Financial11 bit studios
Quarterly Report of 11 Bit Studios S.A. for Nine Months Ended September 30th 2020
1 Nov 202054 pages~96 min full read
11 bit studios S.A. reported record financial results for the first nine months of 2020, with revenue increasing 37.89% year-on-year to PLN 68.16 million and net profit surging 277.49% to PLN 32.12 million.
Operating margins reached 51.5%, driven by a 12% reduction in operating expenses following the end of a previous employee incentive scheme and the application of a 5% preferential corporate tax rate via IP Box relief.
The Frostpunk portfolio, supported by expansions like The Last Autumn and On The Edge, remained the primary revenue driver, while Children of Morta and Moonlighter contributed approximately 28% to 30% of total revenue.
The company maintains a strong liquidity position with PLN 116 million in total financial assets, including over PLN 80 million in cash and cash equivalents.
Management is shifting to a faster release cadence, targeting one internal title every 12 to 18 months and one publishing project per quarter.
Development resources are currently focused on three internal projects—including the high-budget Project 8 on Unreal Engine 5—and four external publishing titles representing a PLN 25 million investment.
Despite pandemic-related recruitment challenges, the workforce grew to 156 employees, with investments in intangible assets rising to PLN 32.69 million.
11 bit studios S.A. achieved record-breaking financial performance during the first nine months of 2020, characterized by a 37.89% year-on-year revenue increase to PLN 68.16 million and a net profit surge of 277.49% to PLN 32.12 million. This growth was primarily driven by the successful monetization of the Frostpunk portfolio, including the release of major expansions such as The Last Autumn and On The Edge, alongside strong contributions from the publishing division. Titles like Children of Morta and Moonlighter accounted for approximately 28% to 30% of total revenue, bolstered by new distribution channels such as Xbox Game Pass.
The company significantly strengthened its liquidity position, ending the period with PLN 116 million in total financial assets and over PLN 80 million in cash and cash equivalents. Operating margins improved to 51.5%, aided by a 12% decrease in operating expenses following the conclusion of a costly 2017–2019 employee incentive scheme and the utilization of the IP Box tax relief, which applied a preferential 5% corporate income tax rate to qualifying intellectual property revenue. Despite pandemic-related recruitment challenges, the workforce grew to 156 employees as the company increased investments in intangible assets to PLN 32.69 million.
Strategically, the company is transitioning toward a more frequent release cycle, aiming for one internal title every 12 to 18 months and one publishing project per quarter. Current development is focused on three internal projects, including the high-budget Project 8, which has transitioned to Unreal Engine 5, and projects codenamed Dolly and Eleanor. The publishing pipeline has expanded to four external titles with a total investment of PLN 25 million. While the company benefited from increased gaming demand during the COVID-19 pandemic, management remains cautious regarding potential long-term macroeconomic headwinds that could impact the premium games market.
