8186
Next Games Corp.: Financial Statements Bulletin January-December 2020
Next Games Corporation Company Release, 19 February 2021, 8:00 a.m. EET
Company EBITDA positive as a result of record Publishing Profitability.
January-December in short
- Revenue was EUR 27.2 (34.7) million
- Gross Profit was EUR 14.3 (19.7) million, 52% (57%) of revenue
- Operating Result (EBIT) improved EUR 4.0 million and was EUR -3.4 (-7.4) million
- Adjusted Operating Result improved EUR 3.9 million and was EUR -0.1 (-4.0) million
- EBITDA turned positive and was (EUR) 0.5 (-3.5) million
- Publishing profitability doubled in proportion to revenue with EBITDA at EUR 6.4 (3.8) million, 24% (11%) of revenue
- Research and Development expenses were EUR -5.6 (-6.6) million, 21% (19%) of revenue
- The company had 104 (107) employees at the end of 2020
July-December in short
- Revenue was EUR 12.8 (15.5) million
- Gross profit was EUR 6.7 (8.4) million, 52% (54%) of revenue
- Operating Result (EBIT) was EUR -1.7 (-3.9) million
- Adjusted Operating was EUR -0.2 (-2.2) million
- EBITDA was EUR 0.2 (-2.0) million
- Publishing profitability measured by EBITDA doubled to EUR 3.0 (1.5) million, 24% (10%) of revenue
- Research and Development expenses EUR -2.9 (-3.3) million, 23% (21%) of revenue
(Numbers in brackets refer to the corresponding year-on-year period unless otherwise mentioned)
Key Figures
| EUR million | Jul-Dec 2020 | Jul-Dec 2019 | Change | 2020 | 2019 | Change |
| Company | ||||||
| Revenue | 12.8 | 15.5 | -17% | 27.2 | 34.7 | -22% |
| Gross Profit | 6.7 | 8.4 | -20% | 14.3 | 19.7 | -28% |
| EBITDA | 0.2 | -2.0 | 111% | 0.5 | -3.5 | 116% |
| Operating Result (EBIT) | -1.7 | -3.9 | 56% | -3.4 | -7.4 | 54% |
| Adjusted Operating Result | -0.2 | -2.2 | 91% | -0.1 | -4.0 | 97% |
| Gross profit % | 52% | 54% | 2ppt | 52% | 57% | 5ppt |
| EBITDA % | 2% | -13% | 15ppt | 2% | -10% | 12ppt |
| Operating Result (EBIT) % | -14% | -25% | 11ppt | -12% | -21% | 9ppt |
| Adjusted Operating Result % | -1% | -14% | 13ppt | 0% | -11% | 11ppt |
| Publishing Operations’ Profitability | ||||||
| EBITDA | 3.0 | 1.5 | 100% | 6.4 | 3.8 | 70% |
| EBITDA % | 24% | 10% | 14ppt | 24% | 11% | 13% |
| Research and Development Key Figures | ||||||
| Investments | 1.9 | 1.0 | 85% | 3.5 | 2.4 | 48% |
| Expenditure | 3.7 | 3.6 | 4% | 7.0 | 7.6 | -7% |
| Key Figures per Quarter | ||||||
| EUR million | Jul-Sept 2020 | Jul-Sept 2020 | Change | Oct-Dec 2020 | Oct-Dec 2020 | Change |
| Revenue | 6.1 | 7.8 | -22% | 6.7 | 7.7 | -12% |
| Gross Profit | 3.2 | 4.3 | -27% | 3.5 | 4.1 | -14% |
| EBITDA | 0.2 | -1.1 | 118% | 0 | -0.8 | 100% |
| Operating Result (EBIT) | -0.8 | -2.1 | 63% | -1.0 | -1.8 | 47% |
| Adjusted Operating Result | 0.0 | -1.2 | 104% | -0.2 | -1.0 | 76% |
| Gross profit % | 52% | 56% | 4ppt | 52% | 53% | 1ppt |
| EBITDA % | 3% | -14% | 17ppt | 0% | -11% | 11ppt |
| Operating Result (EBIT) % | -13% | -27% | 14ppt | -14% | -24% | 10ppt |
| Adjusted Operating Result % | 1% | -15% | 16ppt | -3% | -13% | 10ppt |
Chief Executive Officer Teemu Huuhtanen
2020: Ready for growth
“Our strategy to make games based on well known brands is the cornerstone of profitably growing our market share.“
Next Games’ year 2020 ended on a positive note, reaching EBITDA profitability of EUR 0,5 million. The main theme of the past year was our turnaround in profitability. Publishing Operations profitability doubled as compared to the previous year. We also held a successful Capital Market Day for investors in the fall, where we refined our strategy and announced our new, mid-term financial targets of achieving yearly revenues of EUR 250 million, reaching EBITDA of over 23 % and an EBIT level of over 18%. Our growth goals are supported by our games as a service focus, and continued development and support of our full portfolio of games. The spearhead of new releases is our latest game based on the well-known brand; Stranger Things. We will grow revenues through scaling marketing investments in the upcoming year.
