CD Projekt S.A. (CDR) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. My name is Katarzyna Szwarc, I'm the President of the Supervisory Board and [indiscernible] by opening the General meeting at 10 a.m. today. Moving to the agenda we will start by adopting a resolution about election of President of the General Meeting, but before going into that I would like to [ ask -- tell ] the people about instructions, how you can exercise your right of vote using those devices, please.

Good morning, ladies and gentlemen. After having signed the list of attendance, you received a tablet. On all tablets, you have 2 buttons screened, and the status is online, meaning the tablet is ready and is awaiting the beginning of the vote. Those 2 buttons are your data and documents. Under the first button, every time when we are not voting, you can check how many shares you have, and how many votes and who do you -- who you represent. After entering the function, at the back, you have a return button, and you can return to the main screen. The second button is documents. And the documents, we have all the documents, which are also to be found on the website of the company concerning a given general meeting. The voting itself is as follows: After a vote is open, on the tablets, you will see the title of the vote and 3 buttons to make your decision. You press the proper button and on the next screen, you confirm, and the tablet then sends your vote to the system. After the end of the vote, you will see the results on the screen, on your tablets and they will be read out by the person who is in charge of the given vote. Thank you, and I wish you a good meeting.

Thank you very much. We will now elect the President of the General Meeting. This is going to be a secret ballot. I'm awaiting candidates.

I would like to propose the President of our Supervisory Board, Katarzyna Szwarc as a candidate.

I agree to be a candidate. Do we have other candidates? Since we do not have other candidates, I'm hereby opening the vote on selecting the President of the General Meeting, please vote now. This is a secret ballot. [Voting]

Thank you very much. 55,276,359 shares were participated. No one was against. This resolution was adopted about the election of the General Meeting Chairman. Resolution #2 is about the approval of the General Meeting Agenda. We have convened this assembly on the 16th of May 2024. And at the same time, we publish on the website, the announcement of this General Meeting. And -- today we have present [ or represented ] [indiscernible] votes and this is 55% of the capital -- share of capital. And I have here the list of attendance. I'm going to sign it and you can consult this list of attendance. If you have such a need, the company can make it available to you. While proposal is the following, let us proceed as follows: We will vote the resolutions according to the draft that was published in the report [ 9 -- '24 ] -- of the 16th of May '24. And if you would like to modify the content of the resolution, we will proceed to modify it. Now considering that the General Meeting has been convened in a valid manner, is empowered to undertake resolutions. We start with the agenda. The first is about approving of the General Meeting agenda. This is an open ballot. Please vote now. [Voting]

Thank you very much. 55,276,359 votes were cast, all were in favor, none against, none abstained, the resolution adopted. Now, we are going to go through the financial statement and the consolidated financial statement of CD Projekt for the year 2023 and Piotr will give us a recap of what happened in 2023.

Good morning. To sum up, last year, of course, we had one major event, and this was the premiere of the extension Phantom Liberty that took place at the end of September. This made it possible for us to also publish slightly later in December, the Ultimate Edition so a version of Cyberpunk with the basic elements of the game and the extension. The extension itself was well received by the players and by the media. We have also reached record results in terms of satisfaction of the players from the basic game. According to Steam, the extension premiere allows us to increase revenue from Cyberpunk products. So the basic game and the extension. And since 2020, the premier of the game, this allowed us to have PLN 3 billion in revenue. In total, the revenues of company for 2023 were PLN 1.230 billion. At the same time we have managed to get PLN 481 million in profit and the general income from operational activity was PLN 611 million, which allowed us to accumulate in total financial reserves amounting in form of cash deposits and shares of a value of PLN 1.3 billion, which means that we were able to propose to divide some of this profit and to grant a dividend. These are the results from last year. And those results are significantly better than the results in 2022. Of course, this makes us very happy. Thank you very much, and let's go back to the agenda.

