MANAGEMENT BOARD REPORT ON THE
ACTIVITIES OF THE CD PROJEKT GROUP
FOR THE PERIOD BETWEEN 1 JANUARY
AND 30 JUNE 2024
Disclaimer
This English language translation has been prepared solely for the convenience of English-speaking readers.
Despite all the efforts devoted to this translation, certain discrepancies, omissions or approximations may
exist. In case of any differences between the Polish and the English versions, the Polish version shall prevail.
CD PROJEKT, its representatives and employees decline all responsibility in this regard.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
2 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
3 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
Table of contents
4 Key highlights of the first half of 2024
5 Brief outline of the CD PROJEKT Group
6 Activity profile
11 Growth prospects of the CD PROJEKT Group
12 CD PROJEKT S.A. on the securities market
15 CD PROJEKT Group activity profile
16 Organizational structure of the CD PROJEKT Group
18 Disclosure of business segments, products and services, outlets, suppliers and clients
30 Disclosure of external and internal factors affecting further growth of the CD PROJEKT Group
32 Disclosure of factors which, in the Issuer’s opinion, will have an effect on its earnings during at least
the coming quarter
32 Disclosure of significant agreements
32 Key threats and risks related to the remaining months of the current financial year
33 Results of operations of the CD PROJEKT Group
34 Discussion of the key economic and financial figures disclosed in the consolidated financial statements
52 Corporate governance
53 Entity contracted to audit financial statements
53 Shareholders controlling at least 5% of the vote at the General Meeting
55 Agreements which may result in changes in the proportions of shares held by shareholders and bondholders
57 Disclosure of the control system of employee share programs
57 Disclosure of the purchase and redemption of own shares
58 Company shares held by members of the Management Board and the Supervisory Board
58 Management structure
59 Composition of the Management Board of CD PROJEKT S.A.
61 Changes in the composition of the Management Board of CD PROJEKT S.A.
61 Composition of the Supervisory Board and Audit Committee of CD PROJEKT S.A.
62 Changes in the composition of the Supervisory Board and Audit Committee of CD PROJEKT S.A.
62 Disclosure of retirement benefits and similar compensation payable to former members of the Issuer’s
executive, supervisory or administrative bodies, and of any liabilities associated with such benefits, specifying
the aggregate amounts for each category of recipients
62 Agreements between the Issuer and members of its managing bodies concerning compensation in the event
of their resignation or dismissal, including dismissal or recall as a result of a merger
62 Changes in basic management practices at the Company and its Group
63 Applicable corporate governance policies
63 Disclosure of significant legal proceedings
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
4 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
Key highlights of the first half of 2024
■ On 4 January the CD PROJEKT RED studio announced that over 5 million copies
of Phantom Liberty – the storyline expansion for Cyberpunk 2077 – had been
sold between its release date (26 September 2023) and the end of 2023
■ On 11 April 2077 Cyberpunk 2077 triumphed in the “Evolving Game” cate-
gory at the 20th BAFTA Games Awards gala. This award is presented to
the game with outstanding post-release support from the dev team
■
On 21 May the studio released REDkit – a modding tool for
The Witcher 3: Wild Hunt, enabling users to create their own adven-
tures set in the world of Geralt of Rivia
CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
CD PROJEKT GROUP
BUSINESS ACTIVITY
FINANCIAL RESULTS
CORPORATE GOVERNANCE
BRIEF OUTLINE OF
THE CD PROJEKT GROUP
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
6 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
Activity profile
CD PROJEKT S.A. (also referred to as CD PROJEKT or the Company), headquartered in Warsaw, conducts
business activities in the dynamically growing global digital entertainment segment. These activities, carried
out since 1994 under the CD PROJEKT brand name, began by distributing foreign games in Poland. Pivotal
moments in the Group’s history came in 2002 with the establishment of the CD PROJEKT RED studio, which
initiated work on the Company’s first major RPG – The Witcher – as well as in 2008, with the launch of GOG.COM.
The CD PROJEKT Group currently conducts operating activities in two key global segments: CD PROJEKT RED
and GOG.COM.
1 Role Playing Game – a storyline-driven game based on a consistent narrative.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
7 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
CD PROJEKT RED
Development and publishing video games and managing the Company’s franchises, including through creation
and production of tie-in products.
GOG.COM
Digital distribution of videogames via the Company’s proprietary GOG.COM platform and the GOG GALAXY application.
During the reporting periods 96.8% of the CD PROJEKT Group’s sales revenues were generated by exports.
Throughout the first half of 2024 North America and Europe accounted for 70.1% and 19.2% of the Group’s
sales respectively.
