ANNUAL FINANCIAL REPORT
CSR REPORT
2022/2023
CONTENTS
ANNUAL FINANCIAL REPORT AS OF 31 MARCH 2023
1. | INTRODUCTION | pages 3 to 7 |
2. | DECLARATION BY THE CHIEF EXECUTIVE OFFICER | page 8 |
3. | MANAGEMENT REPORT | pages 9 to 24 |
4. | REPORT ON CORPORATE GOVERNANCE | pages 25 to 34 |
5. | STATUTORY AUDITORS' REPORT ON THE | |
CONSOLIDATED FINANCIAL STATEMENTS AS OF 31 MARCH 2023 | pages 35 to 37 | |
6. | CONSOLIDATED FINANCIAL STATEMENTS AS OF 31 MARCH 2023 | pages 38 to 58 |
7. STATUTORY AUDITORS' REPORT ON THE PARENT COMPANY'S
ANNUAL FINANCIAL STATEMENTS AS OF 31 MARCH 2023 | pages 59 to 61 |
8. PARENT COMPANY'S FINANCIAL STATEMENTS AS OF 31 MARCH 2023 | pages 62 to 77 |
9. | STATUTORY AUDITORS' SPECIAL REPORT ON | |
RELATED-PARTY AGREEMENTS AS OF 31 MARCH 2023 | pages 78 to 80 | |
10. CORPORATE SOCIAL RESPONSIBILITY (CSR) REPORT | ||
MESSAGE FROM THE CEO | page 82 | |
INTEGRATING CSR INTO FOCUS ENTERTAINMENT'S ACTIVITIES | pages 83 to 85 | |
PILLAR 1: BE A PUBLISHER OF ENTERTAINING VIDEO GAMES | ||
THAT ARE SAFE AND RESPECTFUL OF OUR PLAYERS | pages 86 to 88 | |
PILLAR 2: BE AN ATTRACTIVE AND RESPONSIBLE EMPLOYER | pages 88 to 91 | |
PILLAR 3: BE A PUBLISHER THAT IS COMMITTED TO THE ENVIRONMENT AND | ||
SOCIETY | pages 91 to 94 | |
NOTE ON METHODOLOGY / ABOUT THIS REPORT | pages 95 to 96 |
INTRODUCTION 1
MESSAGE FROM THE CHAIRMAN & CEO
The 2022-2023 financial year was a historic one for FOCUS ENTERTAINMENT thanks to the excellent- quality games published over the course of the year. Indeed, we are very proud that the company took the fourth top spot in the 2023 Metacritic ranking of video game publishers, with an average rating of 80/100. That shows our commitment to offering players unique, high-quality experiences, and it is the result of our teams' excellent work.
The games released during the financial year also confirm the company's strategic AA and indie positioning, and were well received. Four games had a particularly strong performance: A Plague Tale: Requiem, Evil West, Teenage Mutant Ninja Turtles: Shredder's Revenge (illustrating the success of the Dotemu
acquisition), and Atomic Heart. Two other games also proved the company's ability to engage communities and offer additional content over time: SnowRunner, released in April 2020, and Insurgency: Sandstorm, released in December 2018.
I would like to give a special thanks and congratulations to all of FOCUS ENTERTAINMENT's teams for their collective efforts, their expertise, their passion, and their commitment.
We generated a historic level of revenue in the 2022-23 financial year, with €194.1 million, versus €142.6 million for FY 2021-22. FY 2022-23 revenue grew overall by +36.2% compared to FY 2021-22.
FOCUS ENTERTAINMENT Group also invested €65.1 million in the development of new games, compared to €35 million the previous year. As such, we are confident that we will be able to deliver our most ambitious line-up ever, with the goal of releasing 46 games over the next three years, with growing revenue coming from 24 co-owned or wholly owned games. In other words, for that pipeline of games, around 50% of revenue is expected to come from games for which we co-own or wholly own the IP. The 2023-24 financial year will be marked by the launch of Atlas Fallen, developed by our subsidiary studio Deck13, and Banishers: Ghost of New Eden, developed by Don't Nod and of which we co-own the IP.
In terms of strategy, we continue to move up the value chain via our two key business lines: development and publishing.
The Group now owns seven studios - including Dovetail, acquired in April 2023, which we warmly welcome into our federation of talent - and four publishing labels. We are also delighted to be joining forces, for the first time in our history, with three industry veterans - Olivier Blin, François Alaux, and Thomas Painçon - to create Carpool Studio. At the Group level, as at April 2023, we now have over 590 talented employees, of which around 65% belong to development teams, which positions us as a developer- publisher capable of offering original creations and excellent-quality games.
The video game industry, in spite of being the youngest in the creative entertainment sector, is now bigger than the music, film, and SVOD industries combined. It brings together over 3 billion players and fans worldwide. We are positioned in the PC and console gaming market, which generated $92 billion in 2022. Our gaming platforms receive some of the highest levels of engagement in PC gaming, particularly Steam, where 30 million players are logged on at any given moment. Meanwhile, the total number of installed consoles (Nintendo Switch, Xbox Series S/X, and PlayStation 5) is expected to grow by 24% this year to 213 million units. As such, we are confident that our positioning in the AA and indie PC and console gaming market - which we estimate is worth $26 billion - confirms that our expertise is in the right place at the right time to make us the leading player in our market.
