REGISTRATION DOCUMENT and Annual Report Contents
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2019 REGISTRATION DOCUMENT and Annual Report Contents Message from the Chairman 3 5 Corporate social responsibility AFR 121 5.1 Methodology note on Statement by the person employee-related, environmental and societal reporting 122 responsible for the Registration 5.2 Corporate social responsibility Document AFR 4 governance 125 5.3 Offering a customized game experience that enriches players’ lives beyond pure entertainment 127 1 Key fi gures 5 5.4 Acting as a responsible employer 130 5.5 Developing our local roots 142 1.1 Quarterly and annual consolidated 5.6 Building long-term relationships sales 6 with our business partners 148 1.2 Sales by platform (Net bookings) 7 5.7 Optimizing our environmental 1.3 Sales by geographic region impact 151 (Net bookings) 8 5.8 Report of the independent third party on the consolidated non-fi nancial 2 Group presentation 9 performance statement 157 2.1 Group business model and strategy 10 2.2 History 14 6 Financial statements 161 2.3 Financial year highlights 15 6.1 Consolidated fi nancial statements 2.4 Subsidiaries and equity investments 16 as at March 31, 2019 AFR 162 2.5 Research and development, 6.2 Statutory auditors’ report investment and fi nancing policy 18 on the consolidated fi nancial 2.6 2018/2019 performance review statements AFR 228 AFR (non-IFRS data) 20 6.3 Separate fi nancial statements 2.7 Outlook 24 of Ubisoft Entertainment SA for the year ended March 31, 2019 AFR 233 3 Risks and internal control AFR 25 6.4 Statutory auditors’ report on 3.1 Risk factors 26 the annual fi nancial statements AFR 264 3.2 Risk management and internal 6.5 Statutory auditors’ special control procedure 35 report on regulated agreements and commitments 269 4 Report on corporate governance 41 6.6 Ubisoft (parent company) results for the past fi ve fi nancial years AFR 271 4.1 Corporate governance 42 4.2 Compensation for the administrative 7 and management bodies 78 Information on the Company 4.3 Statutory auditors AFR 119 and its Capital 273 7.1 Legal information 274 7.2 Share capital AFR 277 7.3 Share ownership 284 7.4 Securities market 291 7.5 Financial communication 294 8 Glossary and cross-reference tables 295 Glossary 296 Registration Document cross-reference table 297 Management report cross-reference table 299 Cross-reference table of the items making up the statement of non-financial performance 300 Annual report cross-reference table AFR 302 The items from the Annual Financial Report are clearly identifi ed in the table of contents with the pictogram AFR AFR Registration Document 2019 and Annual Report The French version of this Registration Document was fi led on June 7, 2019 with the Autorité des Marchés Financiers (AMF) in accordance with Article 212-13 of its General Regulation. It may be used in connection with a fi nancial transaction if accompanied by a memorandum approved by the Autorité des Marchés Financiers. This document has been prepared by the issuer and is binding upon its signatories. Pursuant to Article 28 of Commission Regulation (EC) No. 809/2004, the following information is incorporated by reference in this Registration Document: ♦ the consolidated and separate fi nancial statements and the relevant Statutory auditors’ reports for the fi nancial year ended March 31, 2018, presented in the Registration Document fi led on June 6, 2018 under No. D.18-0544, pages 142 to 246; ♦ the consolidated and separate fi nancial statements and the relevant Statutory auditors’ reports for the fi nancial year ended March 31, 2017, presented in the Registration Document fi led on July 21, 2017 under No. D.17-0787, pages 125 to 219. - Registration Document 2019 1 2 - Registration Document 2019 Message from the Chairman Dear Shareholders and Partners, Ubisoft achieved a record performance in the 2018/2019 fi nancial We expect to reach fi ve billion players over the next 10 years, as year, in line with the plan that the Group set itself three years ago. barriers between platforms and regions disappear. The growing success of console and PC franchises on mobile devices and the Over the past three years, we have continued to radically transform advent of cloud gaming will play an important role in these major the Company. We have launched high-quality games and experiences developments. For a start, cloud gaming will be enhanced by at a steady pace. The Group’s digital transformation has been much multi-screen offerings and exciting new experiences with access to faster than anticipated and we have reduced our dependence on unprecedented technological capability. As an indication of the future new launches, switching to a much more recurring model. We have scale of this transformation, more and more platforms are competing also diversifi ed our portfolio through the development of two high- for quality content and access to engaged player communities. Our potential sectors, PC and mobile, and are chasing strong growth recent partnerships with