1. Company. DoubleU Bingo. Take5. DoubleU Casino. DoubleDown Casino. DoubleDown Classic. (Note 1: Stockholder s list) Title.

Transcription

1 DoubleU Games

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3 1. Company (Note 1: Stockholder s list) Title DoubleU Casino DoubleU Bingo Take5 DoubleDown Casino DoubleDown Classic Launched May Jun Nov Apr Sep Platform 3

4 1. Company 2Q EBITDA is 42.0%, 30.5%, Free Cash Flow (Unit: 100 million won) * Monthly performance in Jun. (Unit: 100 million won) EBITDA 42.0% 50 EBITDA % (Unit: Stockholder s list) Type Share Total (%) Note Total shares issued 17,184, Treasury stock 1,353,976 - Shares subject to dividend Dividend per share 15,830,580 1 share 103 (100mn won) 650 (won) Market dividend rate % Note 1) Treasury stocks: 1,398,976 Note 1) 92.1 % - Dividend amount/ Market capitalization Q EBITDA 플랫폼 Platform 마케팅비 Marketing costs 인건비 Others 등 - EBITDA 마케팅비 Marketing costs 17 2Q 플랫폼 Platform 로열티 Others Higher than 15 KOSDAQ average dividend rate 1.5% 4

5 2. Social Casino Market Casino PC/Mobile Game Gambling 5

6 2. Social Casino Market (DoubleU Games Group M/S 10.8%) (Unit: million dollar) $5,278 $4,915 $5,120 $4,641 $4,250 $3,810 $3,352 $2,779 $2,028 $1, E 2018E 2019E 2020E 2021E (Source: Eilers & Krejcik Gaming, LLC) (Source: Eilers & Krejcik Gaming, LLC) 6

7 2. Social Casino Market the social casino genre is about 20% ios market Android market Casino 11 (28%) 12 (30%) 19 (48%) Strategy % % % % Simulation Action Role Playing % % % % % % Arcade Casino Action Strategy Casino Sports Arcade Strategy Arcade RolePlaying Simulation RolePlaying Simulation Action Sports (Source: App Annie based on US August payment, Facebook sales ranking) (Source: App Annie based on US August payment) 7

8 2. Social Casino Market # Company Key Titles Launched M/S Type Offline Casino IP 1 Playtika Slotomania, House of Fun, Bingo Blitz. WSOP, CZR % Slot X 2 DoubleU Games DoubleDown Casino, DoubleU Casino, Take % Slot IGT 3 Zynga Zynga Poker, Hit it Rich!, Wizard of OZ, Black Diamond % Slot X 4 Scientific Games Jackpot Party Casino, Gold Fish, Quick Hits, Hotshot % Slot Bally, WMS 5 Aristocrat Heart of Vegas, FaFaFa real Casino Slots, Cashman Casino % Slot Aristocrat 6 Sony/GSN Bingo Bash, GSN Casino, Fresh Deck Poker, Mirrorball % Slot X 7 Churchill Downs Big Fish Casino, Big Fish Bingo, Jackpot City Slots % Slot Churchill Downs 8 Playstudios myvegas, Konami Slots, POP Slots % Slot Konami 9 Tencent Fight the Landlord, Tencent Poker % Poker X 10 Boyaa Texasx Hold'Em Series, Fight the Landlord % Poker X (Source: Eilers & Krejcik Gaming, LLC) 8

9 3. DoubleU Games Group Sales Trend the total payment amount is growing steadily Q/Q (Unit: million dollar) $60 $50 $40 $30 $20 $10 $0 12FY 3Q 12FY 4Q 13FY 1Q 13FY 2Q 13FY 3Q 13FY 4Q 14FY 1Q 14FY 2Q 14FY 3Q 14FY 4Q 15FY 1Q 15FY 2Q 15FY 3Q 15FY 4Q 16FY 1Q 16FY 2Q 16FY 3Q 16FY 4Q 17FY 1Q 17FY 2Q Note 1) DDC payments reflect only payments made in June. DUC Take5 DUB DDC ETC 9

