14.8.2020
agenda 1 Half-year in review 2 Financial results 3 Summary & outlook Terhi Kauppi Tero Virtala CFO CEO
HALF-Year in review
H1-2020 highlights • Revenue 17.0 (13.8) M€, +23% . • Operating profit 3.2 (1.5) M€, 18.6% of revenue. • Remedy signed Epic Games as the publisher for two unannounced games. • Control team released first DLC “The Foundation”, working on “AWE” DLC as well as Steam and next gen versions. • Crossfire team preparing for single- player campaign launch in 2020. • Pandemic had no significant impact on Remedy, strike team set up to mitigate.
Market has developed favorably for us GLOBAL GAMES MARKET 2020 $159.3Bn PlayStation 4 Demand grows for good 112 million units +9.3% YoY growth games and studios. CONSOLES & PC With the ongoing industry Xbox One 48 million units consolidation, there are BIG fewer independent AAA SCREEN studios. GAMES for CASUAL PLAYERS HARDCORE GAMERS GAMERS Remedy has developed well to take 62 million units advantage of the growing and changing market. MOBILE & TABLET
control • Award-winning supernatural 3rd-person • Control added to PlayStation Now action-adventure game. subscription service and first expansion “The Foundation” launched in March 2020. • Originally released in August 2019 on • Second expansion “AWE” for original PlayStation 4, Xbox One & PC. platforms and Ultimate Edition for Steam • Published by 505 Games. coming August 27th 2020. • Game IP created and owned by Remedy. • Control is also being developed for new • Revenues based on development platforms and services, including the next payments from the publisher and share of generation consoles PlayStation 5 and game sales net revenue. Xbox Series X. • Developed in 3 years with a budget of less • Game sales continue on a good level with than €30 million. PR and marketing activities.
CONTROL roadmap 2 0 1 9 2 0 2 0 2 0 2 1 DLC 1 DLC 2 DELUXE ULTIMATE EDITION SEASON PASS ...and more to come…
crossfire • Crossfire is one of the world’s most • Smilegate and Microsoft are bringing the popular online first-person shooters (FPS): game to the western audience as over 650M registered and 8.5M Crossfire X on Xbox platforms. simultaneous players in 80 countries. • Includes Remedy’s campaign, which is • Created and owned by Smilegate. split into operations, the first one to be released is titled “Operation Spectre”. • Remedy creates single-player experiences • Crossfire is Remedy’s debut in the first- for Crossfire. person shooter genre. • Remedy revenues based on development payments from the publisher and potential royalties.
vanguard • The objective of Vanguard is to create a long-lasting service-based multiplayer game combined with selected Remedy features . We now have an internally playable first development version of the game. • The team has taken the first playable development version further, continuously evaluating, learning and adjusting the development. • Some parts of the game show very good promise, some parts have been redesigned. • The early phase work on Vanguard continues with a small team.
Unannounced projects • We have signed publishing agreements on • We had multiple concrete partnership the 3 rd unannounced AAA project and a options. Believe that Epic Games was the smaller project with Epic Games. best for the games and Remedy. • For multiple gaming platforms. • Epic is strong in digital, and already has a global presence. • Epic will fully fund the development. • Aims to shake the publishing business. • Net revenues shared 50/50. Has shown they can very successfully build • Remedy to retain IP ownership. new business areas. • We are a key partner for them.
Financially, we got a third strong pillar 2020 Crossfire and Control revenues continue well. We added a third major pillar – and fourth smaller one. (Unannounced) WITH WITH WITH
Talented and motivated personnel 266 52% full-time employees 30.6.2020 21% 28 nationalities year-on-year growth 48% 69% Finnish employees recruited from outside of Finland
Key figures Revenue M€ Operating cash flow M€ 17.0 (13.8) 1.2 23.0% growth EBIT M€ Cash position M€ 3.2 (1.5) 16.8 18.6% of revenue
Financial development 35 35% 31.6 Revenue (M€) EBIT % 30 30% 25 25% 24.1 % 20.1 20.6 % 20 20% 17.2 18.9 % 18.6 % 16.4 15.5 17.0 13.7 15 15% 11.9 10.5 11.7 % 10 10% 9.8 % 4.7 6.1 % 3.8 5 5% 4.7 % 3.0 % 2.4 % 1.7 % 0 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 H1-2020
Growth analysis EBIT Net sales • Net sales growth driven by Control revenue share and 4000 19000 Epic publishing deals. 3000 14000 • EBIT growth affected by 2000 revenue growth, 9000 1000 capitalization and stable 0 4000 other opex. H1-2019 H1-2020 H1-2019 H1-2020 • Capitalizations increased due Capitalization Staff expenses to 3 different projects subject to capitalization. 4000 11000 • Staff expenses higher as 9000 3000 number of personnel 7000 2000 increased by 21% and due to 5000 higher bonus accrual. 1000 3000 0 1000 H1-2019 H1-2020 H1-2019 H1-2020
Capitalization logic Capitalized based on Not capitalized 100% capitalized future return expectations 2 unannounced projects WITH SELF-FUNDED WITH WITH
Summary & outlook
H1-2020 summary & outlook for H2-2020 • We are developing four game franchises • We expect our revenue and EBIT to grow and five game projects under them. during 2020. • Control’s second expansion “AWE” and • Majority of revenue and EBIT growth is Ultimate Edition on Steam to be released estimated to materialize during H2-2020. on August 27 th 2020. • We continue according to our long-term • Control is being developed for new growth plans. platforms and services, including next • Our goal is to have consistent game generation consoles. releases, with an aim to launch at least • Crossfire X coming to Xbox One and Xbox one game or game expansion annually. Series X. • We expect 2020 to be a good year. • Projects with Epic Games and Vanguard continue their early development phases.
Thank you!
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