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Annual Report of 11 bit studios S.A. for 2014

12 June 201567 pages21,269 words

Summary

The 2014 fiscal year marked a transformative period for 11 bit studios S.A., characterized by record-breaking financial performance and a strategic expansion of its business model. The primary driver of this growth was the global success of the title This War of Mine, which recouped its production costs within two days of its November debut and propelled the company to its fourth consecutive year of profitability. Annual revenue surged by 210% to 17.68 million PLN, while net profit experienced a nearly tenfold increase to 9.24 million PLN. This performance resulted in a net return on equity of 119% and a significantly strengthened balance sheet, with total assets rising to 21.52 million PLN and short-term investments doubling to 7.6 million PLN. The company’s operations are heavily international, with foreign sales accounting for approximately 96% of total revenue. This global footprint introduces significant exposure to currency fluctuations, particularly as 80-90% of income is generated in USD. Beyond internal game development, the company diversified its revenue streams by launching the "11 bit launchpad" publishing initiative and the "Games Republic" digital distribution platform. While these new ventures face intense competition from crowdfunding and self-publishing trends, they represent a shift toward a multi-faceted gaming ecosystem. To support long-term growth, the company implemented a three-year incentive program for employees tied to consolidated revenue and income targets. Audited by Deloitte Polska, the financial statements confirm a robust cash position that eliminates the need for external financing in the immediate future. Strategic focus has shifted toward the mobile adaptation of flagship titles and the development of the upcoming project Industrial, which was rescheduled to 2016 to prioritize product quality. Despite the abandonment of two minor projects and the inherent risks of rising development budgets, the company maintained high standards of corporate governance and transparency on the NewConnect market, signaling a mature phase of corporate evolution following its initial debut period.

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