I don't see any questions. So resolution #3, adoption of the financial report of the company. So please vote now. [Voting]

Thank you very much. 55,276,359 valid votes were cast. In favor, 55,271,228 and no one was against, but we had 5,131 votes abstaining. The resolution is adopted. Now resolution #4, about the consolidated statement of CD Projekt for the 2023. Please vote now. [Voting]

Thank you very much. In total, we have 55,271,228 (sic) [ 55,276,359 ] valid votes. In favor, 55,271,228. Abstaining 5,131. The resolution is adopted. And then we will vote on the resolution concerning the approval of the Management Board report on CD Projekt Capital Group and to the Projekt S.A. activities in 2023 and CD Projekt Group Sustainability Report. Please vote now. [Voting]

Thank you very much. A total of 55,276,359 votes were cast. In favor, 55,271,228. No one was against. 5,131 abstained. The resolution is adopted. Now resolution concerning allocation of company profit for 2023. Let me remind that the proposal of the management is the following: We have PLN 474,705,302 decreased by the amount of PLN 30,617,741, which is the negative value of the retained earnings from previous years in the amount of PLN 1,937,508 resulting from the correction of error, related to entered provision for holiday pay for previous years, and the negative value of retained earning amounting to PLN 28,680,232 that is PLN 444,087,560 needs to be allocated as follow: PLN 99,910,000 (sic) [ PLN 99,910,510 ] is to be divided among the shareholders issuing a dividend of PLN 1 per share. The remaining part of the profit is PLN 344,177,050 needs to be allocated to the reserve capital. The day of the dividend is June 21, and the dividend payment date is June 27, 2024. I don't see any motions nor questions. We are starting the vote on this proposal. Please vote now. [Voting]

Thank you very much. A total 55,276,359 votes were cast. All were in favor. No one was against, no one abstained. The resolution is adopted. Now we are moving on to discharge of duties to the members of the Boards. First, members of the Management Board. This is going to be a secret ballot. So part of the shares will be subject to exclusion because they concern people who are exercising the right of vote and the discharge concerns them. So we are starting with a discharge for Adam Kicinski for the period from the 1st of January till 31st of December 2023. Please vote now. Adam's vote will not be included. [Voting]

Thank you very much. In total, 51,219,458 (sic) [ 51,230,458 ] shares were cast. In favor 51,219,835; against, 800; abstentions, 9,823. The resolution has been adopted. Congratulations, and thank you very much. Moving on to voting on the discharge for Piotr Nielubowicz, for the period on the 1st of January till the 31st of December 2023. And please vote now. [Voting]

Thank you very much. A total of 48,417,842 valid votes were cast. In favor, 48,407,219; against, 800 votes; abstentions, 9,000 -- 8,023 (sic) [ 9,823 ] votes. This Resolution has been adopted. Thank you and congratulations. Moving on to resolution on granting discharge to Adam Badowski for the period on the 1st of January till 31st of December 2023. Please vote now. [Voting]

Thank you. A total of 54,583,719 votes were cast. In favor, 54,573,096; against, 800 votes; abstentions, 8,800 -- 9,823. The resolution has been adopted. Thank you. And then next is discharge concerns Michal Nowakowski, for the period on the 1st of January through to December 31, 2023. Please vote now. [Voting]

Thank you very much. A total of 54,746,069 valid votes were cast. In favor, 54,735,446 votes; against, 800; abstentions, 9,823 votes. The resolution has been adopted. Thank you, and congratulations. The next resolution concerns Piotr Karwowski for the period from the 1st of January through to 31st of December 2023. Please vote now. [Voting]

Thank you. A total of 55,167,631 valid votes were cast. In favor, 55,157,008 votes; against, 800 votes; abstentions, 9,823. The resolution has been adopted. Thank you. And the next discharge for Pawel Zawodny from the 1st of January through to December 31, 2023. Please vote now. [Voting]

Thank you. A total of 55,257,932 valid votes were cast. In favor, 55,247,309 votes; against, 800 votes; abstentions, 9,823 votes. The resolution has been adopted. Thank you. And the last discharge for the Management Board for Jeremiah Cohn from the 1st of January through to December 31, 2023. Please vote now. [Voting]

Thank you. A total of 55,276,359 valid votes were cast. In favor, 55,265,736 votes; against, 800 votes; abstentions, 9,823 votes. The resolution has been adopted. Thank you. And now moving on to discharge for the Supervisory Board. The first voting concerns the Chair of the Supervisory Board, Mr. Marcin Iwinski, for the period from the 1st of January through to December 31, 2023. Please vote now. [Voting]

Thank you. A total of 42,402,839 valid votes were cast. In favor, 40,316,622 votes were cast; against, 2,076,394 votes; abstentions, 9,823. Thank you. The resolution has been adopted. And now moving on to voting on the discharge for the future Chair of the Supervisory Board, Katarzyna Szwarc for the period from the 1st of January through to December 31, 2023, please vote now. [Voting]

Thank you. A total of 55,276,359 valid votes were cast. In favor, 53,190,142; against, 2,076,394 votes; abstentions, 9,823. Thank you. The resolution has been adopted. Moving on to discharge for Michal Bien for the period from the 1st of January through to December 31 2023. Please vote now. [Voting]

