Okay, I think we are ready to start. Good afternoon, my name is Janusz Maruszewski. Welcome to our meeting with the CI Games Management Board. Today we'll be discussing the company's financial results for 2024. I am pleased to welcome to our meeting Mr. Marek Tymiński, CEO of CI Games. Good afternoon, Marek.
Hello, hi, how are you?
Katarzyna Sermanowicz-Giza, Financial Director. Good afternoon, Katarzyna. Hello.
Good afternoon, hello.
The meeting will be divided into two parts: a presentation and a Q&A session. I would like to invite you to participate and ask questions. That is all from my side. I give you the floor.
Thank you. Welcome everyone to the 2024 summary and results. We will also touch on what is really new, what has really happened recently. Starting with CI Games, obviously, we made it very clear last year as part of our strategy, it is players first, and we will, this is the key front and center for CI Games and that is going to stay. Just a brief overview of what has really been there in the last year and what has really happened recently. Our financial performance for 2024: net revenue of over PLN 80 million, EBITDA of around PLN 43 million, and net cash flow minus PLN 24 million. We fully integrated all our development studios into one CI Games that will deliver better efficiency across all the projects, making better games in the future. We got major funding from Epic Games. Epic is an exclusive PC publisher for Project 3.
That is the next installment in Lords of the Fallen franchise. We will be self-publishing that on consoles, PlayStation 5, Xbox, and hopefully more. We strategically repositioned and restructured our business with the players first at its center. Currently, our headcount is 175 people. We repaid our loans, including bonds, last year. We also got the new financing. Part of the new financing we signed last year, and a bigger part of that new financing was finalized in March 2025. What is very recent, and we are still looking into sales, and we will be looking into better promotions, we successfully launched Lords of the Fallen version 2.0, and we will talk a bit more about that.
The key takeaway from that is that the launch of Lords of the Fallen v2.0 and all the feedback from the community and the success and the amount of people who got back to playing that game and the amount of people who also bought that game in the last days is giving us a lot of promise into launching the next one as it restored gamers' confidence into our franchise and really strengthened the sentiment to that IP. On the financial side, Katarzyna will get you through key data for 2024.
Hello, once again. Yes, moving to financials. As you know, the year 2024 was the year without any new game release. Therefore, revenue in this year is on the lower level compared to 2023. The game Lords of the Fallen accounted for 61% of the group consolidated revenue, while Sniper Ghost Warrior Contracts 2 accounted for 20% of the group's revenue. The games from the portfolio of United Label generated around 6% of total sales. If we look on the margin, on the sales margin, we see that there is a decline from 54% to 27%, and the main reason behind it is amortization costs of the Lords of the Fallen. This cost is included in cost of goods sold. The game Lords of the Fallen has been amortized in 61%, and we have still 39% to be amortized in the next years. Selling costs significantly declined.
Of course, the reason is the fact that in 2023 we had significant costs related to marketing of the launch of the game. G&A costs declined by 18%, and the main reason is cost control, mainly savings in recruitment, legal, and other costs. The group generated operating loss at PLN 4 million in 2024, but if we look on the EBITDA, we see EBITDA on the level of PLN 43 million. The biggest impact, or actually the key impact on this difference is amortization of Lords. Also, you may see that EBITDA margin increased from 37% to 53%, and the main reason is decline in selling costs and G&A costs. Moving to the balance sheet, the structure of the balance sheet significantly changed in 2024 compared to the end of 2023.
The main reason behind it is the fact that in 2023 we had an abnormally high level of working capital, which is on the other hand normal if we take into account the fact of the release of the game in the last quarter of 2023. Non-current assets increased by PLN 20 million, and the main reason is current investment or current investment on ongoing projects. Current assets declined by PLN 54 million, and this is mainly the reduction in receivables and in cash. Share capital slightly increased, and this is the following of the issuance of Series J shares, which were allocated to key employees. In December 2024, we finalized a motivational program, which was allocated to key employees of the group.
Non-current liabilities increased by PLN 25 million, and the main reason is advances that we are receiving from Epic Games, which led to the next installment of Lords of the Fallen. Long-term liabilities were slightly offset in the reduction of different tax liabilities. Current liabilities dramatically, I would say, declined, and the main reason is, as we mentioned before, is repayment of two overdraft facilities over PLN 30 million, bonds which were repaid in July, almost PLN 27 million, and reduction in traditional liabilities, which were high following a game release at the end of 2023. Moving to summary of the cash flow. In 2024, operating cash flow was almost PLN 90 million, and this is primarily driven by conversion of trade receivables into cash, and it was offset by repayment of trade liabilities coming from the fourth quarter of 2023, including marketing campaign.
