Interim / Quarterly Report • Aug 12, 2022
Interim / Quarterly Report
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The Half-Year Financial Report is unaudited. Figures in parenthesis refer to the comparison period in the previous year, unless otherwise stated.
| MEUR, IFRS, Group, unaudited | |||||
|---|---|---|---|---|---|
| 4–6/2022 | 4–6/2021 | 1–6/2022 | 1–6/2021 | 1-12/2021 | |
| Revenue | 9.4 | 9.4 | 22.1 | 17.5 | 44.7 |
| Growth in revenue, % | -0.2% | -3.4% | 25.8% | 3.3% | 8.9% |
| EBITDA | -1.8 | 2.3 | 1.5 | 3.2 | 14.5 |
| Operating profit (EBIT) | -2.4 | 1.5 | 0.4 | 1.3 | 11.4 |
| Operating profit, % of revenue | -25.6% | 15.7% | 1.6% | 7.3% | 25.5% |
| Result for review period | -2.6 | 1.0 | -0.6 | 1.0 | 8.8 |
| Result for review period, % of revenue | -27.5% | 10.6% | -2.5% | 5.5% | 19.7% |
| Balance sheet total | 100.4 | 90.7 | 100.4 | 90.7 | 101.1 |
| Cash flow from operations | -8.3 | -0.8 | 9.4 | 3.5 | 6.1 |
| Net cash | 54.6 | 56.9 | 54.6 | 56.9 | 47.5 |
| Cash position | 53.6 | 60.6 | 53.6 | 60.6 | 51.4 |
| Net gearing, % | -63.1% | -74.3% | -63.1% | -74.3% | -54.4% |
| Equity ratio, % | 86.2% | 84.4% | 86.2% | 84.4% | 86.4% |
|---|---|---|---|---|---|
| Capital expenditures | 2.6 | 2.5 | 5.3 | 4.6 | 9.6 |
| Average number of personnel during review period (FTE) |
300 | 280 | 295 | 277 | 280 |
| Headcount at the end of period | 319 | 293 | 319 | 293 | 294 |
| Earnings per share, € | -0.19 | 0.08 | -0.04 | 0.07 | 0.67 |
| Earnings per share, € (diluted) | -0.19 | 0.07 | -0.04 | 0.07 | 0.65 |
| Number of shares at the end of period | 13,302,700 | 13,072,150 | 13,302,700 | 13,072,150 | 13,298,450 |
In the second quarter of 2022, our revenue, EUR 9.4 million, was at the previous year's level. Key positive contributors were the development fees from Alan Wake 2 and Max Payne 1&2 Remake. At the same time, development fees from Codename Condor and Alan Wake Remastered and game royalties from Control decreased from the comparison period. Alan Wake Remastered and Crossfire games did not yet generate royalties.
In the second quarter, operating profit decreased to EUR -2.4 (1.5) million, mainly due to significant external development expenses. The composition of revenue also affected our profitability.
The highlight of the second quarter was the development agreement for Max Payne 1&2 Remake with Rockstar Games in April. Max Payne 1&2 Remake allows us to reignite the soul of that original world, story, and characters for the vast gaming audience of today. The game is currently developed by a small core team. Max Payne is a highly motivating game for our team and fits well with many of our strengths. The game has good business potential with well-managed risks, and it allows us to utilize and strengthen the production and technology synergies across our projects.
In May, we celebrated the 12th anniversary of Alan Wake and confirmed that Alan Wake 2 will be released in 2023 as planned. The Alan Wake 2 team is at its peak size, and game production continues at full speed on all fronts. In the second quarter, Remedy announced that Alan Wake Remastered will be released for Nintendo Switch, opening up a new audience for the game.
The development of Codename Condor, a spin-off game of Control, has progressed well. The project is moving from the proof-of-concept stage to the production readiness stage. Codename Heron, a biggerbudget Control game, is in the concept stage. At the moment, we are keeping the development team small and giving it time to fine-tune the game concept before expanding the team and taking the project to the proof-of-concept stage.
