2005.04.28 1Q 2005 Earning Release Company Logo Copyright by ARTCOM PT All rights reserved. .

2005.04.28

1Q 2005 Earning Release

Company LogoCopyright © by ARTCOM PT All rights reserved.

www.neowiz.com

http://www.art-com.co.kr/online/ppt_gallery_1.htm


2 www.neowiz.comCopyright © by Neowiz All rights reserved.

The financial results for Q1 2005 have been prepared on un-audited basis, and may be subject to change during independent auditing process.

Some of the information and data in this material have been prepared based on assumption. There can be no assurance that the assumptions used by Neowiz are correct and even if they are that the effect of such assumption on Neowiz’s business and results of operation will be as projected.

Therefore, Neowiz will not be responsible for individual investment decision based on solely on this material.




Content

I. 1Q 2005 Earning1. Summary2. Sales3. Costs4. Business Index

II. 2005 Business Outlook




1) Sales: KRW 20.4bn, 10%↑ Q-Q2) Operating Income: KRW 2.3bn 3) Recurring Income: KRW 0.6bn4) Net Income: KRW 0.2bn

1Q 05 4Q 04 1Q 04 Q-Q Y-Y

Sales 20,354 18,460 22,533 10.3%↑ 9.7%↓

CGS 10,115 10,927 10,623 7.4%↓ 4.8%↓

Gross Inc 10,238 7,532 11,910 36.0%↑ 14.0%↓

S&AE 7,906 8,721 6,234 9.3%↓ 26.8%↑

Operating Inc 2,332 -1,189 5,676 N/A 58.9%↓

Recurring Inc 611 -2,715 4,825 N/A 87.3%↓

Net Income 202 -1,684 3,234 N/A 93.8%↓

OP Margin 11.5% N/A 25.2% N/A 13.7%P↓

Unit: KRW mn

1Q Earning Summary

1Q Earning Summary1Q Earning Summary




Sales & Sales Breakdown

22,533

14,723

6,638

1,17218,459

13,680

3,890

889

Ads

Sayclub

Game

20,354

16,088

875

Unit: KRW mn

1Q Sales: KRW 20.4bn, 10% ↑ Q-Q1Q Sales: KRW 20.4bn, 10% ↑ Q-Q

1Q 04 4Q 04 1Q 05

Sales ※ Game: KRW 16.0bn Sayclub: KRW 3.4bn Ads: KRW 0.9bn

3,391




Cost Breakdown

Cost ※Payroll: KRW 7.8bn (# of staff in 1Q: 450) Commission: KRW 2.6bn Marketing: KRW 2.0bn Depreciation: KRW 1.4bn CAPEX: KRW 0.3bn

1Q 04 4Q 04

1,852

1,697

3,263

6,356

3,688

2,624

2,743

2,290

7,780

4,21216,856

19,649

1Q 05

1,443

2,034

2,638

7,810

4,096

18,021

OthersPayrollCommission

Marketing

Depreciation

1Q Total Cost : KRW 18.0bn, 8% ↓Q-Q 1Q Total Cost : KRW 18.0bn, 8% ↓Q-Q

Unit: KRW mn




Max

Avg

1Q 05 4Q 04 3Q 04 2Q 04 1Q 04 Q-Q

Unique Visitors 9,362,139 8,796,669 9,836,864 9,403,543 9,913,855 6.4%↑

Buying Users 557,588 534,600 554,004 556,176 683,173 4.3%↑

Paying Rate 6.0% 6.0% 5.6% 5.9% 6.9% -

ARPU (KRW) 11,635 10,934 9,897 10,700 10,300 756↑

Business Index - Whole936 million Unique Visitors & 56 million Buying Users936 million Unique Visitors & 56 million Buying Users

ARPU: KRW 11,635ARPU: KRW 11,635

288264 246

193233

504 496444

478

375

-

100

200

300

400

500

600

1Q04 2Q04 3Q04 4Q04 1Q 05

6.0%6.1%5.6%5.9%

6.9%

-

2,000

4,000

6,000

8,000

10,000

12,000

1Q04 2Q04 3Q04 4Q04 1Q05

Note: Unique visitor, buying unit and ARPU are used average figures on quarterly basis. Source: Koreanclick and Neowiz

Max & Avg. Concurrent Users

UV BU

UV & Paying Rate Unit: “000 Unit: “000




579 million Unique Visitors & 34 million Buying Users579 million Unique Visitors & 34 million Buying UsersARPU: 15,668ARPU: 15,668

1Q 05 4Q 04 3Q 04 2Q 04 1Q 04 Q-Q

Unique Visitors 5,789,813 5,314,272 5,765,548 5,130,269 5,937,086 8.9%↑

Buying Users 341,937 277,360 241,551 248,858 326,973 23.3%↑

Paying Rate 5.9% 5.2% 4.2% 4.9% 5.5% 0.7%P↑

ARPU (KRW) 15,668 16,380 16,380 16,660 15,000 1,598↓

239

154

191160164

100

150

200

250

300

1Q04 2Q04 3Q04 4Q04 1Q05

천 5.9%5.2%

4.2%4.9%

5.5%

-

1,500

3,000

4,500

6,000

7,500

1Q04 2Q04 3Q04 4Q04 1Q05

Business Index – Pmang Only

Note: Unique visitor, buying unit and ARPU are used average figures on quarterly basis. Source: Koreanclick and Neowiz.

