• Gravity Reports Second Quarter of 2024 Results and Business Update

    来源: Nasdaq GlobeNewswire / 09 8月 2024 06:00:00   America/New_York

    Seoul, South Korea, Aug. 09, 2024 (GLOBE NEWSWIRE) -- GRAVITY Co., Ltd. (NasdaqGM: GRVY) (“Gravity” or “Company”), a developer and publisher of online and mobile games based in South Korea, today announced its unaudited financial results for the second quarter ended June 30, 2024, prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board and business updates.

    SECOND QUARTER 2024 HIGHLIGHTS

    • Total revenues were KRW 122,967 million (US$ 89,330 thousand), representing a 2.7% increase from the first quarter ended March 31, 2024 (“QoQ”) and a 48.5% decrease from the second quarter ended June 30, 2023 (“YoY”).
    • Operating profit was KRW 14,989 million (US$ 10,889 thousand), representing a 44.2% decrease QoQ and a 71.6% decrease YoY.
    • Profit before income tax expenses was KRW 20,057 million (US$ 14,570 thousand), representing a 38.3% decrease QoQ and a 63.6% decrease YoY.
    • Net profit attributable to parent company was KRW 12,569 million (US$ 9,131 thousand), representing a 53.2% decrease QoQ and a 72.1% decrease YoY.

    REVIEW OF SECOND QUARTER 2024 FINANCIAL RESULTS

    Revenues

    Online game revenues for the second quarter of 2024 were KRW 19,445 million (US$ 14,126 thousand), representing a 7.6% increase QoQ from KRW 18,065 million and a 14.2% increase YoY from KRW 17,025 million. The increase QoQ was mainly attributable to increased revenues from Ragnarok Online in Thailand. The increase YoY was also mainly due to increased revenues from Ragnarok Online in Thailand.

    Mobile game revenues were KRW 99,019 million (US$ 71,933 thousand) for the second quarter of 2024, representing a 0.5% increase QoQ from KRW 98,548 million and a 54.7% decrease YoY from KRW 218,687 million. The increase QoQ was resulted by increased revenues from Ragnarok Origin, which was launched in North, Central and South America on February 28, 2024 and initial revenues from THE RAGNAROK (Ragnarok: Novice Hearts), which was launched in Taiwan, Hong Kong and Macau on June 6, 2024. Such increase was partially offset by decreased revenues from Ragnarok Origin in Southeast Asia. The decrease YoY was mainly due to decreased revenues from Ragnarok Origin in Southeast Asia, Taiwan, Hong Kong and Macau and Ragnarok X: Next Generation in Korea. This decrease was partially offset by increased revenues from Ragnarok Origin in North, Central and South America and THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau.

    Other revenues were KRW 4,503 million (US$ 3,271 thousand) for the second quarter of 2024, representing a 42.2% increase QoQ from KRW 3,166 million and a 41.5% increase YoY from KRW 3,182 million.

    Cost of Revenue

    Cost of revenue was KRW 76,006 million (US$ 55,215 thousand) for the second quarter of 2024, representing a 3.2% increase QoQ from KRW 73,628 million and a 54.8% decrease YoY from KRW 168,309 million. The increase QoQ was mainly due to commission paid for mobile game services related to Ragnarok Origin in North, Central and South America and THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau. The decrease YoY was primarily due to decreased commission paid for mobile game services related to Ragnarok Origin in Southeast Asia, Taiwan, Hong Kong and Macau and Ragnarok X: Next Generation in Korea.

    Operating Expenses

    Operating expenses were KRW 31,972 million (US$ 23,226 thousand) for the second quarter of 2024, representing a 65.8% increase QoQ from KRW 19,282 million and a 78.8% increase YoY from KRW 17,884 million. The increase QoQ was mainly due to increased advertising expenses for mobile game services related to THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau. The increase YoY was also mainly due to increased advertising expenses for mobile game services related to THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau.

    Profit Before Income Tax Expenses

    Profit before income tax expenses was KRW 20,057 million (US$ 14,570 thousand) for the second quarter of 2024 compared with profit before income tax expense of KRW 32,498 million for the first quarter of 2024 and profit before income tax expenses of KRW 55,097 million for the second quarter of 2023.

    Net Profit

    As a result of the foregoing factors, Gravity recorded a net profit attributable to parent company of KRW 12,569 million (US$ 9,131 thousand) for the second quarter of 2024 compared with net profit attributable to parent company of KRW 26,866 million for the first quarter of 2024 and a net profit attributable to parent company of KRW 45,016 million for the second quarter of 2023.

    Liquidity

    The balance of cash and cash equivalents and short-term financial instruments was KRW 499,247 million (US$ 362,680 thousand) as of June 30, 2024.

    Note: For convenience purposes only, the KRW amounts have been expressed in U.S. dollars at the exchange rate of KRW 1,376.55 to US$ 1.00, the noon buying rate in effect on June 28, 2024 as quoted by the Federal Reserve Bank of New York.

