Neowiz Holdings Corporation · KRX:042420
Neowiz — Investor Presentation (April 2005)
39 slides from Neowiz's investor presentation, April 2005
Slide 1: A Presentation for Prospective Investors & Partners
A Presentation for Prospective Investors & Partners www.neowiz.com Apr 2005 Company Logo Copyright © by ARTCOM PT All rights reserved.
Slide 2: Contents
CONTENTS I. Overview II. Financial Highlights III. Services & Products IV. 2005 Business Outlook Copyright © by Neowiz All rights 2 www.neowiz.com reserved.
Slide 3: I. Overview
I. Overview Neowiz at a glance Company History Shareholder Structuring Management Brief Financial Statement Copyright © by Neowiz All rights 3 www.neowiz.com reserved.
Slide 4: Neowiz at a Glance
Neowiz at a Glance Top online game service provider Operator of the largest online chatting site in Korea Online Games Internet Contents Online Music • Attracting 6 million active users Web Board • Market Share Expanding (30% +) MMORPG • Diversifying Game Portfolio Games Online Arcade Casual Games
Slide 5: Company History
Company History Consistent Business Reorientation Global Game Publishing Online + Modem Web Key word Search Business Value ISP Games Games Avatars 1997 ~ 2000 2001 ~ 2003 2004 ~ Present 1997: Founded by 2001: Acquired M-Cube Corp 2004: MMORPG ‘Yogruting’ beta service launched S Nah & B Chang 2002:
Slide 6: Shareholder Structuring
Shareholder Structuring 1ST Largest Shareholder: Sung-Kyung Na 2nd Largest Shareholder: Byung-Kyu Chang Shareholder # of Shares % Sung-Kyun Na 1,350,000 17.67% Byung-Kyu Chang 1,137,900 14.89% Sae-Yeon Choi 779,750 10.21% Foreign Institutions 963,107 12.60% Treasury Stocks 194,338 2.54% Others 3,2
Slide 7: Management
Management CEO Seong Kyun Na COO Kwan-Ho Choi Seoul National Univ (BA in Management) Seoul National Univ (MA in Mgmt) KAIST (MS in Management ) Chaeil Communication CTO Seong-Kyu Oh CFO Kwan-Yong Song KAIST (MS in Computer Science) Seoul National Univ (MA in Management) Hangul & Computer P
Slide 8: Brief Financial Statement
Brief Financial Statement Financial Statement Summary for 2004 Income Statement Balance Sheet Unit: KRW Unit: KRW In millions 2004 2003 2002 In millions 2004 2003 2002 Assets Sales 77,478 81,290 41,548 Total CA 68,851 85,787 77,721 Cost of sales 42,445 34,375 24,473 Property, plant 7,988 8,874 6,2
Slide 9: II. Financial Highlights
II. Financial Highlights Growth & Profitability Revenues & Profits Sales Breakdown Cost Structure Copyright © by Neowiz All rights 9 www.neowiz.com reserved.
Slide 10: Growth & Profitability
Growth & Profitability Maintain Min 20% Operating Margin over the Past Five Years, Except Y2004 Dramatic increase in Profitability in Y2003, due to adding new revenue resource Revenue Trend Operating Income Trend (KRW billion) (KRW billion) 90 30 81 77 25.1 60 20 42 31 30 10 8.7 7.3 6.8 Y2001 Y200
Slide 11: Quarterly Revenue & Profits
Quarterly Revenue & Profits Quarterly Revenue Trend Quarterly Operating Income Trend (KRW billion) 22.5 (KRW billion) 21.4 21.5 20.0 19.1 18.4 18.5 17.4 8.3 9.0 5.7 4.7 3.4 2.6 0.2 -1.2 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 Wbn 1Q03 2Q03 3Q03 4Q03 1Q04 2Q0
Slide 12: Cost Structure
Cost Structure High Operating Leverage: High Fixed Costs. (75% of its total expenses) Recently, Labor & Marketing Costs ↑: Preparing New Business (MMORPG etc) 4Q Costs ※ Payroll: KRW 7.8bn (mainly increase in staff, 4Q: 450) Commission: KRW 2.7bn Unit: KRW Mn Marketing: KRW 2.7bn (Hike in Game & J
Slide 13: Sales Breakdown
Sales Breakdown (KRW billion) Quarterly Sales Breakdown 24 22.5 22 21.4 21.4 20.0 19.1 20 18.4 18.5 17.4 18 16 14 12 10 8 Others 6 Advertising 4 Sayclub 2 Game 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 Wbn 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 Q-Q Y2004 Game 10.6 11.1 9.0 11.4 14.7 12.8 11.8 13.7
Slide 14: III. Services & Products
III. Services & Products Business Portfolios Game Portal Landscape Pmang.com Sayclub.com Jukeon.com Copyright © by Neowiz All rights 14 www.neowiz.com reserved.
