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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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Lotteries & Native American Casinos in the United States, 2024-2029: Competitive Analysis, Industry Segmentation, Financial Benchmarks
The “Lotteries & Native American Casinos in the US – Industry Market Research Report” report has been added to ResearchAndMarkets.com’s offering.
Over the last few years, industry revenue grew at a CAGR of 5.5% to $198.9 billion, including an expected 3.3% rise in 2024.
In periods of economic growth, lotteries and Native American casinos benefit from low unemployment levels, which drive growth in per capita disposable income. In contrast, recessionary periods cause the majority of consumers to opt against gambling in favor of reducing discretionary spending.
Market Trends
- Pent-up demand propelled industry recovery. Consumers who had cut back on discretionary spending during the pandemic helped boost industry growth.
- Strong consumer demand for traditional lotteries has offset larger pandemic losses. Consumers’ propensity toward simple lottery games sustains the product segment.
- Large population centers are a boon for the industry. In regions with larger population concentration, industry establishments benefit from wider exposure and increased contact with a diverse range of customers.
- A continuous push for high-quality customer service encourages competition. Since many of the gambling and lottery facility operators are small and localized, good customer service ensures a competitive edge and makes the facility more attractive to customers.
Report Coverage
- Market estimates from2014-2029
- Competitive analysis, industry segmentation, financial benchmarks
- Incorporates SWOT, Porter’s Five Forces and risk management frameworks
A selection of companies mentioned in this report includes, but is not limited to:
- The Florida Lottery
- New York State Lottery
Leading the charge in the convergence of financial technology and iGaming, Genome, a cutting-edge electronic money institution, is thrilled to announce its strategic partnership with Chilli Partners, a prominent iGaming affiliate program specializing in casino games.
The collaboration marks a pivotal moment in the iGaming industry, bringing together Genome’s expertise in online financial services and Chilli Partners’ prowess in affiliate marketing. The partnership is set to redefine the landscape of affiliate payouts, offering an array of benefits to both affiliates and the iGaming community at large.
“We are excited to embark on this journey with Chilli Partners. By combining our financial expertise with their influential position in the iGaming affiliate space, we aim to set new standards for efficiency and innovation in affiliate payouts,” – noted Genome’s CEO Daumantas Barauskas.
For one, the partnership offers efficient payouts. Affiliates can now enjoy expedited and secure payouts through Genome’s state-of-the-art financial infrastructure, enhancing their overall experience and satisfaction.
It also provides global reach for Chilli Partners, as it can extend its reach to affiliates worldwide with Genome’s international payment capabilities. This allows Chilli Partners to foster a more diverse and expansive network.
The partnership streamlines financial workflows, ensuring seamless transactions and reducing administrative overhead for Chilli Partners, allowing them to focus on delivering top-notch affiliate services.
Genome is all about innovation in payments and online financial services. This approach brings new possibilities for payment options, providing flexibility and convenience for affiliates participating in the Chilli Partners program.
Lastly, the collaboration prioritizes compliance and risk management, assuring affiliates of secure and compliant transactions in accordance with industry regulations.
“This partnership aligns perfectly with our commitment to providing the best possible experience for our affiliates. Genome’s advanced financial services will play a crucial role in elevating our affiliate program to new heights”, – added Clayton Zammit Cesare, Head of Affiliates at Chilli Partners.
As the iGaming industry continues to evolve, Genome and Chilli Partners stand united in their dedication to driving positive change, innovation, and reliability. The partnership is poised to create a ripple effect, positively impacting the entire iGaming ecosystem.
About Genome
Genome is a leading EMI that provides innovative financial services, including batch payouts, SWIFT, and SEPA transfers. With a focus on efficiency and compliance, Genome empowers businesses across various industries, including iGaming, to streamline financial operations and enhance user experiences.
For more information, please visit https://genome.eu/
About Chilli Partners
Chilli Partners is a prominent iGaming affiliate program specializing in casino games. With a commitment to excellence, Chilli Partners connects affiliates with top-tier iGaming brands, offering a lucrative partnership that includes competitive commission structures and tailored support.
For more information, please visit https://chillipartners.com/
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