GDEV Inc FY2023 Q4 Earnings Release
Download PDFMar, 2024 FY and 4Q 2023
March, 2024
Financial Results
Disclaimer
2
Forward -looking statements
Certain statements in this presentation may constitute “forward -looking statements” for purposes of the federal securities laws. Such statements are based on current expectations
that are subject to risks and uncertainties. In addition, any statements that refer to projections, forecasts or other charac ter izations of future events or circumstances, including any
underlying assumptions, are forward -looking statements.
The forward -looking statements contained in this press release are based on the Company’s current expectations and beliefs conce rning future developments and their potential
effects on the Company. There can be no assurance that future developments affecting the Company will be those that the Compa ny has anticipated. Forward -looking statements
involve a number of risks, uncertainties (some of which are beyond the Company’s control) or other assumptions. You should carefully consider the risks and uncertainties
described in the “Risk Factors” section of the Company’s 2022 Annual Report in Form 20 -F, filed by the Company on June 26, 2023, and other documents filed by the Company
from time to time with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize , o r should any of the Company’s assumptions prove
incorrect, actual results may vary in material respects from those projected in these forward -looking statements. Forward -lookin g statements speak only as of the date they are
made. Readers are cautioned not to put undue reliance on forward -looking statements, and the Company undertakes no obligation to update or revise any forward -looking
statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Presentation of N on -IFRS Financial Measures
In addition to the results provided in accordance with IFRS throughout this press release, the Company has provided the non -IFRS financial measure “Adjusted EBITDA” (the “Non –
IFRS Financial Measure”). The Company defines Adjusted EBITDA as the profit/loss for the period, net of tax as presented in t he Company’s financial statements in accordance with
IFRS, adjusted to exclude ( i) goodwill and investments in equity accounted associates’ impairment, (ii) loss on disposal of subsidiaries, (iii) income ta x e xpense, (iv) finance income
and expenses other than foreign exchange gains and losses and bank charges, (v) change in fair value of share warrant obligat ion s and other financial instruments, (vi) share of loss
of equity -accounted associates, (vii) depreciation and amortization, (viii) share -based payments expense and (ix) certain non -ca sh or other special items that we do not consider
indicative of our ongoing operating performance. The Company uses this Non -IFRS Financial Measure for business planning purposes and in measuring its performance relative to
that of its competitors. The Company believes that this Non -IFRS Financial Measure is a useful financial metric to assess its op erating performance from period -to-period by
excluding certain items that the Company believes are not representative of its core business. This Non -IFRS Financial Measure i s not intended to replace, and should not be
considered superior to, the presentation of the Company’s financial results in accordance with IFRS. The use of the Non -IFRS Fin ancial Measure terms may differ from similar
measures reported by other companies and may not be comparable to other similarly titled measures.
Due to the rounding the numbers presented throughout this document may not precisely add up to the totals. The period -over -perio d percentage changes are based on the actual
numbers and may therefore differ from the percentage changes if those would be calculated based on the rounded numbers
The figures in this presentation are preliminary and unaudited. The Company’s 2023 Annual Report on Form 20 -F, which will includ e the Company’s audited financial statements as of
and for the year ended December 31, 2023, is expected to be published within the prescribed filing period.
Key operating metrics used in the presentation
3
In this presentation, we use a number of key operating and non -IFRS financial metrics which we believe accurately, in material aspects, reflect the principal parameters of our historic a nd projected
performance. For further information, regarding our operating metrics, see our 2022 Annual Report in Form 20 -F filed with the SEC.
Operating metrics
• Monthly Paying Users (MPUs) are the number of individuals who made a purchase of a virtual item at least once on a particular platform in the 30 ‐day period ending with the
measurement date
• Average Bookings Per Paying User (ABPPU) is the total Bookings attributable to in -game purchases in a given period, divided by the number of months in that period, divided by the
average number of MPUs during the period
• Bookings are sales contracts generated from in -game purchases and sales of advertisement in a given period
Non -IFRS measure
• Adjusted EBITDA . The Company defines Adjusted EBITDA as the profit/loss for the period, net of tax as presented in the Company’s financial sta tem ents in accordance with IFRS,
adjusted to exclude ( i) goodwill and investments in equity accounted associates’ impairment, (ii) loss on disposal of subsidiaries, (iii) income ta x e xpense, (iv) finance income and expenses
other than foreign exchange gains and losses and bank charges, (v) change in fair value of share warrant obligations and othe r financial instruments, (vi) share of loss of equity -accounted
associates, (vii) depreciation and amortization, (viii) share -based payments expense and (ix) certain non -cash or other special items that we do not consider indicative of our ongoing
operating performance . Adjusted EBITDA is a non -IFRS financial measure and should not be construed as an alternative to net income/loss as an indicator of operating performance as
determined in accordance with IFRS.