Codename Vanguard, a free-to-play (F2P), co-operative multiplayer game to be co-published with Tencent, is in the proof-of-concept stage. As announced after the review period on August 1, we decided, together with Tencent, to keep the game in the current proof-of-concept phase longer and postpone the significant expansion of the development team until 2023. This will give us time to further design and develop key elements of the game before moving to the next phase of development, even though it will come with the cost of postponing some of the development fees to the future.
On May 4, 2022, we achieved an important milestone, when trading in Remedy's shares was transferred from the First North Growth Market Finland marketplace to the official list of Nasdaq Helsinki. In our view, a listing on the official list will increase Remedy's brand awareness, improve the liquidity of shares, and help to broaden our shareholder base.
After the end of the review period, on August 1, we lowered our revenue and operating result outlook for 2022, due to lower-than-expected game royalties in 2022 as well as our decision to take extra time to develop Codename Vanguard.
To ensure a good progress of game development, it is paramount that we can recruit enough new talents. Our recruitment is now progressing faster than in 2021. While keeping the bar high, we have managed to onboard the same number of new people in the first half of 2022 as during the full year 2021. To support our game projects, our capabilities to use external development have improved, which is reflected in our increased external development costs. Our own development teams are now stronger than ever as well. The Northlight technology keeps on progressing and our way of working has continuously improved.
Remedy expects its revenue to remain at the previous year's level and its operating result to decline significantly compared to the year 2021.
We have several games in development, each with a world-class partner and agreed long-term development fees. These development fees form a strong, growing, and predictable revenue basis for many years. On top of these revenues, we build the less predictable but highly scalable revenue streams arising from game royalties.
Individual game royalties depend on many variables, which are not all in our control. Therefore, our assumptions for game royalties are conservative by default. At the same time, even though not assumed as the base case, each high-quality game that stands out in the market has the potential to succeed in a bigger way, which would drive significant revenue and operating profit growth. Step by step, our games are transforming into longer-lasting experiences that typically continue to sell for many years. This also applies to the three games we launched in the end of 2021 and early 2022 with our partners.
In relation to our longer-term game roadmap, we now have five game projects in development and will have major game launches between 2023 and 2025. The timing of individual game launches and new game development agreements may cause variation from quarter to quarter and year to year. With several games out in the market accruing royalties and several new ones in development, this variation is also expected to decrease in the coming years.
In the second quarter of 2022, Remedy's revenue was at the previous year's level, EUR 9.4 (9.4) million. Development fees were EUR 7.4 (6.1) million and royalties from publishing partners were EUR 2.0 (3.3) million. Key positive contributors to the growth of development fees were the development fees from Alan Wake 2 and Max Payne 1&2 Remake. At the same time, development fees from Codename Condor and Alan Wake Remastered as well as game royalties from Control decreased from the comparison period. Alan Wake Remastered and Crossfire games did not yet generate royalties.
In April‒June 2022, Remedy's EBITDA decreased to EUR -1.8 (2.3) million and operating profit (EBIT) was EUR -2.4 (1.5) million, or -25.6% (15.7%) of the revenue. The decrease was mainly due to significantly increased external development expenses (materials and services) mainly related to Alan Wake 2 and Codename Condor. The composition of revenue also impacted our profitability. In the second quarter of 2022, a large share, 79.2% (65.0%), of our revenue was generated by development fees from projects where either the partner fully funds the project or where we act as a co-publisher and fund part of the development. Unlike in subcontracting, the profitability of these projects is on a lower level during the development phase.
In the first half of 2022, Remedy's revenue grew by 25.8% to EUR 22.1 (17.5) million. Development fees were EUR 19.1 (12.3) million and royalties from publishing partners were EUR 3.0 (5.3) million. Key positive contributors to the growth of development fees were the development fees from Alan Wake 2, Max Payne 1&2 Remake and Codename Vanguard. At the same time, development fees from Alan Wake Remastered and Crossfire as well as game royalties from Control decreased from the comparison period. Alan Wake Remastered and Crossfire games did not yet generate royalties.
