Tinybuild Inc. · LSE:TBLD
Tinybuild — FY2022 Earnings Presentation
47 slides from Tinybuild's earnings presentation, March 2023
Slide 1: FY 2022 Results Presentation
FY 2022 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: Showreel
SHOWREEL Page intentionally left blank 3
Slide 4: Presenting Today
PRESENTING TODAY Alex Nichiporchik Tony Assenza Lerika Mallayeva Jon Carnage Joyce Giasone (Jaz) Salati Group CEO, Founder Group CFO CEO, founder DevGAMM Director of Cross Media Head of M&A 20+ years' industry 12+ years’ finance and 18 years 'industry 20-year veteran of the 20+ years’ finance experien
Slide 5: Agenda - FY 2022
AGENDA - FY 2022 OPERATIONAL REVIEW FINANCIAL REVIEW STRATEGY DevGAMM CROSS MEDIA APPENDIX 5
Slide 6: Operational Review
OPERATIONAL REVIEW Alex Nichiporchik (CEO, Founder)
Slide 7: Record Results on Extreme Difficulty Mode
RECORD RESULTS ON EXTREME DIFFICULTY MODE ▪ 1.9x avg return on investment for big budgets titles* ▪ Record number of monetizable events ▪ Decentralized cross platform publishing pipeline ▪ Ramp up strategic initiatives: events, cross media * Games with a development budget over $1m 7
Slide 8: FY 2022 Highlights
FY 2022 HIGHLIGHTS $63m 21% >80 consolidated revenues revenue growth games portfolio 77% 3x $1m+ $26m Titles launched and ROI of sales from Own-IP positive net cash position (ye) 8
Slide 9: Own IP Across Multiple Platforms
OWN IP ACROSS MULTIPLE PLATFORMS OVER 80 GAMES CREATING FRANCHISE POTENTIAL FY22 FY17 77% OWN-IP AS % OF GAMING REVENUE
Slide 10: Balanced Mix Back Catalogue / Front List
BALANCED MIX BACK CATALOGUE / FRONT LIST 80% BACK CATALOGUE AS % OF GAMING REVENUES *Back catalogue is defined as any games released in the prior financial year and before 10
Slide 11: Low Risk M&A
LOW RISK M&A Demagic DEMAGIC SCYTHE KONFA GAMES BOSSA STUDIO’S IP DATE: April 2022 DATE: December 2022 DATE: 26 August 2022 DATE: 26 August 2022 TYPE: Acquihire TYPE: Acquihire TYPE: Acquihire TYPE: IP Purchase LOCATION: Serbia LOCATION: Arizona LOCATION: Belgrade, Serbia LOCATION: UK TEAM SIZE: 23
Slide 12: Industry Recognition
INDUSTRY RECOGNITION ▪ tinyBuild won Best Indie Publisher at the Digital Vikings Awards. ▪ Spiderheck - nominated at D.I.C.E. for the Fighting Game of the Year Award ▪ Not For Broadcast nominated at GDC and BAFTA awards ▪ Potion Craft - nominated at D.I.C.E. for the Strategy/ Simulation Game of the
Slide 13: Secret Sauce
SECRET SAUCE ▪ Setup a cross platform publishing pipeline ▪ Source games from both internal and external studios ▪ Apply secret sauce ▪ Release games with a high degree of visibility on ROI ▪ Invest into more higher budget games 13
Slide 14: Financial Review
FINANCIAL REVIEW Antonio Assenza (CFO)
Slide 15: FY 22: High Growth Company
FY 22: HIGH GROWTH COMPANY Net Game Revenues1 Adj. EBITDA2 Adj. Cash from Operations3 ▪ Net game revenue growth driven by strong ▪ Adj. EBITDA growth driven by a solid ▪ Adj. Cash from Operations increased back catalogue sales and new titles such organic contribution and the decline in slightly due
Slide 16: P&L
P&L ▪ Game and Dev revenues growth due primarily to strong contribution from Development Services segment and the consolidation of Versus Evil and Red Cerberus. ▪ Events revenue declined due to cancellation of DevGAMM in Ukraine, Russia and Belarus ▪ Adj. EBITDA margin reflects the consolidation of s
Slide 17: Balance Sheet
