Rovio Entertainment Corp.: Games revenue up 16.6% year-on-year, strong start for new game Angry Birds Dream Blast January-March 2019 highlights

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Rovio Entertainment Corporation Stock Exchange Release April 25th, 2019 at 08:30 a.m. EEST Games revenue up 16.6% year-on-year, strong start for new game Angry Birds Dream Blast January-March 2019 highlights Rovio's revenue was EUR 70.9 million ...

Rovio Entertainment Corporation        Stock Exchange Release           April 25th, 2019 at 08:30 a.m. EEST

 

Games revenue up 16.6% year-on-year, strong start for new game Angry Birds Dream Blast

January-March 2019 highlights 

  • Rovio's revenue was EUR 70.9 million (65.7) or 7.8% growth year-on-year; In comparable currencies, the growth was approximately 3%
  • Rovio's newest game Angry Birds Dream Blast, launched on 24th January, had gross bookings of EUR 6.9 million during Q1 and reached a quarterly run-rate of EUR 11.5 million in March
  • Games revenue in Q1 grew to EUR 66.3 million (56.8) or 16.6% year-on-year. In comparable currencies, the revenue growth was approximately 11%. The Games gross bookings were EUR 65.8 million (58.6) or 12.3% growth year-on-year and in comparable currencies the growth was 7%.
  • User acquisition investments were EUR 23.7 million (14.6), or 35.8% of the Games segment's revenue (25.7%)
  • Brand Licensing revenue was EUR 4.6 million (8.9) or -48.2% lower year-on-year, as expected
  • Group adjusted operating profit was EUR 7.5 million (9.6) and adjusted operating profit margin 10.5% (14.6 %)
  • Group adjusted operating profit excluding Hatch Entertainment was EUR 9.3 million (10.8) and adjusted operating profit margin 13.1% (16.4%)
  • Operating cash flow was EUR 3.3 million (10.5)
  • Earnings per share was EUR 0.08 (0.09)
  • Rovio has adopted the IFRS 16 Leases-standard as it became effective, on January 1, 2019. The impact on group EBITDA in the reporting period was EUR +0.6 million, on operating profit EUR 0.0 million, on operating cash flow EUR +0.6 million and the balance sheet total increased by EUR 9.2 million at the end of the reporting period.

Key figures

  1-3/ 1-3/ Change, 1-12/
EUR million 2019 2018 % 2018
Revenue 70.9 65.7 7.8% 281.2
EBITDA* 10.5 14.3 -26.7% 47.8
EBITDA margin* 14.8% 21.8% 17.0%
Adjusted EBITDA* 10.5 14.6 -28.3% 47.5
Adjusted EBITDA margin, %* 14.8% 22.2% 16.9%
Operating profit* 7.5 9.2 -19.2% 31.5
Operating profit margin, %* 10.5% 14.1% 11.2%
Adjusted operating profit* 7.5 9.6 -22.1% 31.2
Adjusted operating profit margin, %* 10.5% 14.6% 11.1%
Profit before tax 7.5 9.0 -16.0% 32.2
Capital expenditure 0.7 0.3 105.1% 1.3
User acquisition cost 23.7 14.6 62.7% 78.6
Return on equity (ROE), % 19.5% 25.7% 21.5%
Net gearing ratio, %* -67.4% -66.4% -75.3%
Equity ratio, %* 78.4% 81.5% 83.7%
Earnings per share, EUR 0.08 0.09 -15.2% 0.31
Earnings per share, diluted EUR 0.07 0.09 -15.0% 0.31
Net cash flows from operating activities* 3.3 10.5 -68.9% 42.6
Employees (average for the period) 422 385 9.6% 388

*Not fully comparable due to IFRS 16 adoption in 2019. See Note 1 for details.

Unless otherwise stated, the comparison figures in brackets refer to the corresponding period in the previous year. Calculations and definitions are presented in the Performance Measures section.
The changes in comparable currencies have been calculated by translating the reporting period figures with the average USD/EUR exchange rates of the comparison period for the US dollar dominated in-app-purchases in United States and global ad network sales.

Kati Levoranta, CEO:

Rovio's first quarter 2019 started with a blast! Strong performance of Angry Birds 2 and successful launch of Angry Birds Dream Blast drove Rovio Games first quarter revenue up 16.6% year-over-year.

Rovio's revenue in the first quarter of 2019 was EUR 70.9 (65.7) million, growing by 7.8% compared to the same period of the last year. The adjusted operating profit was EUR 7.5 (9.6) million and the adjusted operating profit margin was 10.5% (14.6%). The decline in operating profit was mainly due to lower revenues in Brand Licensing in the beginning of the year, as expected.

