Ten Square Games S.A. (TEN) Earnings Call Transcript & Summary

[Audio Gap] We've been -- like the entire industry, we've been struggling post privacy changes on Apple, and we are looking into new channels and new ways of promoting our products. So that's where we've been very much focused, and we continue to be focused on in the coming months. And then the right box, the fourth point of focus is the portfolio that we have that relates to new games. We have new games where we're working intensively across all our portfolio from Fishing Clash all the way to Wings of Heroes. But we are also at the late stage of development of Undead Clash and Fishing Masters and the teams are focused on working across all of these products. And the one thing we've been dealing with is the overall macroeconomic uncertainty. We've seen that impacting our business as well. We've been talking about it throughout 2022. And we've seen some impacts on our portfolio. We'll talk a little bit about that in a moment. Okay. So on Fishing Clash, I think that's the game that had a slightly weaker performance in Q4. But I think it's more important for everyone to think about what's happened in Q1 of this year. We've seen a weaker start to the year. We're observing what we call internally in-ears resolution syndrome within our players. So we see players being in the game, but spending less in the game. We think that's also related partially to the overall macro environment, but slightly on the better news side is we've seen recovery in March from -- down in February, and that's good news for us, but we are working very much on improving the product. There's a lot of new efforts that are going into bringing more interesting content to Fishing Clash users. In the next few months, we'll be releasing that content and testing if this is improving the parameters of the game. On the user acquisition side, we've run in Q3 and in Q2, we've tried to increase the batches for user acquisition quite successfully. But with the current market environment, what we've been seeing in Q4, especially December and throughout January and February and March is our ability to invest into user acquisition; it is closely related to the expected performance of acquired cohorts and users. We have a long history of investing in that product and the decisions we've taken recently is to optimize marketing to the level of profitability that we expect. So what you see, the result of is lower user acquisition spend. But as I said on the previous slide, we are working on new channels and depending on the current channels and bringing improvements to user acquisition operations, and that's something that's going to be our main focus. The one point to mention is Fishing Clash distribution in China. This is now discontinued or is being discontinued due to an organization in NetEase, our partner in China, our main distributor. And there's only one way, the license was with NetEase, the decision is to discontinue a large part of the portfolio, and that includes Fishing Clash. What it means for us is it wasn't a big impact on our operation, but that means we are not operating a game very soon in China. And that's it for now if we have any further news we will learn from the market. Hunting Clash, I think -- very important, we had stable bookings in Q4 2022. We -- the team there is working on the game on bringing improvements, we're making changes to the game. There's lots of very good ideas about the game and also how we can operate the game. What you saw in Q1, especially in February, we've run some tests across the game and what it allows us to do is to achieve the best ever results in February 2023. That gives us a lot of insight into how we should build the game and operate and we'll be -- we'll keep on investing in Hunting Clash, make changes to the game and try to grow it going forward. The user acquisition was a little bit easier on Hunting Clash and -- but we're also very closely looking at how much we can invest into promotion and user acquisition of that product. Regarding Rortos' performance. In Q4, we saw an increase of 29% over the previous quarter. It marked the highest booking quarter in Rortos' history. It's also worth noting that since the acquisition, the Rortos' revenues increased twice. One of the main drivers of those increases is, of course, the successful launch of Wings of Heroes in Q4 and also continuous improvement in Real Flight Simulator. Regarding the Wings of Heroes, right now, the focus -- right now, the focus is on adding more content, adding more monetization features, adding the social features and more competition features. We believe that the product is in a very early stage of the development, and there is still a lot of things to be done. In the meantime, the Rortos' team is also working