TIDMDEVO
RNS Number : 4422N
Devolver Digital, Inc.
25 September 2023
25 September 2023
The information contained within this announcement is deemed by
the company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014 as it forms part of the
domestic law of the United Kingdom by virtue of the European Union
(Withdrawal) Act 2018 (as amended) ("UK MAR"). Upon the publication
of this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
Devolver Digital, Inc.
("Devolver Digital", "Devolver" or the "Company", and the
Company together with all of its subsidiary undertakings "the
Group")
Unaudited results for the six months ended 30 June 2023
Healthy pipeline for new releases in Q4 2023 and 2024
On track for EBITDA break-even in 2023 and return to growth in
2024
Devolver Digital, an award-winning digital publisher and
developer of independent ("indie") video games, announces its
unaudited results for the six months ended 30 June 2023. All
figures relate to this period unless otherwise stated.
Prioritising quality to unlock long-term value
o As announced in the trading update on 3 (rd) August 2023, high
potential titles have been delayed to 2024 to ensure that they have
the time, effort and support to succeed.
o As a result, 1H 2023 was an unusually quiet release period
with only 4 new titles, of which only one was a major title, Terra
Nil (1H 2022: 7 title releases).
o As also previously announced, Devolver declined subscription
deal proposals that undervalued the titles' value and revenue
opportunities in 2023 and 2024, resulting in lower subscription
revenues.
o Back catalogue revenues were up 10%, accounting for 87% of
total revenues (1H 2022: 64%), reflecting the lower new title
contribution and the continued strong performance of Cult of the
Lamb.
o Average 79 Metacritic score for released titles year to date (76 average score for 1H 2023).
o Steady recovery at Good Shepherd; announced tie-up with Rebellion for 2000 AD IP.
Financial performance reflects unusually quiet 1H release
schedule, as expected
o As flagged, 1H 2023 financial performance has been impacted by
a quiet release schedule: revenues down 17%; Normalised Gross
Profit down 51%.
o As expected, Normalised Adjusted EBITDA loss of US$3.5m (1H 2022: US$6.8m profit).
o Statutory net loss of US$10.1m (1) (1H 2022: US$16.6m loss).
o Cash of US$64.8m at 30 June 2023 (1H 2022: US$74.2m),
following c.US$7.2m purchase of shares in the market for the
Employee Benefit Trust.
o Cost-saving initiatives underway to protect margin and strong net cash position.
Current trading and outlook
o Back catalogue continues to be driven by Cult of the Lamb post
1H 2023 period-end.
o Targeted marketing and the full return of physical gaming
events are expected to help drive engagement and maintain quality
for upcoming titles.
o 11 new titles expected in 2023, including nine titles
published directly by Devolver.
o Seven releases scheduled for 2H 2023 including major titles
Wizard With A Gun and The Talos Principle 2, as well as Gunbrella,
KarmaZoo and Hellboy: Web of Wyrd.
o On track to meet previous guidance of break-even profitability
in 2023, return to profitable growth in 2024 and acceleration in
2025.
o Healthy pipeline of more than 30 new titles due for release in the next three years.
Harry Miller, Executive Chairman of Devolver, said:
"The first half of 2023 was a reset for Devolver, with delays to
new releases as we prioritise the quality and long-term potential
of major titles scheduled for the second half of 2023 and 2024.
Devolver's DNA is to commit relatively low spend on high quality
titles that stand the test of time. We look forward to returning to
our normal cadence of releases in the rest of 2023 and 2024 with
big titles to come such as Wizard With A Gun and The Talos
Principle 2, as well as The Plucky Squire and Baby Steps.
As a result of our busy upcoming release schedule, steps to
improve our return from our back catalogue and active management of
our cost base, Devolver is on track to meet its previous guidance
of break-even EBITDA profitability in 2023, a return to profitable
growth in 2024 and then an acceleration in 2025."
About Devolver Digital
Devolver is an award-winning video games publisher in the indie
games space with a balanced portfolio of third-party and own-IP.