Map 1 The CD PROJEKT Group around the world
São Paulo
Wrocław
Kraków
Warszawa
Berlin
Los Angeles
Boston
Shanghai
Tokyo
Seoul
Paris
Vancouver
Madrid
Headquarters (CD PROJEKT RED, GOG.COM)
CD PROJEKT RED dev studio
Branch offices
Media and community managers
Publishing team representatives
CD PROJEKT RED Inc. and The Molasses Flood
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
8 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
GROWTH STRATEGY
Strategic directions related to development and support for the team, along with transformation of the videogame
development process are presented in the CD PROJEKT Group Strategy Update published in 2021 (including
the accompanying video commentary) as well as in our Strategy Update which focuses on long-term plans for
developing key projects and was published in 2022.
In the framework of its strategy, in the coming years the Studio intends to develop and publish the following
releases:
■ A new Witcher trilogy, the first installment of which is the game codenamed Polaris;
■ Project Sirius (a game with multiplayer features, developed by The Molasses Flood);
■ The Witcher Remake (developed in collaboration with Fool’s Theory);
■ Project Orion – upcoming game in the Cyberpunk universe.
Other than the projects revealed in the Strategy Update, the Studio also engages in other, unannounced pro-
jects, which will be publicized following positive verification of their commercial potential, or commencement
of their associated informational campaigns, as appropriate.
In addition, CD PROJEKT RED is carrying out internal work on the third proprietary IP codenamed Hadar.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
9 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
In line with the adopted strategy, in late 2023 CD PROJEKT RED launched a new hub in Boston (distinct from
The Molasses Flood). This hub is tasked with work on the new game set in the Cyberpunk universe –
Project Orion.
CD PROJEKT has also revealed that it was carrying on with the franchise flywheel concept, which involves
developing an ecosystem of mutually supporting products, rooted in the potential of the Studio’s franchises.
The Group collaborates with various external partners in order to create new ways to interact with its franchises.
CD PROJEKT further announced enrichment of its entertainment ecosystem with games offering multiplayer
features.
Details of the CD PROJEKT Group’s strategy are described in materials available on the Company website.
Chart 1 CD PROJEKT Group – business model
Presenting gamers with ambitious,
innovative, high-quality games
Parallel development projects
supporting an ambitious release
schedule
Offering unique development
opportunities and career
advancement options for team
members while retaining
creative autonomy
Steady stream of revenues
and earnings - enabling
financial independence
Development and expansion of
franchises by creating synergies
and supporting recognition of
our brands beyond the field of
videogames
Supporting and harnessing synergies
in the context of our franchises
Collaboration with experienced
quality-focused partners in expanding our
franchises to new fields of entertainment
Management and protection of intellectual property
related to globally recognized franchises, beloved
by fans throughout the world
Maintaining control over the creative process
– caring for the quality of products
which comprise our franchises
Games developed by experienced
teams which prioritize quality
Parallel production by CD PROJEKT RED
development studios in Poland, USA
and Canada, and The Molasses Flood
Applying own tools and know-how to
development of open-world story-driven RPGs
Development of games in the context of
a strategic partnership which involves
the use of Unreal Engine
to support open-world gameplay
Carrying out global marketing and
sales campaign – by internal PR, Marketing
and Biz Dev teams
Maintaining dialogue with gamers
in 11 languages
FRANCHISE
MANAGEMENT
PUBLISHING
TECHNOLOGY
PRODUCTION
INTELLECTUAL
PROPERTY
STAKEHOLDER VALUE
7
OUR KEY CAPITAL
INTELLECTUAL CAPITAL
Franchise rights: The Witcher and Cyberpunk,
in selected fields of exploitation
TECHNOLOGICAL CAPITAL
Gamedev technologies and tools
RELATIONS AND SOCIAL CAPITAL
Strong communities
established around our products
Longstanding trust-based relations
with business partners
PRODUCT CAPITAL
Portfolio of available games and tie-in products
HUMAN CAPITAL
Team of experienced developers, highly skilled
in creating and producing games,
centered around a shared set of values
Internal publishing team with experience
in leading global marketing campaigns,
successfully promoting sales of our games
Effective backoffice team supporting our operations
FINANCIAL CAPITAL
Financial reserves
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
10 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
EMPLOYMENT
The Group considers its team to be its greatest asset. We employ people who are passionate about develo-
ping world-class products and services. Their talent, involvement and motivation represent the human capital
of the CD PROJEKT Group. They, along with their creative ideas, are the force behind the Group’s success.
