Seoul, Nov. 12, 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 third quarter ended September 30, 2024, prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board and business updates.
THIRD QUARTER 2024 HIGHLIGHTS
- Total revenues were KRW 128,376 million (US$ 97,629 thousand), representing a 4.4% increase from the second quarter ended June 30, 2024 ("QoQ”) and a 27.1% decrease from the third quarter ended September 30, 2023 ("YoY”).
- Operating profit was KRW 27,576 million (US$ 20,971 thousand), representing an 84.0% increase QoQ and a 27.3% decrease YoY.
- Profit before income tax expenses was KRW 28,415 million (US$ 21,609 thousand), representing a 41.7% increase QoQ and a 31.0% decrease YoY.
- Net profit attributable to parent company was KRW 22,385 million (US$ 17,023 thousand), representing a 78.1% increase QoQ and a 22.7% decrease YoY.
REVIEW OF THIRD QUARTER 2024 FINANCIAL RESULTS
Revenues
Online game revenues for the third quarter of 2024 were KRW 19,657 million (US$ 14,949 thousand), representing a 1.1% increase QoQ from KRW 19,445 million and a 13.5% increase YoY from KRW 17,316 million. The increase QoQ was mainly attributable to increased revenues from Ragnarok Landverse in Thailand and Ragnarok Online in China. The increase YoY was also mainly due to increased revenues from Ragnarok Landverse in Thailand and Ragnarok Online in China. Such increase QoQ and YoY was partially offset by decreased revenue from Ragnarok Online in Thailand.
Mobile game revenues were KRW 102,524 million (US$ 77,969 thousand) for the third quarter of 2024, representing a 3.5% increase QoQ from KRW 99,019 million and a 34.1% decrease YoY from KRW 155,467 million. The increase QoQ was resulted increase revenue from Ragnarok: Rebirth in Southeast Asia and THE RAGNAROK which was launched in Korea on September 9, 2024. Such increase was partially offset by decreased revenues from Ragnarok Origin in North, Central and South America and Southeast Asia. The decrease YoY was mainly due to decreased revenues from Ragnarok Origin in Southeast Asia, Taiwan, Hong Kong and Macau. 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 6,195 million (US$ 4,711 thousand) for the third quarter of 2024, representing a 37.6% increase QoQ from KRW 4,503 million and an 84.3% increase YoY from KRW 3,362 million.
Cost of Revenue
Cost of revenue was KRW 76,261 million (US$ 57,996 thousand) for the third quarter of 2024, representing a 0.3% increase QoQ from KRW 76,006 million and a 35.3% decrease YoY from KRW 117,834 million. The increase QoQ was mainly due to increase of salaries and amortization expense on intangible asset. 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.
Operating Expenses
Operating expenses were KRW 24,539 million (US$ 18,662 thousand) for the third quarter of 2024, representing a 23.2% decrease QoQ from KRW 31,972 million and a 20.3% increase YoY from KRW 20,394 million. The decrease QoQ was mainly due to decreased advertising expenses for mobile game services related to THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau, and commission paid. The increase YoY was mainly due to increased advertising expenses for mobile game services related to the launch of THE RAGNAROK in Korea on September 9, 2024 and the launch of Mirren: Millennium Tour in Korea on August 20, 2024.
Profit Before Income Tax Expenses
Profit before income tax expenses was KRW 28,415 million (US$ 21,609 thousand) for the third quarter of 2024 compared with profit before income tax expense of KRW 20,057 million for the second quarter of 2024 and profit before income tax expenses of KRW 41,208 million for the third quarter of 2023.
Net Profit
As a result of the foregoing factors, Gravity recorded a net profit attributable to parent company of KRW 22,385 million (US$ 17,023 thousand) for the third quarter of 2024 compared with net profit attributable to parent company of KRW 12,569 million for the second quarter of 2024 and a net profit attributable to parent company of KRW 28,961 million for the third quarter of 2023.
Liquidity
The balance of cash and cash equivalents and short-term financial instruments was KRW 513,993 million (US$ 390,887 thousand) as of September 30, 2024.
Note: For convenience purposes only, the KRW amounts have been expressed in U.S. dollars at the exchange rate of KRW 1,314.94 to US$ 1.00, the noon buying rate in effect on September 30, 2024 as quoted by the Federal Reserve Bank of New York.
GRAVITY BUSINESS UPDATES
Ragnarok Online IP-based Games
- THE RAGNAROK, an MMORPG Mobile and PC game
- Ragnarok X: Next Generation, an MMORPG Mobile and PC game
- Ragnarok: Rebirth an MMORPG Mobile game
- Ragnarok V: Returns, a 3D MMORPG Mobile and PC game
- Ragnarok M: Classic, an MMORPG Mobile and PC game
- Ragnarok Origin, an MMORPG Mobile and PC game
- Ragnarok Crush, a Puzzle and Tower Defense Mobile game
- Ragnarok 3, an MMORPG Mobile and PC game
- PROJECT ABYSS, an MMOARPG Mobile game
Other IP-based games
- TOKYO PSYCHODEMIC, a 2D Cinematic Profiling Adventure PC and Console game
- KAMiBAKO, a World Craft RPG PC and Console game
- Gunbound an MMO Turn-Based Artillery PC game
- Snow Brothers 2 Special, an Action and Platformer PC and Console game
Investor Presentation
Gravity issued an investor presentation. The presentation contains the Company's recent business updates, results of the third 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 regions. 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: [email protected]
Ms. Jin Lee
Ms. Yujin Oh
IR Unit
Gravity Co., Ltd.
