WINKING STUDIOS LIMITED

(Company Registration No. 159882)

(Incorporated in the Cayman Islands)

13 August 2025

Half Year Results ended 30 June 2025

M&A strategy fueling growth across a rapidly expanding global gaming market

Winking Studios Limited (AIM / SGX: WKS) ("Winking Studios" or the "Company" and together with its subsidiaries, the "Group"), one of the leading global AAA game art outsourcing studios and an established game development company, announces its unaudited results for the six-month period ended 30 June 2025 ("1H2025").

Financial Summary

Financial & Operational Highlights

Outlook

¹Adjusted EBITDA in 1H2025 comprises EBITDA, with adjustments that included the Group's share-based compensation expenses, foreign exchange gains and costs of acquisition and integration.

²Adjusted EBITDA in 1H2024 comprises EBITDA, with adjustments that included the related one-off dual listing expenses on LSE, share-based payments expenses, foreign exchange gains, costs of acquisition and integration, interest income and private placement related expenses (to raise S$27 million).

Executive Director and Chief Executive Officer (Founder) of Winking Studios, Johnny Jan, commented:

"We are pleased to report healthy revenue growth in the first half of 2025, reflecting robust demand and the successful execution of our core M&A strategy. The completion of our largest acquisition to date, Mineloader, adds scale, broadens our capabilities in AAA console game art production and deepens our presence in Western markets as we actively pursue further acquisitions.

With a strong balance sheet, a healthy base of follow-up revenues from high-value projects and a growing pipeline of M&A opportunities, underpinned by our team's continued focus on execution and operational excellence, we are well positioned for growth in FY2025 and to create long-term value for all our stakeholders."

Enquiries

About Winking Studios Limited (AIM and SGX: WKS)

Headquartered in Singapore and dual-listed on the London Stock Exchange and Singapore Exchange (Trading Code: WKS), Winking Studios Limited is one of Asia's largest AAA game art outsourcing studios and an established game development company.

With over 25 years of experience and established track record, the Group provides end-to-end art outsourcing, game development services and other gaming services across various platforms for the global gaming industry via its three business segments of Art Outsourcing, Game Development and Global Publishing & Other Services.

The Group has 13 studios across Taipei, Nanjing, Suzhou, Dalian, Tianjin, Shanghai and Kuala Lumpur with over 1,400 highly skilled employees serving a global customer base that includes 22 of the top 25 game development companies in the world. For more information, please visit www.winkingworks.com

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CEO's Statement

The Group delivered strong financial and operational performance in 1H2025, underpinned by robust trading and the successful execution and integration of strategic acquisitions.

Since our listing on the Catalist of the Singapore Exchange in November 2023, the Group has been proactive in delivering its M&A strategy, resulting in the completion of three acquisitions. The most recent, our largest acquisition to date, was the US$19.8 million acquisition of Mineloader in April 2025.

Demand for our art outsourcing and game development services remains robust with the Group's revenue increasing 27.3% to US$19.4 million in 1H2025 (1H2024: US$15.2 million), primarily driven by the US$4.1 million revenue contribution from Mineloader. The Group's gross profit grew 38.2% to US$5.9 million with gross profit margin increasing to 30.2% in 1H2025 (1H2024: 27.9%), driven mainly by contributions from Mineloader, which specialises in higher margin AAA games from console platforms.

While the acquisitions have been accretive to the Group's revenue performance, there was also aggregation of related administrative costs of these acquired companies, one of the key factors behind the increase in the Group's administrative expenses in 1H2025.

Adjusted EBITDA increased 17.9% to US$2.4 million in 1H2025 (1H2024: US$2.1 million), which reflects our resilient underlying performance. More details can be found in the CFO's Review and detailed financial statements of this announcement.

Strengthened by our market position, growing repeat revenue streams and a well-defined strategic roadmap, we remain focused on advancing our growth objectives and delivering sustainable, long-term value for our shareholders.

Meeting market demand through operational expansion

Market demand was strong in the first half of the year, with accelerated momentum in the second quarter. We are seeing growth that was driven primarily by the mobile online gaming market in the East and by the console gaming market in the West, including increasing activity related to next-generation consoles.

The Switch 2 console, released in June 2025, sold over 3.5 million units in its first four days¹, making it the fastest-selling Nintendo hardware ever and surpassing the original, which sold over 1.5 million units in its first week². Winking Studios is currently engaged on multiple Switch 2 titles and is actively involved in the development of multiple next-generation PlayStation titles, alongside ongoing work on current-generation platforms.