Slide 15: Business Portfolios
Business Portfolios Game Portal with No. 1 Traffic Market Share in Korea. Revenues: Provides Web-Board Games for More Than 7 Million Pmang Adult Game Users Each Month. Game Currency Refill www.pmang.com Game Items Starting Game Publishing Business with 10+ Titles Monthly Subscription Fee Pro
Slide 16: Korean Game Portal Landscape
Korean Game Portal Landscape More than 11 Mill Korean Adults Visit Game Portals Every Month. More than 1.5 Mill People are Fee Paying Users for Web Board game (thousand) Daily Unique Visitors Trends 7000 6000 Pmang Netmarble 5000 Hangame 4000 3000 2000 Pmang: Most Popular Game Portal in 1000 Terms
Slide 17: Pmang.com: Web Board Games
Pmang.com: Web Board Games Web Board Sales Trend (KRW bn) 15 14.7 13.7 Revenue is generated by: 12.7 11.8 11.5 Game Avatars: Pay W 950W ~ W 6,500 to Buy 10 Game Avatars that Grant Varying Amounts of Virtual Cash that Can Be Used for Betting. 5 Monthly Subscription: Pay W12,000 Monthly Subscription
Slide 18: Pmang.com: Web Board Games
Pmang.com: Web Board Games Monthly UV & Paying Rate (%) 6 5.5% 5.1% 5.2% 6 Paying Monthly 4.9% 4.9% Rate Visitors 4.2% (RHS) The monthly average # of fee pay (LHS) (%) 4 4 ing users 4Q04 is about 280,000, 5.7 5.9 5.1 5.8 5.3 up by 15% q-q, making a dramati 2 c growth. (Its users exceeded 30 2 0,00
Slide 19: Sayclub at a Glance
Sayclub at a Glance With its no. of concurrent users exceeding 480,000 every day, Sayclub is the most active chatting environment in the world. Users graphic representation (Avatar). Online Advertising 880,000+ active communities are present in SayClub. SayClub’s users c an enjoy listening to musi
Slide 20: SayClub: No1. Online Community
SayClub: No1. Online Community Web Chatting with over 10 million Online Community 450 million Mini Homepy service 400,000 Concurrent Users Unique Visitors Monthly Access 550,000 5,000,000 515,145 4,720,700 12,000,000 504,465 495,781 500,000 4,500,000 4,306,389 10,127,135 4,186,893 9,836,864 4,326,
Slide 21: Sayclub Avatars: the Concept
Sayclub Avatars: the Concept Users saw Avatars as a way to represent their virtual personality Avatar Bulletin Board Memo Internet Broadcasting Room Messenger Buddy List Introduction in Chat Rooms Copyright © by Neowiz All rights 21 www.neowiz.com reserved.
Slide 22: Global Avatar Licensing Partners
Global Avatar Licensing Partners Mattel: “Barbie” Character (Neowiz is the “Only” licensee of Mattel “Barbie Collectibles” in the world) NIKE, FILA: Sports apparels & celebrity Blizzard: Starcraft, Diablo II, War Craft III Game Characters Movie Characters: The Lord of the Rings Copyright ©
Slide 23: Jukeon at a Glance
Jukeon at a Glance With more than five million fee paying users per month, Neowiz opened new online music portal “Jukeon” on Aug 24 2004 Various issues, which are related to music industry, are posted Jukeon lets you q uickly find the mu sic that you want. Users representation Download our client:
Slide 24: IV. Business Outlook for year 2005
IV. Business Outlook for year 2005 Overall Outlook for year 2005 Pmang Yogurting Special Force Jukeon Internet: Search Engine Copyright © by Neowiz All rights 24 www.neowiz.com reserved.
Slide 25: Sales & OP margin & # of staff for 2005
Sales & OP margin & # of staff for 2005 Target Sales for 2005 (E): KIRW 111bn, 43%↑ Target OP margin (E): 14%, 5% P↑ OP Margin Total Sales 14% 31% 9% 110,900 550 81,290 77,485 450 300 2003 2004 2005 Copyright © by Neowiz All rights 25 www.neowiz.com reserved.
