Ten Square Games Sa · GPW:TEN
Ten Square Games Sa — Q1 2022 Earnings Presentation
32 slides from Ten Square Games Sa's earnings presentation, May 24, 2022
Slide 1: Q1 2022 results
Q1 2022 results May 24th, 2022
Slide 2: Q1 2022 highlights
O01 2022 HIGHLIGHTS
Slide 3: Q1 2022 Highlights
Q1 2022 HIGHLIGHTS Quarterly 1 performance 2 Current portfolio 3 New games 4 Acquired portfolio Uplift of 20% in Soft launched bookings Q4’21/Q1’22 (Mar-22/Apr-22) Bookings (PLN M) Strong early In testing performance so far, phase +30% D1 retention PLN -15% q-o-q PLN Strong performance Early testing
Slide 4: Performance update
Performance update
Slide 5: Fishing Clash performance (excl. FC China)
Fishing clash performance (excl. FC china) Bookings and marketing expenses (PLN M) 60 Bookings Marketing expenses 50 40 M PLN 30 55.9 57.8 59.8 57.6 53.8 50.6 48.7 49.1 48.1 44.3 44.4 42.9 44.4 20 37.3 39.1 39.0 38.2 39.2 35.7 40.3 32.7 35.5 31.7 32.4 32.5 29.8 28.6 29.6 24.4 10 19.2 14.1 11.4 12.4
Slide 6: Fishing Clash China update: successful launch and performance
Fishing clash China Fishing Clash China update Successful Launch and Performance App store TOP sport GAMES IN CHINA (Jul 21’ – Apr 22’, APP ANNIE) • +4M downloads since launch Entrance to Huawei store at the end of April – entrance • TOP 3 in terms of downloads 1 to the store with over 500m users (M
Slide 7: Hunting Clash performance
Hunting Clash performance Bookings and marketing expenses (PLN M) 14 Bookings • Bookings in Q1 2022 – the best quarter in the Marketing expenses game’s history • Recent performance decline – related to market 12 conditions, low content production during April 11.1 11.1 11.3 11.4 11.1 and lower UA in
Slide 8: Acquired portfolio update – Rortos
Acquired portfolio update – rortos Airline Commander gross revenue (EUR k) 700 +12% 600 Performance in line with our investment case – Q1’22 1 performance of Rortos was in line with our 500 assumptions, Apr-22 revenue increased ca. 9% m-o-m 400 Promising soft launch of Wings of Heroes – the game is
Slide 9: Acquired portfolio update – Gamesture
Acquired portfolio update – gamesture Gamesture gross bookings (PLN k) 1,600 +146% Performance above our investment case – April 22’ net 1,400 1 revenue 12% above the budget, strongly driven by Slash & Roll 1,200 Promising soft launch of the new game ‚The Gang’ – the 1,000 2 game is available in Pol
Slide 10: Production pipeline update
PRODUCTION PIPELINE UPDATE Expected Game Description / Current status soft launch* • Military flight simulator Soft • The game is in the soft launch phase in the United Stated, Poland and India, generating launched very promising early KPIs • Social based competitive game Testing • The game is in te
Slide 11: Stabilization in production capacity
stabilization in production capacity Headcount per team Dec 2020 Dec 2021 Mar 2022 Game Development 202 297 319 • Headcount growth Game Support 31 38 39 stabilization with a strong focus on a delivery of current BI, R&D, Technology 14 41 51 development pipeline • Strong growth in Growth, Consumer In
Slide 12: Financial results
Financial results
Slide 13: Bookings breakdown and dynamics
Bookings breakdown and dynamics Bookings (PLN M) Bookings breakdown – geographies and products in Q1 2022 70 5% 60 North America 15% Europe 42% 50 Asia 40 38% Others 30 5% 20 Fishing Clash 5% 10 Hunting Clash 23% 0 Rortos games 67% Jan-22 Feb-21 Sep-20 Jan-20 May-20 Jun-20 Jan-21 May-21 Jun-21 Sep-2
Slide 14: Operating expenses analysis
Operating expenses analysis Operating expenses excluding selling costs1 Main selling costs1 50 10% 140 100% 7.7% 75% 45 8% 80% 120 55% 55% 59% 5.0% 5.1% 54% 54% 40 6% 51% 47% 60% 3.8% 2.6% 3.2% 100 35 2.2% 2.6% 4% 40% 30 2% 72.8 80 20% PLN M PLN M 25 0% 40.4 32.3 40.1 42.4 0% 60 33.9 23.0 20 8.5 11.
