Ten Square Games’ net profit in Q3 is below the consensus

2021-11-22 17:20, act 2021-11-22 18:48

publication
2021-11-22 17:20

update
2021-11-22 18:48

Ten Square Games' net profit in Q3 is below the consensus
Ten Square Games' net profit in Q3 is below the consensus
/ Ten Square Games

Ten Square Games generated a net profit of PLN 24.8 million in the third quarter, by 58%. less than a year ago, the company said in its quarterly report. The average forecast of the analysts surveyed by PAP Biznes was PLN 38.6 million.

The company’s revenues in the third quarter amounted to PLN 148 million and were 17.5% y / y. lower than last year. At the beginning of October, the company announced that revenues – without taking into account the impact of revenue recognition over time – reached PLN 158.9 million, but ultimately deferred revenues reduced the reported quarterly sales by PLN 9.8 million.

The adjusted EBITDA result reached PLN 54.8 million and was 26 percent lower. lower than last year. Analysts surveyed by PAP expected the result in the range of PLN 47.8-55.1 million, with the average at PLN 53 million. Adjustments for the past quarter included, inter alia, PLN 6.8 million of deferred results and PLN 3.7 million of the costs of “potential and realized” acquisitions and the review of strategic options. The non-cash impact of the incentive program in Q3 2021 amounted to PLN 7.7 million, almost PLN 1 million more than the year before.

The quarterly reported EBITDA result is PLN 34.5 million, which means 49 percent. decline year on year. EBITDA was 23 percent. lower than the average forecast of brokerage houses.

Payments from “Fishing Clash” players dropped in the third quarter by approx. PLN 0.6 million to PLN 114.4 million, and in the case of “Hunting Clash” they decreased by PLN 2.3 million to PLN 28 million.

In Q3, the “Fishing Clash” game in China generated revenues of PLN 1.7 million. As the company explains, this is a “net” income after commission and user acquisition costs, as the expenses for this are borne by its partner in China, Netease Shanghai. The game was available on Apple’s Chinese online store during this period. In November, the title is also expected to be available in stores for Android devices.

The largest games from the portfolio of the Italian company Rortos acquired in July – “Real Flight Simulator” and “Airline Commander” – in the third quarter achieved payments of PLN 3.6 million and PLN 2.7 million, respectively. In total, Rortos games generated PLN 7.2 million in payments.

Marketing expenses of Ten Square Games in the third quarter fell to PLN 33.9 million from PLN 42.4 million a quarter earlier. The expenditure on the promotion of the biggest game, “Fishing Clash”, amounted to PLN 21.1 million, and the company spent PLN 12.9 million on the advertisement of “Hunting Clash”.

In October, payments from “Fishing Clash” players amounted to PLN 41.5 million and were the highest since April this year. Marketing expenses amounted to PLN 7 million, i.e. they were by 8 and 11 percent, respectively. higher than in September and August. Last month, the game “Hunting Clash” generated PLN 9.4 million in payments from players, the most since July, with marketing expenditure of PLN 4.2 million (17% and 5% more than in September and August, respectively).

The number of active “Fishing Clash” players on average in Q3 (the so-called MAU) increased to 3.17 million from 2.93 million a quarter earlier. The monthly number of active “Hunting Clash” players has dropped to 1.73 million, the lowest level since Q3 2020.

Ten Square Games estimates that the improvement of results in both the product and marketing area of ​​”Fishing Clash” may significantly affect the results of the next quarter.

“In order to use this potential, the group conducts constantly optimized live-ops activities, continues the continuous development of the product’s functionality and conducts marketing activities. The significant strengthening of the team working on this game in recent months (from 50 to 90 people) should significantly improve the efficiency and pace at which new content is added “- it was written.

It has been added that the team working on the game “Hunting Clash” has also grown in recent months and now numbers 65 people.

The results of Ten Square Games in the third quarter of 2021 and their reference to the PAP Biznes consensus (data in PLN million)
3Q2021 Results cons. difference yy kdk YTD 2021 yy
Revenue 148.0 162.1 -8.7% -17.5% -10.3% 487.0 9.7%
EBITDA 34.5 44.9 -23.1% -48.7% -13.0% 134.8 -0.7%
EBIT 31.2 42.5 -26.6% -53.1% -19.4% 125.8 -5.8%
net profit jd 24.8 38.6 -35.7% -57.8% -25.7% 110.9 -7.4%
EBITDA margin 23.3% 27.7% -4.36 -14.22 -0.74 27.68% -2.89
EBIT margin 21.1% 26.2% -5.14 -16.00 -2.38 25.83% -4.24
net margin 16.8% 23.8% -7.02 -16.03 -3.49 22.77% -4.20

kuc / ana /

Source:PAP Biznes

About Eric Wilson

The variety offered by video games never ceases to amaze him. He loves OutRun's drifting as well as the contemplative walks of Dear Esther. Immersing himself in other worlds is an incomparable feeling for him: he understood it by playing for the first time in Shenmue.

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