To support rising demand, the Group continues to invest in headcount and remains on track to establish new production hubs in Southeast Asia, in line with our ambitions to expand our production footprint and meet evolving customer needs of high-quality game art and cost efficiencies, among others. We are actively recruiting top-tier talent and in 2H2025 will be launching Vertic Studios, a new high-end art production brand that caters specifically to the sophisticated needs of AAA games with substantial budgets.

Winking Studios continues to strengthen its relationships with major global game development companies, including long-standing clients such as Sony, Microsoft, EA and 2K, which has contributed to a growing pipeline of both new and follow-up projects. As at 30 June 2025, the Group has received indicative artist bookings totalling at least US$49.4 million over the next 24 months (subject to final confirmation from customers). Of which, US$18.4 million of the indicative bookings is expected to be recognised in 2H2025.

In March 2025, Chinese gaming giant Tencent disclosed it had 14 "evergreen titles" generating over RMB 4 billion annually³. Winking Studios has been and remains actively involved in 12 of these high-value titles, demonstrating our ongoing role in developing and supporting the longevity of some of the industry's most prominent and commercially successful games while providing strong visibility over future revenue.

Accelerating growth through our M&A strategy

A core pillar of the Company's growth strategy, we remain committed to accelerating expansion through further strategic and targeted M&A within a highly fragmented market.

With the acquisition of Mineloader, the Group added 495 employees to its headcount, boosting the total to 1,405 employees as at 31 July 2025. Mineloader's service offerings in console platform games and established experience and presence in the global gaming industry are also valuable additions to the Group. I am delighted with the progress being made with the integration of Mineloader, which contributed US$4.1m revenue in 1H2025.

We are now better positioned to pursue our core strategy of expansion via acquisition, supported by stronger leverage in the rapidly growing Asian market, access to new opportunities in Europe, and a proven M&A track record that provides confidence to potential partners. 

Winking Studios continues to pursue future M&A opportunities, targeting established and profitable studios in Europe and Asia that offer specialised expertise, new value propositions, access to new market segments and scalable operations. Active conversations are ongoing with targets in the UK and Europe, and a strategic focus going forward will be the establishment of our UK office to facilitate a direct presence in key Western markets, including the US and Europe.

Positioned to grow market share in a rapidly expanding industry

The global gaming industry continues to expand at pace, with total market revenues expected to grow from US$216.9 billion in 2023 to US$345.3 billion by 2028, representing a CAGR of 9.8%*.

The mobile games sector, which is currently a key market of Winking Studios' art outsourcing business segment, is expected to lead the overall industry, with a CAGR of 12.7% between 2023 and 2028. 

This growth is driven by the increasing demand from players for high-quality, regularly updated content, immersive visuals and intricate character models and environments; all of which require significant investment in game art and development services.

As the industry continues to evolve, major game development companies are increasingly outsourcing their game art and development needs to boost efficiency, reduce fixed costs and make scaling easier, contributing to a structural shift towards established external service providers such as Winking Studios.

The global game art outsourcing market grew from US$1.8 billion in 2018 to US$3.7 billion in 2023, representing a CAGR of 14.9%, and is expected to reach US$7.1 billion in 2028. The mobile sector of the global game art outsourcing industry is expected to continue to outpace other game outsourcing segments, with a projected size of US$3.6 billion in 2028 and registering a CAGR of 16.7% between 2023 and 2028.

It is a similar story in game development outsourcing, a market which grew from US$6.4 billion in 2018 to US$9.9 billion in 2023, representing a CAGR of 8.9%. Driven by the increased scope and complexity of games, this figure is expected to grow to US$17.8 billion by 2028, representing a CAGR of 12.5%.

As one of the top four global game art outsourcing providers, Winking Studios is well-positioned to continue to capture market share in this rapidly expanding industry.

*All statistics and forecasts in this section are sourced from China Insights Consultancy (October 2024)

Game outsourcing to redefine the future of game development

The global gaming industry is undergoing a paradigm shift. In the post-COVID era, even as many global game development companies streamline internal teams, industry revenues have continued to climb - raising a fundamental question: who is building the games that are driving this sustained growth?

The answer lies in the rise of outsourcing and external development partnerships. Increasingly, game development companies are adopting a leaner, more agile approach by relying on outsourced talent to deliver high-quality game assets, features and entire modules. According to a recent industry report⁴, the majority of professional respondents expect to spend more than US$6 million on outsourced development in 2025, the highest level since 2019 and a clear indicator of where the industry is heading.

