Franchise strategy clarified by the Control publishing rights acquisition
Higher revenue and improved profitability versus the comparison period
The Business Review is unaudited. Figures in parentheses refer to the comparison period in the previous year, unless otherwise stated.
Highlights from January-March 2024
- Revenue increased by 56.2% to
EUR 10.8 (6.9) million. -
EBITDA increased to
EUR -1.2 (-4.9) million. -
Operating profit (EBIT) was
EUR -2.1 (-5.6) million, and the operating profit margin was -19.3% (-81.0%) of revenue. -
Cash flow from operations was
EUR 3.3 (-3.9) million. -
In February, Remedy acquired full rights to the Control franchise from
505 Games . Upon the transaction, all rights to Control, codename Condor, Control 2, and all future Control products reverted to Remedy.
Key Figures
MEUR, | 1-3/2024 | 1-3/2023 | 1-12/2023 |
Revenue | 10.8 | 6.9 | 33.9 |
Growth in revenue, % | 56.2% | -45.4% | -22.2% |
EBITDA | -1.2 | -4.9 | -17.0 |
Operating profit (EBIT) | -2.1 | -5.6 | -28.6 |
Operating profit, % of revenue | -19.3% | -81.0% | -84.4% |
Result for review period | -2.0 | -5.6 | -22.7 |
Result for review period, % of revenue | -18.5% | -81.6% | -66.8% |
Balance sheet total | 90.4 | 94.2 | 79.0 |
Cash flow from operations | 3.3 | -3.9 | -16.0 |
Net cash | 21.0 | 43.9 | 23.8 |
Cash and cash equivalents | 17.0 | 39.8 | 20.1 |
Net gearing, % | -31.5% | -52.3% | -35.1% |
Equity ratio, % | 73.7% | 89.1% | 85.5% |
Capital expenditures | 19.6* | 2.1 | 10.0 |
Average number of personnel during review period (FTE) | 345 | 328 | 334 |
Headcount at the end of period | 360 | 342 | 352 |
Earnings per share, € | -0.15 | -0.42 | -1.68 |
Earnings per share, € (diluted) | -0.14 | -0.41 | -1.66 |
Number of shares at the end of period | 13,516,401 | 13,469,100 | 13,490,151 |
*Contains 16.9 million invested in publishing rights of Control franchise
Comments by CEO Tero Virtala
In February, we took a significant strategic step by acquiring full rights to the Control franchise from
In
In the first quarter of 2024 revenue was higher compared to a year ago. Development fees increased from the comparison period, mainly due to higher development fees from
Codename Condor, a part of the Control franchise, moved to full production meaning it has reached the final development stage before a game is launched. Based on wide internal playtests, we can see that the core loop is engaging, and the game brings a unique Remedy angle to the genre.
Control 2 team has focused on finalizing the proof-of-concept stage, in which the game world, game mechanics and visual targets are proven. We expect the project to advance to the production readiness stage during the second quarter of 2024.
Codename Kestrel continued in the concept stage. The team works to refine the game concept.
After the Control rights acquisition, we can freely choose the right model with which to grow our two franchises and expand the Remedy Connected Universe. When expanding high-quality franchises, each new game benefits from the success of its predecessors and the existing fan base. We continue seeking further focus and synergies across our games portfolio and operations. Soon we expect to have two game projects simultaneously in full production and one in the production readiness stage for the first time. We are confident that the good progress of the beginning of the year carries over to the full production stages.
Outlook 2024 (unchanged)
Remedy expects its revenue to increase from the previous year and operating profit (EBIT) to improve.
The revenue growth rate and EBIT improvement are meaningfully dependent on the choice between self-publishing and/or choosing a new publishing partner for the games in the Control franchise (Codename Condor and Control 2).
We will specify the Outlook for 2024 when the decision for the business model and the potential agreements for Control 2 and Condor have been made.
Long-term business prospects
We have two established own franchises, Control and
Events after the end of the reporting period
The Annual General Meeting was held on
On
Remedy received the following flagging notifications after the reporting period.
Webcast and conference call
Remedy will host a webcast and conference call in English on its Q1 2024 financial results for investors, analysts and media on
The Business review will be available after publication on Remedy's Investor website: https://investors.remedygames.com/financials-and-reports/financial-reports/.
Webcast details:
Register in advance for the webcast:
https://remedy.zoom.us/webinar/register/WN_CadK4Ci9TcOE4gL113WnnQ
After registering, you will receive a confirmation email containing information about joining the webcast.
Conference call details:
Dial in by calling your local phone number a few minutes before the briefing begins. International numbers are available at: https://remedy.zoom.us/u/kbZXDFBZgc.
Webinar ID: 857 1013 9504
Passcode: 487991
A recording of the webcast will be available afterwards on Remedy's Investor website: https://investors.remedygames.com/financials-and-reports/webcasts-and-presentations/.
More information
Phone: +358 50 4334 992
Email: liisa.eloranta@remedygames.com
Remedy in brief
www.remedygames.com
https://news.cision.com/remedy-entertainment-oyj/r/remedy-entertainment-plc--business-review-january-march-2024--franchise-strategy-clarified-by-the-co,c3969366
https://mb.cision.com/Main/18862/3969366/2765787.pdf
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