In January‒June 2022, Remedy's EBITDA decreased to EUR 1.5 (3.2) million and operating profit (EBIT) to EUR 0.4 (1.3) million, or 1.6% (7.3%) of the revenue. The decrease was mainly due to significantly increased external development expenses (materials and services) mainly related to Alan Wake 2 and Codename Condor. The composition of revenue also impacted our profitability. In the first half of 2022, a large share, 86.4% (69.9%), of our revenue was generated by development fees from projects where either the partner fully funds the project or where we act as a co-publisher and fund part of the development. Unlike in subcontracting, the profitability of these projects is on a lower level during the development phase.
In April–June, Remedy's cash flow from business operations amounted to EUR -8.3 (-0.8) million. Operating cash flow was impacted by a smaller amount of incoming payments from partners and higher outgoing payments related to outsourcing, personnel, and other operating costs.
In April–June, Remedy's cash flow from investing activities amounted to EUR -2.6 (-2.8) million and cash flow from financing activities amounted to EUR -2.0 (-2.0) million.
In January–June, Remedy's cash flow from business operations amounted to EUR 9.4 (3.5) million. Compared to the comparison period, Remedy received a much higher amount of development fees from partners, especially related to Alan Wake 2 and Codename Vanguard. On the other hand, higher outgoing payments related to outsourcing, personnel costs and other operating costs impacted cash flow negatively.
Royalty revenue cash flow is based on agreed payment terms with partners and can differ significantly during certain periods from accrual-based revenue recognized within a period. Cash flow from business operations is also affected by the timing of incoming significant project development fee payments, which vary according to invoicing milestones.
In January–June, Remedy's cash flow from investing activities amounted to EUR -5.3 (-5.0) million and cash flow from financing activities amounted to EUR -1.9 (38.4) million. In the comparison period, Remedy carried out a directed offering of new shares.
Remedy's non-current assets on June 30, 2022, totaled EUR 27.0 (15.5) million. The increase in non-current assets is largely due to the capitalization of product development expenses. The total amount of capitalized product development expenses was EUR 19.1 (10.7) million on June 30, 2022. The company has several projects under development and their product development costs are capitalized according to IFRS standards. The company does not have any goodwill on its balance sheet.
On June 30, 2022, Remedy's cash in hand and on bank accounts totaled EUR 53.6 (60.6) million.
The company's liabilities on June 30, 2022, amounted to EUR 13.9 (14.1) million.
Remedy's balance sheet total on June 30, 2022, was EUR 100.4 (90.7) million and equity EUR 86.5 (76.6) million. Equity was impacted by a dividend payment of EUR 2.3 million in April 2022. The company's equity ratio was 86.2% (84.4%) and net gearing -63.1% (-74.3%).
The number of the company's personnel (headcount) was 319 (293) at the end of the period under review, with an annual growth of 9%. 51% of the personnel represent 31 different nationalities, the rest (49 %) are Finns. Including consultants and other external game industry professionals, the total number of people working for Remedy at the end of the period under review was 345, growing 10% from the same period last year.
At the end of the period under review, the company's Executive Team included CEO Tero Virtala, CFO Terhi Kauppi, CTO Markus Mäki, Creative Director Sami Järvi, HR Director Mikaela Öberg, Chief Commercial Officer Johannes Paloheimo, and Chief Operating Officer Christopher Schmitz.
The Annual General Meeting was held on April 13, 2022, in Espoo. Shareholders and their proxy representatives could only participate in the meeting and exercise shareholder rights by voting, submitting counterproposals and asking questions in advance.