Slide 26: Sales & Sales Breakdown for 2005
Sales & Sales Breakdown for 2005 Target Sales for 2005: KRW 1,11bn, 43%↑ 110,949 9,078 81,289 77,485 10,560 1,552 1,000 4,737 2,950 4,095 20,279 20,373 32,903 Special Force Yogurting 53,017 67,082 Others 42,087 Ads Sayclub Pmang 2003 2004 2005 Unit: KRW mn Copyright © by Neowiz All rights 26 www.n
Slide 27: Cost Breakdown for 2005
Cost Breakdown for 2005 Target Cost for 2005: KRW 95bn, 35% ↑ Costs ※ Payroll: KRW 38.4bn (mainly increase in # of staff, 550) Commission: KRW 23.8bn Marketing: KRW 7.5bn Depreciation: KRW 8.3bn 95,000 17,050 70,199 56,190 14,323 10,587 38,400 Others 27,833 20,274 Payroll Commission 23,800 Marketi
Slide 28: Roadmap for 2005
Roadmap for 2005 • Global Game Publishing - Commercialize Yogurting in Japan - Commercialize in China, Taiwan + - Expand M/S in Korean MMOROG International - Special Force M/S Expansion - Launch New Game Titles Commercialization • Games Commercialize performance - Yogurting Commercialize in Kore
Slide 29: Core Business for 2005
Core Business for 2005 • Commercialize Yogurting in Japan • Enter into Asian market • Launch Community Service in Japan Online Community Oversea Business 2005 • Expand M/S in Web board market • Commercialize Yogurting • Commercialize SF Online Search • Launch New Game (eg. Phy-Fi) Games Engine • C
Slide 30: Online Game Business
Online Game Business Web Board Yogurting • Increase Traffic M/S • Start Open Beta in 1H • Improve Paying Rate • Commercialize in 2H • Provide Customer Oriented Service Focusing on new Expand Online Game emerging online Business ‘Casual’ Game Market Oversea Publishing • Yogurting Service in • Comme
Slide 31: 2005 Online Game Market Overview
2005 Online Game Market Overview Emergence of Casual Game Market MMORPG Game Market Casual Game Market Web Board Game Market 600 300 300 (KRW in Billion) (KRW in Billion) (KRW in Billion) 400 200 200 200 100 100 2003 2004 2005 2003 2004 2005 2003 2004 2005 “Yogurting” Neowiz Positioning Commercial
Slide 32: Web Board Game – Pmang
Web Board Game – Pmang Target Sales for 2005: KRW 68bn Strengthen Customer Service Strengthen Service Adopt New Mileage System Increase Customer Loyalties Launch Best Item Continuously Raise Paying Rate Introduce Reward System for Attracting New Customers Game Portfolio Diversification by New Game
Slide 33: Yogurting 2005 Roadmap
Yogurting 2005 Roadmap Target sales for 2H 2005: KRW 6.0bn • Commercialize in 3Q Commercialization • Runs Marketing Promotion • Target Concurrent Users: 50,000 Open Beta Service • Start Open Beta Service in May 2005 3rd Closed • Finish 3rd Closed Beta Service in Jan Beta Service 1st & 2nd Closed •
Slide 34: Global Game Publishing
Global Game Publishing Target Oversea Licensing fee for 2005: KRW 5.0bn Making Japan China Contract Worth $3.4 Million Plan to Make Additional Taiwan Licensing Contracts During Y2005 Yogruting Copyright © by Neowiz All rights 34 www.neowiz.com reserved.
Slide 35: Game Intro: Yogurting
Game Intro: Yogurting Introduction 1st Closed Beta 2nd Closed Beta 3rd Closed Beta Open Beta Commercialized June 2004 July 2004 Sept 2004 Dec 2004 May 2005 3Q 2005 N a m e : Yogurting Name concept from “Yogurt cities” that are the places with active culture-access. T y p e : MMOAAG NEW (Massively
Slide 36: Publishing – Special Force (SF)
Publishing – Special Force (SF) Target Sales for 2005: KRW 9.0bn 2nd Most Popular Game in Korean PC cafes Unit:: % Internet Café Game Traffic Ranking 20 16 Kart Rider 12 SF Lineage 8 Lineage II 4 MU 0 Mar May July Sep Nov Jan Significant Increase MU in Game Traffic, (2nd most popular game in Kor
Slide 37: Online Music Business
Online Music Business Gradually Increase Fee Paying Users Hike in Jukeon.com Recognition, following by TV Commercial Bugs Music UV Trend Unit: thousand 20000 16000 12000 Free Paying Users: 1,200 Mil 8000 4000 0 7 9 11 1 3 5 7 9 11 Potential Customers JukeOn Increase in JukeOn recognition Recordi
Slide 38: Jukeon.com
Jukeon.com Licensing Fee Arrangements Completed with Most Big Record Labels 2nd position for Commercialization Music Portal Monthly Re-Subscription Rate: 90% Jukeon’s Business Structure Song창작자 Writhers Planning 기획사 Agency Record음반사 Companies 도매상 소매상 Customers 소비자 창작자 기획사 음반사 Whole Sales 도매상 Retai
Slide 39: Q&A
Q&A www.neowiz.com/eng/ Jason Lee (Head of IR) [email protected] +82.2.6001.1605 Katie Park (IR) [email protected] +82.2.6001.1603 Copyright © by Neowiz All rights 39 www.neowiz.com reserved.