Financial highlights
Revenue, $ mn
Profit/(loss) for the period net of tax, $ mn Adj EBITDA (1), $ mn
Total costs and expenses, excl. D&A, $ mn
99
119 115 121 109
4Q22 1Q23 2Q23 3Q23 4Q23
-19%
Year -over -year change, %
-5% -9% -5% 10%
4Q22 1Q23 2Q23 3Q23 4Q23
-77
-8
20 24
11
-78%
Margin, %
-7% 17% 20% 10%
-9
29
10
4Q22 1Q23 2Q23 3Q23 4Q23
-12
16
-9%
Margin, %
-10% 14% 24% 9%
63%
14%
23%
4Q22
18%
22%
60%
1Q23
21%
28%
51%
2Q23
22%
31%
47%
3Q23
21%
25%
54%
4Q23
173
131
99 91 99
Other Platform commissions Selling and marketing expenses
4
(1) See slide #3 for definition and slide #11 for reconciliation to profit/(loss) for the period, net of taxSource: Company Information (preliminary and unaudited)
Operating highlights
Bookings, $ mn Monthly paying users, ‘000 Average bookings per paying user, $
102 103
111
102 106
4Q22 1Q23 2Q23 3Q23 4Q23
316
383 392 375 359
4Q22 1Q23 2Q23 3Q23 4Q23
103
83 87 84
92
4Q22 1Q23 2Q23 3Q23 4Q23
-29%
Year -over -year change, %
-19% -1% -6% 4% -13%
Year -over -year change, %
2% 14% 23% 13% -18%
Year -over -year change, %
-23% -17% -26% -11%
5
Source: Company Information (preliminary and unaudited)
Diversification by games/ platforms/ geography
Diversification by games, % Diversification by platforms, % Diversification by geography, %
52% 47%
41% 42%
7%
5% 2%
4Q22
4%
4Q23
Pixel Gun 3D
Island Hoppers
Hero Wars: Dominion Era
Hero Wars: Alliance
60% 57%
40% 43%
4Q22 4Q23
PC Mobile
34% 34%
22% 27%
24%
24%
20%
4Q22 4Q23
15%
Other
Asia
Europe
US
VS VS VS
6
Source: Company Information (preliminary and unaudited)
by bookings by bookings by bookings
Appendix
7
Consolidated statement of comprehensive income
8
‘000 $
Source: Company Information (preliminary and unaudited) 2023 2022 2021
R ev en u e 464, 549 47 9, 688 434, 094
Cos ts an d ex pen s es , ex cl u di n g depreci ati on an d am orti zati on
Cost of revenue:
Platform commissions ( 1 09, 020) ( 1 29, 623) ( 1 1 7 , 229)
Game operation cost ( 51 , 669) ( 44, 036) ( 1 8, 945)
Other operating income 2, 053 1 , 327 —
Selling and marketing expenses ( 225, 7 38) ( 1 52, 67 4) ( 27 0, 065)
General and administrative expenses ( 29, 61 8) ( 36, 1 1 9) ( 23, 031 )
Goodwill and investments in equity accounted associates’ impairment — ( 62, 828) —
Share listing expense — — ( 1 25, 438)
Impairment loss on trade receivables and loans receivable ( 5, 91 9) ( 29, 987 ) ( 1 02)
Total cos ts an d ex pen s es , ex cl u di n g depreci ati on an d am orti zati on ( 41 9, 91 1 ) ( 453, 940) ( 554, 81 0)
Depreciation and amortization ( 6, 27 6) ( 6, 901 ) ( 2, 540)
Profi t/( l os s ) from operati on s 38, 362 1 8, 847 ( 1 23, 256)
F inance income 5, 248 1 , 868 79
F inance expenses ( 4, 047 ) ( 2, 1 91 ) ( 3, 220)
Change in fair value of share warrant obligation and other financial instruments 1 0, 946 2, 7 67 1 0, 080
Share of loss of equity-accounted associates ( 51 5) ( 1 0, 1 21 ) —
Profi t/( l os s ) before i n com e tax 49, 994 1 1 , 1 7 0 ( 1 1 6, 31 7 )
Income tax expense ( 3, 87 9) ( 3, 7 60) ( 1 , 1 27 )
Profi t/( l os s ) for th e y ear n et of tax 46, 1 1 5 7 , 41 0 ( 1 1 7 , 444)
Attributable to equity holders of the Company 46, 1 1 5 7 , 303 ( 1 1 7 , 455)
Attributable to non-controlling interest — 1 07 11
Oth er com preh en s i v e i n com e
I tem s th at are or m ay be recl as s i fi ed s u bs equ en tl y to profi t or l os s 1 , 837 3, 338 11
F oreign currency translation difference 1 , 650 3, 456 36