10 3. DoubleU Games Group Sales Trend reaching about 60% of total payment DoubleU Casino Take5 Slots DoubleDown Casino (Unit: million dollar / Quarter) (Unit: 1,000 dollar / Month) (Unit: million dollar / Quarter) $25 70% $140 20% $90 70% $20 $15 $10 $5 60% 50% 40% 30% 20% 10% $120 $100 $80 $60 $40 $20 18% 16% 14% 12% 10% 8% 6% 4% 2% $80 $70 $60 $50 $40 $30 $20 $10 60% 50% 40% 30% 20% 10% $0 13FY 3Q 14FY 3Q 15FY 3Q 16FY 3Q 0% $0 16FY Nov 17FY Feb 17FY May 0% $0 11FY 1Q 12FY 4Q 14FY 3Q 16FY 2Q 0% DUC Mobile Mobile (%) Mobile % DDC Mobile (%) 10

11 4. DoubleU Games Group Competitiveness IGT's overwhelming IP more than 26 proven offline slot IPs per year for at least 10 years 8% 6% Provide slot IP Royalty 14% 44% 28% IGT Scientific Games Aristocrat Konami other Subject: Total North America Participants Casino Owned Games Source: Eilers-Fantini Slot Survey( 16 3Q) Main contents: Separate license agreement (GDDA) for acquisition of exclusive license for social casino market for IGT intellectual property (IP) Convert 26 offline slots to online slots per year Contract period: Initial contract period 10 years (can be extended up to 20 years) Royalty: Estimated royalty based on net sales (rate is non-public) * GDDA : Game Development Distribution and Services Agreement 11

12 4. DoubleU Games Group Competitiveness and royalties high purchasing power Major social casinos ARPU status 2% 9% Market average North America 70% Oceania 10% Europe 9% 89% Other 11% Payment user conversion ratio (% MUP / MUU) North America Oceania Other 5.3% 4.6% 12

13 4. DoubleU Games Group Competitiveness More than 100 highly competitive slot libraries (new slot games every 2 weeks) Slot machines Launched new slot game every 2 weeks 13

14 4. DoubleU Games Group Competitiveness Exceptional economic system and ability to operate personalized service High roller Slot machine Personalized payment Service New type launching: Classic 14

15 4. DoubleU Games Group Competitiveness Comparison of marketing efficiency between DDC and DUC (Unit: 1,000 dollar) 12% Marketing costs A $ 51,167 $ 18,133 9% New subscriber's billing contribution B $ 26,188 $ 24,530 ROI C=B/A 51% 135% 10% ROI trend: 100% return on marketing costs within 6 months 69% 100% M M+1 M+2 M+3 M+4 M+5 M+6 M+7 M+8 North America Oceania Europe Other 15

16 4. DoubleU Games Group Competitiveness (Unit: 100 million won) % % % % 40% % 34% 29% 29% % % % 21% H 12FY 1H 13FY 2H 13FY 1H 14FY 2H 14FY 1H 15FY 2H 15FY 1H 16FY 2H 16FY 1H 17FY 매출 Sales Operating 영업이익 income (%) 30% 20% 10% 0% 16

17 H PLANS 3-REEL ('STEPPER') concept Competitive content utilizing IGT's powerful library 20% of the land-based slot market global launch in September Features: IGT's 3RM (777 games) Genre slots Launching: Global launch in September 2017 Over 60% of IGT M/S of land-based Stepper (Source: internal data) 3RM Genre Company: Penn Interactive (Rocket Games) Sales: $51.9M (based on 1 st half 2017, Eilers & Krejcik Gaming 2Q17) Leading Games: Viva Slots Vegas (3RM) 17

18 H PLANS Ellen Slot is a game that utilizes the powerful IP of US TV SHOW 'ELLEN' (by Warner Brothers) Ellen, the most popular female TV host among American women in their 40s and 50s Global launch in line with 'ELLEN NEW SEASON' coming Nov. - "VIRAL marketing plan" Features: Slots with American popular TV show Ellen Launching: Global launch in October 2017 Target: Slot games targeting 40s-50s women Ellen: Selected as the most popular female TV Host in the US in