The Annual General Meeting re-elected Markus Mäki (Chair), Christian Fredrikson, Jussi Laakkonen and Henri Österlund as members of the company's Board of Directors. Kaisa Salakka and Sonja Ängeslevä were elected as new Board Members. Unlike the other Board Members, the term of office of Sonja Ängeslevä commenced on May 2, 2022. The members of the Board of Directors were elected for the term lasting until the 2023 Annual General Meeting.
The Annual General Meeting decided on the matters belonging to the Annual General Meeting, and
discharged the members of the Board of Directors and the CEO from liability for the financial year 2021,
decided, based on the Board of Directors' proposal, on a dividend distribution of 0.17 euros per share and in the aggregate amount of 2,261,459.00 euros from the company's distributable funds,
In addition, the Annual General Meeting resolved to authorize the Board of Directors to resolve on
The authorization for the directed repurchase of own shares is valid until the closing of the next Annual General Meeting, however, no longer than until October 13, 2023, and it replaces the previous authorizations. The authorization to decide on share issues or issuance of option rights or other special rights is valid for five years from the date of the Annual General Meeting and it replaces the previous authorizations.
At its organizing meeting held after the Annual General Meeting, the Board elected Markus Mäki to continue as the Chairman of the Board of Directors.
On May 4, 2022, trading in Remedy's shares was transferred from the First North Growth Market Finland marketplace to the official list of Nasdaq Helsinki. Remedy's shares are traded in Nasdaq Helsinki with the trading code REMEDY. The closing price of Remedy's shares on the last trading day of the review period was 24.25 euros.
| January–June 2022 | Highest share price, € | Lowest share price, € | Closing share price, € | Volume-weighted average price, € |
|||
|---|---|---|---|---|---|---|---|
| REMEDY | 40.60 | 24.20 | 24.25 | 28.15 | |||
| 30.6.2022 | 30.6.2021 | 31.12.2021 | |||||
| Market capitalization, € | 322,590,475 | 617,659,088 | 527,948,465 | ||||
| Number of shareholders | 16,682 | 11,032 | 14,203 | ||||
| Number of shares at the end of period | 13,302,700 | 13,072,150 | 13,298,450 | ||||
| Number of shares at the end of period, diluted | 13,949,650 | 13,947,650 | 13,950,150 | ||||
| Average number of shares within period | 13,302,700 | 12,905,483 | 13,045,392 | ||||
| Average number of shares within period, diluted | 13,949,650 | 13,781,483 | 13,865,400 | ||||
| Value of share turnover within period | 20,339,434 | 120,247,058 | 212,553,836 | ||||
| Total number of traded shares within period | 722,122 | 2,808,826 | 5,110,204 |
The company has one series of shares (ISIN: FI4000251897). The number of shares in the company was 13,302,700 on June 30, 2022. The company held no treasury shares.
Between September 16 and December 31, 2021, a total of 4,250 of Remedy's new shares were subscribed for with the company's stock options 2018. These shares were registered in the Trade Register on January 27, 2022. As an outcome, the number of the company's shares rose from 13,298,450 to 13,302,700.
On April 13, 2022, the Annual General Meeting resolved to authorize the Board of Directors to resolve on the issuance of shares for a fee or without a fee or issuances of option rights or special rights so that the number of shares to be issued can be at maximum 1,300,000. On June 30, 2022, the authorization had not been used and thus, a total maximum of 1,300,000 new shares could be issued under the authorization on said date.
