11 bit studios S.A. reports record high half-year results

Nearly PLN 50.2m in revenue, PLN 32.2m in EBITDA and almost PLN 25.0m in net profit – these are the results delivered by 11 bit studios S.A. in H1 2020. The items rose by 62.9%, 245.3% and 237%, respectively, year on year.

11 bit studios S.A.’s excellent financial performance in the first six months of the year was the effect of strong sales of the whole game portfolio, as confirmed by Grzegorz Miechowski, the Company’s CEO. “We are particularly satisfied with the monetisation of Frostpunk and its DLCs released as part of the Season Pass. The publishing division also had a valuable contribution to our business, with Moonlighter and Children of Morta sales accounting for approximately 30% of the Company’s revenue in H1,” he says. Mr Miechowski points out the very high operating cash flow of PLN 30.8m. As at the end of June 2020, the Company’s financial assets (cash and cash equivalents, bank deposits and trade and tax receivables) reached a record level of PLN 114.2m. “Never before in the more than 10 years’ history of 11 bit studios S.A. have we seen such good H1 results, even in 2018, when Frostpunk and Moonlighter were launched,” Mr Miechowski comments. He also notes that the H1 2020 net profit reflects changes in the policies applied to account for costs of the 2017–2019 Incentive Scheme and presentation changes related to accounting for the IP Box tax relief: “The positive effect of these two events on our net profit for the first half of the year was approximately PLN 7.5m.”

The Company, which moved to its own office building at ul. Brzeska 2 in Warsaw in March, is undergoing major internal changes. “We are increasing the headcount significantly. It is already close to 150, which necessitates changes to the Company’s organisational structure,” the CEO explains. Most of the new hires have joined three internal development teams working on new own titles, i.e. Project 8, Dolly and Eleanor . “We are satisfied with the progress of work on these games, although we do admit that Project 8 has proved slightly more challenging than we originally assumed, which means that we need additional time to complete it. Work on the other two projects is running without any disruptions and its pace is very satisfying,” says Mr Miechowski.

In his opinion the COVID-19 pandemic, which led to the cancellation of all industry events, did not impede the dynamic development of the 11 bit publishing division. At the end of June, 11 bit studios S.A. announced that it had acquired another title with a working title Ava, authored by Spanish studio Chibig. It is the fourth new publishing project in the Company’s portfolio. “Negotiations are under way to acquire another two,” states the representative of 11 bit studios S.A.

In his opinion, the investments 11 bit studios S.A. has made in new games, including its proprietary titles and those in the publishing division, combined with the record-high level of financial assets allow the Company to be highly optimistic about the following quarters and years. “However, the time to reap fruit of these investments is yet to come,” says the Company’s CEO. Therefore, in the coming periods, 11 bit studios S.A. will focus on the development and monetisation of its existing game portfolio in order to maximise the life cycle of each production. “The launch of Frostpunk for handheld devices planned for 2021 is only one example of such activities,” says Mr Miechowski .