Gameloft : 2013 Annual Results, Sales of €233.3M, up 12%

Mar 19, 2014, 12:50 ET from Gameloft

PARIS, March 19, 2014 /PRNewswire/ --

Current operating income of €28.4M, up 39%

Operating cash flow of €24.5M, up 26%

Net cash of €60.3M

Gameloft's consolidated profit and loss statement for the year ending December 31, 2013; breaks down as follows:

    In millions of EUR                            2013           2012
    Sales                                        233.3          208.3
    Cost of sales                               - 40.5         - 32.6
    Gross profit                                 192.8          175.8
    R&D                                        - 106.8        - 103.1
    Sales and marketing                         - 36.1         - 35.5
    Administration                              - 20.9         - 17.2
    Other operating income and expenses           -0.4            0.5
    Current operating income                      28.4           20.4
    Stock-based compensation                     - 3.5          - 4.0
    Other income and expenses                    - 1.3          - 1.6
    Operating income                              23.6           14.9
    Financial income                             - 7.5          - 0.5
    Net income before tax                         16.1           14.3
    Tax expense                                   -8.5          - 5.0
    Net income                                     7.5            9.3

In 2013, Gameloft's consolidated sales reached €233.3 million, up by 12% year on year. On a constant-exchange-rate basis, the full-year growth stood at 16% in 2013. EMEA represented 32% of 2013 sales; North America, 28%; LATAM, 21%; and APAC, 19%. Sales continue to be driven by the worldwide success of Gameloft games on smartphones and tablets. Gameloft's 2013 sales on smartphones and tablets grew by 36% year on year. Gameloft's growth was also driven by the success of the free-to-play business model: sales of virtual goods and advertising currently account for more than 85% of the company's smartphone revenues. This free-to-play model enables Gameloft to reach very large audiences. In the last 30 days, no less than 160 million people have played a Gameloft game on their smartphone or tablet. This model also increases the longevity of the company's products. Games launched prior to 2013 accounted for more than 75% of the company's revenues in 2013.

The gross profit for 2013 reached €192.8 million, up 10%. The gross margin for the period reached 83%, relatively stable compared with the gross margin of 84% achieved in 2012.

"The  solid  growth  in  sales,  stable  headcount  and  efficient  cost  control  have  allowed  Gameloft  to  significantly  increase  its  current  operating  income  which  stood  at  28.4  million,  up  39%  year  on  year," stated Alexandre de Rochefort, Chief Financial Officer of Gameloft. R&D costs represented 46% of sales in 2013, compared with 49% in 2012. Sales & Marketing costs represented 15% of sales in 2013, compared with 17% in 2012. Administration costs represented 9% of sales in 2013, compared with 8% in 2012. The current operating margin of 2013 therefore reached 12.2% compared with 9.8% in 2012.

Compensation costs related to stock options and bonus shares awarded to employees stood at €3.5 million in 2013. Stock-based compensation costs do not negatively impact the company's equity and cash level. Other income and expenses of €1.3 million are essentially linked to the restructuring of Gameloft's development studios in India and the Philippines. Gameloft's 2013 operating income therefore reached €23.6 million, up 59% year on year, and the company's operating margin stood at 10.1%. Excluding capitalized R&D, Gameloft's 2013 operating income was €24.2 million, up 32%.

Net financial income for 2013 amounted to -€7.5 million and is essentially comprised of latent foreign exchange losses on intragroup receivables related to the fall of several foreign currencies against the Euro (Brazilian Real, Canadian Dollar, Japanese Yen, etc.) and of losses on the cash repatriation from Argentina initiated in August 2013. The net income before tax therefore stood at €16.1 million, up 12% year on year.

The tax expense reached €8.5 million. The amount of unrecognized consolidated tax loss carry-forwards at the end of December 2013 was €10.3 million. The net income for 2013 stood at €7.5 million, down 19% year on year.

Healthy  financial  position  and  investing  for  the  future

For the fifth year in a row Gameloft has significantly improved its financial position. The company's equity stood at €136.3 million and net cash reached €60.3 million at the end of December 2013.

Cash generation was strong during 2013 and allowed the company to invest heavily in its IT infrastructure: Gameloft's operating cash flow reached €24.5 million, up 26% year on year, of which close to €15 million was invested in IT equipment. These investments have allowed Gameloft to smoothly manage the massive increase of its daily users on smartphones and tablets: the company's number of daily active users increased to 20 million at the end of 2013 from 9 million a year before.

Given its healthy net cash position, Gameloft launched a share buy-back plan in April 2013. At the end of December 2013 the company had bought, at an average price of €5.55 per share, 1,117,473 Gameloft shares on the market representing 1.38% of the capital on December 16, 2013. In accordance with the General Assembly's delegation granted on June 19, 2013, Gameloft's Board of Directors decided to cancel with immediate effect these 1,117,473 shares on December 17, 2013.

Outlook  for  2014

Gameloft was the second-ranked game publisher in the world in terms of game downloads on smartphones and tablets in 2013 according to the App Annie Index. With more than 20 million daily active users and 1 billion Gameloft freemium games downloaded to date, the company is a key and leading player of the mobile gaming market. In addition, the huge success of Gameloft's last two major releases: Despicable  Me:  Minion  Rush and Asphalt  8  Airborne highlights the company's ability to release worldwide hits in a very competitive environment.