At CD PROJEKT, we are building a work environment based on acceptance, openness, and trust because we
believe it fosters the creativity of our teams and enhances the innovation and appeal of our creations. This
belief is enshrined in the CD PROJEKT S.A. Diversity Policy – an expression of basic values which apply to
the Company and guide relations among its team members, key managers and members of the Management
Board and Supervisory Board.
CD PROJEKT is also a signatory to the Diversity Charter – an international initiative organized under the auspi
-
ces of the European Commission, which obligates us to institute non-discrimination policies at the workplace,
take action to promote diversity and involve team members and business partners in these activities.
Chart 2 Employment structure at the CD PROJEKT Group at the end of 2023 and at the end of H1 2024
At the close of the first half of 2024 the CD PROJEKT Group employed 1 134 persons.
1134
Total employee count
as of 30.06.2024
Women (31%)
Men (69%)
Men (69%)
1165
Total employee count
as of 31.12.2023
Women (31%)
Men(69%)
195
235
735
24
141
1 000
195
234
705
29
133
972
30.06.2024
31.12.2023
Developers
Back office
Publishing*
* The Publishing branch comprises, among others, Marketing, PR, Business Development, Customer Relations and Game
Releases teams.
CD PROJEKT RED
GOG.com
The Molasses Flood
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
11 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
Growth prospects of the CD PROJEKT Group
The CD PROJEKT Group conducts its business in the global videogame market which is one of the most dyna-
mic branches of the global economy. Newzoo – respected analysts of the videogame and e-sports markets –
estimate that by 2027 the volume of the global videogame market will reach 213 billion USD, which implies
a cumulative annual growth rate (CAGR) of 3.7% for the 2023–2027 period. According to PWC’s “Global Enter-
tainment & Media Outlook 2023–2027” report, the videogame and e-sports market is expected to grow by
7.9% annually during this period.
The global gaming community continues to grow each year, both quantitatively and in terms of engagement
(i.e. time spent playing). Newzoo estimates that at the end of 2023 there were 3.3 billion gamers worldwide.
In 2027 the total figure is expected to reach nearly 3.8 billion, with a cumulative annual growth rate for 2021–2027
projected at 3.5%.
The growth outlook of the Group is affected by the increasing popularity of this form of entertainment as an
approachable and attractive mass market offering, and also by technological advancements which result
in increasing sophistication and realism of products offered, increasing availability and affordability of gaming
devices, along with further development of digital means of reaching potential gamers and new game distri-
bution channels.
2 The Global Games Market Report 2024, Newzoo, 13 August 2024; accessed on 13 August 2024;
https://newzoo.com/resources/trend-reports/newzoos-global-games-market-report-2024-free-version
3 Perspectives from the Global Entertainment & Media Outlook 2023–2027, PwC, 21 June 2023, accessed on 1 August 2024;
https://www.pwc.com/gx/en/industries/tmt/media/outlook/insights-and-perspectives.html
4 The Global Games Market Report 2024, Newzoo, 13 August 2024; accessed on 13 August 2024;
https://newzoo.com/resources/trend-reports/newzoos-global-games-market-report-2024-free-version
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
12 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
CD PROJEKT S.A. on the securities market
The CD PROJEKT brand has been present on the Warsaw stock exchange since 2010. 99 910 510 Company
shares are traded on the Main Market of the Warsaw Stock Exchange under the continuous trading system.
Key shareholders of CD PROJEKT S.A. are its co-founders – Marcin Iwiński (incumbent Chairman of the
Supervisory Board) and Michał Kiciński. Other major shareholders who are also members of the Company’s
Management Board are Piotr Nielubowicz – Chief Financial Officer and Adam Kiciński – Chief Strategy Officer.
Chart 3 Company shareholding structure as of the publication date of this report
* According to a notification filed on 13 November 2023
** According to a notification filed on 12 August 2024, the funds managed by Nationale-Nederlanden PTE S.A. collectively held 5.42% of
Company shares, including 5.03% in possession of Nationale-Nederlanden OFE
Chart 4 CD PROJEKT S.A. stock price and the WIG20 index between 1 January and 30 June 2024
R
emaining shares
60.8%
Nationale-Nederlanden PTE**
5.4%
Adam Kiciński
4.0%
Piotr Nielubowicz
6.9%
Michał Kiciński*
10.0%
Marcin Iwiński
12.9%
Founders and
Management Board
members
80
90
100
110
120
130
CD PROJEKT WIG20
01.2024 02.2024 03.2024 04.2024 05.2024 06.2024
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
13 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
Between 1 January and 30 June 2024 the Company stock price fluctuated between 99.20 PLN (19 January 2024)
and 145.00 PLN (22 May 2024). During this half-year period the stock price increased by 24.2%, to 138.95 PLN
at the end of the final trading day of H1 2024 (28 June 2024). Over the same period the WIG20 index gained
11,2% while the main WIG index gained 14.4%.