Our revenue was EUR 27,2 million (34,7). Our Publishing Operations, i.e. the profitability of published games as measured by EBITDA, improved to EUR 6,4 (3,8) million and the corresponding EBITDA margin to 24% (11%): Our published games enable a stable and profitable business, as well as investments in the future.
We benefit from our strong market position in the large and growing mobile gaming market; the fastest growing segment in gaming, reaching 100 billion dollars in revenues within a few years. Interest in games is steadily growing with the global gaming market already larger than the film and music industry combined. Next Games benefits from this market development and we are already one of the largest publishers in our genres (Geolocation and Turned Based RPG) in our main market area; North America.
Our strategy to make games based on well known brands is the cornerstone of profitably growing our market share. The use of well-known brands, enables us to attract players with lower user acquisition costs compared to publishers who rely solely on user acquisition. With our advanced analytics, we are both able to scale efficiently and to optimize the in-game experience for our players.
Over the past year, we have invested heavily in our own technology platform as well as in analytics and processes, i.e. our unified infrastructure. We continue strengthening our strategic partnerships with various partners, and our product development pipeline is working on a number of promising games based on well-known international brands. More than half of our staff worked on upcoming games, and at the heart of our development is our focus on tailoring a player-centric purchase and engagement experience in our games.
We strongly believe that the best people make the best games, which is why we have invested in both international recruitment and professional development. At the end of the year, Next Games employed more than a hundred professionals from 22 different countries. Our newly appointed (end of 2020) and strengthened management team is also a key factor in supporting and accelerating growth.
In many ways the past year has been challenging for all of us, due to the concerns of the COVID-19 pandemic. However despite this challenging situation, we have been able to improve the profitability of our business as well as further the development of our new games, in accordance with our strategy. Our efforts will bear fruits in 2021, and we will continue to develop our business for long term success in the incoming years.
I would like to thank our whole team at Next Games, all our partners and our shareholders for the past year. In particular, I would like to thank our players for their continued commitment to our games. We will continue to invest in players first, now and in the future.
Teemu Huuhtanen
CEO
Outlook 2021
Next Games expects revenues to grow to at least EUR 40 million in 2021. The company is targeting profitable growth with full year EBITDA positive in 2021.
Basis for outlook
The outlook is based on an estimate that Walking Dead games will generate revenue on a steady or slightly declining trend. Revenue for Stranger Things will be increased during 2021, and Blade Runner will be released in key markets.
Audiocast and phone conference
We will hold an audiocast and a phone conference in English. Next Games’ 2020 review will be presented by CEO Teemu Huuhtanen and CFO Annina Salvén. The English audiocast starts on 19, February, 2021 at 10.00 EET. You can join by using the following link: https://nextgames.videosync.fi/2020-q4-results or by phone.
Phone conference details:
Dial in by calling your location’s phone number a couple of minutes before the start. Confirmation code: 69230062#
Finland: +358 981 710 310
Sweden: +46 856 642 651
United Kingdom: +44 333 300 0804
United States: +1 631 913 1422
Additional information:
Annina Salvén
CFO
+358 (0) 40 588 3167
[email protected]
Certified Adviser: Alexander Corporate Finance Oy, puh. +358 50 520 4098
About Next Games
Next Games (Helsinki Nasdaq First North Growth Market: NXTGMS) is the first publicly listed mobile game developer and publisher in Finland, specializing in games based on entertainment franchises, such as movies, TV series or books. Our critically acclaimed The Walking Dead games redefines the way franchise entertainment transforms into highly engaging service-based mobile games. For more information head to www.nextgames.com
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8186
The Arbitral Tribunal Has Confirmed Netflix, Inc.’s Redemption Right Regarding Next Games Corporation’s Minority Shares
Next Games Corporation Company Release August 19, 2022 at 2:45 p.m. (EEST)
The arbitral tribunal has confirmed Netflix, Inc.’s redemption right regarding Next Games Corporation’s minority shares
The arbitral tribunal appointed by the Redemption Board of the Finland Chamber of Commerce has today on August 19, 2022 confirmed that Netflix, Inc. (“Netflix”) has the right to redeem the minority shares in Next Games Corporation (“Next Games”) and that Netflix has the right to obtain title to the minority shares by placing a security approved by the arbitral tribunal for the payment of the redemption price and the interest possibly accruing thereon.