| NAME | SHARES | PERCENTAGE | |
|---|---|---|---|
| 1. | Mäki Markus | 3,197,000 | 24.0 |
| 2. | Järvi Sami Antero | 560,000 | 4.2 |
| 3. | Virtala Tero Tapani | 300,000 | 2.3 |
| 4. | Lehtinen Saku Hermanni | 235,000 | 1.8 |
| 5. | Evli Finnish Small Cap Fund | 228,164 | 1.7 |
| 6. | Sijoitusrahasto Taaleritehdas Mikro Markka | 220,042 | 1.7 |
| 7. | Tolsa Tero Sakari Anttoni | 170,000 | 1.3 |
| 8. | Varma Mutual Pension Insurance Company | 150,000 | 1.1 |
| 9. | Sijoitusrahasto Aktia Capital | 129,807 | 1.0 |
| 10. | Paloheimo Johannes Alfred Gustaf | 103,000 | 0.8 |
| 10 largest shareholders total | 5,293,013 | 39.8 | |
| Accendo Capital SICAV RAIF (nominee registered) | 1,963,162 | 14.8 | |
| Other nominee registered | 1,858,772 | 14.0 | |
| Other shares | 4,187,753 | 31.5 | |
| Total | 13,302,700 | 100.0% |
Remedy has four option plans directed to Remedy's key persons: Option Plan 2018, Option Plan 2019, Option Plan 2020 and Option Plan 2021. The table below illustrates the key information about the option plans. More information about the option plans can be found on Remedy's website at https://investors.remedygames.com/remuneration/.
| Option Plan Maximum | number of option rights issued |
Number of allocated option rights |
Number of unexercised option rights |
Share subscription period | Share subscription price, EUR |
|---|---|---|---|---|---|
| Option Plan 2018 |
302,500 | 302,500 | 71,950 | June 1, 2021 –May 31, 2024 | 7.02 |
| Option Plan 2019 |
371,000 | 371,000 | 371,000 | June 1, 2022 –May 31, 2025 | 9.23 |
| Option Plan 2020 |
400,000 | 204,000 | 204,000 | June 1, 2023 –May 31, 2026 | 22.21 |
| Option Plan 2021 |
350,000 | 312,500 | 312,500 | June 1, 2024 –May 31, 2027 | 47.09 |
Remedy's option rights 2018 are listed on the Nasdaq Helsinki Ltd First North Growth marketplace. On May 31, 2022, Remedy applied also for the listing of its 2019 option rights on the Nasdaq Helsinki Ltd First North Growth marketplace as of June 1, 2022. Originally, a total number of 400,000 option rights 2019 have been issued. Remedy cancelled a total of 29,000 option rights 2019 held by the company. After the cancellation, the remaining 371,000 option rights 2019 entitle holders to subscribe for 371,000 company shares.
The most substantial short-term risks and uncertainties are:
The above-mentioned risks might, if they materialize, have a significant negative impact on the company's business operations, result, financial position, outlook and share price.
On August 1, 2022, Remedy announced that it lowers its revenue and operating result outlook for 2022. According to the updated outlook Remedy expects its revenue to remain at the previous year's level and its operating result to decline significantly compared to the year 2021.
October 28, 2022 Business Review 1–9/2022
Remedy will host a webcast and conference call in English on its half-year financial report for investors, analysts and media on Friday, August 12, 2022, at 2:00 p.m. (EEST). Remedy's half-year financial report will be presented by CEO Tero Virtala and CFO Terhi Kauppi.
Register in advance for the webcast:
https://remedy.zoom.us/webinar/register/WN\_knLaEt2WRSOLTMd-kybDqw
After registering, you will receive a confirmation email containing information about joining the webcast.
