NEXON Q4 2017 Investor Presentation

Key insights

7 takeaways

01
Nexon achieved record-breaking 2017 annual results, driven by the sustained performance of core intellectual properties Dungeon&Fighter and MapleStory.See it on page 3
02
Q4 2017 revenue increased 22% year-over-year, though the company recorded a net loss due to impairment charges and foreign exchange losses on U.S. dollar-denominated assets.See it on page 11
03
The company remains heavily concentrated in Asia, with 83% of total revenue generated by the Korean and Chinese markets.See it on page 12
04
North American operations continue to struggle with profitability, consistently reporting losses despite top-line revenue growth.See it on page 11
05
Management projects continued revenue growth of 10% to 20% for the first quarter of 2018.See it on page 18
06
Strategic initiatives include a transition to an Audit & Supervisory Committee structure and a two-for-one stock split to improve shareholder liquidity.See it on page 21
07
The company maintains a global workforce of 5,768 employees and is prioritizing a new pipeline of PC and mobile titles to address operational inefficiencies.See it on page 30

Summary

Nexon achieved record-breaking annual financial results in 2017, underpinned by the sustained dominance of core intellectual properties such as Dungeon&Fighter and MapleStory. Although the company realized a 22% year-over-year revenue increase during the fourth quarter, it simultaneously recorded a net loss for the period. This bottom-line contraction resulted primarily from non-operating factors, including significant impairment charges and foreign exchange losses associated with U.S. dollar-denominated assets. Despite these fiscal headwinds, the company maintains a positive outlook, projecting continued revenue growth of 10% to 20% for the first quarter of 2018.

Geographically, the company remains heavily concentrated in Asia, with the Korean and Chinese markets generating 83% of total revenue. While the firm sustains a stable global workforce of 5,768 employees, performance remains uneven across regions. North American operations continue to struggle with profitability, consistently reporting losses despite top-line revenue growth. To address these challenges and improve operational efficiency, the company is prioritizing a robust pipeline of new PC and mobile titles while simultaneously increasing investments in headcount and marketing.

Strategic initiatives for the upcoming fiscal period focus on enhancing corporate governance and market accessibility. The transition to an Audit & Supervisory Committee structure aims to strengthen internal oversight, while a two-for-one stock split is intended to improve liquidity for shareholders. As the company navigates the volatility inherent in its international segments, the primary objective remains leveraging the enduring popularity of its flagship titles to offset rising operating costs and stabilize long-term profitability across its diverse global portfolio.