Rovio Entertainment Ltd.’s strong growth continued in the second quarter of 2017, with the company’s revenue increasing to EUR 86.2 million (EUR 44.5 million in Q2/2016). The year-on-year revenue increase was 94.0%, mainly due to the continued strong performance of Rovio’s games, as well as the revenue from The Angry Birds Movie, a global blockbuster animated movie released in May 2016. During second quarter, Rovio also successfully launched two new games – Battle Bay and Angry Birds Evolution.
The revenue of the Games business unit increased by 65.0% and amounted to EUR 61.3 million (EUR 37.2 million in Q2/2016). The growth was driven by a 30% increase in the number of monthly paying users and a 51% increase in revenue per monthly paying user.
The revenue of the Brand Licensing business unit increased by 242.6% to EUR 24.9 million (EUR 7.3 million in Q2/16). The strong revenue growth was due to revenues from The Angry Birds Movie released in May 2016.
Profitability significantly improved in the second quarter of 2017
In the second quarter, Rovio’s adjusted EBITDA increased to EUR 31.6 million (EUR 8.6 million in Q2/2016). The increase was mainly driven by the revenue growth of Games and the revenue from The Angry Birds Movie. In the second quarter of 2017, the adjusted EBITDA margin increased to 36.7% (19.3% in Q2/2016).
The adjusted EBITDA of the Games business unit increased by 30.6% to EUR 13.5 million (EUR 10.3 million in Q2/2016), and that of the Brand Licensing business unit increased to EUR 20.7 million (EUR 0.9 million in Q2/2016). The substantial EBITDA growth of the Brand Licensing business was driven by revenues from The Angry Birds Movie.
First half of 2017
In the first half of 2017, Rovio’s revenue increased by 94.3% year-on-year and totaled EUR 152.6 million (EUR 78.5 million in H1/2016). The revenue of the Games business unit increased by 76.3% to EUR 117.9 million (EUR 66.9 million in H1/2016). The revenue of the Brand Licensing business unit increased by 197.8% and amounted to EUR 34.6 million (EUR 11.6 million in H1/2016).
Rovio’s adjusted EBITDA increased to EUR 41.8 million (EUR 11.0 million in H1/2016). The adjusted EBITDA of the Games business unit increased by 33.9% to EUR 22.5 million (EUR 16.8 million in H1/2016). The adjusted EBITDA of the Brand Licensing business unit increased to EUR 24.3 million (EUR -0.9 million in H1/2016).
CEO Kati Levoranta comments:
“The second quarter of 2017 evidenced true delivery of our Games-First strategy with very strong growth in revenues and profits. During the second quarter, we also finalized Rovio’s restructuring and moved towards a licensing model of lower operating and capital expenses in the consumer products and animated content businesses. The benefits of these structural changes, however, have not yet been reflected in the strong financial performance we achieved in the first half of 2017.
Our current top games continued to improve their key KPIs, enabling us to invest in growth and new games with high confidence. Rovio’s latest games, Battle Bay and Angry Birds Evolution, were launched in Q2 with the strongest launch ARPDAU and other KPIs ever seen in Rovio Games business unit.
The Brand Licensing business unit saw strong revenue growth due to revenues from The Angry Birds Movie. During the second quarter, we entered into a movie licensing, production and distribution agreement with Columbia Pictures Industries, Inc. regarding Angry Birds movie sequel, scheduled for release in September 2019.
I’m very proud of our Rovians. They have all performed at the highest level through the changes in the past few years and made possible our strong profitable growth during the first half of 2017.”
Information about figures presented
Rovio’s operations are divided into two business units, which also constitute its reporting segments: Games and Brand Licensing. The Games business unit consists of Rovio’s mobile games business. The Brand Licensing business unit consists of two sub-units, Consumer Products and Content Licensing, which generate royalty revenues from licensing the Angry Birds brand to product categories other than mobile games. In addition, Rovio has a third reporting segment, Other, which consists of Hatch Entertainment Oy, 80% of which is owned by Rovio, and unallocated group overhead costs. Hatch Entertainment Oy was incorporated in 2016, and it develops a new way of playing mobile games.
Unless otherwise stated, figures in parentheses refer to the comparison period, i.e., the corresponding period in 2016.
Adjusted EBITDA refers to EBITDA after adjustments of non-recurring items related to e.g. restructurings. In 1‒6/2017, the adjustments were in total EUR 2.0 million of which EUR 1.9 million related to restructuring of the Brand Licensing unit and EUR 0.1 million in Games.
The financial figures are presented according to the IFRS standards. The figures for 4‒6/2017, 4‒6/2016,
1‒6/2017 and 1‒6/2016 are unaudited.
For further information:
Rovio communications, +358 40 485 8985, firstname.lastname@example.org
CEO Kati Levoranta and CFO René Lindell are available for comments on August 15, 2017 at 10 a.m.‒12 a.m. (EET).
Rovio Entertainment Ltd., based in Espoo, Finland, is the creator of Angry Birds, the casual mobile game that changed industry and became an international phenomenon. Today Angry Birds is not only the most downloaded series of games of all time, it is a renowned entertainment brand that has branched out into consumer products, animation, and more. The Angry Birds Movie was released in May 2016 and the sequel for the animated blockbuster movie is planned to hit cinemas in 2019. (www.rovio.com)