Devolver has an emphasis on premium games and has published more
than 100 titles, with more than 30 titles in the pipeline scheduled
for release over the next three years. Devolver has in-house
studios developing first-party IP titles and a complementary
publishing brand. Devolver is registered in Wilmington, Delaware,
USA.
Notes:
(1) Including non-cash impact of US$3.9m of share-based payments.
Enquiries
Devolver Digital, Inc. ir@devolverdigital.com
Harry Miller, Executive Chairman
Douglas Morin, Chief Executive Officer
Daniel Widdicombe, Chief Financial Officer
+44 (0)20 3829
Zeus (Nominated Adviser and Sole Broker) 5000
Nick Cowles, Jamie Peel, Alexander Craig
(Investment Banking)
Ben Robertson (Equity Capital Markets)
FTI Consulting (Communications Adviser) devolver@fticonsulting.com
Jamie Ricketts / Dwight Burden / Valerija +44 (0)20 3727
Cymbal / Usama Ali 1000
OPERATING REVIEW
1H 2023 - fewer title releases than previous period
Devolver released 4 new titles in 1H 2023, including Devolver
Tumble Time, Sludge Life 2 and Terra Nil. Terra Nil was the only
major release in 1H 2023, and consequently revenue fell 17% in the
first half compared to 1H 2022 which had 7 title releases. As a
result, back catalogue accounted for an unusually high 87% of total
1H revenues in the period.
Despite the revenue decline there have been several positive
developments in 1H 2023, including our publishing subsidiary Good
Shepherd (GSE) posting a steady recovery following the
restructuring it underwent early in the year, on track to reach
EBITDA break-even by 4Q. GSE recently announced a ground-breaking
partnership with Rebellion (Sniper Elite) to develop and publish
video game adaptations based on stories from the beloved 2000 AD
universe, the home of Judge Dredd, Rogue Trooper, ABC Warrior and
more, as well as Rebellion's other comic IP, including Roy of the
Rovers and Battle Action. Separately, Cult of the Lamb back
catalogue sales have continued to out-perform expectations from the
start of 2023.
Several market events held in 1H 2023 have also added to the
excitement about our future releases for 2024 and 2025. Sony held
its PlayStation Showcase 2023 in May, featuring 36 games in total
including Devolver titles The Talos Principle 2, The Plucky Squire
and Neva . The Summer Games Fest 2023 included Devolver Direct, in
which several new titles were introduced or updated including Baby
Steps , Wizard with a Gun, The Talos Principle 2, and Human Fall
Flat 2 , the highly anticipated sequel to Human Fall Flat which
sold over 40 million copies worldwide since release in July 2016.
Devolver Direct enjoyed record viewership numbers and was included
in numerous broadcasts archived on YouTube with a combined 4.68
million views just one week post broadcast. Finally, Steam's Next
Fest saw the Wizard with a Gun demo post the 5 (th) highest number
of downloads by players out of over 1,000 demos featured in the
event. All these developments bode well for the outlook in 2024 and
beyond.
2022 hit release supports back catalogue
The August 2022 hit release Cult of The Lamb has provided strong
revenue momentum continuing into 1H 2023, the only 2022 release to
do so given that 1H 2022 releases did not perform as expected. The
contribution from Cult of The Lamb was the principal driver for a
10% increase in back catalogue revenues in 1H 2023 compared to the
previous year period. BAFTA-winning Inscryption, an October 2021
release, also continued to perform well in the first six months of
2023. Other back catalogue titles have seen weaker performance in
1H 2023 compared to 1H 2022. Devolver is working hard to stimulate
back catalogue sales through a combination of new ports, additional
DLC, strategic marketing and strategic pricing mechanisms.
Our back catalogue includes all titles released in or prior to
the last financial year (2022 or earlier). As of 31 December 2022,
the back catalogue consists of 109 titles, including numerous indie
cult classics, supporting highly diversified revenues.
Operating expense containment, selective co-funding on game
development
A group-wide exercise to reduce overall expenses is under way.