Tencent, Epic and Google refl ect these in Asia. trends and the relevance of our positioning. As a result, our net bookings* have risen 46% in three years. Non- In this respect, there are numerous opportunities for Ubisoft to IFRS operating income reached €446 million for the period (+164% create value: Growing the audience and player engagement with over three years), with a record non-IFRS operating margin of 22%, larger games and more powerful post-launch content – creating new up 10 points on the 2015/2016 fi nancial year. I would like to thank gaming genres, segments and experiences – adapting our console all Ubisoft staff for their outstanding performance. and PC franchises for mobile devices – preparing the advent of the Today, Ubisoft is ideally positioned within the video game industry next generation of consoles – seizing the opportunities afforded and has key strengths that represent the pillars of its long-term by streaming and cloud gaming – developing our Uplay platform strategy. We are building a sustainable organization while remaining – investing in artifi cial intelligence. To fully capitalize on all these agile. Our aim is to establish a strong corporate culture with a view to opportunities, and in a bid to support the Group’s growth and attracting the best talent. With our extensive global studio network continue to grow our profi tability over the coming years, we are and collaborative approach, we boast unrivaled production capacity accelerating investment in our people and studios. This organic and can deliver quality content at a steady pace. We own all our key investment approach has consistently paid off at Ubisoft and has brands, which gives us excellent visibility. In recent years, we have created signifi cant value for the Company’s talent, players and been forging a special relationship with our communities. Highly shareholders in recent years. We are confi dent about the future engaged and continually expanding, they represent the core value and excited about the opportunities available to us. of our games. With Uplay, we now have a high-performance, fast- I would like to extend my warmest thanks to our shareholders and growing online service and distribution platform, enabling us to partners for their loyalty, support and trust. cement this close relationship over the long term. Although video games are now the largest segment of the entertainment industry, they are still only in the early stages of Yves Guillemot development and are set to undergo further profound transformation. Chairman and Chief Executive Offi cer * Net bookings correspond to historical sales (sales excluding impacts from the application of IFRS 15) - Registration Document 2019 3 Statement by the person responsible for the Registration Document This is a free translation into English of the person responsible for the Registration Document issued in French language and it is provided solely for the convenience of English speaking readers. I confi rm, after having taken all reasonable measures to this effect, consolidated fi nancial statements which shows the impact of the that the information contained in this Registration Document is, early application of IFRS 9 as of April 1, 2017. to my knowledge, accurate and free from any omission likely to The Statutory auditors’ report on the consolidated fi nancial affect its import. statements for the fi nancial year ended March 31, 2019 appears I confi rm that, to my knowledge, the fi nancial statements have been on pages 228 to 232 of this Registration Document. It contains an prepared in accordance with the applicable accounting standards observation drawing the attention of the reader to the “Comparability and provide a true and fair view of the assets and liabilities, fi nancial of fi nancial statements” note in the Notes to the consolidated position and results of the Group and all companies consolidated fi nancial statements which shows the impact of the early application therein, and that the management report information listed on of IFRS 15 as of April 1, 2018. page 299 of Chapter 8 is a true presentation of the evolution of the The Statutory auditors have certifi ed without reservation the business activity, revenue and fi nancial position of the Group and consolidated fi nancial statements of the past three fi nancial years. all companies consolidated therein, as well as a description of the main risks and uncertainties facing them. The Statutory auditors’ report on the separate fi nancial statements for the fi nancial year ended March 31, 2017 (pages 216 and 217 of I have obtained a completion letter from the Statutory auditors the 2017 Registration Document) contains no comment. in which they confi rm that they have examined the information relating to the fi nancial position and statements presented in this The Statutory auditors’ report on the separate fi nancial statements Registration Document, and that they have read the document in for the fi nancial year ended March 31, 2018 (pages 240 and 243 of its entirety.