Korean game publisher PearlAbyss suffers 79% fall in Q1 operating profit

PearlAbyss Corp. headquarters [Courtesy of PearlAbyss]

PearlAbyss Corp., a South Korean game publisher listed on the secondary Kosdaq market, saw its first-quarter operating profit plunge by 78.9 percent from a year ago amid the absence of new releases.

The company said in a regulatory filing on Thursday that it posted 1.1 billion won ($835,105) in operating profit for the first quarter, down 78.9 percent from a year ago.

The figure is significantly lower than the market consensus of 5.2 billion won compiled by Yonhap Infomax.

PearlAbyss raised 85.8 billion won in sales in the January-March period, down 6.2 percent. Net profit soared 61.9 percent on year to 9.4 billion won. The company managed to swing to a profit after a net loss in the previous quarter.

In terms of sales by game intellectual property, “Black Desert” topped with 67.5 billion won, followed by “EVE Online” with 16.9 billion won.

By region, North America and Europe accounted for 55 percent of its entire sales, followed by Korea at 23 percent and other parts of Asia at 22 percent.

By platform, PC platform sales accounted for 74 percent, followed by mobile devices 20 percent, and consoles 6 percent.

First-quarter operating expenses reached 84.7 billion won in the first quarter, down 1.8 percent from a year ago and 14.9 percent from the previous quarter.

By category, labor costs accounted for more than half of the expenses with 44.3 billion, followed by commissions 22.3 percent, and other costs 10.8 percent.

PearlAbyss had 1,355 employees as of the end of March, down 6.7 percent from the previous quarter and 8.8 percent from the previous year.

PearlAbyss said that it will release “Land of the Morning Light” in the second quarter. The game was recently introduced as an expansion to “Black Desert.” The company will organize user meetings in the U.S. and Japan.

PearlAbyss also added that it will have new growth drivers through a new expansion to “EVE Online” and new global releases including “DokeV,” “Plan 8” and “Red Desert” this year.

Shares of PearlAbyss were trading 2.44 percent lower at 44,000 won by midday Thursday.