Thank you. A total of 55,276,359 valid votes were cast. In favor, 53,190,142 votes; against, 2,076,394 votes; abstentions, 9,823 votes. Thank you, the resolution has been adopted. The next resolution concerns discharge for Maciej Nielubowicz for the period from the 1st of January through to December 31, 2023. Please vote now. [Voting]

Thank you. A total of 55,276,359 valid votes were cast. In favor, 53,187,140; against, 2,079,396 votes; abstentions, 9,823 votes. The resolution has been adopted. Thank you. And the last voting concerning discharge for Jan Lukasz Wejchert from the 1st of January through to December 31, 2023. Please vote now. [Voting]

Thank you. A total of 55,276,359 valid votes were cast. In favor, 53,190,142 votes; against, 2,076,394 votes; abstentions, 9,823. Thank you so much. The resolution has been adopted. And now we are moving on to resolution on expressing an opinion with regard to Supervisory Board report concerning remuneration of members of the Management Board and Supervisory Board in 2023. This report was made available in the material submitted to the general assembly. So please vote now. This is going to be an open ballot. [Voting]

Thank you. A total of 55,276,359 valid votes were cast, in favor, 42,766,259 votes; against 12,510,100 votes and there were no abstentions. The resolution has been adopted. Thank you very much. We are now going on to the next resolution about approval of the annual report of the company's Supervisory Board for 2023. Please vote now. [Voting]

Total of 55,276,359 votes were cast. In favor, 55,271,228; no one against; 5,131 abstaining votes. The resolution is adopted. Thank you very much. The next item is a change in the remuneration policy of the Management Board and Supervisory Board members. It should be adopted every 4 years. And therefore, there is a new policy concerning the remuneration of members of the Management Board and of the Supervisory Board of the company. This is resolution #21. Please vote now. [Voting]

Thank you very much. A total of 55,276,359 votes were cast. In favor, 41,923,911; against, 13,352,448; no one abstained. The resolution is adopted. We are now going on to resolutions concerning the granting of discharge to companies that were -- became part of CD Projekt within the merger. It is going to be a secret ballot. The first one is on granting discharge to Mr. Michal Nowakowski on account of the performance of his duties as member of the Management Board of CD PROJEKT RED STORE, which was acquired by the company on February 28. So it concerns the period between January 1 and February 28, 2023. Please vote now. [Voting]

Thank you very much. A total of 54,746,069 votes were cast. In favor, 54,735,446; against, 800; abstained, 9,823. The resolution is adopted. The next one concerns Adam Badowski on account of his performance of duties as members of the Management Board of Spokko, acquired by the company on August 31. So between January 1 and August 31, 2023. Please vote now. [Voting]

Thank you very much. 54,583,719 votes were cast. In favor, 54,573,096; against, 800; abstaining votes, 9,823. Resolution adopted. The next one is on discharge for Marta Gutowska on account of performing duties of member of the Management Board of the Spokko company, acquired on August 31, so between January 1 and August 31, 2023. Please vote now. [Voting]

Total number of votes cast 55,276,359. In favor 55,265,736; against, 800; abstaining votes, 9,823. Resolution adopted. Next resolution is about discharge to Mr. Maciej Weiss for the period between January 1 and August 31. It concerns his duties as member of the Management Board of the Spokko company. Please vote now. I think that the voting system is down. [Technical Difficulty] Can we start to vote? So I remind you, we are voting on the discharge for Maciej Weiss for the period between January 1 and August 31, concerning his duties as member of the Management Board of Spokko. Please cast your vote. [Voting]

Thank you very much. 55,276,359 votes were cast. In favor, 55,265,736; against, 800; abstaining votes, 9,823. And the last one is about Mateusz Janczewski on account of the performance of his duties as member of the Management Board of Spokko. So a period between January 1 and March 31, we are voting on this resolution concerning his discharge. Please vote.

Please give us a second again. [Technical Difficulty]

We are voting on the last discharge for Mateusz Janczewski, member of the Board of Spokko, for the period January 1 to March 31, 2023. Please cast your votes now. [Voting]

Thank you. A total of 55,276,359 valid votes were cast. In favor, 55,265,736 votes; against, 800 votes; abstentions, 9,823 votes. The resolution has been adopted. Thank you very much. This was the last resolution covered by our agenda. So I'm closing the meeting and thank you very much for your attendance. Goodbye. [Statements in English on this transcript were spoken by an interpreter present on the live call.]