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Remedy drives growth with moves towards publishing and new games - Remedy Investors
Remedy Entertainment Plc | Company announcement 09:00 am (EEST) 13 August 2021 HALF-YEAR REVIEW 1 January – 30 June 2021 (unaudited) Remedy drives growth with […]
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Remedy Entertainment Plc | Company announcement 09:00 am (EEST) 13 August 2021
HALF-YEAR REVIEW 1 January – 30 June 2021 (unaudited)
Strong financial position, new co-publishing and development agreement signed to expand Control.
HIGHLIGHTS FROM APRIL–JUNE 2021
- Revenue 9 417 (9 125) thousand euros, change +3.2 %.
- Operating profit (EBIT) 2 304 (2 086) thousand euros, 24.5 % (22.9 %) of revenue.
- Remedy signed a co-publishing and development agreement with 505 Games for a multiplayer spin-off game of the award-winning Control. Collaboration terms for a future, bigger-budget Control-game were also agreed.
HIGHLIGHTS FROM JANUARY–JUNE 2021
- Revenue 17 533 (16 970) thousand euros, change +3.3 %.
- Operating profit (EBIT) 3 155 (3 161) thousand euros, 18.0 % (18.6 %) of revenue.
- Remedy signed a co-publishing and development agreement with 505 Games for a multiplayer spin-off game of the award-winning Control. Collaboration terms for a future, bigger-budget Control-game were also agreed.
- Remedy raised 41 500 thousand euros with a directed offering of new shares to a limited number of domestic and international institutional investors in an accelerated book-building process.
- Control Ultimate Edition was released on PlayStation 5 and Xbox Series X|S on 2 February.
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REMEDY DRIVES GROWTH WITH MOVES TOWARDS PUBLISHING AND NEW GAMES
Remedy Entertainment Plc | Company announcement 09:00 am (EEST) 13 August 2021
HALF-YEAR REVIEW 1 January – 30 June 2021 (unaudited)
Remedy drives growth with moves towards publishing and new games
Strong financial position, new co-publishing and development agreement signed to expand Control.
HIGHLIGHTS FROM APRIL–JUNE 2021
- Revenue 9 417 (9 125) thousand euros, change +3.2 %.
- Operating profit (EBIT) 2 304 (2 086) thousand euros, 24.5 % (22.9 %) of revenue.
- Remedy signed a co-publishing and development agreement with 505 Games for a multiplayer spin-off game of the award-winning Control. Collaboration terms for a future, bigger-budget Control-game were also agreed.
HIGHLIGHTS FROM JANUARY–JUNE 2021
- Revenue 17 533 (16 970) thousand euros, change +3.3 %.
- Operating profit (EBIT) 3 155 (3 161) thousand euros, 18.0 % (18.6 %) of revenue.
- Remedy signed a co-publishing and development agreement with 505 Games for a multiplayer spin-off game of the award-winning Control. Collaboration terms for a future, bigger-budget Control-game were also agreed.
- Remedy raised 41 500 thousand euros with a directed offering of new shares to a limited number of domestic and international institutional investors in an accelerated book-building process.
- Control Ultimate Edition was released on PlayStation 5 and Xbox Series X|S on 2 February.