We launched successfully a new game Angry Birds Dream Blast at the end of January. The gross bookings of Dream Blast were EUR 6.9 million in the first quarter, and this supported Rovio's games business unit to reach EUR 66.3 million gross bookings.  In March, the quarterly gross bookings run rate of Dream Blast already exceeded EUR 11 million and it is now Rovio's second largest game.

Gross bookings of Angry Birds 2 were on a good level of EUR 32 million despite lower user acquisition investments for the game. Angry Birds 2 grew 48% year-on-year.  Angry Birds Friends performed steadily with the quarterly revenue of EUR 7.2 million. We invested a record amount of EUR 23.7 million in user acquisition (14.6) of which majority was to boost the launch of Angry Birds Dream Blast.

Our new games pipeline continues to be very healthy. We have currently 14 games in different phases of development, of which two are in soft launch. We aim to have our next global game launch during the second half of the year.

Brand Licensing unit's revenue was EUR 4.6 million and 48.2% lower year-on-year, due to lower revenues from The Angry Birds Movie, as expected. The premier of The Angry Birds Movie 2 is taking place in August this year and we expect the movie and surrounding marketing to boost our licensing business as well as drive users to our Angry Birds games during the second half of 2019.

Our new, immersive augmented reality game, Angry Birds AR: Isle of Pigs, is in pre-registration in Apple App Store and will be available for download shortly for Apple iPhone and iPad users.

Hatch Entertainment, Rovio's 80% owned subsidiary developing a mobile game streaming service for mass audiences, has signed a partnership agreement with Samsung in April, following collaborations with leading teleoperators NTT DOCOMO and Sprint. To accelerate its growth, Hatch Entertainment is seeking external funding and further strategic partnerships.

While having many exciting things ahead of us I'd like to thank already now all Rovians for the great and fun start of the year!

Outlook for 2019 (unchanged)

In 2019, Rovio expects group revenues to grow to EUR 300 - 330 million and adjusted operating profit margin between 9 and 11 per cent.

Basis for outlook

In 2019, Rovio Games business continues developing its live game portfolio according to the Games as a Service strategy, profitable user acquisition and development of new games. Target is to launch at least two new games in 2019 (the first one, Angry Birds Dream Blast, was launched on January 24th). The expected timing of the second launch is during the second half of the year.

The user acquisition investments are expected to be around 30 percent of Games revenues for the full year with payback target of 12 months. The amount of user acquisition may vary depending on development of the games' monetization, timing of new game launches and the level of competition in the market.

The Brand Licensing segment revenues are expected grow in 2019 with focus on the second half of the year when the Angry Birds Movie sequel is scheduled for release.

The first half of 2019 is expected to have revenues at a similar level or slightly better than the last half of 2018 while the profit is less than the average for the whole year of 2019. Overall, the largest revenue growth and profit contribution is expected from the second half of 2019.  The profit margin excluding Hatch Entertainment is expected to be between 12 and 14 per cent.

Briefing and webcast:

Rovio will host an English language webcast on the 2019 first quarter results, including the Q&A session for investors, media and institutional investors at 14:00-15:00 EEST on 25.4.2019. The webcast can be viewed live at: //www.rovio.com/investors-investor-calendar , and later the same day as a recording.

More information:

Kati Levoranta, CEO, tel. +358 207 888 300
René Lindell, CFO, tel. +358 207 888 300
Mikko Setälä EVP, Investor Relations, tel. +358 400 607 437, mikko.setala@rovio.com

Distribution: Nasdaq Helsinki, principal media, www.rovio.com

Rovio in brief

Rovio Entertainment Corporation is a global, games-first entertainment company that creates, develops and publishes mobile games, which have been downloaded 4.5 billion times so far. The Company is best known for the global Angry Birds brand, which started as a popular mobile game in 2009, and has since evolved from games to various entertainment and consumer products in brand licensing. Today, the Company offers multiple mobile games, animations and has produced The Angry Birds Movie, which opened number one in theatres in 50 countries and the sequel which is in production. Rovio is headquartered in Finland and the company's shares are listed on the main list of NASDAQ Helsinki stock exchange with the trading code ROVIO. (www.rovio.com)




This announcement is distributed by West Corporation on behalf of West Corporation clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Rovio Entertainment Oyj via Globenewswire

Source(s) : Rovio Entertainment Oyj

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