Financial · January 1, 2022

Focus Entertainment Annual Financial Report & CSR Report 2021/2022

Summary

Focus Entertainment’s 2021/22 fiscal year marks a definitive strategic pivot from a third-party distributor to an integrated developer-publisher. This transition was fueled by the acquisition of five studios—Streum On, Dotemu, Douze Dixièmes, Leikir, and Deck13—and a rebranding from Focus Home Interactive. The Group’s primary objective is to secure greater control over its intellectual property, targeting a pipeline of 31 games by 2025 and a goal of owning 50% of its IP turnover. Financial results for the period ending March 31, 2022, reflect this heavy investment phase. Turnover reached €142.6 million, a 17% decrease from the pandemic-driven highs of the previous year, while net income fell to approximately €3.0 million. Despite lower earnings, the balance sheet was significantly bolstered through a €70.4 million capital increase and a new €140 million loan facility. Total assets doubled to €251.0 million, driven by a surge in goodwill and intangible assets related to studio acquisitions. Digital sales now dominate the revenue mix at 88%, with the Americas remaining the largest geographic market at 54% of sales. Operational and governance structures were modernized to support this growth. The Group transitioned to a Board of Directors structure, appointing Frank Sagnier as Chairman and Christophe Nobileau as CEO. Simultaneously, the company launched its inaugural Corporate Social Responsibility (CSR) strategy, focusing on player safety, environmental impact, and workplace diversity. Key ESG milestones include a significantly improved Gaïa rating and a 94/100 gender equality index. While the Group faces increased off-balance-sheet commitments of €124.2 million for future content, it maintains a solid net cash position of €62.6 million, positioning it to execute its long-term development roadmap.

From the report

CONTENTS ANNUAL FINANCIAL REPORT AS OF 31 MARCH 2022 1. INTRODUCTION pages 3 to 7 2. DECLARATION BY THE PERSON RESPONSIBLE page 8 3. MANAGEMENT REPORT pages 9 to 24 4. BOARD REPORT ON CORPORATE GOVERNANCE pages 25 to 33 5. AUDITOR’S REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS FOR YEAR ENDED 31 MARCH 2022 pages 34 to 36 6. CONSOLIDATED ACCOUNTS AS OF 31 MARCH 2022 pages 37 to 58 7. AUDITOR’S REPORT ON THE PARENT COMPANY’S FINANCIAL STATEMENTS FOR YEAR ENDED 31 MARCH 2022 pages 59 to 61 8. PARENT COMPANY’S FINANCIAL STATEMENTS AS OF 31 MARCH 2022 pages 62 to 77 9. AUDITOR’S SPECIAL REPORT ON THE RELATED-PARTY AGREEMENTS FOR THE YEAR ENDED 31 MARCH 2022 pages 78 to 80 10. CORPORATE SOCIAL RESPONSIBILITY (CSR) REPORT MESSAGE FROM THE CEO page 82 INTEGRATING CSR INTO FOCUS ENTERTAINMENT’S ACTIVITIES pages 83 to 86 PILLAR 1: BE A PUBLISHER OF ENTERTAINING VIDEO GAMES THAT ARE SAFE AND RESPECTFUL OF OUR PLAYERS pages 86 to 88 PILLAR 2: BE AN ATTRACTIVE AND RESPONSIBLE EMPLOYER pages 88 to 91 PILLAR 3: BE A PUBLISHER THAT IS COMMITTED TO THE ENVIRONMENT AND SOCIETY pages 91 to 94

ENTERTAINING VIDEO GAMES THAT ARE SAFE AND RESPECTFUL OF OUR PLAYERS pages 86 to 88 PILLAR 2: BE AN ATTRACTIVE AND RESPONSIBLE EMPLOYER pages 88 to 91 PILLAR 3: BE A PUBLISHER THAT IS COMMITTED TO THE ENVIRONMENT AND SOCIETY pages 91 to 94 METHODOLOGICAL NOTE/ABOUT THIS REPORT pages 95 to 96

MESSAGE FROM THE CEO After the 2020/21 year, during which the video gaming industry benefited greatly from the lockdown measures implemented worldwide, FOCUS ENTERTAINMENT recorded turnover of €142.6M for FY 2021/22, including a contribution of €5.6M by Dotemu. SnowRunner, Insurgency: Sandstorm and A Plague Tale: Innocence made major contributions to the period’s business thanks to the release of additional content and supplementary revenue from one-off deals, thereby confirming the Group’s capacity to generate long-term revenue on flagship franchises. The year also benefited from the success enjoyed by Necromunda: Hired Gun developed by Streum On Studio, a member of the Group since April 2021, and by Aliens: Fireteam Elite, both of which were launched during the year. In 2021/22, we also confirmed our desire to create our own franchises and bring together talents. Our strategy is to move up the value chain, evolving our business model from publisher/distributor to developer/publisher, increasing the portion of Intellectual Property (IP) held in our game portfolio. The long-term aim is to reach 50% of turnover generated by games, whose IP is held by the Group. To this end, this year should constitute a turning point: • the Group carried out no fewer than 4 external growth operations during the year.

