Very good sales of Frostpunk and DLCs made Q12020 the second best quarter ever for 11 bit studios S.A. in terms of revenues and profits.
Revenue in excess of PLN 30.52m, EBITDA of PLN 19.61m and net profit of nearly PLN 14.51m were the financial results delivered by 11 bit studios for the first quarter of 2020, up by 114.3%, 168.3% and 226.9%, respectively, year on year. ‘The Company’s net profit would have come in even higher but for the non-cash provisions recognised each quarter (to Q2 2020 inclusive) in connection with the Incentive Scheme for 2017–2019. The provisions reduced the net profit for Q1 2020 by more than PLN 2.05m. The Company also decided not to account for the IP Box tax relief in its quarterly results and will use it only in the annual return for 2020,’ said Grzegorz Miechowski, President of the Management Board of 11 bit studios.
He stated that the Company’s impressive performance in the first three months of the year were chiefly attributable to the successful launch, on January 21st 2020, of the second paid DLC for Frostpunk – Frostpunk: The Last Autumn. ‘We knew that the DLC was of premium quality and long awaited by fans, but we were still pleasantly surprised by how well it sold,’ added Miechowski. The launch of the DLC has also largely contributed to the sales of the standard version of Frostpunk. ‘As a result, the aggregate revenue from sales of Frostpunk and paid DLCs in the period from the game’s release in April 2018 to the end of March 2020 exceeded PLN 100m and thus went above the aggregate sales revenue from This War of Mine, which had been, after all, released much earlier, in November 2014,’ said the Company’s CEO. Publishing titles, that is Moonlighter and Children of Morta, were also large contributors to 11 bit studios S.A.’s performance in the first quarter of 2020. ‘Revenue from both games in the first three months of the year accounted for 24% of the Company’s total revenue,’ commented Miechowski.
Strong net cash flows from operating activities, of more than PLN 24.3m in Q1 2020, were a testimony to 11 bit studios robust financial standing. As a result, at the end of March 2020 the Company’s total financial assets (cash and cash equivalents, bank deposits and trade receivables) for the first time ever exceeded PLN 100m.
The CEO assures that 11 bit studios has no intention of slowing down on its growth path in the following quarters of 2020, although he admits that repeating the Q1 performance would be quite a challenge. ‘The Company is undergoing a lot of changes as it is re-scaling its activities. We are now working from our own new office, located at ul. Brzeska 2 in Warsaw, which meets all the needs of a gaming company. We are actively recruiting new employees,’ added Miechowski. He says that the Company plans to have a workforce of 190–200 by the year’s end. At present, it employs 140 staff. ‘The new hires will first of all join those teams that are involved in developing or prototyping games under the working titles Projekt 8, Projekt 9 and Projekt 10, explained Miechowski. The 11-bit publishing division will also continue its dynamic development, despite the restrictions on travelling and cancellation of all industry events due to the COVID-19 pandemic. The division is working hard to expand its publishing portfolio for the coming years. ‘For the time being, the portfolio comprises three projects that are very promising and far larger than the previous ones, including one project from Poland. Their number should grow by the end of the year,’ concluded 11 bit studios CEO.