on Airline Commander and Real Flight Simulator as usual. If we look at our Rortos' strategy and the niche that is occupying, we can see like the revenues and the share are growing within that market. And hopefully, as we did it with Hunting Clash, we'll be able to grow that similar -- Flight Simulator portfolio and other aircraft titles will be able to grow and grow in market share and grow in revenue as well. If we compare the data that we gathered from the first few months of the life of Wings of Heroes. We can see like our main engagement KPIs are above our core titles, which is Fishing Clash and Hunting Clash. If we look at the revenue per user, we can see like there is a very nice uptick, especially in the first initial days of the player journey. What we see that in the later we go, the LTV curves are a little bit flattening in comparison to our clash titles. Therefore, we decided to scale up the team. We scale up the team by 35%. We added few key people that were working during the Fishing Clash development and Hunting Clash development. And that has huge experience with Deep Mehta and social features and also with running the game with the LiveOps. So right now, our main challenge is to improve the title, improve the long-term LTVs. And that will allow us to scale up the marketing expenses. Right now, the title is on marketing RI-positive, but we saw a small decline in marketing spend due to the performance of some of the marketing companies. That's why we will be working on the product. We'll increase -- we'll improve the product a lot over the next, I believe, 18 months' time. However, the first improvements can be seen in upcoming months. And therefore, we'll be able to increase our marketing spend and also grow the revenues from that title. Regarding our current new productions. In Undead Clash, as you know, we had a write-down of some part of the development cost due to the pilot that we are right now doing with that title. The first marketing test of the game resulted in the KPIs below our expectations. The marketing conditions were -- are a little bit tough in that segment. However, with a new pilot that we are addressing, we have high hopes of also targeting -- to have a different marketing costs per user and also improve the core engagement KPIs. Right now, that pilot is in a very late development stage, and we are expecting to run the first test in upcoming weeks and we'll inform you about any further data that we will gather from those tests. Regarding Fishing Masters, this is another fishing game, but with very much more casual audience. It has a lot of idle RPG elements in that. So it's a little bit different than our core clash titles. On October, we had the first release where we saw the promising KPIs. In February, we saw a major update that improved those KPIs. However, we are still looking to improve to the KPIs that are very important for a game success. And we are constantly monitoring those numbers. And the soft launch of the title is planned still for the first half of 2023. The other project, Magical District, we had a write-down of PLN 9 million. And the team is right now focusing only on Fishing Masters and delivering the best product possible. Okay. Now moving to Gamesture. So the studio in which we've invested last year increased our engagement as well throughout last 6 months. So that company has grown in the last 12 months about 2.5x its revenue, and that is thanks to the development of their portfolio. So when we're looking at the business, it had one game, now operates 3 games successfully -- we think the core portfolio, which is Slash & Roll and The Gang, so these are the 2 games that we call Gamesture caused them the social wars. That's a very, very interesting genre for us and Gamesture is looking into developing more of these games here in the coming months. The major focus for the company is to scale up the marketing and increase the reach of the games, and that's an ongoing work, especially you can see increase in Q1. So that is exactly following the game changes, increased marketing budgets and trying to grow the games profitably. There is a new game coming up from Gamesture in the forthcoming months. It's going through -- actually, the technical launch has started. The game is called Hero Legacy. It's a different game. It's not a social wars IP. It's a completely new games from the portfolio that the team is going to be tested. And as I said, the Gamesture is looking to add more games to their portfolio in the coming months. So I think so far, so good. It's a good acquisition. I think both of the acquisitions were good for us. Gamesture has grown 2.5x through or just 2x since the acquisition in revenue. There's lots of interactions between our companies, and we look in to leverage value in all of them.