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/kyOvxC4TO
Finland: +358 9 7252 2471
Sweden: +46 850 539 728
United Kingdom: +44 330 088 5830
United States: +1 646 558 8656
Webinar ID: 831 1823 7596
Passcode: 338475
A recording of the webcast will be available after the briefing at https://investors.remedygames.com/presentations/
| EUR thousand | 4-6/2022 | 4-6/2021 | 1-6/2022 | 1-6/2021 | 1-12/2021 |
|---|---|---|---|---|---|
| REVENUE | 9,402 | 9,417 | 22,058 | 17,533 | 44,726 |
| Other operating income | 0 | 1 | 0 | 1 | 1 |
| Materials and services | -3,480 | -923 | -5,874 | -2,066 | -5,368 |
| Personnel expenses | -6,242 | -5,248 | -11,899 | -10,322 | -21,152 |
| Depreciation and impairment | -601 | -848 | -1,178 | -1,920 | -3,043 |
| Other operating expenses | -1,395 | -921 | -2,757 | -1,950 | -3,757 |
| OPERATING PROFIT (LOSS) | -2,411 | 1,477 | 350 | 1,276 | 11,407 |
| Financial income | 170 | 27 | 206 | 84 | 253 |
| Financial expenses | -754 | -120 | -783 | -148 | -318 |
| PROFIT (LOSS) BEFORE INCOME | |||||
| TAXES | -2,995 | 1,384 | -227 | 1,212 | 11,342 |
| Income tax expense | 413 | -381 | -328 | -241 | -2,548 |
| PROFIT (LOSS) FOR THE FINANCIAL | |||||
| YEAR | -2,581 | 1,003 | -555 | 971 | 8,794 |
| OTHER COMPREHENSIVE INCOME | |||||
| (EXPENSE) | |||||
| Items that may be subsequently | |||||
| reclassified to profit or loss | 0 | 0 | 0 | 0 | 0 |
| Total other comprehensive income | |||||
| (expense) for the financial year | 0 | 0 | 0 | 0 | 0 |
| TOTAL COMPREHENSIVE INCOME | |||||
| (EXPENSE) FOR THE FINANCIAL | |||||
| YEAR | -2,581 | 1,003 | -555 | 971 | 8,794 |
| PROFIT (LOSS) FOR THE FINANCIAL | |||||
| YEAR ATTRIBUTABLE TO | |||||
| Owners of the company | -2,581 | 1,003 | -555 | 971 | 8,794 |
| TOTAL COMPREHENSIVE INCOME | |||||
| (EXPENSE) ATTRIBUTABLE TO | |||||
| Owners of the company | -2,581 | 1,003 | -555 | 971 | 8,794 |
| EARNINGS PER SHARE | |||||
| Basic earnings per share, euro | -0.19 | 0.08 | -0.04 | 0.07 | 0.67 |
| Diluted earnings per share, euro | -0.19 | 0.07 | -0.04 | 0.07 | 0.65 |
| EUR thousand | June 30, 2022 | June 30, 2021 | December 31, 2021 |
|---|---|---|---|
| NON-CURRENT ASSETS | |||
| Intangible assets | |||
| Development costs | 19,089 | 10,739 | 15,110 |
| Other intangible assets | 0 | 0 | 0 |
| Tangible assets | 3,331 | 3,221 | 3,178 |
| Right-of-use assets | 1,567 | 1,507 | 1,075 |
| Investments | 3,000 | 0 | 3,000 |
| Non-current receivables | 776 | 655 | 705 |
| Deferred tax assets | -8 | 7 | 6 |
| CURRENT ASSETS | |||
| Inventory | 18 | 0 | 17 |
| Trade and other receivables | 12,215 | 6,318 | 20,163 |
| Contract assets | 3,031 | 7,687 | 2,348 |
| Other current financial assets | 3,781 | 0 | 4,139 |
| Cash and cash equivalents | 53,607 | 60,575 | 51,384 |
| TOTAL ASSETS | 100,406 | 90,710 | 101,126 |
| EQUITY | |||
| Share capital | 80 | 80 | 80 |
| Share premium | 38 | 38 | 38 |
| Invested non-restricted equity reserve | 55,853 | 54,161 | 55,779 |
| Retained earnings (losses) | 31,114 | 21,345 | 22,728 |
| Profit (loss) for the financial year | -555 | 971 | 8,794 |
| LIABILITIES | |||
| Non-current liabilities | |||
| Government loan | 1,837 | 2,755 | 1,837 |
| Lease liabilities | 667 | 662 | 218 |
| Deferred tax assets | 0 | 11 | 0 |
