First Quarter Revenue Grew to $676.9 million, up 6.0% year-over-year and up
4.3% Sequentially
Average Daily Payer Conversion Increased to
3.2%
Casual Portfolio Revenue Grew 20.7%
year-over-year and is now 52.5% of Total Revenue
HERZLIYA, Israel, May 10, 2022
/PRNewswire/ -- Playtika Holding Corp. (NASDAQ: PLTK) today
released financial results for its first quarter for the period
ending March 31, 2022.
First Quarter 2022 Financial Highlights:
- First quarter revenue was $676.9
million compared to $638.9
million in the prior year period.
- Net income was $83.2 million
compared to $35.7 million in the
prior year period.
- Adjusted EBITDA, a non-GAAP financial measure defined below,
was $220.5 million compared to
$258.0 million in the prior year
period.
- Our cash and cash equivalents and short-term bank deposits
totaled $1,107.9 million as of
March 31, 2022 with $600 million in additional borrowing capacity
pursuant to our Revolving Credit Facility, resulting in over
$1.7 billion of available
liquidity.
"We delivered strong revenue growth as a result of our continual
efforts to improve and refine our monetization program and increase
retention of our players," said Robert
Antokol, Chief Executive Officer of Playtika. "The year
began with investment in our product roadmaps and new marketing
campaigns to secure our foundation for ongoing growth. I want to
thank our employees who have remained resilient through the war in
Ukraine. I am forever grateful for
their sacrifice and dedication to helping Playtika become a market
leader in mobile gaming entertainment."
"Our differentiated live-ops and direct-to-consumer platforms
provided strong sequential revenue growth in the first quarter
across both our casual and casino games portfolio, and we are
encouraged by strong operating metrics, with increases in average
daily payer conversion and ARPDAU," said Craig Abrahams, President and Chief Financial
Officer. "We continue to lay the groundwork for future growth by
making investments in the business to support new game development,
recent acquisitions, offline marketing campaigns, and investments
in our workforce. These investments in marketing are weighted more
heavily to the start of the year and will position the company well
for sustainable growth."
Highlights
- Casual portfolio grew revenue 20.7% year-over-year, comprising
52.5% of total revenue
- Average Daily Payer Conversion increased to 3.2%, up from 2.8%
in Q1'21
- Direct-to-Consumer channel grew 31.5% year-over-year and is now
22.5% of total revenue
- Solitaire Grand Harvest grew revenue 41.7% year-over-year
- Junes Journey grew revenue 30.4% year-over-year
- Caesars Casino grew revenue 8.2% year-over-year
New Game Developments
- Merge Stories launch planned for Q3'22
-
- Built by our Jelly Button studio, creators of Board Kings
- Two additional titles in development slated to soft launch for
testing in 2022
Financial Outlook
For the full year 2022 the company anticipates revenue of
$2.73 billion and Adjusted EBITDA of
$940 million.
Conference Call
Playtika management will host a conference call at 5:30 a.m. Pacific Time (8:30 a.m. Eastern Time) today to discuss the
company's results. The conference call can be accessed via the
conference numbers below and also via a webcast accessible at
investors.playtika.com. A replay of the call will be available
through the website one hour following the call and will be
archived for one year.
- Toll-free dial-in number: (833) 665-0587
- International dial-in number: (661) 407-1603
- Conference ID: 3398904
Summary Operating
Results of Playtika Holding Corp.
|
|
|
Three months ended March 31,
|
(in millions of dollars, except percentages, Average
DPUs, and ARPDAU)
|
2022
|
|
2021
|
Revenues
|
$
676.9
|
|
$
638.9
|
Total cost and expenses
|
$
556.5
|
|
$
508.6
|
Operating income
|
$
120.4
|
|
$
130.3
|
Net income
|
$
83.2
|
|
$
35.7
|
Adjusted EBITDA
|
$
220.5
|
|
$
258.0
|
Net income margin
|
12.3%
|
|
5.6%
|
Adjusted EBITDA margin
|
32.6%
|
|
40.4%
|
|
|
|
|
Non-financial performance
metrics
|
|
|
|
Average DAUs
|
10.1
|
|
10.4
|
Average DPUs (in thousands)
|
323
|
|
296
|
Average Daily Payer Conversion
|
3.2%
|
|
2.8%
|
ARPDAU
|
$
0.74
|
|
$
0.68
|
Average MAUs
|
31.7
|
|
31.4
|
About Playtika Holding Corp.