Email: [email protected]
Telephone: +82-2-2132-7800
GRAVITY Co., Ltd.
Consolidated Statements of Financial Position
(In millions of KRW and thousands of US$)
As of | |||||||||||||||
31-Dec-23 | 30-Sep-24 | ||||||||||||||
KRW | US$ | KRW | US$ | ||||||||||||
(audited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||
Assets | |||||||||||||||
Current assets: | |||||||||||||||
Cash and cash equivalents | 184,082 | 139,993 | 200,677 | 152,613 | |||||||||||
Short-term financial instruments | 277,215 | 210,820 | 313,316 | 238,274 | |||||||||||
Accounts receivable, net | 71,213 | 54,157 | 66,385 | 50,485 | |||||||||||
Other receivables, net | 3,637 | 2,766 | 473 | 360 | |||||||||||
Prepaid expenses | 2,994 | 2,277 | 4,894 | 3,722 | |||||||||||
Other current financial assets | 4,439 | 3,376 | 5,884 | 4,475 | |||||||||||
Other current assets | 3,319 | 2,524 | 3,921 | 2,982 | |||||||||||
Total current assets | 546,899 | 415,913 | 595,550 | 452,911 | |||||||||||
Property and equipment, net | 10,151 | 7,720 | 7,230 | 5,498 | |||||||||||
Intangible assets, net | 6,370 | 4,844 | 5,827 | 4,431 | |||||||||||
Deferred tax assets | 5,952 | 4,526 | 5,542 | 4,215 | |||||||||||
Other non-current financial assets | 1,824 | 1,387 | 1,624 | 1,235 | |||||||||||
Other non-current assets | 6,985 | 5,312 | 8,562 | 6,510 | |||||||||||
Total assets | 578,181 | 439,702 | 624,335 | 474,800 | |||||||||||
Liabilities and Equity | |||||||||||||||
Current liabilities: | |||||||||||||||
Accounts payable | 61,778 | 46,982 | 49,951 | 37,987 | |||||||||||
Deferred revenue | 18,093 | 13,760 | 17,902 | 13,614 | |||||||||||
Withholdings | 3,072 | 2,336 | 3,595 | 2,734 | |||||||||||
Accrued expense | 2,313 | 1,759 | 2,945 | 2,240 | |||||||||||
Income tax payable | 16,927 | 12,873 | 5,873 | 4,466 | |||||||||||
Other current liabilities | 4,251 | 3,233 | 2,777 | 2,112 | |||||||||||
Total current liabilities | 106,434 | 80,943 | 83,043 | 63,153 | |||||||||||
Long-term account payables | 677 | 515 | 898 | 683 | |||||||||||
Long-term deferred revenue | 1,785 | 1,357 | 2,652 | 2,017 | |||||||||||
Other non-current liabilities | 3,175 | 2,415 | 2,332 | 1,774 | |||||||||||
Deferred tax liabilities | 2,382 | 1,811 | 2,383 | 1,812 | |||||||||||
Total liabilities | 114,453 | 87,041 | 91,308 | 69,439 | |||||||||||
Share capital | 3,474 | 2,642 | 3,474 | 2,642 | |||||||||||
Capital surplus | 27,098 | 20,608 | 26,979 | 20,517 | |||||||||||
Other components of equity | 4,016 | 3,054 | 11,606 | 8,826 | |||||||||||
Retained earnings | 428,499 | 325,870 | 490,318 | 372,882 | |||||||||||
Equity attributable to owners of the Parent Company | 463,087 | 352,174 | 532,377 | 404,867 | |||||||||||
Non-controlling interest | 641 | 487 | 650 | 494 | |||||||||||
Total equity | 463,728 | 352,661 | 533,027 | 405,361 | |||||||||||
Total liabilities and equity | 578,181 | 439,702 | 624,335 | 474,800 |
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 | Nine months ended | ||||||||||||||||||||
30-Jun-24 | 30-Sep-23 | 30-Sep-24 | 30-Sep-23 | 30-Sep-24 | |||||||||||||||||
(KRW) | (KRW) | (KRW) | (US$) | (KRW) | (KRW) | (US$) | |||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||
Revenues: | |||||||||||||||||||||
Online games | 19,445 | 17,316 | 19,657 | 14,949 | 57,037 | 57,167 | 43,475 | ||||||||||||||
Mobile games | 99,019 | 155,467 | 102,524 | 77,969 | 513,148 | 300,090 | 228,216 | ||||||||||||||
Other revenue | 4,503 | 3,362 | 6,195 | 4,711 | 9,801 | 13,865 | 10,544 | ||||||||||||||
Total net revenue | 122,967 | 176,145 | 128,376 | 97,629 | 579,986 | 371,122 | 282,235 | ||||||||||||||
Cost of revenue | 76,006 | 117,834 | 76,261 | 57,996 | 391,628 | 225,895 | 171,791 | ||||||||||||||
Gross profit | 46,961 | 58,311 | 52,115 | 39,633 | 188,358 | 145,227 | 110,444 | ||||||||||||||
Operating expenses: | |||||||||||||||||||||
Selling, general and administrative expenses | 28,108 | 17,190 | 20,325 | 15,457 | 45,490 | 64,181 | 48,809 | ||||||||||||||
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