TOKYO--(BUSINESS WIRE)--NEXON Co., Ltd. (Nexon) (3659.TO), a global leader in online games, today announced the financial results for its third quarter ended September 30, 2020.
“Despite a delay in the year’s biggest launch – Mobile Dungeon&Fighter – Nexon delivered our best Third Quarter ever, with strong growth from multiple franchises as well as extending our powerful franchises to mobile, putting us within the range of our quarterly guidance,” said Owen Mahoney, President and CEO of Nexon. “This very solid performance demonstrates the durability and diversity of Nexon’s core franchises, a foundation on which we are launching new Virtual Worlds on new platforms, and in new markets. Our 2021 pipeline layers big growth opportunities in multiple markets on top of an exceptionally strong core business. I’ve never been more excited about Nexon’s future.”
Recent Highlights Include:
- Nexon posted the best Q3 revenues of all time, with group revenues of ¥79.4 billion, up 52% year-over-year – within our expected range.
- Mobile game revenues in Q3 account for 42% of Nexon’s group revenues – up 140% year-over-year. Three titles significantly exceeded expectations in Q3 – The Kingdom of the Winds: Yeon, KartRider Rush+ and V4.
- Revenues from PC online games1 were up 20% year-over-year and account for 58% of Q3 revenues. This performance was driven by multiple franchises in multiple markets including MapleStory across geographies as well as Dungeon&Fighter, Sudden Attack and EA SPORTSTM FIFA ONLINE 4 in Korea.
- Operating income ¥27.6 billion – below our outlook. Nexon delivered record-breaking Q3 operating income – up 13% year-over-year, driven by an extraordinarily strong performance in Korea while recording a ¥3.0 billion impairment loss.
- Net income2 was ¥16.3 billion – below our outlook due to the operating income underperformance as well as an ¥8.6 billion FX loss primarily on U.S. dollar-denominated cash deposits.
- In Japan, Nexon launched V4 in September and EA SPORTSTM FIFA MOBILE in October.
- In June, Nexon announced an initiative to invest $1.5 billion in companies that demonstrate the ability to create and sustain global entertainment properties. To date, the company has invested \85.9 billion or 54% of the fund and recognized an unrealized gain of \18.6 billion under other comprehensive income.
- On October 29, 2020 Nexon was added to the prestigious Nikkei Stock Average – The Nikkei 225. Nexon is also listed on the JPX400 and Nikkei Stock Index 300.
- Kevin A. Mayer has been nominated to Nexon’s Board of Directors. Mr. Mayer’s proven expertise in driving growth at the Walt Disney and TikTok aligns with Nexon’s vision for global expansion. The nomination will be voted on at Nexon’s annual shareholders meeting in March 2021.
- As part of our capital allocation strategy, Nexon’s Board of Directors approved a new share repurchase policy to buy-back up to ¥100 billion worth of stock in the next three years. This will be in addition to our M&A strategy as well as the annual dividend.
Fourth Quarter 2020 Outlook:
- Expect revenues in the range of ¥60.7 to ¥65.5 billion, up 23% to 33% year-over-year on an as-reported basis, up 24% to 33% year-over-year on a constant currency3 basis
- Expect operating income of ¥12.3 to ¥16.0 billion
- Expect net income2 of ¥8.7 to ¥11.6 billion
- Forex sensitivity4 : Every one Japanese yen move against the U.S. dollar would have the following impact on our financials for Q4 2020
- Revenues: ¥0.59 billion
- Operating Income: ¥0.16 billion
Conference Call and Replay
Nexon management will host a conference call for investors, analysts and the media to discuss the company’s financial results and outlook. The conference call will be held at 5:30 p.m. JST / 3:30 a.m. EST, and will be simultaneously conducted in Japanese and English. It will consist of brief remarks made by the management team followed by a Q&A session. Q&A session will be conducted with consecutive interpretation.
Conference Call (Japanese & English) |
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Time: |
November 10, 2020 at 5:30 p.m. JST / 3:30 a.m. EST (planned) |
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For English Speakers |
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Telephone Number: |
+81-3-6629-1042 (Japan), +1-408-758-9913 (US), |
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+44-20-3364-5380 (UK), +852-302-77009 (Hong Kong), |
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+65-640-85783 (Singapore), +82-70-4732-0202 (South Korea) |
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Pass Code: |
96737556# |
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For Japanese Speakers |
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Telephone Number: |
+81-3-6630-2234 (Japan) |
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Pass Code: |
72322404# |
Conference Call Replay |
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A replay of the call will be available about 30 minutes after the conclusion of the conference call and can be accessed until November 17, 2020. Webcast replay and a transcript of the call will be available within several days on Nexon’s Investor Relations website. |
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Conference Call Replay (English) |
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Replay Telephone Number: |
+81-3-6630-2251 (Japan) |
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Reference Number: |
512544235# |
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Conference Call Replay (Japanese) |
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Replay Telephone Number: |
+81-3-6630-2236 (Japan) |
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Reference Number: |
512544231# |
For additional information regarding Nexon’s third quarter financial results, please visit the Investor Relations section of Nexon’s website at http://ir.nexon.co.jp/en/.
This press release is prepared to offer reference information about Nexon to investors and is intended to generally provide investors and analysts with financial and operational information about Nexon, but not to solicit or recommend any sale or purchase of stock or other securities of Nexon.
About NEXON Co., Ltd. http://company.nexon.co.jp/en/
Founded in 1994, NEXON Co., Ltd. (Nexon) (3659.TO) is a company engaged in the production, development and operation of online games and Virtual Worlds. First listed on the Tokyo Stock Exchange in December 2011, Nexon was placed on JPX400 in 2015 and added to the Nikkei Stock Index 300 in 2017. In 2020, Nexon was added to the Nikkei 225. Nexon currently has more than 60 live games on multiple platforms including mobile and available in more than 190 countries. Major game franchises include MapleStory, KartRider and Dungeon&Fighter.
1 PC revenues include other revenues besides PC online games and mobile games.
2 Net income refers to net income attributable to owners of the parent, as stated in Nexon’s consolidated financial results.
3 Constant currency is a non-GAAP measure used to show performance unaffected by fluctuations in foreign currency exchange rates. Constant-currency basis amounts are calculated using the average foreign currency exchange rates for the comparable period in the prior year and applied to the current period.
4 In most situations, the exchange rates of both the South Korean Won and the Chinese Yuan are linked to the U.S. dollar. For simplicity, forex sensitivity is calculated based on the assumption that Korean Won and Chinese Yuan move similarly against Japanese yen when there is an exchange rate movement in US. dollar and Japanese yen.