This trend marks a strategic evolution in game production. Rather than housing every skillset internally, game development companies are tapping into a global network of specialised partners such as Winking Studios. This model not only enhances scalability and cost efficiency but also enables faster innovation and access to top-tier talent worldwide. Game outsourcing is no longer just a cost-saving measure - it is now a core driver of how modern games are developed, accelerating production while delivering creative excellence.

Outlook: positioned for sustained growth and long-term value creation

We remain committed to delivering growth for the full year, supported by good revenue visibility and healthy, long-term market drivers.

The need for higher-quality content and more immersive gaming experiences is rising in line with the evolution of the gaming industry and the rapid advancements in technology. Crucially, the Asian gaming market, which dominates the global games industry, is growing rapidly. Despite the headcount reductions felt across the industry in 2024, we are seeing the mobile gaming sector in particular experience a strong recovery and we expect a sustained trend of increased spending on external development among game developers and publishers, playing directly to our existing strengths.

In 2H2025, a key strategic focus is accelerating the expansion of our workforce and production capacity in southeast Asia. We are actively recruiting top-tier talent to meet the surging demand in the gaming industry. A significant advancement is the launch of Vertic Studios, a new brand specialising in high-end art production.

Supported by a strong cash position and no debt, we continue to forge ahead with our M&A strategy. Another key area of focus remains targeting studios in Western markets, supported by the establishment of our UK office, which will serve as a strategic foothold for long-term international expansion.

Our vision is clear, and this period has seen material steps forward towards our aspiration of becoming the #1 game art services provider globally. With the support of the excellent team, growing international momentum and several exciting opportunities ahead, I look forward to updating stakeholders on the next stage of our growth. 

Johnny Jan

Executive Director and Chief Executive Officer (Founder)

¹https://www.nintendo.co.jp/corporate/release/en/2025/250611.html

²https://www.polygon.com/2017/3/14/14921130/nintendo-switch-sales-launch-first-week

³https://technode.com/2025/03/20/tencents-evergreen-games-signal-high-player-engagement-but-lack-of-new-ips/

⁴https://xdsummit.com/wp-content/uploads/2025/04/XDS_Insights-Report_2025.pdf

CFO's Review

Revenue

The Group's revenue increased from US$15.2 million in 1H2024 to US$19.4 million in 1H2025, an increase of US$4.2 million, representing a year-on-year growth of 27.3%, primarily driven by the revenue contribution of US$4.1 million from the acquisition of Mineloader in 1H2025. Excluding the impact of exchange rate fluctuations, the Group's revenue would have increased by 27.1% year-on-year on a constant currency basis.

Excluding Mineloader's revenue contribution, the Group's revenue in 1H2025 remained relatively stable.

Business Segment Review

Art Outsourcing

This business segment is involved in the creation and development of digital art assets. The Group has the capabilities to provide a wide range of design services including 2D concept art, 3D modelling, 2D animation, 3D animation and visual effects, which includes environment design and game character design.

Historically, the majority of the Group's revenue was contributed by the Art Outsourcing business segment and in 1H2025, it accounted for 82.1% of the Group's overall revenue. Revenue from this business segment increased by US$3.3 million or 25.9% to US$15.9 million as compared to 1H2024, mainly due to increased orders from both new and existing clients in Mainland China, United States, Malaysia, and other regions.

Game Development

This business segment provides programming, game development, design and script writing services.

In 1H2025, this business segment contributed 17.6% of the Group's overall revenue, with a revenue growth of US$0.9 million or 36.8% to US$3.4 million as compared to 1H2024. The revenue growth in 1H2025 was mainly supported by stronger demand from customers in Mainland China and Australia.

Global Publishing and Other Services

This business segment is involved in the release of game products produced by the Group as well as third party game developers on global game platforms such as PlayStation, Switch and Steam. It is also involved in the sale of the

Group's in-house developed video game products and peripheral gaming products.

Historically, this business segment is the lowest revenue contributor and in 1H2025, it contributed revenue of US$0.07 million or 0.3% of the Group's overall revenue, which is lower than the US$0.10 million recognised in 1H2024.

Geographical Segment Review

Serving a global customer base that includes 22 of the top 25 game development companies in the world, the Group has made good progress over the years to diversify our revenue base geographically. The following table depicts the revenue breakdown geographically in 1H2025 and 1H2024:

Revenue from Mainland China and Hong Kong is contributed by two segments, one is from Chinese customers in Mainland China and Hong Kong and the other is from Mainland China and Hong Kong (non-China) that comprises (i) Chinese subsidiaries from European and American customers and (ii) overseas subsidiaries of Chinese customers.