Max Concurrent User Unit: “000

Unit: “000UV & Paying Rate




Attach: Sales & Cost Breakdown

1Q Sales Breakdown 1Q Sales Breakdown

1Q 05 4Q 04 1Q 04 Q-Q Y-Y

Sales 20,354 18,459 22,533 10.3%↑ 9.6%↓

Game 16,088 13,680 14,723 17.6%↑ 9.3%↑

Sayclub 3,391 3,890 6,638 12.8%↓ 48.9%↓

Ads 875 889 1,172 -1.5%↓ 25.3%↓

1Q Cost Breakdown1Q Cost Breakdown

1Q 05 4Q 04 1Q 04 Q-Q Y-Y

Payroll 7,810 7,780 6,356 0.3%↑ 22.9%↑

Commission 2,638 2,290 3,263 15.2%↑ 19.2%↓

Marketing 2,034 2,743 1,697 25.8%↓ 19.9%↑

Depreciation 1,442 2,624 1,852 45.0%↓ 22.1%↓

Total 18,021 19,649 16,856 8.3%↓ 6.9%↑

Unit: mn

Unit: mn




Year 2005 Business Outlook

Entering Entering Web-board Web-board to Stable to Stable

stagestage

Business Business ExtensionExtension

1

2

3

Expand Expand Online Game Online Game

BusinessBusiness

Online game publisher - Enlarge our game business area from mid size game (like SF and Psi-Fi) to MMORPG Game such as Yogurting and GG

4 Global Game Global Game PublisherPublisher

Maintain cash cow business - Poised to broaden our customer base

Various business acquisitions - Acquisitions of M-Cube, Ntix Soft and Thing Soft serve as stepping stone for our game business

Oversea licensing contract - Launch Yogurting service in Japan within Year 2005 - Plan to make additional oversea licensing contract




Neowiz Online Game Publishing Infrastructure

Dragon Fly NTIX Soft Thing Soft

Yogurting(3Q Y2005)Psi-Fi

(Y2006)

Project GG

(Y2007)

SpecialForce(Y2005)

Casual Game MMORPG

Online Game Publishing

Online Game Publishing- Reshuffle our target game market to mid-large size game market- Reshuffle our target game market to mid-large size game market (Needed LT development period and Investments) (Needed LT development period and Investments)- Ntix’s development capability + Partnership with core developers- Ntix’s development capability + Partnership with core developers- Secure future publishing game pipe line - Secure future publishing game pipe line




Special Force- Significant Increase in Internet Café Game Traffic (2- Significant Increase in Internet Café Game Traffic (2ndnd position) position)- More than 9 million concurrent users- More than 9 million concurrent users- Generate revenue by item sales, instead of monthly membership - Generate revenue by item sales, instead of monthly membership

Unit:: %

0

4

8

12

16

20

24

Apr July

Sep

Dec Apr

Feb

CartRider

SF

Mu

WOW

Internet Café Game Traffic Ranking

LineageLineage II




Yogurting- Start open beta service in May 10 2005 (domestic) - Start open beta service in May 10 2005 (domestic) - Plan to make additional oversea licensing contracts in 2Q 2005 - Plan to make additional oversea licensing contracts in 2Q 2005 - Launch Yogurting service in Japan within Year 2005- Launch Yogurting service in Japan within Year 2005

Open Beta

Commercialization• Commercialize in 3Q• Marketing promotion plan

• Start open beta in 2Q 2005• Launching marketing plan

• Completed 3rd closed beta in Jan• Finished 4th closed beta in Apr

• Successful closed beta service during Sept ~ Oct 2004

3rd Closed Beta Service

1st & 2nd ClosedBeta Service




Jason Lee (Head of IR)[email protected]+82.2.6001.1605

Katie [email protected]+82.2.6001.1603

Contact

www.neowiz.com/eng/

mailto:[email protected]





2005.04.28 1Q 2005 Earning Release Company Logo Copyright by ARTCOM PT All rights reserved. .

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Transcript of 2005.04.28 1Q 2005 Earning Release Company Logo Copyright by ARTCOM PT All rights reserved. .