Okay. So a few words about financial statements and summary of P&L. Last 2 quarters, third quarter and fourth quarter were pretty stable in terms of bookings and user acquisition costs. G&A costs, we see a decline, thanks to our organization and decisions we've taken in May 2022. Thanks all of that adjusted EBITDA is very similar to third quarter to PLN 35 million. And net profit strongly affected by write-offs of 2 games, so Magical District and part of Undead Clash. Yes, bookings. In terms of all gains, of course, we are still strong on Western markets, so North America and Europe. And Fishing Clash is our main source of revenue, but the chart is slightly decreasing, thanks to Hunting Clash and right now also Rortos games. And cash flow. Each quarter, we generate cash from operating activities. We are closing last year with cash position at PLN 127 million, which is more than enough to self-finance our investments or our gains and to think about other potential M&As and what's going on in next quarters?

Okay. So just a summary on what is that we're focusing on. Obviously, the core focus goes to our main portfolio, as you've seen, Fishing Clash requires more efforts on our side, and we've been working over the last several months to increase the team to make the team working into 3 different streams. There's new content coming through Fishing Clash, and that's something that we believe is the main leverage for this game to help it to go back to growth. On Hunting Clash, it's exactly the same thing that we've done, which is scaling up the team so we can iterate and try more new things for our players. So that's happening. We're seeing very good signs of that, and there's lots of more trying to be done in both titles. Wings of Heroes is a new game, which we believe has a long-term development potential. We are starting to scale up the team. We're trying to blend the team of our Rortos colleagues and also blending experience from TSG of scaling, Fishing and Hunting Clash, and that's something we'll really need to focus over the next few months. We are also finalizing the work on Fishing Masters. And on that Clash, I think the efforts are going to be able to test more KPIs and conclude both of these developments here in the next few months. The very important thing for us is to prove our kind of platform capabilities, and we're working on integrating and exchanging know-how between the companies and DSG Group. And we think there's lots of value from the know-how exchange across product development, BI, using our systems and leveraging user acquisitions. So that's something that we've been working on quite extensively, and we'll keep on working on that. And then the thing is not to forget them coming off the largest gaming conference in San Francisco last week, I had a lot of discussions with our colleagues in the industry. It's very clear that that market has been disrupted post-pandemic market has gone down. Also, macroeconomic uncertainties are overlaying this. We are following our places closely. The good news is that we see the player's base being kind of with us and active. The thing is the willingness to spend across our games is something that has been pulled back a little bit, but the good news is we keep our players and we need to bring them more entertainment. So market uncertainty stays with us. And the only thing we can do is to focus on our own doing and trying to deliver the best we can. I guess that's it. I think there's been 1 change and maybe we can explain here Investor's Calendar.

Hi, everyone. As you know, we will publish our financial results for the first quarter in May on 22nd May 2023, with the publication of the financial results, the company is planning also to present its strategic update that was previously planned for the fourth quarter. And we will also publish sales update soon in the beginning of April with the more precise results for the first quarter bookings. The company is also planning its presence on the conferences in the early of June, and I hope we will be able to see each other here in person and discuss the results of the company. Thank you. And let's move to the Q&A session.

Let's start with the questions. The first one relates to the Google privacy changes. And the company is, when do you expect it to happen? And what might it mean for your marketing expenses?

Sorry, can you...

The first question relates to the planned changes in the Google privacy policy. And when do you expect it to happen? And what it may mean for your marketing expenses?

Okay. So when it comes to privacy changes on Google, I think those are expected to come still this year. I think there's no clear date. There's been no indication on the date when it happens. There's a lot of discussion in the market. What is it going to mean. But I think Apple and Google are different companies. So some of the discussions that we're hearing is Google will look from a perspective of how to -- while making privacy changes how to take into consideration the operations of companies like ours and to be able to provide a service that will help us to market our products effectively. That's the kind of major assumption for us. And we're waiting for the change to arrive. I think there's lots of things. We're trying to prepare like we try to prepare for IDFA, but it's no -- there isn't much visibility on what's going to happen. The idea is we'll be able to be more effective. And also, we've learned on IDFA change on Apple.

Thank you. The next question regards games development. Excluding Rortos and Gamesture, it has been 4 years since TSG launched the last game, Hunting Clash. What are the plans to improve the situation?

Well, we know that this industry has a success rate smaller than other industries. What does it mean to -- in order to have a successful game, at least in our terms, we need to have an ROI-positive marketing which is more and more challenging. So I believe in our history, our success rate was around 30% to 40% if we include all our productions. It doesn't mean that this drop -- this number will drop significantly. What it means, it means like in order to have a success you need different circumstances to be aligned. On our side, we can do what we can do the best. So we work on the products. We are trying to improve our product market feed exploration. And with proper research, we are -- we will be able to find nice good niches that are very close to our core. Also, we believe that we are trying sometimes to do things that are outside of our core in order to explore the market. But the things that are working and worked in the past are the titles that are very close to our core. The other part of the strategy is to, of course, look at any partnerships and publishing deals and, of course, M&As. And we are continuing to do that. And with those products, we can use our know-how and our other tools that we developed over the last 10 years and to make those titles even more successful.

