3Q 2017 Earnings Results. November 7, 2017

Transcription

1 3Q 2017 Earnings Results November 7, 2017

2 DISCLAIMER The financial information included in this document are consolidated earnings results based on K-IFRS. The financial results for 3Q 2017 for Netmarble Games (the Company ) contained in this document have been provided for investors convenience only and have not been reviewed by an independent auditor. Therefore, certain part(s) of this document are subject to change upon the auditor s review. This document contains forward-looking statements that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance, and often contain words such as expects, anticipates, "intends, "plans, "believes, "seeks, or "will." Forward-looking statements" by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties which could adversely or positively affect our future results include the behavior of financial markets, the Company s strategic actions, unanticipated dramatic developments in our major business conditions, and numerous other matters at the national and international levels which could affect our financial results. These uncertainties may cause our actual results to be materially different from those expressed in this document. 1

3 CONTENTS FINANCIAL HIGHLIGHTS OF 3Q 2017 OVERSEAS REVENUE SHARE GAME PORTFOLIO MAJOR COST STRUCTURES FOCUS OF 4Q 2017 APPENDIX. CONSOLIDATED FINANCIAL STATEMENTS

4 1. FINANCIAL HIGHLIGHTS OF 3Q Q recorded revenue of W581.7bn (YoY 62%, QoQ 8%), EBITDA of W129.5bn (YoY 78%, QoQ 7%), and operating profit of W111.8bn (YoY 73%, QoQ 6%) EBITDA margin and operating profit margin were 22.3% and 19.2%, respectively Revenue 687 YoY 62% QoQ 8% 20.3% 27.4% EBITDA 31.1% 22.4% 22.3% 18.0% Operating Profit 25.5% 29.1% (Unit : W bn) 19.5% 19.2%

5 1. FINANCIAL HIGHLIGHTS OF 3Q 2017 Net profit was W84.2bn (YoY 104%, QoQ 8%). Net profit (controlling) was W74.3bn (YoY 86%, QoQ 6%) Margins for net profit and net profit (controlling) were 14.5% and 12.8%, respectively Net Profit Net Profit (Controlling) (Unit : W bn) 11.5% 17.5% 21.3% 14.5% 14.5% 11.1% 15.6% 18.9% 13.0% 12.8%

6 2. OVERSEAS REVENUE SHARE Proportion of overseas revenue rose to 71% on the back of L2R s success in Japan and full-quarter inclusion of SEA performance Revenues were diversified across Korea (29%), North America (24%), Southeast Asia (19%) and Japan (16%) Overseas revenue share expected to keep rising with L2R launch in NA/Europe scheduled for 4Q Korea & Overseas Revenue Share 56% 42% Korea 31% Overseas 52% 71% Revenue Breakdown by Region Others 12% (Unit : W bn) Japan 16% Korea 29% Southeast Asia 19% North America 24% 5

7 3. GAME PORTFOLIO MMORPG proportion of the revenue increased to 46% (QoQ 7%) thanks to L2R contribution Game portfolio continues to be diversified with 5 games each of which contributes at least 5% to the total revenue Top 5 revenue generators are L2R, Marvel Contest of Champions, Seven Knights, Everybody s Marble, and Cookie Jam Revenue Breakdown by Genre Others 6% Revenue Breakdown by Major Games Others 25% Lineage2Revolution 45% Casual 23% MMORPG 46% Cookie Jam 6% RPG 25% Everybody's Marble 6% Seven Knights 6% Marvel Contest of Champions 12% NOTE: Major Games are games accounting for over 5% of the total revenue 6

8 4. MAJOR COST STRUCTURES Operating costs rose to W469.9bn (YoY 60%, QoQ 8%) in proportion to the revenue growth from the previous quarter Marketing costs considerably increased QoQ to W101.0bn due to increased L2R marketing costs in Japan Labor costs went up due to one-off overtime payment Operating Costs (Unit : W bn) Breakdown of Revenue by Operating Costs Commission Labor Marketing Others (Inc.D&A) Commission Labor Marketing Others (Inc.D&A) 39.4% 40.9% 41.3% 41.5% 40.0% % 17.6% 7.3% 15.4% 13.1% 12.7% 11.4% 5.5% 5.1% 16.1% 17.4% 15.3% 15.9% 7.8% 7.5% 7

9 5. FOCUS OF 4Q 2017 L2R will be launched on November 15 in 54 countries across NA and Europe with unprecedented 1.5+mn pre-registered users Tera M is also scheduled to be launched on November 28 in Korea. Pre-registration has exceeded 1.9mn so far Fate/Grand Order will be launched on November 21 in Korea L2R Showcase (TwitchCon 2017) Tera M Media Showcase Fate/Grand Order Showcase 8

10 APPENDIX. CONSOLIDATED FINANCIAL STATEMENTS Consolidated Income Statement (Unit : W bn) Consolidated Statement of Financial Position (KRW bn) 1Q16 2Q16 Revenue Commission Labor Cost Advertising Cost Other Costs (exc. D&A) EBITDA Margin (%) 20.2% 17.0% 20.3% 27.2% 31.1% 22.4% 22.3% D&A Operating Income Margin (%) 18.1% 15.1% 18.1% 25.5% 29.1% 19.4% 19.2% Non-Operating Income Non-Operating Cost Pre-tax Profit Tax Net Profit Net Profit (controlling) Margin (%) 12.6% 5.97% 11.1% 15.6% 18.9% 13.0% 12.8% (KRW bn) 1Q16 2Q16 Current Assets ,750 2,815 Cash and Cash Equivalents ,856 1,884 Accounts Receivable Other Current Financial Assets Other Current Assets Non-Current Assets 1,064 1,042 1,242 1,236 2,250 2,362 2,572 Available-for-Sale Securities Intangible Assets ,330 1,339 1,336 Tangible Assets Other Non-Current Assets Total Assets 1,578 1,582 1,789 1,957 3,207 5,112 5,387 Current Liabilities , Accounts Payable Debt Other Current Financial Liabilities Other Current Liabilities Non-Current Liabilities Other Non-Current Financial Liabilities Other Non-Current Assets Total Liabilities , Total Equity 1,291 1,307 1,431 1,310 1,537 4,304 4,516 9

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