Proven Capabilities In Art Outsourcing And Game Development Addressing A Blue Chip Customer Base
Led by its founder Mr. Johnny Jan, over its 25 years of operating history, the Group has established itself as a leading art outsourcing service provider globally, with a strong reputation for the quality of its services and a demonstrable track record of working with the world’s most prominent game developers and most successful game titles. The Group has collaborated with 22 of the top 25 game development companies, including miHoYo, the developer of hit multiplayer video game Genshin Impact, NetEase, Inc., NCSOFT Corporation, Gamania Digital Entertainment Co., Ltd, Ubisoft Shanghai, and Rayark International Limited, and has an established partnership with three of the major game publishing platforms, namely, Sony, Microsoft, and Nintendo, which is a testament to the Group’s reputation in the game development and art outsourcing industries.
Addressing A High Growth Market
The video gaming sector, and in particular the mobile and online gaming segments, is expected to demonstrate continued strong growth, with the global gaming industry expected to reach US$345.3 billion revenue in 2028, representing a CAGR of 9.8% between 2023 and 2028. The mobile gaming sector, which is currently the Company’s largest segment, is expected to continue to lead the growth in the overall global gaming industry, with a CAGR of 12.7% between 2023 and 2028, due to the increased demand for higher quality mobile games, which in turn has increased demand for associated art outsourcing services. With game companies needing to continuously improve the gameplay experience for players, game companies are allocating more resources to game development, which represented a total spend of US$10.7 billion in 2023.
Compelling Cost Advantage
Outsourcing represents an increasing proportion of game development budgets, with this trend expected to continue going forward. The outsourcing model allows game publishers and intellectual property owners to more efficiently manage their own in-house resources and to access the scale of experienced talent which has become necessary to support the launch of increasingly sophisticated gaming titles. The Group has a highly skilled workforce, with experience in all aspects of game development and differing art styles, and continues to train new recruits within its comprehensive training programmes.
Forward Earnings Visibility From Growing Follow-On Revenues
Focus on high-growth mobile and online titles provides the Group with repeat revenue opportunities and enhanced earnings visibility.
Limited Product Risk
As a “work-for-hire” business, the Group provides outsourcing services to its customers in support of their development of video and mobile games. As such, the Group is not exposed as principal to the risks associated with ownership and development of these products.
Fragmented Market For Art Outsourcing Services
The global game art outsourcing industry is generally fragmented, with most service providers being relatively small independent studios. While some game art outsourcing studios have grown larger by merging with and/or acquiring other studios, most art outsourcing studios still do not have the capabilities to provide a comprehensive suite of art outsourcing services to clients. Leaders in the art outsourcing industry, such as the Group, therefore typically boast a comprehensive range of art outsourcing services that are able to meet the demands of various game companies in Asia, Europe, and North America, noting that differences in game art styles and production methods require a broad skill set which many of the smaller art outsourcing providers cannot provide. The fragmentation of the market provides opportunities for the Group, both through its ability to compete effectively within the global marketplace given its relative scale and through its acquisition strategy.