Thank you. The next question regards Rortos. Really a big part of Rortos valuation was made on Airline Commander and Real Flight Simulator potential. Can you elaborate on those gains? In financial statements, it seems the most focus is set on Wings of Heroes, while 2 others are omitted.

So I believe it's all connected to -- in what stage those 2 games are. I mean, Airline Commander and Real Flight Simulator. And also, if we compare Wings of Heroes, which is a new title and which basically still lacks a lot of crucial features that modern free-to-play games all have in common. So -- that's why we see that Wings of Heroes has much higher potential, has a much higher upside than the previous 2. However, the works on Airline Commander, for example, are also -- they also involve a big team. And we are working in different directions with that project. What I mean like we introduced a lot of features. And right now, we are working on a version that will combine all those new features into a very nice player journey. And those tests will also be, let's say, concluded by the April. However, as Wings of Heroes, huge potential in our eyes, that's why it requires the highest investment.

Thank you. The next question is regards dividend payment. What are your plans regarding dividend payment in 2023?

Okay. So we haven't decided yet, but I think that, as always, in April, we will publish our decision and then shareholder meeting.

And related question. Do you consider buyback program?

Right now, no, we also need shareholders' approval to do it. So not now.

Are there an ABB transactions planned?

No, we're not aware of any ABB transactions as management.

The next question regards Fishing Masters. In what phase of production is Fishing Master right now? Is it currently being tested in the U.S.A., is the company satisfied with the KPIs achieved by this product?

So we are not satisfied with all the KPIs. We are satisfied with the engagement KPIs and marketing KPIs. We are working heavily on the monetization KPIs. The game is in the test phase in U.S. -- U.S.A. and we are conducting a lot of marketing tests with the different creatives. And this is the stage we are right now at. And we are also looking at the dynamics of the development of the KPIs, which I already mentioned from October to February release, we saw a very nice uptake in those KPIs. However, not all KPIs are satisfactory as of yet.

The next question regards the game Wings of Heroes. What is the reason for such a drop in revenues in March?

So as we mentioned on the previous conference, our marketing spending will be connected to the performance of all the cohorts, and we will be monitoring carefully how the LTV curves behave and how much we can spend efficiently. We saw that there is a point where the LTV curves are flattening, which means the payers don't pay as much as in the initial weeks. What does it mean? We basically had to scale down the marketing expenses. And right now, the revenues that we are gathering -- generating are very much connected to the number of new users that we acquire, like in short. So right now, we are working to improve those LTVs, if those LTVs will resemble more LTVs that we have in Fishing Clash or Hunting Clash, then we'll be able to scale up the marketing by March.

And the other question also regards Wings of Heroes. How many people were working on the game at the end of 2022? And how many is right now?

So if I'm not wrong, by the end of 2022, it was around 20, 23 people. Right now, it's 30. And right now, the team was scaled up. And of course, if that team will -- and the output of that team will be much higher, and that's what we actually expect. We'll be considering maybe even further strengthening that team.

The next question regards future plans of the company. Do you plan to increase your ownership in Gamesture?

The kind of agreement between Gamesture shareholders and us has been such that we'll have the right to increase our engagement in Gamesture in time -- over the time of 5 years since the acquisition. So yes, currently, that's the plan that will, in time, increase our engagement engage.

Thank you. If the company had to create the game Fishing Clash from the scratch, what would be the main change compared to the current version?

It's a hard question. It's a very hard question, on one side because probably we wouldn't like to share this secret know-how right now as we are also having some plans for maybe new fishing games. So I won't be able to answer that question, sorry.