Fabrice Larue, Chairman and CEO of FOCUS ENTERTAINMENT
FOCUS ENTERTAINMENT | 3 |
1 INTRODUCTION
FOCUS ENTERTAINMENT IS ONE OF THE EUROPEAN LEADERS OF VIDEO GAME DEVELOPMENT AND PUBLISHING.
Our goal is to offer unique experiences to players throughout the world.
Our editorial line stands out thanks to innovative concepts that transcend the bounds of video games. With 20 years of expertise, we bring together talented individuals and game creators, to whom we offer top-level services, delivered by publishing experts.
We support innovative projects without compromising on quality, with investments ranging from participation in financing new games to partial or complete integration of a studio. Our developer partners become part of a strong group of companies that has created successful franchises (A Plague Tale, SnowRunner, The Surge, and more) and that is able to give their game worldwide reach.
Initially created as a distribution company, Focus moves into interactive software with the famous music studio tool Ejay.
FOCUS becomes an international publisher with TrackMania, Sherlock Holmes, and Runaway.
Farming Simulator becomes the year's | Deck13 Interactive | Change in governance |
top-selling PC game in France with over | becomes first acquisition | structure with |
100 K copies sold. | of IP acquisition strategy, | establishment of a |
with financial capacity of | board of directors and | |
€46 M for M&A | adoption of the new name | |
and game development. | FOCUS ENTERTAINMENT. |
Private investment of | ||
€13.3 M from select | Private investment of | |
investors, largely | €70.4 M from select | |
oversubscribed with a 3.7% | investors, with a limited | Acquisition of Dovetail Games. |
discount on the face value. | discount of 0.89% and new | |
Creation of Carpool Studio. | ||
financing for €140 M. | ||
1995 | 2000 | 2009 | 2011 | 2015 | 2017 | 2020 | 2021 | 2022 | 2023 |
Creation of the | Acquisition of BlackMill. | ||
Deck13 Montreal studio, | |||
acquisitions of the studios | |||
FOCUS launches its first | Streum On Studio, | ||
Dotemu, | |||
console games. | |||
and Douze Dixièmes. | |||
Renewal of the | |||
partnership with | |||
IPO, €12.7 M raised | Saber Interactive. | ||
FOCUS obtains the rights | (including €8.5 M in share | ||
to distribute Sudden Strike | capital increase) - offering | ||
in France. First success | oversubscribed by 12.2-fold, | ||
as a video game distributor. | Euronext "Jury Prize" | ||
and BFM Business | New leading | Acquisition of | |
"Best IPO | shareholder | Leikir Studio. | |
of the year." | Neology Holding. |
AN OUTSTANDING EDITORIAL LINE
The FOCUS ENTERTAINMENT editorial line is distinguished by innovative concepts. We look for impactful artistic visions, new trends, new forms of gameplay, concepts and projects that are different from anything existing and which deserve to be shared with players around the world.
We look for studios that offer unique titles and pay special attention to quality.
INTEGRATED STUDIOS OR PARTNER DEVELOPER
While we receive hundreds of project proposals every year, our priority is to find partners who are creative, innovative, driven by their passion, and with whom we can build a long-term relationship based on transparency, trust, and a commitment to quality.
Publishing, financing, distribution, collaboration, porting, and more: the nature of a partnership between FOCUS ENTERTAINMENT and a development studio is founded on values and a shared vision. The greatest video games are the result of true collaboration.
TRANSFORM NICHE CONCEPTS INTO GLOBAL SUCCESSES
Our catalogue is "genre- and trend-agnostic".
We do not seek out particular types of games to fill our catalogue, but rather titles supported by a creative vision and talented developers. Each day, we demonstrate our capacity to transform niche concepts into global successes.
We do not let market trends dictate our editorial choices. Our standards are built on quality and originality.
4 | FOCUS ENTERTAINMENT |
INTRODUCTION 1
ENHANCE CONTENT QUALITY
• Greater production quality to offer top-tier quality for the AA segment.
• Solid content is essential and generates revenue through all distribution channels and available platforms
on the market.
A FEDERATION OF TALENT
FOCUS ENTERTAINMENT unites talent across the entire chain of creation, from the design to the development of a game, all the way to its worldwide sale.
We support our developer partners with their vision, we help finance projects, or we invest in studios by acquiring a stake. We aim to bring together talent and studios with a unique vision in a strong and ambitious group of companies in order to maximise value creation by securing our brands and getting the most out of them. We commit to unite and develop our talent within this shared vision. We create a virtuous circle in which passionate individuals create synergies that enable FOCUS ENTERTAINMENT to innovate, adapt, and anticipate shifts in the constantly evolving video game market.
With the seven acquisitions of studios carried out since June 2020, the Group has two main business lines: development and publishing.
STUDIOS | PUBLISHING |
AAINDIE
Since the acquisition of Dovetail in April 2023, the Group now has 590 employees, of which 402 work in development. That represents about 68% of the Group's workforce.
General & administrative | Sales & marketing |
67 | 121 |
Development
402
FOCUS ENTERTAINMENT | 5 |
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Focus Home Interactive SA published this content on 04 September 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 September 2023 15:05:05 UTC.