Net cash loan from investing activities, PLN 78 million. This is mainly a reflection of our investment on the pending open projects. Net cash loan from financing, as we already mentioned, this is the reflection of the repayment of two bank facilities over PLN 30 million, bonds in July. It was equivalent of EUR 6 million with interest, and this is partially offset by a new bank facility of PLN 15 million. Just adding on the facilities to summarize, in March we extended this PLN 15 million into PLN 24.5 million, and we have additional three loans of total PLN 25.5 million, so our current debt capacity is PLN 50 million. That is all on the financial side.
Marek, please turn on the microphone. We don't hear you. No, we don't hear you. You can turn on the microphone in the window, webinar window, conference room window. You have it turned off. Now it's turned on. No, we don't hear you. Maybe please reconnect. We will wait for you. We have to wait a few moments for Marek, so he will reconnect because of some technical difficulties.
Do you hear me now ?
Yes, we can hear you. It's okay.
Okay, great. We had some.
You can continue.
Yeah, I said that we had a solid performance in 2024, considering we had no major release, and most of the sales were generated with Lords of the Fallen that, as we all know, had major issues at the launch in October 2023. Nonetheless, those issues, and those issues were technical performance issues, but we also identified several design gameplay issues that the game had, and beyond that, and a lot of that we have improved, updated in 50 patches, 50 updates since the launch of the game. The culmination of that was version 2.0. Nonetheless, this game sold, just want to remind, over 1 million copies in the first 10 days. That also included the physical units.
We have a stock of physical units across global retailers and our warehouses, less than 100,000 units, so it's not a significant stock, and we see really good sales, especially recently when we launched v2.0. We sold over a million copies in 10 days. What's really important here, as we absolutely had it, as we absolutely stated that many, many times before, we really managed to turn around the sentiment to the franchise with version 2.0. That was part of the version 2.0 that was extremely important, but also part of that came from those 50 updates we had since the launch of that game.
With version 2.0, we added certain important functionalities, but what was really the key here was the seamless co-op, share progression, and also a free friends pass so anybody can invite friends to play, and they can play for as long as they want. When they want to play on their own, then they have to buy the game. It is working really well for us all together, with us also standing very strongly with this players first approach and listening to the fans, listening to the communities, and improving upon what we hear. Help us to achieve that turnaround over the sentiment.
We sold, we will sell 200,000 units, almost all of that is already sold within the first 10 days from the launch of version 2.0, in comparison to 650,000 units that we sold since late October when we announced we just crossed 1 million until pretty much just ahead of version 2.0. It looks really, really well for us, 200,000 units versus 650,000 units in almost 18 months. However, we are staying really closely looking into the next promotions and basically watching the next promotions, watching the current sales, and we will be able to update investors in the next couple of months once we understand the situation better and how much of that turnaround of the franchise, turnaround of the sentiment, will impact trends in terms of the sales.
First day, first five days on Steam, we had over 1,000% more in units versus the promotion we had in January. The promotion in January was at the same discount, the same price, $120. We had huge increase of sales for Xbox and obviously PlayStation that has been always our key platform. Not recently, recently Steam started to be a bigger platform in terms of units, but so far it's still PlayStation, 500% more on PlayStation the first five days comparing to the first five days of the same promotion that started the 10th of April. Here is the best comparison, like one to one. A week after we started, we started the campaign, the promotion the 10th of April on PlayStation 5, and at the 17th of April, we launched version 2.0, and that's the final outcome. Right.
Project 3, this is the next game in Lords of the Fallen IP. This is the next one in the installment. We are not really able to tell you anything new. Obviously, one of the reasons to believe is that we really made it with the sentiment and the franchise has a very good reputation and has a lot of players behind it. We see that a lot of players are already asking for the next one, and we will be announcing the next one in the next couple of months. It is really soon. Once we do that, hopefully we will be able to share more information with investors. The launch of Project 3 is planned for 2026, and the game is basically on track to be delivered next year.
Just wanted to point out from that list here, a fact of being partner of Epic also helps us to really have more support from them, and I think that at the end of the day, this will help us to make even better games. It is a very, very good partner, and we're absolutely happy with that partnership so far. I think on the marketing side, that's another remark here important to say. We believe that the marketing campaign for the next one will benefit a lot from what we already achieved around that IP, and we'll make it much more efficient, and it will be at a much lighter budget than we had for 2023. Obviously, we are in development of Project Sniper Ghost Warrior Evolved. That is currently in pre-production with the partner studio. We are in pre-production of Project Age.
