Condensed Interim Consolidated Financial Statement of the CD PROJEKT Capital Group: H1 2019

Key insights

6 takeaways

01
CD PROJEKT Capital Group reported H1 2019 sales revenue of 214.4 million PLN, an increase from 168.4 million PLN in H1 2018 driven by digital distribution and Cyberpunk 2077 preorders.See it on page 42
02
Net profit for H1 2019 was 51.7 million PLN, a slight decrease from the 52.4 million PLN recorded in the same period of 2018.See it on page 7
03
Operating expenses rose to 155.4 million PLN, impacted by higher employee compensation, product costs, and a 15.2 million PLN charge related to the 2016–2019 incentive program.See it on page 62
04
As of June 30, 2019, the group held total assets of 1.14 billion PLN and total financial assets of 602.3 million PLN.See it on page 41
05
The company distributed 100.9 million PLN in dividends to shareholders during the period.See it on page 64
06
The group adopted IFRS 16 accounting standards, affecting fixed assets and financial liabilities, and established a new subsidiary, CD PROJEKT RED STORE sp. z o.o., to manage merchandising.See it on page 16

Summary

The CD PROJEKT Capital Group demonstrated robust financial growth during the first half of 2019, characterized by a significant rise in sales revenues to 214.4 million PLN, compared to 168.4 million PLN in the same period of 2018. This performance was largely driven by strong digital distribution results and the initiation of preorders for the highly anticipated title Cyberpunk 2077, which bolstered deferred revenues and cash assets. Despite this top-line expansion, the group recorded a net profit of 51.7 million PLN, representing a marginal decline from the 52.4 million PLN reported in the previous year.

This slight contraction in profitability is attributed to rising operating expenses, which climbed to 155.4 million PLN due to increased employee compensation and costs associated with products and services. Furthermore, the group recognized 15.2 million PLN in additional general and administrative costs following an update to projections for its 2016–2019 incentive program. The financial statements also reflect the adoption of IFRS 16, which necessitated adjustments to fixed assets and financial liabilities regarding building leases, alongside the establishment of a new subsidiary, CD PROJEKT RED STORE sp. z o.o., to manage merchandising operations.

As of June 30, 2019, the group maintained a solid financial foundation with total assets of approximately 1.14 billion PLN and total financial assets of 602.3 million PLN. The company continued its commitment to shareholder returns, distributing 100.9 million PLN in dividends. By consolidating its primary segments, including CD PROJEKT RED and GOG.com, the group remains positioned for long-term development, supported by a stable balance sheet and ongoing investment in its core gaming portfolio.