KEY FIGURES
| FAS, unaudited EUR thousand | 4–6/2021 | 4–6/2020 | 1–6/2021 | 1–6/2020 | 1-12/2020 |
| Revenue | 9 417 | 9 125 | 17 533 | 16 970 | 41 086 |
| Growth in revenue, % | 3.2 % | -1.1 % | 3.3 % | 23.0 % | 29.8 % |
| EBITDA | 2 599 | 2 340 | 3 727 | 3 660 | 14 313 |
| Operating profit (EBIT) | 2 304 | 2 086 | 3 155 | 3 161 | 13 245 |
| Operating profit, % of revenue | 24.5 % | 22.9 % | 18.0 % | 18.6 % | 32.2 % |
| Result for review period | 1 774 | 1 607 | 1 647 | 2 500 | 10 337 |
| Result for review period, % of revenue | 18.8 % | 17.6 % | 9.4 % | 14.7 % | 25.2 % |
| Balance sheet total | 89 139 | 37 843 | 89 139 | 37 843 | 48 355 |
| Cash flow from Operations | -973 | 1 572 | 3 024 | 1 163 | 11 806 |
| Net cash | 56 901 | 13 081 | 56 901 | 13 081 | 20 016 |
| Cash position | 60 575 | 16 755 | 60 575 | 16 755 | 23 690 |
| Net gearing, % | -74.3 % | -47.5 % | -74.3 % | -47.5 % | -56.6 % |
| Equity ratio, % | 85.9 % | 72.8 % | 85.9 % | 72.8 % | 73.2 % |
| Capital expenditures | 2 531 | 1 119 | 4 584 | 2 634 | 6 346 |
| Average number of personnel during review period (FTE) | 280 | 258 | 277 | 262 | 265 |
| Headcount at the end of period | 293 | 266 | 293 | 266 | 275 |
| Earnings per share, € | 0.136 | 0.133 | 0.126 | 0.207 | 0.856 |
| Earnings per share, € (diluted) | 0.127 | 0.126 | 0.118 | 0.196 | 0.797 |
| Number of shares at the end of period | 13 072 150 | 12 072 150 | 13 072 150 | 12 072 150 | 12 072 150 |
Calculation formulas used for the indicators
EBITDA = operating profit (EBIT) + depreciation and amortization
Net cash = cash in hand and at banks + liquid investments – interest-bearing liabilities
Net gearing = (interest-bearing liabilities – cash in hand and at banks – liquid investments) / shareholders’ equity
Equity ratio = shareholders’ equity / (balance sheet total – advances received)
COMMENTS BY CEO TERO VIRTALA
During April–June 2021, revenue was €9.4M (9.1) and operating profit was €2.3M (2.1). Control’s royalty revenues were slightly higher in Q2 2021 than in Q2 2020, while the development payments from our partners were at a lower level. Cash flow from operations in Q2 2021 was €–1.0M and cash balance at the end of the period was €60.6M.The cash position has provided us with stronger means to execute our strategy and carry out our ambitious long-term growth plans. In the second quarter, we advanced in creating category-defining games and expanding our games into long-term franchises. We also expanded our multi-project capabilities and strengthened our in-house capabilities related to project financing and publishing activities.
In June, we signed a co-publishing and development agreement with 505 Games for a newly announced game project called Condor. Condor is a 4-player cooperative PvE (player vs. environment) game, set in the world of our award-winning Control. In addition, we agreed on collaboration terms for a future, bigger-budget Control game. This is a good example of our capability to create franchises that can grow into multiple meaningful, high-quality future games. We can also enhance our publishing role strategically, with a trusted partner like 505 Games.
We continue actively marketing Control. Control Ultimate Edition was announced for Google Stadia and launched after the reporting period on July 27th. Control was also included as a limited time free offering in Epic Game Store’s Mega Sale 2021. Overall, new platforms, services and special offerings give us valuable lessons for the future, bring additional revenue, help us to reach new audiences and increase Control brand awareness. Control has already reached a formidable audience, having been played by over 10 million players. The growing audience and brand awareness are valuable as we continue to support Control and develop Condor, and we are in the early conception phase for a future, bigger-budget Control game.
We have a small Crossfire team focusing on supporting the upcoming launches of Crossfire’s HD story mode and CrossfireX. We expect these launches to happen later this year. Crossfire’s HD multiplayer mode was already launched in China by Smilegate and Tencent in June.
Remedy’s AAA game project with Epic Games has moved into full production, and a second, smaller-scale game remains in full production mode. Vanguard, our free-to-play co-op game project, is still progressing at a good pace, with selected internal and external closed gameplay tests.
Our headcount grew to 293 by the end of June 2021. Earlier in 2021, we started piloting and evaluating new ways to attract and recruit talent that will be based outside Finland. Our main focus has been in Europe, and I am satisfied that we have been able to reach our targets related to recruitment, onboarding and teamwork. During the second quarter, we also continued our initiatives related to production capabilities, Northlight technology, people, teams, and ways of working.
I am happy with the progress we have made so far in 2021. Our financial position is stronger than before. Control continues to reach new players, expands into new games, and is a strong proof of our ability to create category defining games and brands. Our multi-project model is continuously developing and we are approaching a phase where we can launch new games more often and more regularly. We are on track to reach our ambitious long-term growth objectives.