BALANCE SHEET ▪ Net cash position of $26.5m at 31 December 2022, reflects increase in software development investments ▪ Increase in trade receivables is due to timing differences in payments from platforms following a strong Q4 performance ▪ Goodwill drops to $3.7m following the write-off of part of
Slide 18: Cash Flow
CASH FLOW ▪ Net cash generated from operations was $19.3m in 2022, a sharp increase from $13.3m in 2021 as a result of higher revenues and lower exceptional charges ▪ The decrease in contingent consideration reflects the write down in goodwill ▪ The increase in amortisation of intangible assets reflec
Slide 19: Cash Utilisation 2022
CASH UTILISATION 2022 $26.5m NET CASH AT 31 DECEMBER 2022 ▪ Development costs largest cash outflow ▪ Timing differences $4.6m ▪ M&A investment of $4.2m
Slide 20: Diversified Investments
DIVERSIFIED INVESTMENTS $36m GAME DEV INVESTMENTS IN 2022, WITH LOW CONCENTRATION RISK ▪ Over 20 games with spend of $500k+ in 2022 ▪ No game accounted for more than 15% of total ▪ 10%+ invested in new tech, media & platforms
Slide 21: Strategic Review
STRATEGIC REVIEW Alex Nichiporchik (CEO, Founder)
Slide 22: Growth Recipe
GROWTH RECIPE ▪ Investment in catalogue, evergreen franchises ▪ Diversified revenue streams by audiences, platform ▪ Innovation with technology, visuals, services ▪ Reboot of our Events business
Slide 23: Five Year Plan
FIVE YEAR PLAN IP ORIGINATES FROM GAMES & ANIMATED SERIES GAAS, ANIMATED SERIES, INTERACTIVE MEDIA CO EXIST BIGGER TITLES AND TV SERIES 2023 2024 2025 2026 2027 BIGGER TITLES START COMING OUT, CROSS MEDIA FUELED BY LIVE ACTION MEDIA PROFITABLE FRANCHISES 23
Slide 24: Decentralize
DECENTRALIZE ▪ Eliminate bottlenecks and gives people full ownership ▪ This enables us to ship bigger games more efficiently ▪ Verify marketing viability before launch ▪ Increase accountability and visibility ▪ Games end up shipping on all platforms
Slide 25: Bigger Budgets, Bigger Returns
BIGGER BUDGETS, BIGGER RETURNS 1.9x AVERAGE RETURN on investment from big games* launched in 2022 ▪ Game as a Service approach ▪ Multiplatform launch ▪ Low-risk, data-driven approach 1.9x avg return * Games with a development budget over $1m 25
Slide 26: Currently Under Development
CURRENTLY UNDER DEVELOPMENT ▪ Small number of high-potential games ▪ $1-5m budget per game ▪ 2-5y development cycle ▪ Over 100hrs playtime (GAAS)
Slide 27: DevGAMM
DevGAMM Lerika Mallayeva (DevGAMM CEO, Founder)
Slide 28: DevGAMM's History
DEVGAMM’S HISTORY Founded as Lost all 3 major events Acquired by Largest event in CIS FlashGAMM (, , ) due to Renatus Media Ltd, 5,000+ yearly attendees 100+ attendees Russia's invasion of Rebranded to DevGAMM Annual turnover $1m+ Ukraine 2008 2009 2013 2017 2019 2020 2022 2023 Acquired by…
Slide 29: Growth Plan
GROWTH PLAN 2008-19 ATTENDEE GROWTH IN 3 COUNTRIES Pre Ukraine invasion ▪ 10y experience managing growth ▪ 3 large events in different countries Looking forward ▪ 3 large events per year (Poland, Lithuania, Portugal) ▪ 2 first years – investments in the region, then profits ▪ DevGAMM Summit in UK ▪ Co
Slide 30: Synergetic Union
SYNERGETIC UNION ▪ tinyBuild is positioned as a thought leader of the industry ▪ tinyBuild signed over 30 titles discovered at DevGAMM ▪ tinyBuild and its studios hired over 50 people here ▪ DevGAMM benefits from industry insights & connections
Slide 31: Cross Media