Next Games announced on 9 August 2022 that the Board of Directors of Next Games had decided to apply for the termination of multilateral trading in Next Games’ shares and for the delisting of Next Games’ shares from the First North Growth Market Finland marketplace’s list (“First North”) to occur as soon as possible after Netflix has received title to all the Next Games shares subject to redemption in the redemption proceedings.
The title to the minority shares is transferred to Netflix once a security approved by the arbitral tribunal has been placed, which is expected to take place on or about 22 August 2022. The minority shareholders of Next Games, following the placing of the security and the transfer of ownership, are entitled to receive only the redemption price and the possible interest payable thereon. Nasdaq Helsinki Ltd. will issue a separate release regarding the delisting of Next Games’ shares from First North.
Next Games Corporation
Additional information:
Saara Bergström, Chief Communications Officer
+358 (0) 40 588 3167
Media: [email protected]
Investor relations: [email protected]
Certified Adviser: Aktia Alexander Corporate Finance Oy, tel. +358 (0) 50 520 4098
About Next Games
Next Games redefines the way entertainment franchises transform into engaging mobile games with an authentic and social fan experience at the heart. Next Games creates compelling fans-first interactive experiences by combining the stories of well-known movies and TV series with interesting game mechanics. An unwavering focus on fans is at the core of the studio’s development. Next Games has recently been acquired by Netflix as a core internal studio to build games on the Netflix platform. www.nextgames.com
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Next Games Corporation Company Release 12 August 2022 at 9:30 a.m. (EEST)
Next Games reschedules publication of its Half-Year Review 1 Jan – 30 Jun 2022 to Wednesday 31 August 2022. The previously planned publication date for the Half-Year Review was 19 August 2022.
The reason for the postponement is integration work relating to the previously announced, completed tender offer for all shares in Next Games by Netflix, Inc., including expansion of Finnish, international and U.S. accounting standards as well as changes in reporting systems, which delays the preparation of the Half-Year Review.
Additional information:
Saara Bergström
Chief Communications Officer
+358 (0) 50 483 3896
[email protected]
Certified Adviser: Aktia Alexander Corporate Finance Oy, puh. +358 (0) 50 520 4098
About Next Games Next Games redefines the way entertainment franchises transform into engaging mobile games with an authentic and social fan experience at the heart. Next Games creates compelling fans-first interactive experiences by combining the stories of well-known movies and TV series with interesting game mechanics. An unwavering focus on fans is at the core of the studio’s development. Next Games has recently been acquired by Netflix as a core internal studio to build games on the Netflix platform. www.nextgames.com
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8186
Next Games Corporation Applies for the Delisting of Its Shares From the First North Growth Market Finland Marketplace
Next Games Corporation Company Release August 9, 2022 at 9:30 a.m. (EEST)
Next Games Corporation applies for the delisting of its shares from the First North Growth Market Finland marketplace
The Board of Directors of Next Games Corporation (“Next Games”) has on 8 August 2022 decided to apply for the termination of multilateral trading in Next Games’ shares and for the delisting of Next Games’ shares from the First North Growth Market Finland marketplace’s list (“First North”).
As announced earlier, Netflix, Inc. (“Netflix”) has with its application to the Redemption Board of the Finland Chamber of Commerce dated 9 May 2022 commenced redemption proceedings pursuant to Chapter 18 of the Finnish Limited Liability Companies Act to redeem all minority shares in Next Games.
Netflix holds more than nine tenths (9/10) of all shares and votes in Next Games. Netflix has the right to redeem all shares held by minority shareholders of Next Games. Subject to the approval of the arbitral tribunal appointed to resolve the matter, Netflix has the right to acquire all shares held by the minority shareholders by placing a security for the payment of the redemption price.
Next Games will as soon as possible file an application for the termination of trading and for the delisting with Nasdaq Helsinki Ltd. In the application, Next Games will apply for the termination of trading and delisting as soon as possible after Netflix has received title to all Next Games shares subject to redemption in the redemption proceedings.
Next Games Corporation
Additional information:
Saara Bergström, Chief Communications Officer
+358 (0) 40 588 3167
Media: [email protected]
Investor relations: [email protected]
Certified Adviser: Aktia Alexander Corporate Finance Oy, tel. +358 (0) 50 520 4098
About Next Games
Next Games redefines the way entertainment franchises transform into engaging mobile games with an authentic and social fan experience at the heart. Next Games creates compelling fans-first interactive experiences by combining the stories of well-known movies and TV series with interesting game mechanics. An unwavering focus on fans is at the core of the studio’s development. Next Games has recently been acquired by Netflix as a core internal studio to build games on the Netflix platform. www.nextgames.com
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