Condensed Interim Consolidated Financial Statement of the CD PROJEKT Group: H1 2023

Key insights

6 takeaways

01
CD PROJEKT Group reported H1 2023 net sales of 325.2 million PLN and a net profit of 91.3 million PLN, down from 377.9 million PLN and 113.7 million PLN respectively in H1 2022.See it on page 3
02
The company maintains a strong financial foundation with over 2 billion PLN in equity and more than 1 billion PLN in liquid financial assets.See it on page 26
03
Shareholders received 99.9 million PLN in dividends, while the company replaced its 2020–2025 incentive plan with two new programs covering 2023–2027.See it on page 49
04
Corporate restructuring efforts included merging with CD PROJEKT RED STORE sp. z o.o., initiating a merger with Spokko sp. z o.o., and increasing the ownership stake in The Molasses Flood LLC.See it on page 54
05
Profitability was impacted by lower digital sales and higher administrative expenses, partially offset by R&D tax relief and the reversal of development write-downs for the Sirius project.See it on page 30
06
To streamline future production, the company implemented a post-balance sheet workforce reduction at the CD PROJEKT RED studio.See it on page 60

Summary

The CD PROJEKT Group’s financial performance for the first half of 2023 reflects a period of operational transition and structural consolidation. During this six-month interval, the Group generated net sales of 325.2 million PLN and a net profit of 91.3 million PLN, representing a decline from the 377.9 million PLN in revenue and 113.7 million PLN in profit recorded during the same period in 2022. This contraction is primarily attributed to lower digital sales and increased administrative expenses, though the company maintains a robust equity position exceeding 2 billion PLN.

The Group’s financial strategy during this period focused on optimizing its corporate structure and long-term incentive frameworks. Key initiatives included the merger with CD PROJEKT RED STORE sp. z o.o., the initiation of a merger with Spokko sp. z o.o., and an increased ownership stake in The Molasses Flood LLC. Furthermore, the company replaced its 2020–2025 incentive plan with two new programs for 2023–2027, while distributing 99.9 million PLN in dividends to shareholders. Financial results were also influenced by the partial reversal of development write-downs for the Sirius project, the utilization of R&D tax relief, and a significant reduction in other provisions.

Operating across the global video game industry, the Group continues to adhere to International Financial Reporting Standards, maintaining a strong liquidity profile with over 1 billion PLN in financial assets. Despite the decline in year-over-year profitability, the company remains committed to its long-term development strategy, evidenced by ongoing investments in office infrastructure and the implementation of operational efficiencies, including a post-balance sheet workforce reduction at the CD PROJEKT RED studio to streamline future production cycles.