Other 1 87 ( 1 1 8) ( 25)
Total com preh en s i v e i n com e/( l os s ) for th e y ear, n et of tax 47 , 952 1 0, 7 48 ( 1 1 7 , 433)
Attributable to equity holders of the Company 47 , 952 1 0, 641 ( 1 1 7 , 444)
Attributable to non-controlling interest — 1 07 11
E arn i n gs /( l os s ) per s h are:
E arnings/( loss) attributable to ordinary equity holders of the parent, U S$ – basic 0. 23 0. 04 ( 0. 64)
E arnings/( loss) attributable to ordinary equity holders of the parent, U S$ – diluted 0. 23 0. 04 ( 0. 64)
Consolidated statement of financial position
9
‘000 $
Source: Company Information (preliminary and unaudited) Decem ber 31 , 2023 Decem ber 31 , 2022
L I AB I L I TI E S AND SHAR E HOL DE R S’ E QU I TY
E qu i ty
Share capital — —
Additional paid-in capital 25, 531 23, 685
Share-based payments reserve 1 43, 593 1 44, 240
Translation reserve 5, 1 43 3, 493
Accumulated deficit ( 27 4, 07 9) ( 320, 1 94)
E qu i ty attri bu tabl e to equ i ty h ol ders of th e Com pan y ( 99, 81 2) ( 1 48, 7 7 6)
Non-controlling interest — —
Total equ i ty ( 99, 81 2) ( 1 48, 7 7 6)
Non -cu rren t l i abi l i ti es
Lease liabilities – non-current 983 444
Long-term deferred revenue 1 1 5, 344 96, 887
Share warrant obligations 1 , 27 8 1 3, 035
Put option liabilities – non-current — 27 , 47 5
Other non-current liabilities — 57 7
Total n on -cu rren t l i abi l i ti es 1 1 7 , 605 1 38, 41 8
Cu rren t l i abi l i ti es
Lease liabilities – current 1 , 458 7 43
Trade and other payables 30, 303 30, 521
Provisions for non-income tax risks 1 , 354 1 , 336
Put option liabilities – current 28, 995 —
Tax liability 6, 47 3 4, 250
Deferred revenue 234, 1 7 8 295, 552
Total cu rren t l i abi l i ti es 302, 7 61 332, 402
Total l i abi l i ti es 420, 366 47 0, 820
Total l i abi l i ti es an d s h areh ol ders ‘ equ i ty 320, 554 322, 044 Decem ber 31 , 2023 Decem ber 31 , 2022
ASSE TS
Non -cu rren t as s ets
Property and equipment 1 , 1 46 7 86
R ight-of-use assets 2, 920 1 , 462
Intangible assets 8, 47 6 1 2, 97 7
Goodwill 1 , 836 1 , 836
Investments in equity accounted associates — —
Long-term deferred platform commission fees 7 3, 996 94, 682
Deferred tax asset 1 22 1 08
Other non-current investments 1 8, 07 4 1 7 , 903
Other non-current assets 1 07 1 07
Loans receivable – non-current — 3, 31 7
Total n on -cu rren t as s ets 1 06, 67 7 1 33, 1 7 8
Cu rren t as s ets
Indemnification asset 2, 443 2, 51 2
Trade and other receivables 51 , 903 45, 37 2
Loans receivable 1 48 51 7
Other investments 84, 236 50, 365
Prepaid tax 3, 349 3, 326
Cash 7 1 , 7 98 86, 7 7 4
Total cu rren t as s ets 21 3, 87 7 1 88, 866
Total as s ets 320, 554 322, 044
Consolidated cash flow statement
10
‘000 $
Source: Company Information (preliminary and unaudited) 2023 2022 2021
Operati n g acti v i ti es
Profit for the year, net of tax 46, 1 1 5 7 , 41 0 ( 1 1 7 , 444)
Adjustments for:
Depreciation and amortization 6, 27 6 6, 901 2, 540
Share-based payments expense 2, 032 3, 7 51 3, 7 61
Goodwill and Investments in equity accounted associates
impairment — 62, 828 —
Share listing expense — — 1 25, 438
Income from share option forfeiture and cancellation ( 609) — —
Share of loss of equity-accounted associates 51 5 1 0, 1 21 —
E xpected credit losses 5, 91 9 29, 987 1 02
Property and equipment write-off — 454 —
Impairment of intangible assets — 547 —
Change in fair value of share