In 1H2025, Chinese customers from Mainland China and Hong Kong accounted for 22.8% of the Group's total revenue, while Mainland China and Hong Kong (non-China) accounted for 16.3% of the Group's total revenue. On a combined basis, Mainland China and Hong Kong accounted for 39.1% of the Group's total revenue.

In 1H2024, Chinese customers from Mainland China and Hong Kong accounted for 28.6% of the Group's total revenue, while Mainland China and Hong Kong (non-China) accounted for 4.4% of the Group's total revenue. On a combined basis, Mainland China and Hong Kong accounted for 33.0% of the Group's total revenue.

The Group continues to make good progress with our revenue diversification strategy, which saw the United States market and other regions delivering revenue growth in 1H2025 as compared to 1H2024 and we expect further diversification as we seek to build out our UK office.

¹ Hong Kong here refers to Hong Kong Special Administrative Region
² Taiwan here refers to the Taiwan region.

Gross Profit and Margin

Corresponding to higher revenue in 1H2025, the Group's gross profit increased to US$5.9 million, which represents a year-on-year growth of 38.2%.

The Group's gross profit margin increased to 30.2% in 1H2025 from 27.9% in 1H2024, which was mainly driven by contributions from Mineloader that specialises in higher margin AAA games from console platforms.

Operating Costs

Distribution and marketing expenses increased marginally by US$0.1 million from US$1.0 million in 1H2024 to US$1.1 million in 1H2025. The increase was mainly due to the ongoing distribution and marketing expenses of US$0.1 million related to the AIM dual listing on LSE.

Administrative expenses increased by 57.9% or US$1.6 million, from US$2.7 million in 1H2024 to US$4.3 million in 1H2025, which was mainly due to:

Alternative Performance Measures ("APMs")

The Group also reports on a number of APMs to showcase the financial performance of the Group, which are not standard accounting measures defined by the International Financial Reporting Standards ("IFRS"). The Directors believe these measures provide valuable additional financial information for users to understand the fundamental transactional performance of the Group.

In particular, APMs are used to provide the users of the accounts a clearer understanding of the Group's underlying profitability over a period of time.

Net Profit / Adjusted Net profit

Overall, the Group's net profit remained relatively stable at US$0.9 million in 1H2025 (1H2024: US$0.9 million). On an adjusted net profit basis, the Group's 1H2025 of US$1.4 million was higher than 1H2024 of US$1.1 million.

EBITDA / Adjusted EBITDA

With higher depreciation and amortisation recognised in 1H2025, the Group's EBITDA of US$2.2 million in 1H2025 was higher than US$1.8 million in 1H2024.

In 1H2025, the Group's Adjusted EBITDA of US$2.4 million³ was higher than US$2.1 million⁴ in 1H2024.

It should be noted that both the Adjusted EBITDA and adjusted net profit in 1H2025 include the AIM ongoing listing expenses of US$0.3 million, which were not incurred in 1H2024.

³Adjusted EBITDA in 1H2025 comprises EBITDA, with adjustments that included the Group's share-based compensation expenses, foreign exchange gains and costs of acquisition and integration.

⁴Adjusted EBITDA in 1H2024 comprises EBITDA, with adjustments that included the related dual listing expenses on LSE, share-based payments expenses, foreign exchange gains, costs of acquisition and integration, interest income and private placement related expenses (to raise S$27 million).

Cash flow

Net cash generated from operating activities was US$0.6 million in 1H2025, as compared to US$0.9 million generated in 1H2024. The lower cash inflow was mainly due to a reduction in working capital in 1H2025 attributed to higher contract assets during 1H2025 arising from the acquisition of Mineloader and lower trade payables resulting from an expedited payment schedule to suppliers. 

Net cash used in investing activities was US$13.5 million in 1H2025, compared to US$3.6 million used in 1H2024, which was mainly attributable to the Group's acquisition of Mineloader.

Net cash used in financing activities was US$0.8 million in 1H2025, compared to US$1.7 million used in 1H2024. This reduction was a result of lower cash dividends paid during the period under review.