Rental expenses, out-sourced professional fees and other operating
and administration fees are all being optimised for efficiency with
continual assessment for cost savings. Separately, as part of the
directional move towards more participation in the live services
area, we will seek co-funding for larger titles where partners can
bring strategic value.
FINANCIAL REVIEW
Unaudited first half 2023 results to June 30 2023
The unaudited financial results included in this announcement
cover the Group's combined activities for the six months ended 30
(th) June 2023 (prepared in accordance with applicable
International Financial Reporting Standards, "IFRS").
Normalised Adjusted results
The following refers to Normalised Adjusted results, as
presented in the financial statements contained within this
release. Normalised Adjusted results exclude any one-time
exceptional items during the respective half-year periods.
Normalised EBITDA and Normalised Adjusted EBITDA results are not
intended to replace statutory results and are prepared to provide a
more comparable indication of the Group's core business performance
by removing the impact of certain items including exceptional items
(material and non-recurring), and other, non-trading, items that
are reported separately. These results have been presented to
provide users with additional information and analysis of the
Group's performance, consistent with how the Board monitors
results. Further details of adjustments are given in Notes 3 and 4
to the condensed financial statements contained within this
semi-annual results release.
P&L results and margins
Devolver Digital's first half 2023 performance was muted due to
a lower number of title releases (4) compared to the previous
period (7). Revenues of US$43.9 million fell 17% year-over-year.
Normalised gross profit was US$9.4 million, a decline of 51%
year-over-year. Normalised Adjusted EBITDA turned to a loss of
US$3.5 million from US$6.8 million profit in 1H 2022.
Normalised gross profit margin decreased to 21.4% in the first
half of 2023, down from 35.8% in the year-earlier period. Gross
margin was compressed due to the absence of first-party IP and
other new releases in recoup during the period, resulting in the
royalty pay-out mix being heavily weighted towards third party
titles in 1H 2023. This compares to 1H 2022 when new first-party IP
and other releases were cushioned while the titles were still in
recoup (before royalties are usually paid out).
Normalised Adjusted EBITDA margins were depressed at negative
7.9% in the first half of 2023, compared to positive margin of
12.9% the previous year. The compression in 1H 2023 gross profit
had a direct flow through effect to impact Normalised Adjusted
EBITDA, despite successfully containing cash operating expenses at
similar levels as the 1H of 2022.
Employee Benefit Trust (EBT)
Devolver established an Employee Benefit Trust (EBT) in May 2022
to facilitate stock option exercise by employees and contractors
who were awarded 2017 Stock Option plan stock options and stock
units vesting under the 2022 Long Term Incentive Plan (LTIP). The
EBT is a Jersey-incorporated Trust enabling option exercise and
share settlement off-market without impacting market liquidity.
Share purchases by the EBT are funded by way of a loan from
Devolver which can request settlement of the loan at any time in
future. The shares held by the EBT are consolidated within
Devolver's share capital balance.
Cash Balances
Cash holdings at end of June 2023 were US$64.8 million, a
reduction of US$14.7 million compared to end of 2022's level of
US$79.5 million. The reduction in cash balances during the period
was primarily due to: 1) lower operating cash generation in the
first half combined with the US$13.6 million ongoing investment in
game development during the period; 2) approximately US$7 million
provided to the EBT for the market purchase of c. 19m shares.
CURRENT TRADING OUTLOOK
As noted in our August 2023 update, expected performance for
2023 will be impacted by three key factors: delays to new title
releases, a reduction in revenue from subscription deals and
relative weakness from our back catalogue with the exception of a
few outperforming titles.
Our busy release schedule for Q4 2023 features major titles
Wizard with a Gun and The Talos Principle 2, among others. Waiting
until titles are ready has led to delays as we prioritise our
strategy to maximise the appeal and success of new titles by
increasing investment on development, quality control and
marketing. Giving our titles every chance to succeed is critical to
our long-term growth. As previously indicated, titles such as The
Plucky Squire, which has been tracking well with audiences, will
now be released in 2024 alongside other titles previously earmarked
for release in 2023 such as Anger Foot, Pepper Grinder and Stick It
to the Stickman.
