Nexon Announces Third Quarter 2013 Results New and Existing Titles on PC and Mobile Drive 64% Revenue Growth Investments in World-Class Developers Mark Significant Progress Toward Strategic Initiatives Business Wire TOKYO -- November 8, 2013 NEXON Co., Ltd. (“Nexon”) (3659.TO), a worldwide leader in free-to-play online games, today announced financial results for its third quarter ended September 30, 2013. Revenues grew 64% year-over-year, operating income increased 53% and net income increased 10%. “We are pleased with our solid third quarter results, driven by the strong performance of new and existing titles. We exceeded the high end of our outlook for the fourth consecutive quarter, with Korea growth accelerating and stable performance in China,” said Seungwoo Choi, President and Chief Executive Officer of Nexon. “We continue to make excellent progress on our long-term strategic initiatives, making several investments in studios headed by world-class developers, which enables us to secure AAA content, particularly in the US and European markets. The platform transition toward synchronous online game play and free-to-play monetization shows no signs of slowing, and – as pioneers of the free-to-play model – we are well-positioned to capitalize on this industry momentum.” Third Quarter Fiscal 2013 Financial Highlights (IFRS) (1) (Millions of yen, except per share data) Q3 2012 Q3 2013 YoY% Revenues ¥24,256 ¥39,883 64% PC 23,567 32,995 40% Mobile 690 6,887 10.0x Operating income 10,602 16,237 53% Net income ^2 7,352 8,054 10% Earnings per share: 16.94 18.35 8% Footnotes: ^1 Nexon voluntarily adopted IFRS beginning in the first quarter of 2013. ^2 Net income refers to net income attributable to owners of the parent, as stated in Nexon’s consolidated financial results. Additional information regarding Nexon’s third quarter financial results is available at Nexon’s IR website “IR Library” at https://ir.nexon.co.jp/en/library/index.html. Revenue Breakdown (IFRS) (Millions of yen) Q3 2013 Q3 2013 YoY % Change Revenue by Region ^1 Q3 2012 (As- (Constant As- Constant Currency ^3 Reported) Currency)^3 Reported China ¥11,404 ¥15,962 ¥12,464 40% 9% Korea 6,579 12,151 9,488 85% 44% Japan 3,232 8,755 8,754 171% 171% North America 1,341 1,364 1,093 2% -18% Europe and 1,701 1,651 1,290 -3% -24% Others ^2 Nexon Total 24,256 39,883 33,089 64% 36% Footnotes: ^1 Based on the region in which revenues originate; not a representation of our revenues according to Nexon entities. ^2 Others: Other Asian countries and South American countries. ^3 On a constant currency basis (using Q3 2012 currency exchange rates). Regional Highlights Korea growth accelerated, driven by FIFA Online 3 and well-received Dungeon&Fighter updates. Stable growth continued in China, reinforced by a tier one update to Dungeon&Fighter. Japan grew year-over-year due to the consolidation of gloops. China Revenues were up 40% year-over-year, or 9% on a constant currency basis. Dungeon&Fighter performance was in-line with expectations, supported by a popular tier one content update. Counter-Strike Online also continued to show year-over-year growth. Korea Revenues were up 85% year-over-year, or 44% on a constant currency basis. This accelerating growth was driven by existing titles such as FIFA Online 3, Sudden Attack, Dungeon&Fighter and Mabinogi. MapleStory continues to perform below expectations. New mobile game Fantasy Runners for Kakao achieved nearly 3 million downloads during the quarter. Japan Revenues were up 171% year-over-year due the consolidation of gloops. Dragon Eclipse, the first collaboration between gloops and DeNA, launched in September, with a native app released the following month. Existing mobile titles including Three Kingdoms Guild Battle continue to show stable performance. North America Revenues were up 2% year-over-year, or down 18% on a constant currency basis. Nexon announced several key investments in high-profile US-based developers including Shiver Entertainment, headed by industry veteran John Schappert. Nexon also announced a publishing agreement with UK developer Splash Damage for the title Extraction. Europe and Others Revenues were down 3% year-over-year, or 24% on a constant currency basis. Nexon announced a publishing agreement with Gamania for Warface in Taiwan. Fourth Quarter 2013 Business Outlook The following table presents Nexon’s outlook for the fourth quarter of fiscal 2013. (Millions of yen) Q4 2012 Q4 2013 (IFRS) (IFRS) Revenues ¥30,882 ¥31,775~¥33,606 PC 23,813 25,916~27,198 Mobile 7,070 5,860~6,408 Operating income 8,793 6,748~7,921 Net income 552 4,814~5,730 Earnings per share 1.27 10.96~13.05 The Company also expects a weaker Japanese yen to continue to contribute to year-over-year growth based on its ¥98.95 per US$1 and ¥8.94 per 100KRW currency exchange assumptions. About NEXON Co., Ltd. http://company.nexon.co.jp/ NEXON Co., Ltd. (“Nexon”) (3659.TO) is a worldwide leader in free-to-play online games. Founded in Korea in 1994, Nexon developed one of the world's first graphics-based massively multiplayer online games. Nexon also pioneered the concept of microtransactions and the free-to-play business model, setting a new standard in which play is free, and users have the option to purchase in-game items to enhance their experience. Nexon currently services nearly 60 online games in more than 100 countries and since its founding, Nexon has generated more than 1.4 billion player registrations. The Company is headquartered in Tokyo, Japan and its shares are listed on the Tokyo Stock Exchange. Contact: NEXON Co., Ltd. Owen Mahoney, +81-3-3523-7910 Chief Financial Officer or Greg Melchior, +81-3-3523-7919 Corporate Public Relations
Nexon Announces Third Quarter 2013 Results
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