East Side Games Group (TSX:EAGR, OTCQB:EAGRF) Inc has reported record revenue for both the fourth quarter and full-year ended December 31, 2021.
For the fourth quarter of 2021, the company posted revenue of $28.6 million, a 49% increase from Q4 2020 revenue of $19.2 million, while 2021 annual revenue was $93.2 million, an increase of 37% on 2020 revenue of $68.1 million.
In a statement, Darcy Taylor, CEO of East Side Games Group (TSX:EAGR, OTCQB:EAGRF) (ESGG) commented: "This was a monumental year for ESGG and we capped it off with significant growth in Q4, achieving record quarterly revenue, annual revenue and record user numbers, in addition to launching our first 'Super Marquee' title, RuPaul's Drag Race Superstar."
"The marketing landscape continued to improve in the fourth quarter, we have adapted well to Apple's IDFA changes and have been successful in our marketing campaigns with increased disciplined investing in user acquisition towards the end of the year linked to new launches and sustained returns. This contributed to an extremely successful launch of RuPaul's Drag Race Superstar which, as we mentioned last quarter, surpassed the 1 million download mark only weeks after launch. Our core portfolio of games was a strong contributor to our performance this quarter. We had no new game launches until late October and still realized a strong recovery from the seasonally slow third quarter," he added.
READ: East Side Games developing Star Trek-themed mobile game in partnership with ViacomCBS Consumer Products
The East Side Games CEO continued: "With a record-setting FY2021 in the rearview, we have continued to execute on our growth strategy. On January 27 of this year, we launched the second of our 'Super Marquee' titles, The Office: Somehow We Manage, in collaboration with Universal Games and Digital Partnerships. This title has already ranked in the Top 10 Games in Canada and the US, Top 10 Casual Games in 6 countries, and was also featured as Game of the Day, on the Apple App Store."
"February 15th marked another milestone for us as we announced the achievement of $100 million revenue for the 12-month period ended February 5, 2022. We expect to build on this $100 million milestone through Q1 2022 as we recognise a full quarter of revenue from RuPaul's Drag Race Superstar and capture the first partial quarter of The Office: Somehow We Manage as it begins to ramp up.
"Record quarterly revenue capped off a record year for us. The breadth of our game portfolio allowed us to adapt to marketing landscape changes in the previous 2 quarters and return to strong growth in Q4. Adjusted EBITDA was impacted by increased investment in user acquisition and development of new titles," Taylor added.
Other fourth-quarter and full-year 2021 highlights included:
- Q4 Adjusted EBITDA was $1.1 million, a decrease of 83% vs same period 2020 Adjusted EBITDA of $6.6 million
- Full-year Adjusted EBITDA was $7.4 million, a decrease of 38% vs 2020 Adjusted EBITDA of $12.0 million
- Q4 net and comprehensive loss of $(0.8) million, or ($0.01) on a per common share basis
- Full-year 2021 net and comprehensive loss of $1.9 million or ($0.03) per share
- Adjusting for the lower US dollar in 2021 compared to 2020, in constant dollars, Q4 revenue would have been $29.2 million and full-year revenue on a pro forma basis would have been $100.3 million
- Cash on hand at December 31, 2021, was $9.2 million. In addition to the cash on the balance sheet, the Company has access to $13.5 million in credit facilities, none of which has been drawn upon in the reporting period
- Record player audience with Q4 Daily Active Users (DAU) reaching 348,154, up 21% year-over-year, and Monthly Active User (MAU) of 1,526,246, up 53% over the same period.
- Average Revenue per DAU (ARPDAU) for the quarter was $0.90, slightly up from the prior-year quarter
- Launched RuPaul's Drag RaceSuperstar mobile game on October 25th. This game has since been shortlisted for Pocket Gamer's People's Choice Award and secured Game of the Day feature on the Apple App Store
- Expanded and extended the partnership with Trailer Park Boys to include more games in expanded genres
- Added new Game Kit partner, NoPowerup, for the development of an idle business tycoon-style game to launch in 2022
Significant events subsequent to fourth quarter 2021:
- Launched The Office: Somehow We Manage, in collaboration with Universal Games and Digital Partnerships, on January 27. This title has already ranked in the Top 10 Games in Canada and the US, Top 10 Casual Games in 6 countries, and was also featured as Game of the Day, on the Apple App Store
- Entered into a multi-year partnership with ViacomCBS Consumer Products, for the worldwide release of a Star Trek: Lower Decks-themed mobile game. The game will be available in 2022 on both iOS and Android
- Entered into a multi-year partnership with BBC Studios, for the worldwide release of a mobile title based on the Doctor Who franchise. The game will be available in 2022 on both iOS and Android.
- Acquired Funko Pop! Blitz mobile game from N3TWORK. Funko Pop! Blitz is a deeply engaging match-3 blitz character collection game featuring Funko Pop! versions of lovable characters across multiple iconic franchises in unique weekly events
- Expanded the Game Kit partnership with Mighty Kingdom, based in Australia, for the worldwide release of three additional free-to-play mobile games on iOS and Android
"We've carried our momentum into 2022, executing on our growth pillars of organic game growth, accretive acquisitions and distributed growth through our proprietary Game Kit platform licensing. We've added more 'Super Marquee' IP in the form of the Star Trek and Doctor Who franchises, acquired Funko Pop! Blitz, which fits perfectly into our portfolio of top-tier casual games, in addition to expanding our Game Kit partnership with Mighty Kingdom," Taylor concluded.
Conference call details
The company said it will hold a conference call to discuss its performance with the investment community at 2.00pm PT today, Friday March 11, 2022.
Webcast and conference call details are: Webcast URL https://onlinexperiences.com/Launch/QReg/ShowUUID=430F1BE3-50A0-491B-9382-04525977278D; Toll Free Dial-In Number +1 (833) 772-0399; International Dial-In Number:+1 (236) 738-2279; Conference ID: 4787454
A replay will be available starting at 6.30am on March 11, 2022, until April 10, 2022, by dialing +1 (800) 585-8367 or +1 (416) 621-4642 and entering the conference ID 4787454.
East Side Games Group (TSX:EAGR, OTCQB:EAGRF) - formerly operating under the name LEAF Mobile Inc - is a leading free-to-play mobile game group, creating engaging games that produce enduring player loyalty.
Its studio groups' entrepreneurial culture is anchored in creativity, execution, and growth through licensing of the company's proprietary Game Kit software platform that enables professional game developers to greatly increase the efficiency and effectiveness of game creation in addition to organic growth through a diverse portfolio of original and licensed IP mobile games that include: Archer: Danger Phone, Bud Farm Idle Tycoon, Cheech & Chong Bud Farm, The Goldbergs: Back to the 80s, It's Always Sunny: The Gang Goes Mobile and Trailer Park Boys Grea$y Money, RuPaul's Drag Race Superstar and The Office: Somehow We Manage.
Headquartered in Vancouver, Canada, the company's games are available worldwide on the App Store and Google Play.
Contact the author at jon.hopkins@proactiveinvestors.com