After a period of strong growth in subscription deals in 2021
and 2022, we expect the trend of reduced revenues from subscription
deals to continue into 2024. We expect to continue to turn down
subscription deal proposals that undervalue the titles' value and
revenue opportunity in 2023 and 2024.
Back catalogue sales have been softer following the weaker
performance of three key title releases in 2022, except for Cult of
the Lamb and Inscryption which have continued to perform strongly,
and a weaker overall economic environment.
As previously indicated in August 2023, we expect Group
Normalised Adjusted EBITDA to be at least break-even in 2023,
before a return to growth in 2024 and an acceleration in 2025.
Our momentum, robust balance sheet with US$65m in cash at June
2023, deep pipeline and strong contribution from extensive back
catalogue all support our confidence of further progress in 2023
and in the future. We have a proven strategy that has delivered
success for the last 13 years. The Board believes that we are well
positioned for future success, and we look forward to reporting on
our progress in the year ahead.
Harry Miller
Chairman
Consolidated Statement of Profit or Loss
Unaudited Unaudited
6 months 6 months ended Year ended
ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
REVENUES
Revenues 43,877 53,003 134,565
TOTAL REVENUES 43,877 53,003 134,565
COST OF SALES
Royalty expense (22,167) (22,015) (61,448)
Development expense (2,878) (1,704) (3,856)
Marketing (3,354) (3,912) (9,148)
Amortisation of intangible
assets (5,150) (7,112) (14,788)
Impairment of intangible
assets (934) - (22,822)
TOTAL COST OF SALES (34,483) (34,743) (112,062)
GROSS PROFIT 9,394 18,260 22,503
ADMINISTRATIVE EXPENSES
Overhead expenses (12,612) (12,637) (25,523)
Stock compensation expense (3,905) (11,477) (19,621)
Amortisation of non-current
assets (1,863) (3,761) (5,292)
Impairment of non-current
assets - - (69,973)
TOTAL ADMINISTRATIVE EXPENSES (18,380) (27,875) (120,409)
Other (loss) / income (591) 5 (549)
OPERATING PROFIT/(LOSS) (9,577) (9,610) (98,455)
Interest income 897 26 364
Interest expense (198) - -
Foreign exchange gains
/ (losses) 239 (2,007) (673)
PRE-TAX PROFIT/(LOSS) (8,639) (11,591) (98,764)
Income tax (expense) /
credit (1,426) (5,019) 7,264
Profit/(Loss) for the
period (10,065) (16,610) (91,500)
Equity holders of the parent (10,042) (16,560) (91,475)
Non-Controlling Interests (23) (50) (25)
PROFIT/(LOSS) FOR THE
PERIOD (10,065) (16,610) (91,500)
Basic earnings per share
($) (0.023) (0.037) (0.206)
Diluted earnings per
share ($) (0.023) (0.037) (0.206)
6 months 6 months Year ended
ended ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
Non-IFRS measures
Adjusted EBITDA* (3,809) 5,627 (73,378)
Normalised Adjusted
EBITDA (3,469) 6,818 13,914
Normalised Adjusted
EBITDA excluding performance-related
impairments (2,535) 6,818 23,210
* Adjusted EBITDA is a non-IFRS measure and is defined as
earnings before interest, tax, depreciation, amortisation (but not
taking out amortisation of capitalised software development costs)
and share-based payment expenses.