Thank you. And the next question regards buyback program and dividend. We already answered it. So let's move to the other one. Are you considering switching to low maintenance model in Hunting Clash, given that the game does not grow on revenues and showed the best net result in December 2021 when there was no user acquisition.

Okay. So the best result -- net result, yes, was, in fact, in December 2021. However, we still see high growth of opportunity there. Right now, we are adding a lot of nice game modes. If some of you are playing that title, you can see like there is a lot of momentum in the title. And we still give ourselves some time in order to prove that we can actually break that ceiling and have much more impactful on net revenue title in our portfolio.

What is the future of Undead Clash? What do you want to change in the gain this year?

So without giving too much details, we are -- people think the title that will be not that far away from the original version. However, the user flow will be much -- much more appropriate for the shooting players that are downloading and installing our game. So I don't want to give too many details. The new version will be -- the new version will be updated soon on the stores. So this is our bet that this version will be much better for the players. We will be able to accommodate a wider range of the players, and we'll be able to lower the CPIs Cost per Install on the marketing side. Those are our bets.

Thank you. I think that this also answers the next question regarding Undead Clash about the changes. So we will move to another one. And it regards cost discipline programs in the company. Do you plan to introduce such programs? What do you think about implementing profitability first approach similar to Hugh?

When you look at these, I mean, the way we run business, we always look at the profitability of the company and trying to out weight how much -- what proportion of profits do we want to invest in the future. And the profitability analysis goes into long-term analysis of future profits coming from expected cash flows from our games and products. And we're looking into that very carefully, taking decisions almost instantly and all the time. If you look at our history, what has happened in the last 12 months, we've been 550 people and that's one of our major cost lines about a year ago. We're at 450 people trying to deliver value across our portfolio. And we are looking at our cost base on a daily basis. And I know, this is how much I can comment. I would not like to comment on Hugh's performance and decisions. This is always related to the particular situation of the company. So I'll let Hugh comment on their own decisions. We are looking at our business from a cost management perspective very thoroughly for the -- almost all the time as long as I've been with the company, that's always been the case.

The next question was on the same topic. So the answer is already there. Let's move to another one. Could you tell us, once again how Rortos' earn-out can be seen in the financial statements, both in P&L and in cash flow statement?

Okay. So earnout, this something we need to pay first time within the next few weeks, then after 1 year, 2 years and 3 years. So last time for 2025. From a balance sheet perspective, it's just the same for liability. And then P&L, we need to unwind the discount factor. So a whole liability is made as a DCF, then we unwinded for present data. Therefore, we see a financial cost in our P&L, and that's all. And cash flow statement, when we already pay it like within a few weeks, then first time we're going to see an outflow in investing part of our cash flow.

Thank you. The next question regards Airline Commander. It generates a lot of downloads, but little revenue. It seems like a loss potential and problems with monetization. Would the subscription model be a better option for this game?

It's, of course, one of the options that we consider. And we also diagnosed that this game might have a huge potential. That's why we invested in that title, and we are developing many features and adding all those features. And right now, this month, we'll have some answers on how big that title can grow. We believe it is a very nice real estate. It attracts a lot of organic installs, organic users. People like this game. We try to deeper the monetization systems in the title and also present players long-term goals and social goals and competitive goals. I believe in a month's time, we'll be able to see if we see that the potential can be unlocked. And then if nothing changes. However, we strongly believe that we improve that product over the last year time. But if we still want to be able to successfully market the title with the user acquisition, we might consider other monetization options like subscription for example.

Thank you very much. The next question regards Gamesture, what is the potential of Gamesture to breakeven in terms of profitability?

Well, I can answer like this. We -- this is obviously one of the key considerations for us to let the company go through the breakeven. There's been an investment in the team to be able to build certain types of games that's been proven. And now the last round of investment was to support the marketing growth, obviously, with a view to go through the breakeven in foreseeable future. There's a number of scenarios for that. That really depends on how far and how quickly those games can be scaled. And we're looking for answers now by basically how the company is trying to scale up or it's scaling of the marketing go fill the game. So I think in time, we'll be able to see progress on that. We have a view. There are a few scenarios. Some are looking very good. All of them are looking at breakeven at some point in time in the future at the back of analysis of LTV curves and profitability of this product in the future, the way the players behave and how they're paying in these games.