| Current liabilities | |||
| Government loan | 919 | 919 | 919 |
| Lease liabilities | 910 | 878 | 884 |
| Trade and other payables | 9,544 | 8,890 | 9,848 |
| TOTAL EQUITY AND LIABILITIES | 100,406 | 90,710 | 101,126 |
| EUR thousand | 1-6/2022 | 1-6/2021 | 1-12/2021 |
|---|---|---|---|
| Cash flow from business operations | 9,441 | 3,462 | 6,052 |
| Cash flow from investments | -5,289 | -5,022 | -16,602 |
| Cash flow from financing | -1,930 | 38,445 | 38,244 |
| Liquid assets – opening balance | 51,384 | 23,690 | 23,690 |
| Change in liquid assets | 2,222 | 36,885 | 27,694 |
| Liquid assets – closing balance | 53,607 | 60,575 | 51,384 |
| Share | Invested | SHAREHOLD | |||
|---|---|---|---|---|---|
| Changes in shareholders' | premium | unrestricted | Retained | ERS' EQUITY | |
| equity 1-6/2022 | Share capital | account | equity fund | earnings | TOTAL |
| EUR thousand | |||||
| Balance January 1, 2022 | 80 | 38 | 55,779 | 31,521 | 87,418 |
| Comprehensive income | |||||
| Profit (Loss) for the financial | |||||
| year | -555 | -555 | |||
| Other comprehensive income | |||||
| Total comprehensive income | -555 | -555 | |||
| Transactions with owners of | |||||
| the company | |||||
| Dividend distribution | -2,261 | -2,261 | |||
| Share options granted | 1,853 | 1,853 | |||
| Share issue and other share | |||||
| subscriptions | 74 | ||||
| Total transactions with owners | 74 | -408 | -334 | ||
| BALANCE JUNE 30, 2022 | 80 | 38 | 55,853 | 30,559 | 86,530 |
| Share | Invested | SHAREHOLD | |||
|---|---|---|---|---|---|
| Changes in shareholders' | premium | unrestricted | Retained | ERS' EQUITY | |
| equity 1-6/2021 | Share capital | account | equity fund | earnings | TOTAL |
| EUR thousand | |||||
| Balance January 1, 2021 | 80 | 38 | 13,748 | 22,326 | 36,093 |
| Comprehensive income | |||||
| Profit (Loss) for the financial | |||||
| year | 971 | 971 | |||
| Other comprehensive income | |||||
| Total comprehensive income | 971 | 971 | |||
| Transactions with owners of | |||||
| the company | |||||
| Dividend distribution | -1,961 | -1,961 | |||
| Share options granted | 1,074 | 1,079 | |||
| Increase in share capital | 40,413 | 40,413 | |||
| Total transactions with owners | 40,413 | -887 | 39,531 | ||
| BALANCE June 30, 2021 | 80 | 38 | 54,161 | 22,316 | 76,595 |
The half-year report has been prepared in accordance with IAS 34 'Interim Financial Reporting' while adhering to related IFRS standards applicable within the EU on June 30, 2022. The accounting policies of the half-year report are similar to the accounting policies applied in the financial statements according to IFRS for the period ended December 31, 2021. The disclosed figures have been rounded off from the accurate figures.
The information presented in this half-year report is unaudited.
| EUR thousand | 4-6/2022 | 1–3/2022 | 10–12/2021 | 7–9/2021 | 4–6/2021 | 1–3/2021 |
|---|---|---|---|---|---|---|
| Development fees | 7,443 | 11,619 | 18,341 | 5,428 | 6,118 | 6,138 |
| Royalties | 1,958 | 1,037 | 1,455 | 1,970 | 3,298 | 1,978 |
| Total | 9,401 | 12,656 | 19,796 | 7,398 | 9,417 | 8,116 |
Currently Remedy's financial assets and liabilities measured at fair value comprise of derivative assets and derivative liabilities and investments to equity funds.