CROSS MEDIA Jon Carnage (Director of Cross Media)
Slide 32: Hello Neighbor: Welcome to Raven Brooks
HEUIG NEIGHBOR WELCOME yo RAVEN BROOKS
Slide 33: Early Reception
Welcome To Raven Brooks S01E01: HELLQ NEIGHBOR (A Series 1.4M views + 3 months ago tinyBuildGAMES @ Trinity moves into the mysterious town of Raven Broo! cc Welcome to Raven Brooks S01E02 Animated Series 1M views + 3 months ago tinyBuildGAMES @ Trinity and Nicky get the gang together to investigate
Slide 34: Animation Timeline
ANIMATION TIMELINE Ep 1-6 Ep 7-12 Ep 13-18 H1 2023 H2 2023 TBD 34
Slide 35: Video Games Are the New Generation's Mega IPs
VIDEO GAMES ARE THE NEW GENERATION’S MEGA IP’S 35
Slide 36: Closing Remarks
CLOSING REMARKS Alex Nichiporchik (CEO, Founder)
Slide 37: Core Strategy
CORE STRATEGY …across Global …creating long …focused on IP multiple developer term scalable ownership… media publisher… franchises… formats 37
Slide 38: Outlook
OUTLOOK The Board remains confident the company is on track to deliver results at least in line with expectations, plus accretive acquisitions. 38
Slide 39: Appendix
APPENDIX
Slide 40: Accounting Policies
ACCOUNTING POLICIES CAPITALISATION POLICIES DEVELOPER ADVANCE 3rd party developer advances are capitalised on payment and recognised on the P&L in line with revenue until the capitalised development AMORTISATION (3RD PARTY) advances are fully amortised DEVELOPMENT COSTS Development costs are capital
Slide 41: A Thorough, Yet Agile, Selection Process
A THOROUGH, YET AGILE, SELECTION PROCESS Tested process quickly identifies IP to pursue Developer led differentiates us… Inbound Desktop Conferences Reach Social pitches research presence DISCOVER Multimedia 1,000+ p/a extend audience Services 2nd party IP marketing, video creative production, QA & c
Slide 42: Growth So Far
GROWTH SO FAR 2013 - 2015 2016 - 2018 2019 2020 2021-22 2023 & beyond… Acquihired… Acquihired…>90 Acquihired… Secret No Time to Transitioned to Neighbor Explain 2nd Party IP & AA launch released games 72 Acquihired Invested in Dynamic Pine Events & Founder owned Pixels DevGamm Highlights 40 35 Top b
Slide 43: Global Presence
GLOBAL PRESENCE >70 GAMES PUBLISHED >400 STAFF* GLOBALLY >10 STUDIOS >1.5m SOCIAL MEDIA FOLLOWERS** Map shows selected partner locations only (March 2022) * Employees and independent contractors 43 ** Source Company research
Slide 44: Innovative Marketing Approach
INNOVATIVE MARKETING APPROACH Mutually beneficial relationship Social Media Following vs. Competitors* with influencers Influencers require 1 content tinyBuild produces c.5 billion + 2 exciting and interactive content YouTube views Influencer 10,000 + receives views (views = money) 3 tinyBuild receives
Slide 45: Franchise Blueprint
FRANCHISE BLUEPRINT Hello Neighbor New VR title franchise milestones… Social, Puzzler 70M+ Roblox Sandbox HN downloads Secret Neighbor GaaS Linear Chapter based Linear Chapter based >4M Animated Secret Neighbor TV series iOS downloads New episodes GRAPHIC NOVELS >140K sold dropping in 2023 TV EPISOD
Slide 46: M&A Strategy
M&A STRATEGY Strategic rationale Deal Structure ▪ New Intellectual Property IP ▪ Deferred consideration ▪ Complimentary publishers ▪ Attractive Multiples ▪ Development studios ▪ Minimum Target Return on Investment ▪ Additional service providers ▪ Accretion Growth mindset Retention and Incentivisatio
Slide 47: Thank You!
Build THANK YOU!