Remedy Entertainment Half-Year Review: 1.1.–30.6.2019

Key insights

6 takeaways

01
Remedy Entertainment’s revenue grew by 49.6% to 13.8 million euros in the first half of 2019, driven by a strategic shift toward a multi-project studio model.See it on page 1
02
While the company reported an operating profit of 1.46 million euros, the comparable EBIT was -1.45 million euros when excluding one-time royalty payments and capitalized development costs.See it on page 5
03
The company increased its workforce by 34.1% to 220 employees by June 2019 to support the development of 'Control,' 'CrossfireX,' and proprietary Northlight technology.See it on page 4
04
A new accounting policy allowing for the capitalization of product development costs was implemented to better reflect the long-term value of the studio's intellectual property.See it on page 10
05
As of mid-2019, ownership remained concentrated, with the ten largest shareholders—including Markus Mäki and Accendo Capital—holding 48.4% of the company's shares.See it on page 14
06
Operational focus during the period was primarily directed toward the August 2019 launch of 'Control' and the expansion of internal development capabilities.See it on page 4

Summary

Remedy Entertainment experienced a period of significant financial growth and operational expansion during the first half of 2019. Revenue surged by 49.6 percent to reach 13.8 million euros, marking a successful turnaround from the previous year’s performance. While the company reported a positive operating profit of 1.46 million euros, this figure was bolstered by a one-time royalty payment and a strategic shift in accounting policy that allowed for the capitalization of product development costs. When excluding these one-time effects and capitalization adjustments, the comparable EBIT stood at -1.45 million euros, reflecting the heavy investment phase required to support the company’s ambitious development pipeline.

The company’s primary focus during this period centered on preparing for the August 2019 launch of the title Control, alongside the ongoing development of CrossfireX and other proprietary projects. To sustain this increased production capacity and advance its proprietary Northlight technology, the organization expanded its workforce by 34.1 percent, reaching a total of 220 employees by the end of June 2019. This scaling effort underscores a commitment to internalizing development capabilities and strengthening the studio's long-term intellectual property portfolio.

Ownership remains concentrated among a core group of stakeholders, with the ten largest shareholders, including Markus Mäki and Accendo Capital, controlling 48.4 percent of the company’s shares as of mid-2019. By transitioning to a model that capitalizes development expenses for its own brands, the firm has positioned itself to better reflect the long-term value of its game assets. These financial and operational maneuvers provide a foundation for the company to transition from a service-oriented development model toward a more sustainable, multi-project studio structure.