warrant obligations and other financial instruments ( 1 0, 946) ( 2, 7 67 ) ( 1 0, 080)
Change in fair value of other investments 115 – —
U nwinding of discount on the put option liability 1 29 366 —
Transaction costs — 1 04 —
Trade and loan receivables write-off 119 81 —
Interest income ( 4, 01 7 ) ( 1 , 639) —
Interest expense 61 116 91
Lease modification gain/( loss) 33 ( 1 1 ) —
Gain on acquisition of subsidiaries — — ( 7 9)
Loss on sale of subsidiaries — 4, 969 —
Dividend income ( 1 , 231 ) ( 231 ) —
F oreign exchange loss 3, 395 1 , 020 2, 809
Income tax expense 3, 87 9 3, 7 60 1 , 1 27
51 , 7 85 1 27 , 7 67 8, 265
Changes in working capital:
Decrease/( increase) in deferred platform commissions 20, 686 21 , 851 ( 26, 946)
( Decrease) /increase in deferred revenue ( 42, 91 7 ) ( 30, 242) 1 27 , 899
Decrease in trade and other receivables ( 9, 880) ( 4, 498) ( 1 2, 682)
( Increase) /decrease in trade and other payables ( 632) 2, 282 9, 600
( 32, 7 43) ( 1 0, 607 ) 97 , 87 1
Income tax paid ( 1 , 088) ( 1 , 07 8) ( 61 7 )
Interest received — — 7
Net cas h fl ows gen erated from operati n g acti v i ti es 1 7 , 954 1 1 6, 082 1 05, 526 2023 2022 2021
F i n an ci n g acti v i ti es
Payments of lease liabilities ( 1 , 892) ( 2, 01 3) ( 2, 1 32)
Proceeds from loans receivable — 224 —
R epayment of borrowings — — ( 49)
Interest on lease ( 56) ( 1 1 5) ( 90)
Dividends paid and distribution to shareholders — — ( 1 60, 366)
Cash acquired in the Transaction — — 1 1 9, 659
Net cas h fl ows u s ed i n fi n an ci n g acti v i ti es ( 1 , 948) ( 1 , 904) ( 42, 97 8)
Net ( decreas e) /i n creas e i n cas h for th e y ear ( 1 6, 457 ) ( 57 , 605) 59, 829
Cash at the beginning of the year 86, 7 7 4 1 42, 802 84, 557
E ffect of changes in exchange rates on cash held 1 , 481 1 , 57 7 ( 1 , 584)
Cas h at th e en d of th e y ear 7 1 , 7 98 86, 7 7 4 1 42, 802 2023 2022 2021
I n v es ti n g acti v i ti es
Acquisition of intangible assets ( 1 6) ( 64) ( 338)
Acquisition of property and equipment ( 7 39) ( 994) ( 1 , 099)
Acquisition of subsidiary net of cash acquired — ( 54, 1 1 3) ( 1 , 1 59)
Investments in equity accounted associates ( 51 5) ( 1 7 , 97 0) —
Loans granted ( 1 , 933) ( 31 , 659) ( 1 23)
Proceeds from repayment of loans 969 7 46 —
Acquisition of other investments ( 1 07 , 1 59) ( 67 , 7 29) —
Proceeds from redemption of investments 7 5, 484 — —
Interest received 368 — —
Dividends received 1 , 07 8 — —
Net cas h fl ows u s ed i n i n v es ti n g acti v i ti es ( 32, 463) ( 1 7 1 , 7 83) ( 2, 7 1 9)
Reconciliation of the profit/loss for the period to the Adjusted EBITDA
11
(1) Adjusted finance income/expenses consist of all finance income/expenses other than foreign exchange gains/losses and bank charges, net. Source: Company Information (preliminary and unaudited) US$ million Q4 2023 Q4 2022 F Y 2023 F Y 2022
Profit/( loss) for the period, net of tax 11 (77) 46 7
Adjust for:
I ncome tax expense 1 ( 0. 7 ) 4 4
Loss on disposal of subsidiaries — — — 5
Adjusted finance ( income) /expenses [1 ] ( 3) ( 0. 8) ( 5) ( 1 )
Change in fair value of share warrant obligations and other financial
instruments ( 1 ) ( 0. 3) ( 1 1 ) ( 3)
Share of loss of equity-accounted associates — 4 0. 5 10
Depreciation and amortization 2 2 6 7
Share-based payments 0. 3 0. 7 2 4
I mpairment of intangible assets — 0. 1 — 0. 5
Goodwill and investments in equity accounted associates’ impairment — 63 — 63
Adjusted E BI TDA 10 ( 9) 43 96