At the end of June 2024 the market capitalization of CD PROJEKT S.A. was 13.9 billion PLN.
Chart 5
Average daily value of trade in CD PROJEKT S.A. shares (by month) between 1 January and
30 June 2024 (PLN millions)
The aggregate value of trade for the first half of 2024 was 5.9 billion PLN, which is 10% less than during the
reference period in 2023. The average daily value of trade was 47.9 million PLN, compared to 53.2 million
PLN the year before. An increase was, however, observed in the average number of transactions per trading
day – from 6 017 to 6 327.
0
10
20
30
40
50
60
70
80
90
100
January
February
March
April
May
June
2023 2024
Average daily value of
trade; H1 2023
- 53 million PLN
Average daily value of
trade; H1 2024
- 48 million PLN
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
14 CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
Table 1 Key indicators of CD PROJEKT S.A. stock
H1 2024 H1 2023 Change
Net earnings per share (PLN) . . .%
Quantity of shares in trading (in thousands) at end of period %
Highest closing price during fiscal year (PLN) . . -.%
Lowest closing price during fiscal year (PLN) . . -.%
Price at beginning of period (PLN) . . -.%
Price at end of period (PLN) . . -.%
Average price during period (PLN) . . -.%
Market capitalization at end of period (PLN thousands) -.%
Average number of transactions per trading day .%
Average daily value of trade (PLN thousands) -.%
Average daily trading volume (shares) -.%
As of the publication date of this report 24 brokerage houses, both foreign and domestic, issue recommen-
dations concerning Company stock. The full list of analysts and brokerage houses which issue recommenda-
tions concerning Company stock can be found on the CD PROJEKT website at https://www.cdprojekt.com/en/
investors/analysts/.
CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
CD PROJEKT GROUP
BUSINESS ACTIVITY
FINANCIAL RESULTS
CORPORATE GOVERNANCE
CD PROJEKT GROUP
ACTIVITY PROFILE
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
16 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Organizational structure of the CD PROJEKT Group
As of 30 June 2024, the CD PROJEKT Group consisted of the parent entity – CD PROJEKT S.A. – and five
subsidiaries: GOG sp. z o.o., CD PROJEKT RED Inc., CD PROJEKT RED Vancouver Studio Ltd., The Molasses
Flood LLC and CD PROJEKT SILVER Inc.
Chart 6 CD PROJEKT Group at the end of the first half of 2024 (capital and voting share)
CD PROJEKT S.A.
GOG sp. z o.o.*
CD PROJEKT RED Vancouver Studio Ltd.
*Spółki objęte konsolidacją
CD PROJEKT RED Inc.*
100%
100%
100%
CD PROJEKT SILVER Inc.
The Molasses Flood LLC
82%
100%
*Consolidated companies
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
17 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Table 2 Basic activity profile of each member company of the CD PROJEKT Group as of 30 June 2024
Company Scope of activity
CD PROJEKT S.A.
The principal scope of activity of the company, carried out through its CD PROJEKT RED
studio, involves development and publishing of videogames based on the Company’s IP,
selling the associated distribution rights, as well as manufacturing, selling, licensing and
publishing tie-in products. CD PROJEKT S.A. also serves as the holding company of the CD
PROJEKT Group, and coordinates the activities of subsidiaries which comprise the Group
(offices in Warsaw, Kraków and Wrocław).
GOG sp. z o.o.
The company distributes videogames through online channels to customers from around
the world. The company also owns the GOG.COM proprietary global digital distribution plat-
form and the GOG GALAXY application (office in Warsaw).
CD PROJEKT RED Inc.
The company coordinates development work on Project Orion and participates in publishing
and promotional activities focused on CD PROJEKT Group projects (office in Boston).
CD PROJEKT RED
Vancouver Studio Ltd.
The company coordinates development in the framework of the CD PROJEKT RED studio
(office in Vancouver).
The Molasses
Flood LLC
This gamedev studio is working on the project codenamed Sirius (office in Boston).
CD PROJEKT
SILVER Inc.
A company established to participate in development of entertainment products tied to
CD PROJEKT brands.
No changes in the organizational structure and composition of the CD PROJEKT Group occurred during the
reporting period.