| June 30, 2022 | Carrying amount |
Fair value |
|||
|---|---|---|---|---|---|
| EUR thousand | Level 1 | Level 2 | Level 3 | Total | |
| Financial assets measured at fair value | |||||
| Investments to equity funds | 6,780 | 6,780 | - | - | 6,780 |
| 6,780 | 6,780 | - | - | 6,780 | |
| Financial liabilities not measured at fair value | |||||
| Unsecured government loan | 2,755 | - | - | 2,755 | 2,755 |
| 2,755 | - | - | 2,755 | 2,755 |
| December 31, 2021 | Carrying amount |
Fair value |
|||
|---|---|---|---|---|---|
| EUR thousand | Level 1 | Level 2 | Level 3 | Total | |
| Financial assets measured at fair value | |||||
| Investments to equity funds | 7,139 | 7,139 | - | - | 7,139 |
| 7,139 | 7,139 | - | - | 7,139 | |
| Financial liabilities not measured at fair value | |||||
| Unsecured government loan | 2,755 | - | - | 2,755 | 2,755 |
| 2,755 | - | - | 2,755 | 2,755 |
When measuring the fair value of an asset or a liability, Remedy uses observable market data as far as possible.
| Machinery and equipment |
Other tangible assets |
Total | ||||
|---|---|---|---|---|---|---|
| EUR thousand | ||||||
| 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | |
| Cost | ||||||
| Balance January 1 | 4,734 | 3,639 | 1,918 | 1,900 | 6,652 | 5,539 |
| Additions | 883 | 514 | - | 9 | 883 | 523 |
| Balance June 30 | 5,617 | 4,153 | 1,918 | 1,909 | 7,535 | 6,062 |
| Accumulated depreciation | ||||||
| and impairment | ||||||
| Balance January 1 | -2,154 | -1,421 | -1,319 | -848 | -3,474 | -2,268 |
| Depreciation | -493 | -337 | -237 | -235 | -730 | -572 |
| Balance June 30 | -2,647 | -1,758 | -1,556 | -1,083 | -4,204 | -2,840 |
| Carrying amount on January 1 | 2,579 | 2,218 | 599 | 1,052 | 3,178 | 3,271 |
| Carrying amount on June 30 | 2,970 | 2,395 | 362 | 826 | 3,332 | 3,222 |
Capitalized development costs
| EUR thousand | June 30, 2022 | June 30, 2021 |
|---|---|---|
| Cost | ||
| Balance January 1 | 25,085 | 16,596 |
| Additions | 3,979 | 4,061 |
| Balance June 30 | 29,064 | 20,657 |
| Balance January 1 | -9,975 | -9,003 |
|---|---|---|
| Depreciation | - | -915 |
| Balance June 30 | -9,975 | -9,918 |
| Carrying amount on January 1 | 15,110 | 7,593 |
| Carrying amount on June 30 | 19,089 | 10,739 |
| EBITDA: | Operating profit (EBIT) + depreciation and amortization |
|---|---|
| Operating profit (EBIT): | Profit (loss) before taxes and financial items |
| Operating profit, % of revenue: | Operating profit (EBIT) / revenue |
| Net cash: | Cash in hand and banks - interest-bearing liabilities |
| Net gearing, %: | (Interest-bearing liabilities - cash in hand and at banks) / |
| shareholders' equity | |
| Equity ratio: | Shareholders' equity / (balance sheet total - advances received) |
| Capital Expenditures: | Change in tangible and intangible assets added by depreciation of these assets |
Espoo, August 12, 2022 Remedy Entertainment Plc Board of Directors
Tero Virtala, Chief Executive Officer Phone: +358 9 435 5040 Email: [email protected]
Terhi Kauppi, Chief Financial Officer Phone: +358 9 435 5040 Email: [email protected]
Remedy Entertainment Plc is a globally successful video game company known for story-driven and visually stunning console and PC games such as Control, Alan Wake and Max Payne. Remedy also develops its own Northlight game engine and game development tools. Founded in 1995 and based in Finland, the company employs over 320 game industry professionals from 32 different countries. Remedy's share is listed on the Nasdaq Helsinki's official list.
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