    GRAVITY BUSINESS UPDATES

    Ragnarok Online IP-based Games

    • Ragnarok: Dawn (tentative English title)

    Ragnarok: Dawn (tentative English title) officially received an ISBN from Chinese government on June 5, 2024, and aims to complete development in 2025.

    • Ragnarok Online, an MMORPG PC game

    Ragnarok Online was officially launched in China on June 28, 2024.

    • Ragnarok X: Next Generation, an MMORPG mobile game

    Ragnarok X: Next Generation will be launched in China on September 13, 2024, with preparations underway for its launch in Japan.

    • Ragnarok Origin, an MMORPG mobile and PC game

    Ragnarok Origin is preparing for its launch in Europe.

    • THE RAGNAROK (Ragnarok: Novice Hearts), an MMORPG mobile game

    THE RAGNAROK (Ragnarok: Novice Hearts) was launched in Taiwan, Hong Kong and Macau on June 6, 2024, and it aims to be launched in Korea in the third quarter of 2024 and Southeast Asia in the fourth quarter of 2024.

    • Ragnarok: Rebirth, an MMORPG mobile game

    Ragnarok: Rebirth was launched in Southeast Asia on June 27, 2024, and it aims to be launched in Taiwan, Hong Kong and Macau in the fourth quarter of 2024.

    • Other Ragnarok Online IP-based games

    Ragnarok Landverse, an MMORPG Blockchain PC game based on P2E systems, was launched in Thailand on July 12, 2024.

    Other IP-based games

    • Mirren: Millennium Tour, a Turn Strategy RPG mobile game

    Mirren: Millennium Tour aims to be launched in Korea in the third quarter of 2024.

    • TOKYO PSYCHODEMIC, a 2D Cinematic Profiling Adventure PC and console game

    TOKYO PSYCHODEMIC was launched in Japan on May 30, 2024, and it aims to be launched in Global in the second half of 2024.

    • KAMiBAKO, a World Craft RPG PC and console game

    KAMiBAKO will be launched in Japan on August 29, 2024, and it aims to be launched in Global in the second half of 2024.

    Expansion of Ragnarok IP-business

    Ragnarok Golf Monsters is an indoor-screen golf brand based on the Ragnarok monster characters. Gravity Communications Co., Ltd. has been having a soft opening since May 30, 2024, and it aims to officially open the facility in Taipei, Taiwan in the second half of 2024.

    Investor Presentation

    Gravity issued an investor presentation. The presentation contains the Company’s recent business updates, results of the second quarter in 2024 and Gravity’s business plan. The presentation can be found on the Company’s website under the IR Archives section at https://www.gravity.co.kr/en/ir/updates. Korean and Japanese versions of the presentation are also provided on the website.

    About GRAVITY Co., Ltd. ---------------------------------------------------

    Gravity is a developer and publisher of online and mobile games. Gravity's principal product, Ragnarok Online, is a popular online game in many markets, including Japan and Taiwan, and is currently commercially offered in 91 markets. For more information about Gravity, please visit http://www.gravity.co.kr.

    Forward-Looking Statements:

    Certain statements in this press release may include, in addition to historical information, “forward-looking statements” within the meaning of the “safe-harbor” provisions of the U.S. Private Securities Litigation Reform Act 1995. Forward-looking statements can generally be identified by the use of forward-looking terminology, such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe”, “project,” or “continue” or the negative thereof or other similar words, although not all forward-looking statements contain these words. Investors should consider the information contained in our submissions and filings with the United States Securities and Exchange Commission (the “SEC”), including our annual report for the fiscal year ended December 31, 2023 on Form 20-F, together with such other documents that we may submit to or file with the SEC from time to time, on Form 6-K. The forward-looking statements speak only as of this press release and we assume no duty to update them to reflect new, changing or unanticipated events or circumstances.

    Contact:

    Mr. Heung Gon Kim
    Chief Financial Officer
    Gravity Co., Ltd.
    Email: kheung@gravity.co.kr

    Ms. Jin Lee
    Ms. Shin Choi
    IR Unit
    Gravity Co., Ltd.
    Email: ir@gravity.co.kr
    Telephone: +82-2-2132-7800

    GRAVITY Co., Ltd.
    Consolidated Statements of Financial Position

    (In millions of KRW and thousands of US$)