Major change here is that this is the next action RPG game under established IP. We do not want to say anything more right now, but we thought we had quite a lot of consideration and thinking on that project in the last several months, and we definitely made a decision that that is not the right time to start the new IP, and we want to absolutely lean towards something that is very established, but again, that is too early to say. We obviously want to take the benefit of what we have created, what we have developed for Lords we launched in 2023, and what we will have with Project 3. United Label, the last six-eight months, we signed three new titles, and those three titles will be launched in 2026 and 2027. When there will be more, we will inform.
United Label is fully owned by us, and we are taking that private. That was the last current report published yesterday. It is 100% ours, and we are taking that out of New Connect. Just before we go into questions, we have a couple of slides. I do not want to go through all of them. You know that, but I just want to make sure it is there. The presentation will be available on our website just after that call is over. Senior leadership team, here there is addition of Nathan Richardson, who joined the company very recently, and he is a Senior Development Director. Also, Steven Lux, we informed about Steven Lux in the investor chat back in January. Steven is the Head of Commercial coming from 2K Take-Two.
The usual split where we have our employees, and obviously, as of now, Spain is the largest, United Kingdom is the second, Poland is the third, and we also have a quite significant amount of people in France, Germany, Romania, Sweden, Italy, USA, and then a lot more countries. Let's get to the questions. We start seeing questions in the chat. Go from the first one, when will be the trailer for Lords, for the next Lords of the Fallen public? It's a good question. Do you hear me, Katarzyna?
Yes, we can hear you.
Okay. It's a good question, but we cannot really provide the answer to that. I just said earlier this game will be announced with a trailer, probably will be announced before that, but trailer, we're expecting that in the next couple of months. We're planning that to have in the next couple of months, so it's soon. How do you assess the impact of GTA 6? We definitely don't want to release Project 3 in the next Lords of the Fallen close to GTA 6 release date. I think this will be a very important milestone for the gaming industry as well. It can add, and it can bring people who haven't been playing recently back to video games. I think it will have a positive impact for the industry, but obviously, we don't want to have we want to release any major game close to release of 6.
There's a question about the cash flow. In general, the cash flow, we have cash flow secured, I mean, financing secured with the bank. We expect, obviously, a significant increase in revenues versus our internal projections based on the recent performance of Lords of the Fallen after we launched version 2.0. I am quite optimistic in terms of cash flow for this and next year until we release the next Lords of the Fallen. The question is whether that was more of a patches or price. I think everything together made the difference and helped us to get back to top 10 on PC, top 10 on PlayStation 5 in terms of charts digital. Also, we're doing very well on Amazon. I think it's all together, and players heard us, and they see us being really authentic behind the players first.
I mean, a good example of that is when we made a poll, whether people preferred body type A or B or male and female. People voted for male and female. That was, I think, 88% people voted for male and female. We changed that within Lords of the Fallen. We are absolutely real and we're credible, and people see that. I think those 50 updates and making this game better and better with every update and then releasing 2.0, everything came together. You can see we also turned around some influencers and some, yeah, some influencers, content creators who didn't like this game at the time of the launch, and now they are really behind that game, and they really like playing that game. It all came together. It's been hard work, but it's definitely paying off.
What is the idea behind the development of Lords of the Fallen IP? Obviously, we want to build that IP. We believe that this is an absolutely strategic IP from the standpoint of our company, and we believe that this IP has a great future, and we are more at the beginning of the journey in building that IP rather than towards the end of the journey. I think there's a lot more in front of us, and there's more than we went through in front of us with that IP once it's established and proven as it is now. I think we can scale up that IP, and at some point, I believe that this IP can also go beyond just video games. It will take time, and we don't want to tease anything.
It's not going to happen in the next year or two, but we are absolutely strategic and absolutely committed to building that IP and building next games. We have a great team, very competent, very professional, very good team behind that next game. We are very confident, very confident that we will have a great product next year, and we will grow that IP further with the next game. I mean, this is not long until that will be out in the market next year. Katarzyna, the question to you, what is the reason for correction of revenue for 2023, reducing it by PLN 8.6 million?
The reason was related to physical size in states. When we did a half-year review in 2024, we concluded that we were not conservative in March in 2023. This is the main reason for that. It is additional price protection provision, which should be created. They were created, but not on the sufficient level during the release of the game.
Thank you, Katarzyna.
Maybe one comment on debt, because someone asked about debt. I just want to explain that we had a limit overdraft facility. It means any cash in coming in EUR repays our debt, and it gives us good flexibility that we can go down with that and go up if we need.