Thank you very much. The next question regards Wings of Heroes. And it reads, if we deduct distribution fees, first quarter 23 implies the title was below breakeven. Should we expect further scaling up to be affecting the results or return to profitability already in the second quarter?

So like from my perspective, we are always looking into long term -- into the long-term performance. So as long as we see that this product requires the investment and that the investment has higher -- high trends of being paid off and basically also to have a huge upside. We'll be investing. We are not focusing on adjusted Q2 financial results of Wings of Heroes. So -- and I believe in Q2, it will be too early to stop any development and any updates on Wings of Heroes. As I said, we diagnosed, let's say, the weak points and all the missing parts. Some of them, of course, are on the road map since, let's say, the project started, and they are being continuously developed and added to the game. Some of the things that we are adding to the road map are derivative of our data insights and analytics.

Thank you. The other question regards wages increase planned in the company. Can the market expect such increases? Other gaming companies are guiding for inflation percentage at least? Do you see the same pressure at your site?

Well, we see, of course, the inflation rise in Poland, but we also see what IT industry is going on, so reduction plans, et cetera. Therefore, we cannot say like what's going on with salary increases within the next few months?

Thank you. The next question also regards team and the plans to reduce the size of the team during that year.

Yes. If I may answer to that question. As I said previously, when you asked about the costs and how we manage the business, we're reviewing our operations on a daily basis. And we are adjusting on as-needed basis. So that depends on our perspective on -- our view on the perspective of the company products we're developing et cetera, this number of inputs to all of these decisions. And that's how we've been running this business thoroughly for the last months and years.

Thank you. I would like just to remember everyone that we ask kindly, people asking the question to sign their name and last name with the questions. The next question regards the forecast of the mobile gaming market in 2023. Do you think it will notice further drops? When do you think the market will see the uptake?

Okay. So on the market, I think it's not very easy to predict the next several months as we see a lot of disruptions in the market. And kind of recessionary behavior of players and consumers in wider industries. So that's what we've been seeing. If you take a look on the long-term perspective, and I would only point at one driver for the market -- for gaming market is the generational trend. So what we will be seeing for the next several years is the growth of user base. And also, we expect a higher engagement of players because new generations are more used to gaming. So a lot of our core audience is 35-plus. And I think with every year, you'll see more players in every cohort of 35-plus. So from our micro kind of market perspective, where we see it, I think those are good news, also good news for the gaming industry in the longer-term perspective. That's how we are thinking. The short term is very hard. It's very unpredictable at the moment. It may go up, may go down. It really depends on many different factors from players' behavior to the pipeline of new products or the changes to the existing portfolio of games. So it's very hard. We're looking individually. We're looking from the niche perspective. We're looking from the segments in which we operate and what is the potential to develop there. And we think there is potential in all the segments that we are operating in. I also would like to make some comments on how we are behaving as a company, how we're performing versus the market. And just a small reminder, we hopefully will talk a little bit more about it in May, just to frame up all the decisions we've taken in the past. When the market was growing at 20% during COVID time, the company grew 2.5x in 2021 and 2020. And the reason for that was our investment in marketing. So we grew primarily Fishing Clash exponentially, much further beyond the growth of the market. And the aftermath of that decision is we've generated significant cash flows for the company. But we are also going down from that top performance of '21. And that is the situation that we're trying to manage. We hope we can grow from a higher base of users in Fishing Clash and also grow Hunting Clash. The challenge in the reality we found ourselves in is we weren't able to. And that's what happened to the company. So we're trying to find a bottom and try to grow again, we believe in the niche, we believe in the potential of players in those segments. Our performance is normalizing as we speak. And that's what happened to Ten Square Games. And I know it's causing some frustrations so a lot of frustrations around us, but that was the reality we had to deal with. And we see the future for our games and portfolio. We just need to focus on what we're doing on the gains we have in the portfolio and also taking the best chances of the things that have been developed in TSG, namely Wings of Heroes is the game will be very much focused on. And then we need to finish the current development. That's the thing when concluded.

