing good monetisation Payments (M PLN) 2,4 2,3 • 77 % revenue increase in Q3 2019 y/y 2,0 2,1 1,3 • PLN 2,3 M revenue in Q3 2019, compared to 0,9 PLN 1,3 M in Q3 2018 0,7 0,4 • Less than PLN 0,2M spent on promotion in 3Q 2019 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q • Stable development of the game b
Slide 9: Dynamic growth of sales revenues
Dynamic growth of sales revenues Szybki wzrost przychodów dzięki dobrej monetyzacji gier mobilnych, głównie Fishing Clash Sales revenues (k PLN) Geographic and product sales breakdown Fishing Clash Others 5% 14% North America x 1,9 r/r 67 650 Europe 42% Q3 2019 Asia Others 39% 49 878 45 304 41 551 3
Slide 10: Operations costs under control
Operations costs under control Operations costs excluding selling costs Selling costs Marketing • Operations costs increasing due to COGS Commissions gradual growth of team size (project Management costs teams, general departments) Revenue share 21,2 Others • Commission costs directly proportional S
Slide 11: Financial results
Financial results EBITDA Net profit • Best quarterly results in Company 22,1 history • EBITDA increased by 70% y/y 18,0 • Net profit increased by 77% y/y 16,7 16,4 • IPBOX – tax interpretation obtained 13,7 13,1 13,0 12,5 10,2 10,4 8,9 M PLN 7,5 M PLN 6,4 5,0 1Q'18 2Q'18 3Q'18 4Q'18 1Q'19 2Q'19 3Q'1
Slide 12: Good cash flow translates to balance sheet improvement
Good cash flow translates to balance sheet improvement Cash flow Balance sheet structure 1Q'18 2Q'18 3Q'18 4Q'18 1Q'19 2Q'19 3Q'19 1Q'18 2Q'18 3Q'18 4Q'18 1Q'19 2Q'19 3Q'19 • Operations cash flow resulting from great financial results – quick rebuilding of cash level after dividend payment 17,6 in Q
Slide 13: Number of projects
Development teams ahead of schedule Live Games for Product A women Number of projects Games for Product B women 2020 Soft Launch Global Launch Ideas Production Time 13
Slide 14: New titles in soft launch
New titles in soft launch 14
Slide 15: Investors' calendar – upcoming events
Investors’ calendar – upcoming events • Wood’s Winter Wonderland – Prague, 03-04.12.2019 IP • Q4 2019 Sales Report – early January 2020 • IPOPEMA Games Day – Warsaw, 13.01.2020. Mobile First • 2019 Yearly Report – March 2020 (exact date to be Let’s Fish announced in early January 2020) 15
Slide 16: THANK YOU!
THANK YOU! IR contact: Bartłomiej Piekarski e-mail: bartlomiej.piekarski@tensquaregames.com tel. +48 667 872 742
Slide 17: Results summary – P&L
Results summary – P&L Selected items of P&L in k PLN 4Q’17 1Q’18 2Q’18 3Q’18 4Q’18 1Q’19 2Q’19 3Q’19 q/q r/r Revenues from sales 10 012 14 400 23 871 35 436 41 551 45 304 49 878 67 650 +36% +91% - from Fishing Clash 2 732 7 560 17 527 28 846 34 831 37 524 43 147 57 896 +34% +101% - from Let's Fish 4
Slide 18: Results summary – balance sheet
Results summary – balance sheet Selected positions in k PLN 4Q’17 1Q’18 2Q’18 3Q’18 4Q’18 1Q’19 2Q’19 3Q’19 ASSETS Fixed assets 2 160 581 2 444 499 2 760 754 2 962 791 2 701 316 3 733 356 4 432 741 5 175 668 Trade receivables 4 551 180 6 684 397 8 734 138 12 228 250 10 671 417 16 249 070 15 651 927
Slide 19: Results summary – cash flows
Results summary – cash flows Selected positions in k PLN 4Q’17 1Q’18 2Q’18 3Q’18 4Q’18 1Q’19 2Q’19 3Q’19 OPERATING ACTIVITIES Profit before tax 3 956 293 6 228 989 9 302 427 12 633 103 16 684 655 12 674 129 15 944 337 22 316 356 Total adjustments -517 057 -1 504 724 -742 700 -641 523 1 100 238 -299
Slide 20: Geographic breakdown of revenues
Geographic breakdown of revenues In k PLN 4Q’17 1Q’18 2Q’18 3Q’18 4Q’18 1Q’19 2Q’19 3Q’19 q/q y/y North America 2 672 4 822 10 938 15 732 16 254 18 841 21 646 28 718 +33% +83% Europe 5 222 6 404 8 818 14 597 19 344 19 059 19 790 26 551 +34% +82% Poland 1 558 1 556 1 762 2 534 3 598 3 367 3 170 3 918
Slide 21: Changes in accounting principles
Changes in accounting principles Changes in booking revenues according to IFRS 15 „Revenue is recognized when the customers has received all the benefits associated with the performance obligation” • Payment -> a player purchases virtual currency Payment Revenue • Revenue -> the player uses the virt
Slide 22: 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 23: Disclaimer
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 herein
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