Seoul, South Korea, Aug. 09, 2024 (GLOBE NEWSWIRE) -- GRAVITY Co., Ltd. (NasdaqGM: GRVY) (“Gravity” or “Company”), a developer and publisher of online and mobile games based in South Korea, today announced its unaudited financial results for the second quarter ended June 30, 2024, prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board and business updates.

SECOND QUARTER 2024 HIGHLIGHTS

• Total revenues were KRW 122,967 million (US$ 89,330 thousand), representing a 2.7% increase from the first quarter ended March 31, 2024 (“QoQ”) and a 48.5% decrease from the second quarter ended June 30, 2023 (“YoY”).

• Operating profit was KRW 14,989 million (US$ 10,889 thousand), representing a 44.2% decrease QoQ and a 71.6% decrease YoY.

• Profit before income tax expenses was KRW 20,057 million (US$ 14,570 thousand), representing a 38.3% decrease QoQ and a 63.6% decrease YoY.

• Net profit attributable to parent company was KRW 12,569 million (US$ 9,131 thousand), representing a 53.2% decrease QoQ and a 72.1% decrease YoY.

REVIEW OF SECOND QUARTER 2024 FINANCIAL RESULTS

Revenues

Online game revenues for the second quarter of 2024 were KRW 19,445 million (US$ 14,126 thousand), representing a 7.6% increase QoQ from KRW 18,065 million and a 14.2% increase YoY from KRW 17,025 million. The increase QoQ was mainly attributable to increased revenues from Ragnarok Online in Thailand. The increase YoY was also mainly due to increased revenues from Ragnarok Online in Thailand.

Mobile game revenues were KRW 99,019 million (US$ 71,933 thousand) for the second quarter of 2024, representing a 0.5% increase QoQ from KRW 98,548 million and a 54.7% decrease YoY from KRW 218,687 million. The increase QoQ was resulted by increased revenues from Ragnarok Origin, which was launched in North, Central and South America on February 28, 2024 and initial revenues from THE RAGNAROK (Ragnarok: Novice Hearts), which was launched in Taiwan, Hong Kong and Macau on June 6, 2024. Such increase was partially offset by decreased revenues from Ragnarok Origin in Southeast Asia. The decrease YoY was mainly due to decreased revenues from Ragnarok Origin in Southeast Asia, Taiwan, Hong Kong and Macau and Ragnarok X: Next Generation in Korea. This decrease was partially offset by increased revenues from Ragnarok Origin in North, Central and South America and THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau.

Other revenues were KRW 4,503 million (US$ 3,271 thousand) for the second quarter of 2024, representing a 42.2% increase QoQ from KRW 3,166 million and a 41.5% increase YoY from KRW 3,182 million.

Cost of Revenue

Cost of revenue was KRW 76,006 million (US$ 55,215 thousand) for the second quarter of 2024, representing a 3.2% increase QoQ from KRW 73,628 million and a 54.8% decrease YoY from KRW 168,309 million. The increase QoQ was mainly due to commission paid for mobile game services related to Ragnarok Origin in North, Central and South America and THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau. The decrease YoY was primarily due to decreased commission paid for mobile game services related to Ragnarok Origin in Southeast Asia, Taiwan, Hong Kong and Macau and Ragnarok X: Next Generation in Korea.

Operating Expenses

Operating expenses were KRW 31,972 million (US$ 23,226 thousand) for the second quarter of 2024, representing a 65.8% increase QoQ from KRW 19,282 million and a 78.8% increase YoY from KRW 17,884 million. The increase QoQ was mainly due to increased advertising expenses for mobile game services related to THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau. The increase YoY was also mainly due to increased advertising expenses for mobile game services related to THE RAGNAROK (Ragnarok: Novice Hearts) in Taiwan, Hong Kong and Macau.

Profit Before Income Tax Expenses

Profit before income tax expenses was KRW 20,057 million (US$ 14,570 thousand) for the second quarter of 2024 compared with profit before income tax expense of KRW 32,498 million for the first quarter of 2024 and profit before income tax expenses of KRW 55,097 million for the second quarter of 2023.

Net Profit

As a result of the foregoing factors, Gravity recorded a net profit attributable to parent company of KRW 12,569 million (US$ 9,131 thousand) for the second quarter of 2024 compared with net profit attributable to parent company of KRW 26,866 million for the first quarter of 2024 and a net profit attributable to parent company of KRW 45,016 million for the second quarter of 2023.

Liquidity

The balance of cash and cash equivalents and short-term financial instruments was KRW 499,247 million (US$ 362,680 thousand) as of June 30, 2024.

Note: For convenience purposes only, the KRW amounts have been expressed in U.S. dollars at the exchange rate of KRW 1,376.55 to US$ 1.00, the noon buying rate in effect on June 28, 2024 as quoted by the Federal Reserve Bank of New York.