Consolidated Statement of Comprehensive Income
Unaudited Unaudited
6 months 6 months Year ended
ended ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
Loss for the period (10,065) (16,610) (91,500)
Other comprehensive
income/(loss): Items
that will be reclassified
subsequently to profit
or loss
Exchange differences
on translation of foreign
operations 33 (964) (477)
Total comprehensive
income/(loss) for the
period (10,032) (17,574) (91,977)
Total comprehensive
income/(loss) is attributable
to:
Equity holders of the
parent (10,009) (17,524) (91,952)
Non-controlling interests (23) (50) (25)
---------- ---------- -----------
(10,032) (17,574) (91,977)
Consolidated Statement of Financial Position
Unaudited Unaudited
6 months 6 months Year
ended ended ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
NON-CURRENT ASSETS
Goodwill 19,416 66,820 19,153
Intellectual property 24,734 49,640 25,782
Software development
costs 47,622 52,960 40,136
Total intangibles 91,772 169,420 85,071
Tangible assets 91 237 174
Employee loans 456 537 995
Deferred tax assets 10,598 - 10,088
TOTAL NON-CURRENT ASSETS 102,917 170,194 96,328
CURRENT ASSETS
Accounts receivable 12,173 19,452 16,813
Employee loans 406 - -
Cash at bank and in hand 64,761 74,176 79,493
Prepaid income tax 3,905 4,705 2,185
TOTAL CURRENT ASSETS 81,245 98,333 98,491
TOTAL ASSETS 184,162 268,527 194,819
CURRENT LIABILITIES
Trade and other payables 17,699 13,956 19,149
Deferred revenue 2,402 5,047 2,091
Current tax payable 4,158 - 262
TOTAL CURRENT LIABILITIES 24,259 19,003 21,502
NON-CURRENT LIABILITIES
Deferred tax liabilities 1,046 9,316 1,045
Long-term liabilities - 1,567 -
TOTAL NON-CURRENT LIABILITIES 1,046 10,883 1,045
TOTAL LIABILITIES 25,305 29,886 22,547
CAPITAL AND RESERVES
Share capital 45 44 45
Share premium 146,062 120,061 146,044
Retained Earnings 49,966 120,942 56,259
Translation reserve -
OCI (2,234) (2,433) (2,267)
Capital Redemption Reserve (34,857) - (27,707)
CAPITAL AND RESERVES
TO OWNERS 158,982 238,614 172,374
Non-controlling interest (125) 27 (102)
TOTAL EQUITY 158,857 238,641 172,272
TOTAL EQUITY AND LIABILITIES 184,162 268,527 194,819
Consolidated Statement of Changes in Equity
Capital Total Non-
Share Share Redemption Translation Retained Devolver controlling Total
capital premium Reserve Reserve earnings equity interest equity
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance at
1 January 2022 44 121,588 - (986) 126,184 246,830 (77) 246,753
Prior year
adjustment - - - - (159) (159) 154 (5)
Loss for the
period - - - - (16,560) (16,560) (50) (16,610)
Currency
translation
differences - - - (1,447) - (1,447) - (1,447)
Transactions
with owners
in their capacity
as owners:
Exercise of
share options
via EBT - (1,527) - - - (1,527) - (1,527)
Share-based
payments - - - - 11,477 11,477 - 11,477
Total transactions
with owners - (1,527) - - 11,477 9,950 - 9,950
Balance at
30 June 2022 44 120,061 - (2,433) 120,942 238,614 27 238,641
Balance at
1 January 2022 44 121,588 - (986) 126,184 246,830 (77) 246,753
Loss for the
period - - - - (91,475) (91,475) (25) (91,500)
Currency
translation
differences - - - (1,281) - (1,281) - (1,281)
Other movements - 383 - - (1) 382 - 382
Transactions
with owners
in their capacity
as owners
Issue of shares - 165 - - - 165 - 165
Exercise of
share options 1 630 - - - 631 - 631
Reclassification
of treasury
shares b/f - 25,837 (25,837) - - - - -
Treasury share
repurchase - - (2,500) - (2,500) - (2,500)
Share-based
payments - - - - 19,622 19,622 - 19,622
Transfers - (2,559) 630 - 1,929 - - -
Total transactions
with owners 1 24,073 (27,707) - 21,551 17,918 - 17,918
Balance at
31 December
2022 45 146,044 (27,707) (2,267) 56,259 172,374 (102) 172,272
Balance at 1
January
2023 45 146,044 (27,707) (2,267) 56,259 172,374 (102) 172,272
Loss for the
period - - - - (10,042) (10,042) (23) (10,065)
Currency
translation
differences - - - 33 - 33 - 33
Transactions
with
owners in
their
capacity as
owners
Share buyback
transactions - - (7,150) - - (7,150) - (7,150)
Exercise of
share
options - 18 - - - 18 - 18
Share-based
payments
charge - - - - 3,905 3,905 - 3,905
Share-based
payments
recycle of
charge - - - - (156) (156) - (156)
Total
transactions