Balance sheet and liquidity

The Group's current assets decreased by approximately US$10.0 million or 20.1% from US$49.8 million as at 31 December 2024 to US$39.8 million as at 30 June 2025. The key components of the Group's current assets comprise cash and cash equivalents, trade and other receivables and contract assets. Cash and cash equivalents totalled US$25.6 million as at 30 June 2025, a decrease of US$14.2 million or 35.7% from US$39.8 million as at 31 December 2024. The decrease was mainly due to a US$13.2 million payment related to the acquisition of Mineloader. As at 30 June 2025, the Group's trade and other receivables amounted to US$8.0 million, an increase of US$1.7 million or 26.1% from US$6.4 million as at 31 December 2024. The increase was primarily attributable to the consolidation of receivables from the acquisition of Mineloader. Contract assets totalled US$6.2 million as at 30 June 2025, an increase of US$2.6 million or 71.5% from US$3.6 million as at 31 December 2024, mainly due to the acquisition of Mineloader and a higher volume of work completed in 1H2025. Almost all of the contract assets from the previous year's output were converted into trade receivables or cash collection.

As at 30 June 2025, the Group's non-current assets increased by approximately US$15.7 million or 149.8% from US$10.5 million as at 31 December 2024 to US$26.2 million as at 30 June 2025. The key components of the Group's non-current assets comprise intangible assets and right-of-use assets. Intangible assets increased significantly to US$16.8 million as at 30 June 2025, an increase of US$14.9 million or 770.5% from US$1.9 million as at 31 December 2024, mainly due to the recognition of goodwill and intangible assets from the acquisition of Mineloader. Right-of-use assets increased slightly to US$3.5 million as at 30 June 2025, an increase of US$0.5 million or 16.5% from US$3.0 million as at 31 December 2024, mainly due to new right-of-use assets arising from the acquisition of Mineloader.

As at 30 June 2025, the Group's current liabilities decreased by approximately US$0.5 million or 6.5% from US$7.3 million as at 31 December 2024 to US$6.8 million as at 30 June 2025. The key components of the Group's current liabilities comprise trade and other payables and lease liabilities. Trade and other payables decreased to US$4.9 million as at 30 June 2025, a decrease of US$1.1 million or 18.2% from US$5.9 million as at 31 December 2024, which was mainly attributable to expedited payment schedule to suppliers. Lease liabilities increased to US$1.7 million as at 30 June 2025, an increase of US$0.6 million or 47.7% from US$1.2 million as at 31 December 2024, which was mainly attributable to new office lease agreements arising from the acquisition of Mineloader.

As at 30 June 2025, the Group's non-current liabilities increased by approximately US$3.3 million or 111.7% from US$3.0 million as at 31 December 2024 to US$6.3 million as at 30 June 2025. The key components of the Group's non-current liabilities comprise deferred income tax liabilities and other non-current liabilities. Deferred income tax liabilities increased to US$2.8 million as at 30 June 2025, an increase of US$1.7 million or 155.2% from US$1.1 million as at 31 December 2024, which was mainly attributable to the acquisition of Mineloader. The Group recognised other non-current liabilities of US$1.7 million as at 1 April 2025, which is the share purchase consideration payable for the acquisition of Mineloader that shall be paid on 31 March 2030.

As at 30 June 2025, the Group's net asset value per ordinary share is US$12.00 cents (as at 31 December 2024: US$11.35 cents).

WINKING STUDIOS LIMITED AND ITS SUBSIDIARIES

Unaudited Condensed Consolidated Interim Financial Statements

For the Six Months Ended 30 June 2025

(Incorporated and domiciled in Cayman Islands with limited liability No. 159882)

Winking Studios Limited (the "Company") was listed on Catalist of the SGX-ST on 20 November 2023 and dual listed on AIM Market of the London Stock Exchange on 14 November 2024. The initial public offering of the Company on Catalist of the Singapore Exchange Securities Trading Limited (the "SGX-ST") was sponsored by PrimePartners Corporate Finance Pte. Ltd. (the "Sponsor").

This announcement has been reviewed by the Company's Sponsor. This announcement has not been examined or approved by the SGX-ST and the SGX-ST assumes no responsibility for the contents of this announcement, including the correctness of any of the statements or opinions made or reports contained in this announcement. The contact person for the Sponsor is Ms. Foo Jien Jieng, 16 Collyer Quay, #10-00 Collyer Quay Centre, Singapore 049318, [email protected].

WINKING STUDIOS LIMITED AND ITS SUBSIDIARIES

Table of Contents                                                                    

A.     Condensed Consolidated Interim Statements of Comprehensive Income ...................................16

B.     Condensed Consolidated Interim Statements of Financial Position .............................................17

C.    Condensed Consolidated Interim Statements of Cash Flow ........................................................18

D.    Condensed Consolidated Interim Statements of Changes in Equity ............................................19

E.     Notes to the Condensed Consolidated Interim Financial Statements ..........................................21

F.     Other information required by Appendix 7C of the Catalist Rules ................................................37

G.     Other information ...... ............................... .............. ....................................................................53