GRAVITY BUSINESS UPDATES

Ragnarok Online IP-based Games

• Ragnarok: Dawn (tentative English title)

Ragnarok: Dawn (tentative English title) officially received an ISBN from Chinese government on June 5, 2024, and aims to complete development in 2025.

• Ragnarok Online, an MMORPG PC game

Ragnarok Online was officially launched in China on June 28, 2024.

• Ragnarok X: Next Generation, an MMORPG mobile game

Ragnarok X: Next Generation will be launched in China on September 13, 2024, with preparations underway for its launch in Japan.

• Ragnarok Origin, an MMORPG mobile and PC game

Ragnarok Origin is preparing for its launch in Europe.

• THE RAGNAROK (Ragnarok: Novice Hearts), an MMORPG mobile game

THE RAGNAROK (Ragnarok: Novice Hearts) was launched in Taiwan, Hong Kong and Macau on June 6, 2024, and it aims to be launched in Korea in the third quarter of 2024 and Southeast Asia in the fourth quarter of 2024.

• Ragnarok: Rebirth, an MMORPG mobile game

Ragnarok: Rebirth was launched in Southeast Asia on June 27, 2024, and it aims to be launched in Taiwan, Hong Kong and Macau in the fourth quarter of 2024.

• Other Ragnarok Online IP-based games

Ragnarok Landverse, an MMORPG Blockchain PC game based on P2E systems, was launched in Thailand on July 12, 2024.

Other IP-based games

• Mirren: Millennium Tour, a Turn Strategy RPG mobile game

Mirren: Millennium Tour aims to be launched in Korea in the third quarter of 2024.

• TOKYO PSYCHODEMIC, a 2D Cinematic Profiling Adventure PC and console game

TOKYO PSYCHODEMIC was launched in Japan on May 30, 2024, and it aims to be launched in Global in the second half of 2024.

• KAMiBAKO, a World Craft RPG PC and console game

KAMiBAKO will be launched in Japan on August 29, 2024, and it aims to be launched in Global in the second half of 2024.

Expansion of Ragnarok IP-business

Ragnarok Golf Monsters is an indoor-screen golf brand based on the Ragnarok monster characters. Gravity Communications Co., Ltd. has been having a soft opening since May 30, 2024, and it aims to officially open the facility in Taipei, Taiwan in the second half of 2024.

Investor Presentation

Gravity issued an investor presentation. The presentation contains the Company’s recent business updates, results of the second quarter in 2024 and Gravity’s business plan. The presentation can be found on the Company’s website under the IR Archives section at https://www.gravity.co.kr/en/ir/updates. Korean and Japanese versions of the presentation are also provided on the website.

About GRAVITY Co., Ltd. ---------------------------------------------------

Gravity is a developer and publisher of online and mobile games. Gravity's principal product, Ragnarok Online, is a popular online game in many markets, including Japan and Taiwan, and is currently commercially offered in 91 markets. For more information about Gravity, please visit https://www.gravity.co.kr.

Forward-Looking Statements:

Certain statements in this press release may include, in addition to historical information, “forward-looking statements” within the meaning of the “safe-harbor” provisions of the U.S. Private Securities Litigation Reform Act 1995. Forward-looking statements can generally be identified by the use of forward-looking terminology, such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe”, “project,” or “continue” or the negative thereof or other similar words, although not all forward-looking statements contain these words. Investors should consider the information contained in our submissions and filings with the United States Securities and Exchange Commission (the “SEC”), including our annual report for the fiscal year ended December 31, 2023 on Form 20-F, together with such other documents that we may submit to or file with the SEC from time to time, on Form 6-K. The forward-looking statements speak only as of this press release and we assume no duty to update them to reflect new, changing or unanticipated events or circumstances.

Contact:

Mr. Heung Gon Kim
Chief Financial Officer
Gravity Co., Ltd.
Email: [email protected]

Ms. Jin Lee
Ms. Shin Choi
IR Unit
Gravity Co., Ltd.
Email: [email protected]
Telephone: +82-2-2132-7800

GRAVITY Co., Ltd.
Consolidated Statements of Financial Position

(In millions of KRW and thousands of US$)

* For convenience purposes only, the KRW amounts are expressed in U.S. dollars at the rate of KRW 1,376.55 to US$ 1.00, the noon buying rate in effect on June 28, 2024 as quoted by the Federal Reserve Bank of New York.

GRAVITY Co., Ltd.
Consolidated Statements of Comprehensive Income

(In millions of KRW and thousands of US$ except for share and ADS data)

* For convenience, the KRW amounts are expressed in U.S. dollars at the rate of KRW 1,376.55 to US$1.00, the noon buying rate in effect on June 28, 2024 as quoted by the Federal Reserve Bank of New York.
(1) Each ADS represents one common share.