        As of
        31-Dec-23     30-Jun-24
        KRW     US$     KRW     US$
        (audited)     (unaudited)     (unaudited)     (unaudited)
    Assets                              
    Current assets:                              
    Cash and cash equivalents              184,082            133,727            142,133            103,253
    Short-term financial instruments              277,215            201,384            357,114            259,427
    Accounts receivable, net                71,213              51,733              70,130              50,946
    Other receivables, net                  3,637                2,642                1,020                    740
    Prepaid expenses                  2,994                2,175                3,674                2,669
    Other current financial assets                  4,439                3,225                5,105                3,709
    Other current assets                  3,319                2,411                5,945                4,319
    Total current assets              546,899            397,297            585,121            425,063
    Property and equipment, net                10,151                7,374                7,859                5,709
    Intangible assets, net                  6,370                4,628                5,911                4,294
    Deferred tax assets                  5,952                4,324                5,319                3,864
    Other non-current financial assets                  1,824                1,325                1,772                1,287
    Other non-current assets                  6,985                5,074                7,887                5,730
    Total assets              578,181            420,022            613,869            445,947
    Liabilities and Equity                              
    Current liabilities:                              
    Accounts payable                61,778              44,878              59,309              43,085
    Deferred revenue                18,093              13,144              17,273              12,548
    Withholdings                  3,072                2,232                2,649                1,924
    Accrued expense                  2,313                1,680                2,050                1,489
    Income tax payable                16,927              12,297              11,678                8,484
    Other current liabilities                  4,251                3,088                3,631                2,638
    Total current liabilities              106,434              77,319              96,590              70,168
    Long-term account payables                      677                    492                    678                    493
    Long-term deferred revenue                  1,785                1,297                2,716                1,973
    Other non-current liabilities                  3,175                2,307                2,141                1,555
    Deferred tax liabilities                  2,382                1,730                2,383                1,731
    Total liabilities              114,453              83,145            104,508              75,920
    Share capital                  3,474                2,524                3,474                2,524
    Capital surplus                27,098              19,685              26,979              19,599
    Other components of equity                  4,016                2,917              10,294                7,478
    Retained earnings              428,499            311,285            467,934            339,932
    Equity attributable to owners of the Parent Company              463,087            336,411            508,681            369,533
    Non-controlling interest                      641                    466                    680                    494
    Total equity              463,728            336,877            509,361            370,027
    Total liabilities and equity              578,181            420,022            613,869            445,947

    * For convenience purposes only, the KRW amounts are expressed in U.S. dollars at the rate of KRW 1,376.55 to US$ 1.00, the noon buying rate in effect on June 28, 2024 as quoted by the Federal Reserve Bank of New York.

    GRAVITY Co., Ltd.
    Consolidated Statements of Comprehensive Income

    (In millions of KRW and thousands of US$ except for share and ADS data)

        Three months ended   Six months ended
        31-Mar-24 30-Jun-23 30-Jun-24   30-Jun-23   30-Jun-24
        (KRW)   (KRW)   (KRW)   (US$)   (KRW)   (KRW)   (US$)
        (unaudited)   (unaudited)   (unaudited)   (unaudited)   (unaudited)   (unaudited)   (unaudited)
    Revenues:                                          
    Online games     18,065     17,025     19,445     14,126     39,721     37,510     27,249
    Mobile games     98,548     218,687     99,019     71,933     357,681     197,567     143,523
    Other revenue     3,166     3,182     4,503     3,271     6,439     7,669     5,571
    Total net revenue     119,779     238,894     122,967     89,330     403,841     242,746     176,343
    Cost of revenue     73,628     168,309     76,006     55,215     273,794     149,634     108,702
    Gross profit     46,151     70,585     46,961     34,115     130,047     93,112     67,641
    Operating expenses:                                          
    Selling, general and administrative expenses     15,747     15,029     28,108     20,419     28,300     43,855     31,859
    Research and development     3,601     2,852     4,286     3,114     5,774     7,887     5,730
    Others, net     (66)     3     (422)     (307)     (46)     (488)     (355)
    Total operating expenses     19,282     17,884     31,972     23,226     34,028     51,254     37,234
    Operating profit     26,869     52,701     14,989     10,889     96,019     41,858     30,407
    Finance income(costs):                                          
    Finance income     6,297     4,213     8,867     6,441     9,674     15,164     11,016
    Finance costs     (668)     (1,817)     (3,799)     (2,760)     (4,370)     (4,467)     (3,245)
    Profit before income tax     32,498     55,097     20,057     14,570     101,323     52,555     38,178
    Income tax expense     5,615     10,070     7,476     5,431     19,869     13,091     9,510
    Profit for the year     26,883     45,027     12,581     9,139     81,454     39,464     28,668
    Profit attributable to:                                          
    Non-controlling interest                   17                   11                   12                     8                   (28)                   29                  21
    Owners of Parent company     26,866     45,016     12,569     9,131     81,482     39,435     28,647
    Earnings per share                                          
    - Basic and diluted     3,866     6,478     1,809     1.31     11,726     5,675     4.12
    Weighted average number of shares outstanding                                          
    - Basic and diluted     6,948,900     6,948,900     6,948,900     6,948,900     6,948,900     6,948,900     6,948,900
    Earnings per ADS                                          
    - Basic and diluted     3,866     6,478     1,809     1.31     11,726     5,675     4.12
                                               

    * For convenience, the KRW amounts are expressed in U.S. dollars at the rate of KRW 1,376.55 to US$1.00, the noon buying rate in effect on June 28, 2024 as quoted by the Federal Reserve Bank of New York.
    (1) Each ADS represents one common share.


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