with owners - 18 (7,150) - 3,749 (3,383) - (3,383)
Balance at 30
June
2023 45 146,062 (34,857) (2,234) 49,966 158,982 (125) 158,857
Statement of Cash Flows
Unaudited Unaudited
6 months 6 months Year ended
ended ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
Operating activities
Cash inflow / (outflow)
from operations (7,367) (14,759) (100,780)
Amortisation, depreciation
and impairments 7,947 10,873 112,376
Share based payments 3,905 11,477 19,621
Interest payable 198 - -
Net taxation payable (361) - (2,062)
Net cashflow from
operating activities 4,322 7,591 29,155
Investing activities
Purchase of intangible
assets (600) - -
Investment in software
development (12,570) (15,631) (32,641)
Purchase of tangible
assets - (5) (66)
Net cashflow from
investing activities (13,170) (15,636) (32,707)
Financing activities
Net change in borrowings/
others - (510) -
Share capital issuance
including option
exercise 18 (1,527) 795
Share repurchase
transactions (7,150) - (2,514)
Interest received 893 26 362
Interest paid - - (2)
Net cashflow from (1,359
financing activities (6,239) (2,011) )
Net cashflow (15,087) (10,056) (4,911)
At 1 January / 1
July 79,493 86,239 86,239
FX 355 (2,007) (1,835)
Closing cash 64,761 74,176 79,493
Note 1: Basis of preparation and consolidation
These condensed financial statements have been prepared in
accordance with the recognition and measurement requirements of
International Accounting Standard 34 Interim Financial Reporting.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for fair presentation have
been included. The condensed consolidated financial statements as
at and for the six months ended June 30, 2023 have been prepared on
the same basis as the audited annual financial statements.
In May 2022 Devolver established an Employee Benefit Trust (EBT)
to facilitate settlement of employee stock options granted under
the 2017 Stock Option Plan and stock awards granted under the 2022
Long Term Incentive Plan. The EBT is a Jersey-based Trust and the
Trustees act to the benefit of the employees. The accounting
treatment determined that Devolver controls the EBT and must
consolidate the EBT within its consolidated financial
statements.
Most transactions eliminate upon consolidation, with the
exception of the purchase by the EBT of Devolver shares from
employees and shares issued to employees who are exercising options
out of the Capital Redemption Reserve. These are recognised at cost
as "Issued shares held within the Group". These shares are included
within the Capital Redemption Reserve, a separate reserve within
equity. The Devolver shares held by the EBT are not revalued. When
the EBT sells the shares to a third party, any gains or losses are
recognised directly in equity.
Operating results for the six months ended 30 June 2023 are not
necessarily indicative of the results that may be expected for the
year ending 31 December 2023. For further information, refer to the
consolidated financial statements and footnotes thereto included in
the Group's annual report for the year ended 31 December 2022.
The Directors are confident that the Group will remain cash
positive and will have sufficient funds to continue to meet its
liabilities as they fall due for a period of at least 12 months
from the date of this first half 2023 announcement and have
therefore prepared this unaudited semi-annual announcement on a
going concern basis.
Tax charged within 6 months ended 30 June 2023 has been
calculated by applying the effective rate of tax which is expected
to apply to the Group for the year ending 31 December 2022 as
required by IAS 34 'Interim Financial Reporting'. The effective
rate of (16.2)% varies from the statutory rate of 21% due to: a)
permanent book to tax differences related to stock compensation
deductions for foreign entities, which is not deductible for US
income taxes, and; b) US State tax liabilities.
The financial presentation in this release should be read in
conjunction with the notes to the consolidated financial statements
as at and for the first half ended 30 June 2023, as contained
within this release.
These preliminary unaudited financial statements were approved
by the Board of Directors on 24 September 2023.
