Financial

Annual Report and Consolidated Financial Statements for the Year Ended 31 December 2020

1 April 202165 pages28,360 words

Summary

The fiscal year 2020 marked a transformative period for tinyBuild as it transitioned from a private entity to a public company listed on the London AIM. This shift was underpinned by a record financial performance, characterized by a 35% increase in revenue to $37.6 million and a 99% surge in adjusted EBITDA to $15.3 million. This growth was primarily driven by a strategic pivot toward an "own-IP" model, which accounted for 70% of sales. The company’s back catalogue proved exceptionally resilient, contributing 75% of total revenue, while the expansion of the Hello Neighbor franchise into a multimedia property served as a successful template for long-term brand scaling. Operationally, the company leverages a high-efficiency development and marketing strategy. By utilizing low-cost development hubs in Eastern Europe and South America and maintaining deep partnerships with over 10,000 influencers, the firm achieved over 5 billion YouTube views while keeping marketing spend below 7% of revenue. The 2021 IPO further strengthened the balance sheet, raising $50 million to fund an aggressive "acquihire" strategy. This resulted in the integration of several development teams and the acquisition of multiple intellectual properties to populate a robust pipeline of 21 upcoming titles. Despite this momentum, the business faces specific risks, including a high dependency on its top five titles for 70% of revenue and a reliance on seven major third-party distribution platforms. However, the company ended 2020 debt-free with a strong net cash position of $26.3 million and a return to net profitability. Governance has been formalized through the adoption of the QCA Code and the establishment of dedicated committees to oversee internal controls and cybersecurity. Moving forward, the focus remains on scaling franchises and acquiring high-performing developers to sustain shareholder value within the global video game market.

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Financial

Annual Report and Consolidated Financial Statements for the Year Ended 31 December 2021

The 2021 fiscal year marked a transformative period for tinyBuild as it successfully transitioned to a public company via a March IPO on the London Stock Exchange’s AIM market. This strategic shift facilitated record financial performance, with consolidated revenue rising 39% to $52.2 million and Adjusted EBITDA growing 46% to $22.2 million. These results were underpinned by an aggressive expansion of the company’s own-IP portfolio, which increased to 81% of total revenue, and a robust back-catalogue that contributed 83% of sales. The company’s "multi-game and franchise" model was further validated by the continued success of the *Hello Neighbor* franchise, which surpassed 70 million downloads and expanded into a multimedia brand. Operational growth was largely driven by a significant M&A program, including seven acquisitions such as Versus Evil and Red Cerberus. These transactions, totaling millions in investment, bolstered publishing, QA, and development capabilities while diversifying the global footprint into high-skill, low-cost regions. Despite these gains, the company faced substantial geopolitical headwinds due to the conflict in Ukraine. Management responded with a large-scale extraction operation to relocate staff to new hubs in the Balkans and Western Europe. While the affected regions account for less than 5% of annual revenues, the company remains focused on mitigating regional instability and reducing revenue concentration among its top titles and platform partners. The company concluded the year in a strong liquidity position, reporting $48.8 million in cash and total assets expanding to $122.4 million. Following the IPO, tinyBuild established formal corporate governance structures and performance-based remuneration policies to align leadership with shareholder interests. With a pipeline of over 30 titles and a data-centric marketing strategy leveraging thousands of influencers, the group is positioned as a multimedia powerhouse. The transition to a public entity has provided the capital necessary to continue its trajectory of organic investment and strategic acquisitions within the global indie gaming market.

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Annual Report and Consolidated Financial Statements for the Year Ended 31 December 2020

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