“SAMG Entertainment Achieves 49% Growth in 2Q Revenue…Accelerating ‘Third Leap’ with Convertible Bond Issuance

• – SAMG Entertainment’s 2Q Revenue Reaches KRW 23.4 billion… a 49% Increase YoY

• – Decision to Issue KRW 30 billion Convertible Bond… Initiating SAMG Entertainment’s ‘Third Leap'”

SAMG Entertainment, led by CEO Suhoon Kim, continued its rapid outward growth in the second quarter. Simultaneously, it accelerates its growth through the issuance of convertible bonds (CB).

According to SAMG Entertainment, based on the consolidated financial statements for the second quarter of this year, the revenue reached KRW 23.4 billion, a 48.8% increase compared to the same period last year. The accumulated revenue for the first half of the year reached KRW 44.5 billion, marking a 39.4% increase for the same period. Following the over 30% revenue growth in the previous first quarter, the second quarter also demonstrates substantial growth.

The sales related to core intellectual property (IP), including ‘Catch! Teenieping,’ ‘Miniforce,’ and ‘Superdino,’ increased. Additionally, the newly launched IP, ‘Metal Card-bot,’ introduced in March, has begun showing substantial performance growth. Especially, ‘Metal Card-bot’ rapidly rose to become one of the top three IPs for boys in South Korea shortly after its launch, solidifying its position as SAMG Entertainment’s new core IP.

Overseas business revenue also recorded significant growth in the second quarter. SAMG Entertainment’s second-quarter overseas business revenue reached KRW 6.6 billion, a rapid increase of 117% compared to the previous quarter. As SAMG Entertainment’s core IPs like ‘Catch! Teenieping’ and ‘Miniforce’ continue to expand the global kids’ fandom, overseas sales growth is gaining momentum.

Based on the consolidated financial statements, the operating loss for the second quarter was KRW 2.2 billion. SAMG Entertainment explained that the reasons for the loss were ▲preemptive inclusion of distribution expenses due to direct delivery ▲increased labor costs due to new business development ▲impacts of IP development expenses.

Furthermore, SAMG Entertainment announced the issuance of KRW 30 billion worth of convertible bonds on this day. This is in line with their policy to accelerate their third leap.

The nominal interest rate for this CB is 0%, and the maturity interest rate is 2.5%, with maturity date set five years from the issuance date. This CB is issued primarily to institutional investors who have already invested in SAMG Entertainment. It’s structured to attract reinvestment from investors who resonate with SAMG Entertainment’s long-term vision.

Unlike the typical CB’s stock conversion period of one year from the issuance date, SAMG Entertainment’s CB in this case has a condition that allows conversion to stock two years after the issuance date. SAMG Entertainment explained that this condition was set to minimize dilution concerns while targeting investors who resonate with SAMG Entertainment’s long-term vision.

A SAMG Entertainment official stated, “The funds raised through CB issuance will be allocated to new IP projects, global market expansion, and offline space business,” and “Through this investment attraction, SAMG Entertainment will officially initiate its third leap.”