19 H PLANS Optimization of TECH structure advanced casino operation service know-how Improving game access speed Free extension of Meta (UI) function Big Data accumulation, service enhancement Game economy system operation Unexpected casino game malfunctions despite technological advances Sep Average daily pay user record highs Dec Days Christmas campaign - 3 new games released Mar-Jun Technical issues related to providing Android Gift Aug-Sep Gift Wheel malfunction - Wheel of fortune bonus round malfunction Casino malfunction Start AD Stop AD 15 year 16 year 17 year 19

20 H PLANS Mobile payment increase trend (Unit: 1,000 dollar) 8,000 7,519 7,000 6,947 6,778 6,306 6,637 6,000 Club functions to enhance competition and collaboration 5, Comparison of half-year growth rate (all DUG payments) (Unit: million dollar) Expansion of proven 3 reel 'STEPPER' slots 14 $30.6 $ % 15 $51.2 $ % 16 $64.6 $ % 3-year average annual growth rate 16.8% 20

21 H PLANS "Double Fortune Casino" (Taiwan 星城 online Monthly Revenue $ 1.4M) Genre: social casino Mobile soft launching: Double Fortune Casino, Monday, August 7 Language: English, Chinese (Traditional, Simplified) Localization plan Local market targeting and cooperation with professional marketing companies Collaboration with major Chinese publishers or plans to establish branch offices Local language support through service agencies in non-english speaking countries Asian social casino market size: 600 billion ~ 700 billion won Main market: 1st place social casino game in Taiwan market 星城 Online-HD First half of 2017 sales: $8.1M (Taiwan market, 2017 Jan~Jun) 21

22 H PLANS strategy game genre 4Q 17 global mobile market in 1Q 18 Genre: Strategy Game Facebook launch: Expected to launch globally 4Q 17 Mobile launch: Expected to launch globally 1Q 18 Features: A new type of strategy game that adds to the traditional strategy game elements that build and manage the base plus the combat methods that focus on character growth and character roles Strategy Game Genre Market Size: $5.7B Leading game and payment amount (2017 first half, US market) First half of 2017 estimated payment $ 134 million $ 156 million $ 187 million (Source: App Annie, US, 2017 Jan ~ Jun, ios + Android) 22

23 6. Long-Term Plans 23

24 6. Long-Term Plans 2% 9% 12% 9% 10% 69% 89% North America Oceania Other North America Oceania Europe Other Overwhelming status in North America such as the US and Canada Plan to enter Australia, Europe and South America markets Even distribution of sales area across North America, Europe and Australia Plan to enter China and Southeast Asia market this year 24

25 7. Appendix DUG: Operating revenue of \37.8bn, operating income of \15.4bn (40.7%) 21.7% Y/Y DDI: Operating revenue of \22.6bn, operating income of \4.2bn (18.5%) and EBITDA of W6.9bn (30.6%) in the second quarter (Unit: million won) (Unit: 1,000 dollar, million won) Operating revenue 38,073 37,806 75,651 79, % Operating cost 25,426 22,410 57,048 47, % Platform fee 11,422 11,342 22,695 23, % Marketing costs Labor costs & others Operating income Non-operating income-cost 6,432 5,039 16,950 10, % 7,572 6,029 12,365 13, % 12,647 15,396 18,603 31, % 1,945 (9,430) 2,454 (14,608) Taxes 1,721 (2,227) 2,129 (1,312) Net income 12,871 8,193 18,928 18, % Operating income % 33.2% 40.7% 24.6% 40.2% Net income % 33.8% 21.7% 25.0% 23.4% Operating revenue 19,977 22, % Operating cost 16,278 18, % Platform fee 5,993 6, % Marketing costs Other expenses Amortization expense 3,340 3, % 2,861 3, % 2,420 2, % Royalty 1,664 1, % Operating income 3,698 4, % EBITDA 6,118 6, % Note 1) DDC payments reflect only payments made in June. 25

26 7. Appendix DoubleU Games ( SI ) STIC SPC ( FI ) Samsung Securities (Acquisition financing) Equity investment in common stock (350 billion won) CB/BW Mezzanine investment (300 billion won) Korea United States Provide senior debt (292.5 billion Won) The8Games Co.,Ltd. US SPC 100% 100% At the time of the transaction: 100% share + related intellectual property rights After the transaction: Roadmap games + Selected games At the time of the transaction: Share purchase price After the transaction : Annual Royalty DoubleDown ( DD ) International Game Technology 26