The next question regards on Undead Clash and plans of the company regarding the product. The previous -- during previous conferences, it seemed that there are huge assumptions regarding good results of the game. So where does the impairment come from? And what are further plans regarding the title?

So if we go back to the beginning, after a successful launch of Hunting Clash, we decided to try even bigger niche -- not niche, to go to the mass market audience, we performed different marketing tests, different researches over the first months of development. We scaled up the team, and we strongly believe that this title can be a huge success. After the first releases and then after reading the first data, we saw on par with Fishing Clash and Hunting Clash engagement KPIs, which for us was a good benchmark and was giving us the hope that this title can actually be what we plan to be. The fact is that there is one KPI, which is a marketing cost per user, was much higher than in our initial test and all the tests that we performed over the development phase. And maybe that's the current marketing situation or maybe it's something with the product market fit. That's why our assumption is right now that conducting a nice pilot that includes not only our expertise and not only the market environment, but also what we read in the data and how we can approach and let's say, attack the market. We believe that this test will show us if that mass market audience is still within the reach of Undead Clash.

Thank you. And what are the plans regarding the Fishing Masters is the company planning to introduce the game to the market in 2023.

So, yes, as I said, right now, we have those tests on the U.S. market. We are running different marketing campaigns. We are looking at the dynamics of how the KPIs are changing. We are still lagging on one of the very crucial KPIs. And with the upcoming updates, we'll be able to better predict what are the market chances for that item.

How many people are employed in the group right now? And what are the plans regarding the employment in 2023?

So we are employing about 450 people at Ten Square Games plus around 100 people between Rortos and Gamesture and we are not commenting on the plans of the employment of the company.

Thank you. We already answered the questions regarding dividends. So the next question regards future strategic update and what are you going to change? And what are the milestones you are going to introduce?

So our strategy is based on 3 pillars. One is the course to doing Rortos. So what is that we do in Rortos the second is development of new studios, which were so is an example. And the third one is adding games to portfolio through acquisitions of companies. And we'll comment and we'll make updates to the strategy across those 3 pillars on each one of them. We will specifically in for market and what our plans are for the future.

Thank you. And as we already said, we will provide the information with the results for the first quarter 2023. Because this was the next question, when are we going to do that. The next question regards payment to Rortos, shareholders. Did the company pay anything from the earnout to date? And when is going to be the first payment?

Okay. So till today's date, we haven't paid anything to Rortos' shareholders. We're going to pay first earnout in April, this year.

Thank you. The next question regards Gamesture. What are the plans of the company? When can -- when Ten Square Games can have like over 50% of Gamesture share?

Okay. So I know what I'm not sure -- that's part of our disclosure so far. Do we disclose, we can tell?

Long-term perspective, like not.

Yes, it's been a few years since the day 1 acquisition, which happened in July '22.

Thank you. Okay. And the next question regards Fishing Clash, China, whether the project was profitable or whether the costs were higher than revenues.

Okay. So in general, the project was profitable because the revenue part, which we booked in our financial statement, was after -- provision after net lease share. So yes, it was profitable. But please remember that was even below 1% of our total revenue. So it wasn't an important part of our business.

Thank you. And I guess, this is the last question with the name of -- and the last name of the person asking the question, are you considering to change communication with investors and give more frequent updates.

Yes. I think the one thing is we are updating on a quarterly basis, so it's just like all similar companies. So there's no plans to extend that, but also on the nature of our businesses. We're working daily with changes that are brought into products takes months and years to develop games. So I think increasing frequency would not add much value to our communication.

Thank you so much. And these were all the questions that had the offer signed with the name and last name. So thank you very much. If any of you have additional questions, I will be happy to help with the answers after the conference. Thank you so much.

Thank you very much.