Playtika (NASDAQ: PLTK) is a mobile gaming entertainment
and technology market leader with a portfolio of multiple game
titles. Founded in 2010, Playtika was among the first to offer
free-to-play social games on social networks and, shortly after, on
mobile platforms. Headquartered in Herzliya, Israel, and guided by
a mission to entertain the world through infinite ways to
play, Playtika has offices worldwide and employs over 4,000
employees.
Forward Looking Information
In this press release, we make "forward-looking
statements" within the meaning of the U.S. Private Securities
Litigation Reform Act of 1995. Forward-looking statements can be
identified by the fact that they do not relate strictly to
historical or current facts. Further, statements that include words
such as "anticipate," "believe," "continue," "could," "estimate,"
"expect," "intend," "may," "might," "present," "preserve,"
"project," "pursue," "will," or "would," or the negative of these
words or other words or expressions of similar meaning may identify
forward-looking statements.
Important factors that could cause actual results to
differ materially from estimates or projections contained in the
forward-looking statements include without limitation:
- our reliance on third-party platforms, such as the iOS
App Store, Facebook, and Google Play
Store, to distribute our games and collect revenues, and the risk
that such platforms may adversely change their
policies;
- our reliance on a limited number of games to generate the
majority of our revenue;
- our reliance on a small percentage of total users to
generate a majority of our revenue;
- our free-to-play business model, and the value of virtual
items sold in our games, is highly dependent on how we manage the
game revenues and pricing models;
- our inability to complete acquisitions and integrate any
acquired businesses successfully could limit our growth or disrupt
our plans and operations;
- we may be unable to successfully develop new
games;
- our ability to compete in a highly competitive industry
with low barriers to entry;
- we have significant indebtedness and are subject to the
obligations and restrictive covenants under our debt
instruments;
- the impact of the COVID-19 pandemic on our business and
the economy as a whole;
- our controlled company status;
- legal or regulatory restrictions or proceedings could
adversely impact our business and limit the growth of our
operations;
- risks related to our international operations and
ownership, including our significant operations in Israel, Ukraine and Belarus and the fact that our controlling
stockholder is a Chinese-owned company;
- our reliance on key personnel;
- security breaches or other disruptions could compromise
our information or our players' information and expose us to
liability; and
- our inability to protect our intellectual property and
proprietary information could adversely impact our
business.
Additional factors that may cause future events and actual
results, financial or otherwise, to differ, potentially materially,
from those discussed in or implied by the forward-looking
statements include the risks and uncertainties discussed in our
filings with the Securities and Exchange Commission. Although we
believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee that the future
results, levels of activity, performance or events and
circumstances reflected in the forward-looking statements will be
achieved or occur, and reported results should not be considered as
an indication of future performance. Given these risks and
uncertainties, readers are cautioned not to place undue reliance on
such forward-looking statements.
Except as required by law, we undertake no obligation to
update any forward-looking statements for any reason to conform
these statements to actual results or to changes in our
expectations.
PLAYTIKA HOLDING CORP.
CONSOLIDATED
BALANCE SHEETS
(In millions,
except for per share data)
|
|
|
March 31,
|
|
December 31,
|
|
2022
|
|
2021
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
Current assets
|
|
|
|
Cash and cash equivalents
|
$
885.8
|
|
$
1,017.0
|
Short-term bank deposits
|
222.1
|
|
100.1
|
Restricted cash
|
2.0
|
|
2.0
|
Accounts receivable
|
139.7
|
|
143.7
|
Prepaid expenses and other current assets
|
97.2
|
|
72.9
|
Total current
assets
|
1,346.8
|
|
1,335.7
|
Property and equipment,
net
|
105.6
|
|
103.3
|
Operating lease
right-of-use assets
|
98.8
|
|
89.4
|
Intangible assets other
than goodwill, net
|
419.3
|
|
417.3
|
Goodwill
|
829.3
|
|
788.1
|
Deferred tax assets,
net
|
40.6
|
|
38.3
|
Investments in
unconsolidated entities
|
17.8
|
|
17.8
|
Other non-current
assets
|
30.7
|
|
13.4
|
Total
assets
|
$
2,888.9
|
|
$
2,803.3
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
|
|
|
|
Current liabilities
|
|
|
|
Current maturities of long-term debt
|
$
12.2
|
|
$
12.2
|
Accounts payable
|
41.9
|
|
45.7
|
Operating lease liabilities, current
|
20.0
|
|
17.2
|
Accrued expenses and other current liabilities
|
457.4
|
|
494.6
|
Total current
liabilities
|
531.5
|
|
569.7
|
Long-term
debt
|
2,420.3
|
|
2,422.9
|
Contingent
consideration
|
30.0
|
|
28.7
|
Employee related
benefits and other long-term liabilities
|
3.1
|
|
23.7
|
Operating lease
liabilities, long-term
|
87.9
|
|
82.3
|
Deferred tax
liabilities
|
56.1
|
|
53.7
|
Total
liabilities
|
3,128.9
|
|
3,181.0
|
Commitments and contingencies
|
|
|
|
Stockholders' equity (deficit)
|
|
|
|
Common stock of $0.01 par value; 1,600.0 shares authorized;
412.2 and 411.1 shares issued and
outstanding at
March 31, 2022 and December 31, 2021, respectively
|
4.1
|
|
4.1
|
Additional paid-in capital
|
1,072.0
|
|
1,032.9
|
Accumulated other comprehensive income
|
18.6
|
|
3.2
|
Accumulated deficit
|
(1,334.7)
|
|
(1,417.9)
|
Total stockholders'
deficit
|
(240.0)
|
|
(377.7)
|
Total liabilities and stockholders'
deficit
|
$
2,888.9
|
|
$
2,803.3
|
PLAYTIKA HOLDING CORP.