Gameloft has the in-house development capacity to release every year around fifteen high quality smartphone games and to support over 20 game services. These games are launched worldwide in 15 different languages on 4,000 smartphone models. "There  is,  to  our  knowledge,  no  equivalent  to  Gameloft's  development  and  distribution  capacity  and  catalogue  of  games  in  the  mobile  gaming  industry," stated Michel Guillemot, Gameloft's Chief Executive Officer.

In 2013, 1 billion smartphones were sold, compared with 700 million in 2012[1]. Gameloft anticipates another year of solid growth for smartphones and tablets in 2014. The continuing strength of the smartphone and tablet market and the solid line-up of new high-quality games to be released in 2014 by Gameloft should sustain the company's growth in the coming quarters. Therefore, the company anticipates another year of growth in sales, results and net cash in 2014.

Sales for the first quarter of 2014 will be published on April 28, 2014, after the market closes.

About  Gameloft:

A leading global publisher of digital and social games, Gameloft® has established itself as one of the top innovators in its field since 2000. Gameloft creates games for all digital platforms, including mobile phones, smartphones and tablets (including Apple® iOS and Android® devices), set-top boxes and connected TVs. Gameloft operates its own established franchises such as Asphalt®, Order & Chaos, Modern Combat and Dungeon Hunter and also partners with major rights holders including Universal®, Illumination Entertainment®, Disney®, Marvel®, Hasbro®, FOX®, Mattel® and Ferrari®. Gameloft is present on all continents, distributes its games in over 100 countries and employs over 5,200 developers.

Gameloft is listed on NYSE Euronext Paris (Euronext: GFT.PA, Bloomberg: GFT FP, Reuters: GLFT.PA). Gameloft is traded OTC in the US (sponsored Level 1 ADR ticker: GLOFY).

    PROFIT & LOSS ACCOUNT (KEUR)                     2013              2012
    Revenue                                       233,296           208,315
    Cost of sales                                 -40,540           -32,555
    Gross margin                                  192,756           175,759
    R&D                                          -106,828          -103,054
    Sales and Marketing                           -36,138           -35,522
    Administration                                -20,931           -17,239
    Other operating income and expenses              -443               504
    Current operating income                       28,417            20,448
    Stock-based compensation                       -3,520            -3,985
    Other income and expenses                      -1,302            -1,613
    Operating income                               23,595            14,850
    Cost of net financial indebtedness              2,094             1,327
    Exchange rate gains                             7,370             5,869
    Exchange rate losses                          -16,992            -7,730
    Net financial income                           -7,529              -534
    Net income before tax                          16,066            14,316
    Tax expense                                    -8,541            -5,036
    Net profit (group share)                        7,526             9,280
    Earnings per share                               0.09              0.12
    Fully diluted earnings per share                 0.09              0.11


1. Consumer Electronic Association, January 2014

    BALANCE SHEET (KEUR)                                  30/06/13        31/12/2012
    Net intangible fixed assets                              8,146            10,482
    Net tangible fixed assets                               16,445             9,098
    Non-current financial assets                             6,749             6,630
    Tax assets                                              11,163            12,916
    Total non-current assets                                42,503            39,126
    Client receivables                                      62,802            59,658
    Other receivables                                       20,572            20,520
    Cash and cash equivalents                               61,797            55,654
    Total current assets                                   145,171           135,832
    TOTAL                                                  187,675           174,958

    Capital                                                  4,201             4,091
    Issue premium                                           88,553            85,669
    Reserves                                                35,973            28,937
    Net income                                               7,526             9,280
    Shareholder equity                                     136,253           127,977
    Non-current liabilities                                  4,286             4,400
    Current liabilities                                     47,135            42,582
    TOTAL                                                  187,675           174,958
    CASH FLOW STATEMENT (KEUR)                                2013              2012
    Net income                                               7,526             9,280
    Amortization and provisions                             13,598            16,390
    Stock-based compensation                                 3,520             3,985
    Capitalized R&D                                           -782            -1,368
    Asset sales                                                397               347
    Other non-cash items                                     1,682              -294
    Deferred tax                                            25,941            28,340
    Self-financing capacity
                                                            -9,680           -17,380
    Change in trade receivables                              8,252             8,559
    Change in operating liabilities                         -1,428            -8,822
    Change in working capital
                                                            24,513            19,518
    Operating cash flow

    License acquisitions                                    -6,114            -5,536
    Acquisitions of intangible fixed assets                   -766              -812
    Acquisitions of tangible fixed assets                  -15,750            -6,097
    Acquisitions of other fixed financial assets              -845              -546
    Repayment of loans and other financial
    assets                                                     343               353
    Asset sales                                                 74                60
    Total cash flows linked to investments                 -23,059           -12,578

    Free cash flow                                           1,454             6,940

    Capital increase related to stock options
    and bonus shares                                        10,000            13,179
    Share buyback                                           -6,202                 0
    Total cash flows from financing activities               3,797            13,179

    Effect of exchange rate changes                           -528            -1,461

    Change in cash                                           4,723            18,658

    Net cash at the beginning of the period                 55,606            36,948
    Net cash at the end of the period                       60,329            55,606

For  further  information:

Heather Cosby



For more information, consult

SOURCE Gameloft