of Intellectual Property (IP) held in our game portfolio. The long-term aim is to reach 50% of turnover generated by games, whose IP is held by the Group. To this end, this year should constitute a turning point: • the Group carried out no fewer than 4 external growth operations during the year. After the 2020/21 Deck13 Interactive acquisition, the group acquired Stream On Studio (April 2021) and Dotemu (September 2021), followed by Douze Dixièmes (October 2021) and welcomed a fifth studio with the purchase of Leikir Studio (February 2022). • The Group has secured the most ambitious game line-up in its history with 31 new games that are to be launched by March 2025. Throughout the period during which these games are to be marketed, 30% of turnover should come from games for which the Group holds the IP directly (15%) or jointly (15%). In a parallel fashion, to give us the means to achieve our ambitions, the Group has continued to boost its financing, with the successful €70.4M capital increase by Private Placement in May 2021 and by signing a new loan for a total amount of €140M in July 2021. At the same time, we are continuing to implement all the tools necessary to gather and gain the loyalty of our talented staff, like the capital increase reserved for Group employees carried out this year. Value creation also goes hand-in-hand with changes to our governance, establishing a Board of Directors and separating the duties of the Chairman of the Board of Directors and the CEO.

n the loyalty of our talented staff, like the capital increase reserved for Group employees carried out this year. Value creation also goes hand-in-hand with changes to our governance, establishing a Board of Directors and separating the duties of the Chairman of the Board of Directors and the CEO. Frank Sagnier has thus been appointed Chairman of the Board of Directors and I myself have been appointed as CEO. In compliance with the Middlenext Code, three independent directors have been appointed to the Board of Directors: Frank Sagnier, Virginie Calmels and Irit Hillel. These structural changes were concluded with a new name for our Group, now called FOCUS ENTERTAINMENT. It aims to offer players across the world unique experiences with a publishing line that stands out thanks to its innovative concepts, alternative game plays and original worlds that go beyond the boundaries of video games. eau CEO df FOCUS ENT Christophe Nobileau, CEO of FOCUS ENTERTAINMENT

FOCUS ENTERTAINMENT IS A EUROPEAN LEADER IN VIDEO GAME DEVELOPMENT AND PUBLISHING Our objective is to offer unique experiences to players throughout the world. Our editorial line stands out due to innovative concepts that transcend beyond the bounds of video games. With 20 years of know-how, we bring together talented individuals and game creators, to whom we offer top-level services, provided by publishing experts. We support innovative projects without compromising on quality, with investments ranging from participation in financing new games through the partial or complete integration of a studio. Our developer partners become part of a strong Group that develops successful franchises such as A Plague Tale and SnowRunner and that is able to give their game a worldwide reach. Initially created as a Farming Simulator Deck13 became Evolution of the governance distribution company, became the year’s first acquisition, IP structure by implementing FOCUSmoved into top-selling PC game in acquisition strategy, a Board of Directors and interactive software France with over 100K f inancial capacity of adopting the new name with the famous music copies sold. €46M for M&A and FOCUS ENTERTAINMENT. studio tool Ejay. game development.

Pages: 97
Words: 59,602
Format: PDF
Type: Financial

Topics

View this document on Game Industry Library.

Related Documents

Financial

Focus Entertainment Annual Financial Report & CSR Report 2022/23

Focus Entertainment achieved record-breaking financial results for the 2022/23 fiscal year, reporting a 36.2% increase in revenue to €194.1 million and a significant rise in net income to €7.3 million. This performance was driven by the commercial and critical success of major releases such as *A Plague Tale: Requiem*, *Atomic Heart*, and *Evil West*, alongside the steady performance of live-service titles. The Group’s strategic thesis centers on transitioning from a traditional publisher to a vertically integrated "federation of talent," marked by a 95% international sales mix and a goal to release 46 games over the next three years. To support this expansion, the Group nearly doubled its investment in game development to €65.1 million and aggressively expanded its internal studio capacity. Key structural milestones included the acquisition of majority stakes in BlackMill Games, Black Soup GmbH, and simulation specialist Dovetail Games, as well as the launch of Focus Production. These moves increased the Group’s net intangible assets to €118.3 million and expanded its workforce to nearly 400 employees. While net debt rose to €27.3 million to fund these acquisitions, the Group maintains a strong liquidity position with €72.2 million in cash and substantial undrawn credit lines. The period was also defined by a significant governance reorganization. Following the transition to a Board of Directors structure and the subsequent resignation of CEO Sean Brennan, Fabrice Larue assumed the consolidated role of Chairman and CEO. Alongside financial growth, the Group formalized its Corporate Social Responsibility (CSR) framework, focusing on player safety, environmental impact—highlighted by a 54.4% shift to renewable electricity—and employee engagement. Despite challenges such as talent retention and a declining gender equality index, the Group remains focused on diversifying its portfolio through owned intellectual property and "Games as a Service" (GaaS) projects to ensure long-term stability.