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME
(In millions, except
for per share data)
(Unaudited)
|
|
|
Three months ended March 31,
|
|
2022
|
|
2021
|
Revenues
|
$
676.9
|
|
$
638.9
|
Costs and expenses
|
|
|
|
Cost of revenue
|
186.9
|
|
183.0
|
Research and development
|
112.7
|
|
85.2
|
Sales and marketing
|
179.7
|
|
140.1
|
General and administrative
|
77.2
|
|
100.3
|
Total costs and
expenses
|
556.5
|
|
508.6
|
Income from operations
|
120.4
|
|
130.3
|
Interest expense and other, net
|
27.5
|
|
75.7
|
Income before income taxes
|
92.9
|
|
54.6
|
Provision for income taxes
|
9.7
|
|
18.9
|
Net income
|
83.2
|
|
35.7
|
Other comprehensive income
(loss)
|
|
|
|
Foreign currency translation
|
(3.3)
|
|
(9.9)
|
Change in fair value of derivatives
|
18.7
|
|
(0.1)
|
Total other comprehensive
income (loss)
|
15.4
|
|
(10.0)
|
Comprehensive income
|
$
98.6
|
|
$
25.7
|
|
|
|
|
Net income per share attributable to common
stockholders, basic
|
$
0.20
|
|
$
0.09
|
Net income per share attributable to common
stockholders, diluted
|
$
0.20
|
|
$
0.09
|
Weighted-average shares used in computing net income
per share attributable to
common stockholders,
basic
|
412.0
|
|
406.5
|
Weighted-average shares used in computing net income
per share attributable to
common stockholders,
diluted
|
412.5
|
|
409.5
|
PLAYTIKA HOLDING CORP.
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In
millions)
(Unaudited)
|
|
|
Three months ended March 31,
|
|
2022
|
|
2021
|
Cash flows from operating
activities
|
$
58.1
|
|
$
(56.4)
|
Cash flows from investing
activities
|
|
|
|
Purchase of property and equipment
|
(13.0)
|
|
(7.5)
|
Capitalization of internal use software costs
|
(13.5)
|
|
(13.3)
|
Purchase of intangible assets
|
(2.4)
|
|
(3.3)
|
Short-term bank deposits
|
(122.1)
|
|
(50.0)
|
Payments for business combination, net of cash
acquired
|
(29.3)
|
|
—
|
Other investing activities
|
—
|
|
2.2
|
Net
cash used in investing activities
|
(180.3)
|
|
(71.9)
|
Cash flows from financing
activities
|
|
|
|
Proceeds from bank borrowings, net
|
—
|
|
880.7
|
Repayments on bank borrowings
|
(4.8)
|
|
(951.0)
|
Proceeds from issuance of unsecured notes
|
—
|
|
176.9
|
Proceeds from issuance of common stock, net
|
—
|
|
470.4
|
Payment of tax withholdings on stock-based
payments
|
(1.4)
|
|
—
|
Net cash provided by (used in)
financing activities
|
(6.2)
|
|
577.0
|
Effect of exchange rate changes on cash and cash
equivalents
|
(2.8)
|
|
(5.9)
|
Net change in cash, cash equivalents and restricted
cash
|
(131.2)
|
|
442.8
|
Cash, cash equivalents and restricted cash at the
beginning of the period
|
1,019.0
|
|
523.6
|
Cash, cash equivalents and restricted cash at the end
of the period
|
$
887.8
|
|
$
966.4
|
Non-GAAP Financial Measures
Adjusted EBITDA is a non-GAAP financial measure and should
not be construed as an alternative to net income as an indicator of
operating performance, nor as an alternative to cash flow provided
by operating activities as a measure of liquidity, or any other
performance measure in each case as determined in accordance with
GAAP.