Note 2: Earnings Per Share
6 months 6 months Year ended
ended ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
Profit/(Loss) attributable
to the owners of the company (10,042) (16,560) (91,475)
Weighted average number
of shares 444,818,506 442,464,268 443,090,183
Basic earnings per share
($) (0.023) (0.037) (0.206)
Profit/(Loss) attributable
to the owners of the company (10,042) (16,560) (91,474)
Weighted average number
of shares 444,818,506 442,464,268 443,090,183
Dilutive effect of share - - -
options
------------ ------------ ------------
Weighted average number
of diluted shares 444,818,506 442,464,268 443,090,183
Diluted earnings per
share ($) (0.023) (0.037) (0.206)
Note 3: Normalised Adjusted Results*
6 months 6 months Year ended
ended ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
Revenue
Reported Revenue 43,877 53,003 134,565
Reported Revenue growth -17.2% 14.1% 37.1%
Gross Profit
Reported Gross Profit 9,394 18,260 22,503
Reported Gross Profit
margin 21.4% 34.5% 16.7%
Normalised Gross Profit
adjustment - 721 23,829
Normalised Gross Profit 9,394 18,981 46,332
Normalised Gross Profit
margin 21.4% 35.8% 34.4%
Adjusted EBITDA
Reported Adjusted EBITDA (3,809) 5,627 (73,378)
Reported Adjusted EBITDA
margin -8.7% 10.6% (54.5%)
Normalised Adjusted
EBITDA adjustment 340 1,191 87,292
Normalised Adjusted
EBITDA (3,469) 6,818 13,914
Normalised Adjusted
EBITDA margin -7.9% 12.9% 10.3%
* Normalised Adjusted EBITDA makes the following adjustments: it
excludes 1) stock compensation (share-based payment) expenses and
revaluation of contingent consideration; 2) one-time expenses and
other non-recurring items; 3) amortisation of IP (but does not
exclude amortisation of capitalised software development costs),
and 4) impairment.
Note 4: Reconciliations to Adjusted EBITDA
6 months 6 months Year ended
ended ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
Operating Profit/(Loss) (9,577) (9,610) (98,455)
Share-based payment expenses 3,905 11,477 19,621
Amortisation and depreciation
of non-current assets 1,863 3,761 5,456
Adjusted EBITDA (3,809) 5,627 (73,378)
6 months 6 months Year ended
ended ended
30-Jun-23 30-Jun-22 31-Dec-22
US$'000 US$'000 US$'000
Adjusted EBITDA (3,809) 5,627 (73,378)
Net Exceptional income from
IP disposal & sale of publishing
rights - - (214)
Non-recurring, one-time
expenses 340 470 1,616
Impairments & others - 721 85,890
---------- ---------- -----------
Normalised Adjusted EBITDA (3,469) 6,818 13,914
Performance-related impairments 934 - 9,296
Normalised Adjusted EBITDA
excluding performance related
impairments (2,535) 6,818 23,210
Note 5: Intangible Assets
Intangible Assets Goodwill Intellectual Software Total
Property Development
US$'000 US$'000 US$'000 US$'000
Cost
As at 1 January 2022 66,820 59,817 61,396 188,033
Additions - - 32,641 32,641
As at 31 December 2022 66,820 59,817 94,037 220,674
Additions 263 815 13,570 14,648
As at 30 June 2023 67,083 60,632 107,607 235,322
Amortisation and impairment
As at 1 January 2022 - 6,435 16,955 23,390
Amortisation charge for
the period - 5,293 14,788 20,081
Impairment 47,667 22,307 22,158 92,132
As at 31 December 2022 47,667 34,035 53,901 135,603
Amortisation charge for
the period - 1,863 5,150 7,013
Impairment - - 934 934
As at 30 June 2023 47,667 35,898 59,985 143,550
Carrying amount
As at 1 January 2022 66,820 53,382 44,441 164,643
As at 31 December 2022 19,153 25,782 40,136 85,071
As at 30 June 2023 19,416 24,734 47,622 91,772
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END
IR SEEESLEDSELU
(END) Dow Jones Newswires
September 25, 2023 02:00 ET (06:00 GMT)
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