Slide 15: Standardized operating results
Standardized operating results Adjusted EBITDA Net profit IFRS 70 90 Adj. EBITDA Adj. EBITDA/bookings 60% • Adjusted EBITDA 60 80 amounted to PLN 41.1M 50% 70 43.5% 50 in Q1 2022 (-39% q-o-q) 41.4% 40.2% 38.5% 60 34.8% 40% • Adjusted EBITDA and 40 net profit in Q1 2022 has PLN M PLN M 50 30.2% 28.9%
Slide 16: Strong balance sheet with significant cash pool
Strong balance sheet with significant cash pool Cash flow (M PLN) Balance sheet (M PLN) 150 600 81.8 74.9 • Gamesture investment 100 400 64.3 (PLN 14.3M) financed 66.0 149.3 84.2 82.9 107.6 139.6 by cash in Q1 2022, 50 65.9 -27.6 49.9 57.8 46.3 46.4 53.4 71.0 resulting in fixed assets 13.9 0 -0.8 -1
Slide 17: High profitability and cash generation
HIGH profitability and cash generation Profitability and Cash Flow KPIs Adjusted EBITDA Free Cash Flow - Operations Adj EBITDA/Bookings Adj EBITDA conversion ratio to FCF OP 80 129.7% 140% 70 120% • Profitability decreased q-o-q, but 60 still is high and amounts to ca. 29% 100% 84.5% this quarter PL
Slide 18: Current focus
Current focus
Slide 19: Current focus
Current focus PORTFOLIO PERFORMANCE Working on the performance of our current portfolio in order to return to a growth trajectory after a recent slowdown PIPELINE LAUNCH Focus to deliver by soft launching our development pipeline still in 2022 PLATFORM INVESTMENT AND M&A Focus on integration and val
Slide 20: Investor's calendar
Investor’s calendar
Slide 21: Investor's calendar
Investor’s calendar Company news flow: • Q2 2022 Sales Update – early July 2022 • Q2 2022 Financial Report – August 22nd 2022 (conference on August 23rd) BP 21
Slide 22: Q&A session
Q&A session
Slide 23: Thank you!
Thank you! IR contact ir@tensquaregames.com
Slide 24: Backup
backup
Slide 25: Profit and loss report
Profit and loss report Selected positions in k PLN Q1’20 Q2’20 Q3’20 Q4’20 2020 Q1’21 Q2’21 Q3’21 Q4’21 2021 Q1’22 Revenues from sales 95,018 169,622 179,259 134,296 578,195 174,114 164,885 147,951 147,095 634,045 150,335 Fishing Clash 84,678 158,044 164,256 155,357 562,335 131,659 114,983 114,371 1
Slide 26: Balance sheet
Balance sheet Selected positions in k PLN Q2’19 Q3’19 Q4’19 Q1’20 Q2’20 Q3’20 Q4’20 Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 ASSETS Fixed assets 4,433 5,176 4,936 11,215 11,604 14,395 16,101 19,091 23,994 291,171 298,866 320,497 Receivables 15,652 24,012 20,738 34,447 58,724 57,205 47,589 57,331 45,946 50,624
Slide 27: Cash flow report
Cash flow report Selected positions in k PLN Q2’19 Q3’19 Q4’19 Q1’20 Q2’20 Q3’20 Q4’20 Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 OPERATING ACTIVITIES Profit before tax 15,944 22,316 33,691 39,192 28,814 65,849 37,091 58,432 37,034 31,291 35,225 30,975 Total adjustments -1,589 -7,197 671 -7,735 -6,675 2,220 49,3
Slide 28: Method of determining adjusted EBITDA
Method of determining adjusted EBITDA Selected items of the Profit and Loss Statement in k PLN Results Q1 2022 Operating profit IFRS 29,392 Amortisation +2,742 Write-down for impairment +0 EBITDA IFRS 32,134 Corrections: Non-cash impact of the incentive programs +12,303 Deferred result (unused virtu
Slide 29: General administrative costs and one-offs
General administrative costs and one-offs General administrative costs (PLN k) Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 One-off costs MSOP 7,291 7,294 7,294 9,361 11,305 M&A 0 0 3,669 18 1,760 Croatia costs 0 0 2,054 0 0 Normal costs Salaries 1,872 3,097 2,284 4,117 5,463 Subsidiaries costs 51 21 1,193 1,196 1
Slide 30: 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 31: 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 32: 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