Below is a reconciliation of Adjusted EBITDA to net
income, the closest GAAP financial measure. We define Adjusted
EBITDA as net income before (i) interest expense, (ii) interest
income, (iii) provision for income taxes, (iv) depreciation and
amortization expense, (v) stock-based compensation, (vi) contingent
consideration, (vii) acquisition and related expenses, (viii)
expense under our long-term compensation plans, (ix) M&A
related retention payments, and (x) certain other items, including
impairments. We calculate Adjusted EBITDA Margin as Adjusted EBITDA
divided by revenues.
We supplementally present Adjusted EBITDA and Adjusted
EBITDA Margin because these are key operating measures used by our
management to assess our financial performance. Adjusted EBITDA
adjusts for items that we believe do not reflect the ongoing
operating performance of our business, such as certain noncash
items, unusual or infrequent items or items that change from period
to period without any material relevance to our operating
performance. Management believes Adjusted EBITDA and Adjusted
EBITDA Margin are useful to investors and analysts in highlighting
trends in our operating performance, while other measures can
differ significantly depending on long-term strategic decisions
regarding capital structure, the tax jurisdictions in which we
operate and capital investments. Management uses Adjusted EBITDA
and Adjusted EBITDA Margin to supplement GAAP measures of
performance in the evaluation of the effectiveness of our business
strategies, to make budgeting decisions, and to compare our
performance against other peer companies using similar measures. We
evaluate Adjusted EBITDA and Adjusted EBITDA Margin in conjunction
with our results according to GAAP because we believe they provide
investors and analysts a more complete understanding of factors and
trends affecting our business than GAAP measures alone.
Adjusted EBITDA and Adjusted EBITDA Margin as calculated
herein may not be comparable to similarly titled measures reported
by other companies within the industry and are not determined in
accordance with GAAP. Our presentation of Adjusted EBITDA and
Adjusted EBITDA Margin should not be construed as an inference that
our future results will be unaffected by unusual or unexpected
items.
RECONCILIATION OF
NET INCOME TO ADJUSTED EBITDA
(In
millions)
|
|
|
Three months ended March 31,
|
|
2022
|
|
2021
|
Net income
|
$
83.2
|
|
$
35.7
|
Provision for income taxes
|
9.7
|
|
18.9
|
Interest expense and other, net
|
27.5
|
|
75.7
|
Depreciation and amortization
|
39.5
|
|
33.2
|
EBITDA
|
159.9
|
|
163.5
|
Stock-based compensation(1)
|
39.8
|
|
24.3
|
Contingent consideration
|
(23.0)
|
|
—
|
Long-term cash compensation(2)
|
24.9
|
|
29.8
|
Acquisition and related expenses(3)
|
9.0
|
|
35.7
|
M&A related retention payments(4)
|
(1.9)
|
|
3.1
|
Other one-time items(5)
|
11.8
|
|
1.6
|
Adjusted EBITDA
|
$
220.5
|
|
$
258.0
|
Net income margin
|
12.3%
|
|
5.6%
|
Adjusted EBITDA margin
|
32.6%
|
|
40.4%
|
_________
|
|
|
(1)
|
Reflects, for the three
months ended March 31, 2022 and 2021, stock-based compensation
expense related to the issuance of equity awards to certain of our
employees.
|
(2)
|
Includes expenses
recognized for grants of annual cash awards to employees pursuant
to our Retention Plans, which awards are incremental to salary and
bonus payments, and which plans expire in 2024. For more
information, see notes to our consolidated financial
statements.
|
(3)
|
Amount for the three
months ended March 31, 2022 primarily relates to expenses
incurred by the Company in connection with the evaluation of
strategic alternatives for the Company. Amount for the three months
ended March 31, 2021 primarily relates to bonus expenses paid as a
result of the successful initial public offering of the Company's
stock in January 2021.
|
(4)
|
Includes retention
awards to key individuals associated with acquired companies as an
incentive to retain those individuals on a long-term basis. The
income amount for the three months ended March 31, 2022 primarily
relates to the reduction of contingent consideration payable to
employees of the Company that were also selling Shareholders of
Reworks. This portion of the contingent consideration is being
accounted for as an M&A retention payment to these employees,
with changes in the amounts recognized as compensation
expense.
|
(5)
|
Amount for the three
months ended March 31, 2022, consists of $8.8 million incurred by
the Company for severance and $3.0 million incurred by the Company
for relocation and support provided to employees due to the war in
Ukraine.
|
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SOURCE Playtika