Thank you. I'm just asking, there was a question about the rewards for the team seeing incredible success for Lords of the Fallen. I mean, I think the team is really encouraged by the success, and really, like you can imagine, it's quite simple, right? I mean, they haven't really got what they expected in terms of got from the communities, what they expected, what they hoped for when we launched Lords of the Fallen in October 2023, and now they got it. I think there's a lot of excitement among the team, and that is very encouraging for everyone to work even harder. Yes, we have a bonus structure. We're very, very good in terms of our HR systems and benefits that we are providing to our talent. Yeah, I think it's great. At what state are the projects from CI and United Label?
I think everything is basically according to our schedule, according to our plans. Yeah, that's all. How big will Project 3 be in terms of hours of gameplay comparing to Lords of the Fallen? I think we cannot really provide details like that. It's just too early. We haven't provided anything really about Project 3, but it's going to be another big game, and it's going to be a single player and seamless co-op from day one. It's going to be a lot of, there's going to be a lot of fun out of that. It's going to be a big game. I think it's definitely growing the IP and making best games possible.
Obviously, as I said previously, Lords of the Fallen is our key strategic pillar, and we also have other projects, but Lords of the Fallen is the one that we hope to have the biggest chances to really scale up and grow the company and create better value for investors. How will the new Lords of the Fallen be? Are you using a lot of? We are using a lot of systems and experience learnings from Lords that we launched in 2023, right? We have all the architecture that we are using. We're using a lot, right? The difference is that with Lords 23, as we call that internally, we built that game from the scratch, almost from the scratch.
This time around, we're building Lords, I mean, Project 3, the next Lords of the Fallen, and we're building that with a big game as a base. It is very different. It helps to make this project more efficiently, and also it is more predictable, and we can focus more on making this game the best it can be. In terms of, you said the promotion of Lords, next Lords will be smaller than Lords that was released in October 2023, and we want to make this next game being bigger in terms of event than Lords of the Fallen in 2023.
Even we will be spending less on marketing, but we believe that you don't really have to spend that much as we spent in 2023 to really be very successful, and we see other games that have spent way less than we spent in 2023 and became way more successful than Lords of the Fallen. I mean, if we see opportunities to spend more, we will definitely do it. I mean, marketing usually is paid after the game is out, a big part of marketing. It's not really about the cash flow, and if it's a cash flow, it's not going to be a problem.
It's more about we don't want to burn money if it's not necessary, and I think communities communicate very efficiently these days, and if you have a great product, people will hear about that, especially when you have content creators talking about that and media and everything. I mean, marketing for video games today is the most efficient it was ever on one side when you have established IP, but it's also very difficult for non-established IP from the standpoint of discoverability. It could polarize, and I think we're in a great position with Lords of the Fallen, and recognition and the sentiment for that franchise will absolutely help us to make the next one more successful, subject to delivering, obviously, great game, but we won't make compromises. We will not make compromises. We will deliver a great game in a great technical state.
Are you beginning to enjoy the benefits of studio reorganization? Yes, I think definitely. Reorganization of studios and getting everything into one CI Games just helps us be more efficient, and we're closer to our projects, and I think some of the mistakes from the past could have been avoided. We were more autonomous in terms of studios, and now we are very integrated. I think it's great, and I think this will lead to really better games in the future. We are absolutely enjoying that. Just looking for one more. I think I answered most of them. Some of them are very similar. There is one more I think it's worth to answer whether the problem at launch was mainly technical or was also related to the price point. I think it wasn't really related to the price point. The price point was right.
Technically, the game had major issues, especially on PC, but also we could have made this game better from the design standpoint, and that's why I said before we improved a lot from the creative standpoint within the updates since the launch, and we also learned a lot, and it's a very different situation right now going for the next one. I think this is really answering most of the questions here. I'm just trying to look again, but I think all of the questions have been answered, pretty much all of them have been answered either now or through the presentation. I just wanted to thank you, everyone.
When we have more information from further sales and further progress on Lords of the Fallen in the next really few months, we will share that with investors, and we may do another investor call that can be whether this could be Q2 or first half results, or it could also be completely independent when we will have something important to communicate. We will do that. I think there's really a lot going on, and the situation with Lords of the Fallen v2.0 is also new to us. It's just been a week, so we still have to gather more data and spend a bit more time to analyze everything before we can share more with the investors, but so far, so good. Thank you very much.
Okay, that's all for today. I would like to say goodbye to you.
Thank you for your presentation and for answering the questions. I wish you the best of luck as you continue to implement your new strategy announced last year and develop the studio. My and your guests were Marek Tymiński, CEO of CI Games. Thank you, Marek. Katarzyna Sermanowicz-Giza, Financial Director of CI Games. Thank you.
Thank you. Bye.
Thank you. That's all for today. Greetings and have a nice day. See you next time. Bye-bye.
Thank you very much.