market-analysis investment france

Focus EntertainmentMar 2023

Financial

Annual Financial Report & Corporate Social Responsibility Report 2020/21

Focus Home Interactive achieved record-breaking financial results for the 2020/21 fiscal year ending March 31, 2021, characterized by a 20% increase in consolidated revenue to €171 million and a 29% rise in operating profit to €24.8 million. This performance was primarily driven by the commercial success of the million-selling title SnowRunner and a 63% surge in back-catalogue sales from established franchises like World War Z and Farming Simulator. A critical driver of this growth was the continued shift toward digital distribution, which accounted for 89% of total revenue. The period represented a transformative strategic pivot from a pure publishing model toward internal development and "AA" title production. This transition was marked by the acquisitions of Deck13 Interactive and Streum On Studio, alongside a significant overhaul of the Group’s governance and ownership. Neology Holding emerged as the primary shareholder, and the company restructured its Management and Supervisory Boards to enhance oversight and achieve gender parity. To fund future external growth, the Group successfully executed a €70.35 million capital increase post-closing, significantly strengthening its liquidity position. From a corporate responsibility perspective, the Group launched its inaugural CSR strategy focused on player safety, environmental commitment, and responsible employment. While the company reported a solid gender equality index of 84/100 and transitioned to 100% renewable electricity, it faced a €2.9 million European Commission fine related to historical geo-blocking restrictions. Despite pandemic-related risks and a competitive market for talent, the Group maintained a robust balance sheet with €68.5 million in equity and a net cash position of €7 million, opting to retain all annual profits to fuel its ambitious expansion pipeline.

investment mergers-acquisitions france

Focus Home InteractiveJan 2021

Financial

Focus Home Interactive Annual Financial Report 2019/20

Focus Home Interactive achieved record financial performance during the 2019/20 fiscal year, characterized by a 13% increase in consolidated revenue to €142.8 million and a 63% rise in net income to €13 million. This growth was underpinned by the commercial success of key titles such as World War Z, which sold over two million copies, and million-selling releases including A Plague Tale: Innocence, Greedfall, and SnowRunner. A robust back catalogue further stabilized the business, accounting for 40% of total sales. Geographically, the Americas emerged as a primary growth driver, while the revenue mix shifted decisively toward digital distribution, which rose from 66% to 82% of total turnover. The Group utilized this period of profitability to accelerate its "Enhance-Evolve-Explore" (EEE) long-term strategy. To secure greater control over intellectual property and development capacity, the company completed the €7.1 million acquisition of Deck13 Interactive and renewed strategic partnerships with Saber Interactive and DONTNOD. Financial flexibility was significantly enhanced through the procurement of €46 million in new credit facilities, intended to fund future acquisitions and IP development. Consequently, advances to development studios rose to €48 million, with future commitments to partners doubling to €78.4 million. Despite the challenges posed by the COVID-19 pandemic, the Group maintained a solid financial structure with a net cash position of approximately €19.6 million and consolidated equity of €54.7 million. Operational risks were managed through digital sales strategies that mitigated physical retail disruptions and currency hedging to address the fact that 61% of sales are denominated in US dollars. While the Group faces an ongoing European Commission antitrust investigation regarding Steam distribution, the overall fiscal health remains strong, supported by an unqualified opinion from statutory auditors and a successful transition to remote work.

game-publishing investment market-analysis+1

Focus Home InteractiveOct 2020

Financial

Rapport Financier Semestriel 2021-22

Focus Home Interactive experienced a transformative first half of the 2021-22 fiscal year, characterized by a strategic shift toward internalizing development capabilities and strengthening its financial foundation. While revenue declined 18% year-over-year to €85.1 million and net income fell to €5.5 million, these figures reflect a transitional period impacted by pandemic-related production delays and the underperformance of specific titles like Hood: Outlaws & Legends. Despite these headwinds, the back-catalog remained resilient, driven by the sustained success of SnowRunner and Insurgency: Sandstorm, with digital sales accounting for 88% of total revenue and the Americas serving as the primary market at 49%. The period was defined by an aggressive external growth strategy and a significant expansion of the corporate balance sheet. The acquisitions of Streum On Studio, Douze-Dixièmes, and a 77.5% stake in Dotemu for €53.5 million substantially increased the Group’s headcount and net goodwill. To fund this expansion, the company completed a €70.35 million capital increase and secured a €140 million financing package. These actions resulted in a robust cash position of €82.5 million and total assets growing to €264.6 million, providing the liquidity necessary to support a doubling of financial commitments to studios and rights holders. Operational highlights included the renewal of a long-term partnership with Saber Interactive for five upcoming titles and the global reveal of Warhammer 40,000: Space Marine 2. The Group also demonstrated progress in corporate governance, doubling its ESG rating and resolving a legacy European Commission investigation. With €61.5 million currently invested in games under development, the company maintains its full-year revenue guidance of €120 million to €150 million, signaling confidence in its long-term pivot toward a more integrated developer-publisher model.

investment mergers-acquisitions france

Focus Home InteractiveJan 2022