vd johan kristiansson 8 september 2009
DESCRIPTION
Starbreeze - A stock listed games developer.TRANSCRIPT
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Starbreeze StudiosStarbreeze Studios
A stock listed A stock listed games developergames developerg pg p
Johan Kristiansson, CEOJohan Kristiansson, CEO
8 Sept 20098 Sept 2009
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AgendaAgendagg
Videogame Videogame industryindustry introductionintroductiongg yy
Starbreeze Starbreeze introductionintroduction
BeingBeing a stock a stock listedlisted companycompany
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The videogame The videogame industryindustry has a 51 BUSD has a 51 BUSD turnoverturnover (S/W (S/W onlyonly))and a 7% and a 7% expectedexpected growthgrowth raterate
Global industry revenues in 2008 and expected CAGR 2009-13
0 %
1 %1 %
4 %
-1 %
7 %
(BUSD)
-3 %
7 %
Source: PwC, Global entertainment and media outlook 2009-2013
(BUSD)
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The key The key plaformsplaforms of the of the currentcurrent generationgeneration
Starbreeze works with 360, PS3 and PCStarbreeze works with 360, PS3 and PC
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The videogame The videogame industryindustry valuechainvaluechain
Sub-contractors Developers Publishers Distributors/
Retailers Consumers
Motion capture studios
Independents, e.g.:
Epic
EA
Activision
Boxed sales
Download sales
USA: ~30%
Europe: ~30%3D-modeling studios
Writers
p
Valve
Crytek
Take Two/2K
Ubisoft
p
Asia: ~30%
Actors
etc.
Starbreeze
Publisher owned, e.g.:
THQ
Sony
DICE/EA IO/Eidos Massive/Ubisoft
Microsoft
The value chain for boxed products is currentlyThe value chain for boxed products is currentlyThe value chain for boxed products is currently The value chain for boxed products is currently going through a shakegoing through a shake--out, where players below out, where players below the topthe top--tier are being erasedtier are being erased
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DevelopersDevelopers get a get a fixedfixed feefee for a for a projectproject, with , with additionaladditionalsalessales royaltiesroyalties ifif the game is the game is successfulsuccessful
Revenue(MUSD)
(Illustrative graph, not based (Illustrative graph, not based on actual contract)on actual contract)
20(MUSD) on actual contract)on actual contract)
Developer revenue
10
0,5 1,0 1,5 Units sold (millions)
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AgendaAgendagg
Videogame Videogame industryindustry introductionintroductiongg yy
Starbreeze Starbreeze introductionintroduction
BeingBeing a stock a stock listedlisted companycompany
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RiddickRiddick and and DarknessDarkness are are ourour latestlatest releasesreleasesRiddick – Dark Athena, for 360, PS3, PC The Darkness, for 360, PS3
• Released in April 2009
•• 82% 82% averageaverage reviewreview scorescore
• Released in June 2007
•• 82% 82% averageaverage reviewreview scorescoregg
•• ””RequelRequel” to ” to RiddickRiddick 1 from 20041 from 2004 •• SalesSales exceedingexceeding 1 million 1 million unitsunits
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TitlesTitles in in productionproduction
Jason Bourne gameJason Bourne game Publisher: Electronic ArtsPublisher: Electronic Arts Contract signed in end of 2008Contract signed in end of 2008
”P j R dLi ””P j R dLi ” ”Project RedLime””Project RedLime” Publisher: Electronic ArtsPublisher: Electronic Arts Signed end of 2007Signed end of 2007
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Starbreeze Starbreeze staffstaff countcount, , sincesince JanuaryJanuary 20042004
100~105 in June 2009 ~105 in June 2009
40
60
80
~25 in June 2004~25 in June 2004
0
20
40
0
Q3
Q4
005 Q
1
Q2
Q3
Q4
006 Q
1
Q2
Q3
Q4
007 Q
1
Q2
Q3
Q4
008 Q
1
Q2
Q3
Q4
009 Q
1
Q2
Q3
Q4
2004/2
0
2005/2
0
2006/2
0
2007/2
0
2008/2
0
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( S )( S )
Revenues and Revenues and earningsearnings per per quarterquarter, , sincesince JanuaryJanuary 20042004
20
25
R (R ( kk))
(MSEK)(MSEK)
15
20 Revenues (Revenues (msekmsek))
5
10
EBT (EBT (msekmsek))
-5
0
Q3
Q4
05 Q
1
Q2
Q3
Q4
06 Q
1
Q2
Q3
Q4
07 Q
1
Q2
Q3
Q4
08 Q
1
Q2
Q3
Q4
09 Q
1
Q2
Q3
Q4
(( ))
-10
5
2004
/20
2005
/20
2006
/20
2007
/20
2008
/20
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Starbreeze share price since Jan 2005Starbreeze share price since Jan 2005
0,6
0,3
0,45
0,15
Starbreeze share price
OMX30 Index
0
Market Cap: 112 MSEK at 0 30 SEK per shareMarket Cap: 112 MSEK at 0 30 SEK per shareMarket Cap: 112 MSEK at 0,30 SEK per shareMarket Cap: 112 MSEK at 0,30 SEK per share
~5500 owners. Largest owner is Peter Törnquist with 5,3% of shares~5500 owners. Largest owner is Peter Törnquist with 5,3% of shares
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Starbreeze Starbreeze futurefuture plansplans
•• SuccessfullySuccessfully launchinglaunching BourneBourne and ”and ”RedLimeRedLime””yy gg
•• Ambition to Ambition to keepkeep buildingbuilding a a strongerstronger industryindustryposition,position, givinggiving usus higherhigher budgets andbudgets and betterbetterposition, position, givinggiving usus higherhigher budgets and budgets and betterbettercontractualcontractual termsterms
•• EarningEarning royaltiesroyalties!!EarningEarning royaltiesroyalties!!
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AgendaAgendagg
Videogame Videogame industryindustry introductionintroductiongg yy
Starbreeze Starbreeze introductionintroduction
BeingBeing a stock a stock listedlisted companycompany
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Discussion topics related to being stock listedDiscussion topics related to being stock listed
•• IR policy: openness to shareholders vs. confidentiality agreements withIR policy: openness to shareholders vs. confidentiality agreements withIR policy: openness to shareholders vs. confidentiality agreements with IR policy: openness to shareholders vs. confidentiality agreements with publisherspublishers
-- This is a tricky issue for SBZ. Our confidentiality agreements are This is a tricky issue for SBZ. Our confidentiality agreements are very strict.very strict.
•• Review horizon: long term vs. short termReview horizon: long term vs. short term-- Each production is 2Each production is 2--3 years, which is a long time for a small listed 3 years, which is a long time for a small listed
companycompany
•• Cash reserve policy: dividends vs. security Cash reserve policy: dividends vs. security -- There is always a high risk of cancelled productions, which creates a There is always a high risk of cancelled productions, which creates a
need for a substantial cash reserveneed for a substantial cash reserve
•• Choice of trading list: Aktietorget vs. First North vs. OMX SmallCapChoice of trading list: Aktietorget vs. First North vs. OMX SmallCap-- We are satified with Aktietorget for now, but other options are We are satified with Aktietorget for now, but other options are
evaluated for the futureevaluated for the future
•• Management attention: making games vs. admin&IRManagement attention: making games vs. admin&IR-- This is a difficult tradeThis is a difficult trade--off for a small listed company. Admin&IR can off for a small listed company. Admin&IR can
be expensive and consume too much time.be expensive and consume too much time.be expensive and consume too much time. be expensive and consume too much time.