The above member companies of the CD PROJEKT Group, incorporated as of 30 June 2024, except for
CD PROJEKT RED Vancouver Studio Ltd., The Molasses Flood LLC and CD PROJEKT SILVER Inc., were sub-
ject to full consolidation. Detailed information can be found in the Consolidated Financial Statement of the
CD PROJEKT Group for the first half of 2024.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
18 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Disclosure of business segments, products and
services, outlets, suppliers and clients
In the first half of 2024 the Group conducted business activities in two segments:
■ CD PROJEKT RED,
■ GOG.COM.
CD PROJEKT RED SEGMENT
Target and scope of business activity
Activities within this segment focus on the Company’s franchises – The Witcher and Cyberpunk – and involve
the following:
■ developing and publishing videogames;
■ coordinating promotion, distribution and sales of own products;
■ managing the Group’s franchises and IP;
■
collaborating with external partners in the scope of creating, selling, licensing or publishing tie-in products
based on the Group’s franchises.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
19 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Key products
Videogame development commenced in 2002 and initially focused on the studio’s RPG debut: The Witcher.
This game, set in Andrzej Sapkowski’s fantasy world, was released in 2007 to global acclaim, garnering over
100 awards and accolades.
The Studio’s key product portfolio currently includes the following videogames:
■ The Witcher;
■ The Witcher 2: Assassins of Kings;
■ The Witcher 3: Wild Hunt with two expansion packs – Hearts of Stone and Blood and Wine;
■ Cyberpunk 2077 with its expansion pack – Phantom Liberty.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
20 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Key sources of revenue
Sales of CD PROJEKT RED games are carried out under the following core business models:
■ sales of territorial distribution rights (for box and digital editions), settled post factum on the basis of monthly
or quarterly sales reports / licensing reports submitted by the Company’s business partners;
■ supplies of physical box editions to the Company’s business partners for retail resale;
■ supplies of batches of activation codes which permit the game to be downloaded and installed;
■ sales carried out through optional microtransactions in GWENT: The Witcher Card Game.
Digital distribution agreements concluded by the Company are typically settled in monthly cycles, while distri-
bution of physical videogame editions follows quarterly reporting cycles. Depending on the specific partner
or contract, the Company also collects licensing reports – these are submitted 30, 45 or 60 days following the
end of each reporting period (typically each month or quarter).
In the first half of 2024 the most important CD PROJEKT RED products from the point of view of revenues were:
■ Cyberpunk 2077 together with its expansion – Phantom Liberty;
■ The Witcher 3: Wild Hunt, together with its expansions – Hearts of Stone and Blood and Wine.
Revenues were also generated – to a lesser degree – by micropayments in GWENT: The Witcher Card Game
and Thronebreaker: The Witcher Tales. Additionally, the Company offered earlier instalments in The Witcher
franchise, including The Witcher and The Witcher 2: Assassins of Kings, both of which continue to attract players
and generate revenues.
The Company also obtained revenues from tie-in products (in the framework of the “franchise flywheel” concept)
associated with The Witcher and Cyberpunk franchises.
Key business partners and suppliers
Within the CD PROJEKT RED activity segment, the Group carries out active distribution of its games for various
hardware platforms, through leading digital distribution platforms (e.g. Steam, PlayStation Store, Xbox Games
Store, Epic Games Store, Nintendo, Apple App Store, Google Play and Humble Bundle, along with its own
proprietary GOG.COM platform) as well as traditional distribution channels, in cooperation with leading global
distributors (such as BANDAI NAMCO Entertainment Europe S.A.S., Warner Bros. Home Entertainment, Epicsoft
Asia PTE LTD, Bandai Namco Entertainment Australia PTY LTD, Cenega S.A., Spike Chunsoft Co., Ltd., GEEKAY,
U&I Entertainment LLC).
In the first half of 2024 sales to two clients exceeded 10% of the Group’s consolidated sales revenues and
totaled 167 899 thousand PLN and 71 999 thousand PLN respectively (39.5% and 16.9% of the Group’s sales
revenues respectively). These clients are not affiliated with CD PROJEKT S.A. or any of its subsidiaries.
The videogame development process relies on certain bought-in tools and technical solutions; however, these
do not result in significant concentration of supply. No CD PROJEKT RED supplier accounted for more than 10%
of the consolidated revenues of the Group in the first half of 2024.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
21 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Communication
In the scope of its publishing activities, the Company is responsible for building promotional campaigns around
its proprietary products, and directly engages in communication with the player via using electronic channels,
social media platforms and participation in events. This area of activity is guided by the “Always remember about
gamers” principle, which is one of the Studio’s core values. CD PROJEKT RED actively manages over 110 social
media profiles in more than a dozen languages, both global and local (such as the BILIBILI and Weibo platforms
in China, and the Naver Cafe platform in Korea).
Key corporate and marketing events
Cyberpunk 2077
In early 2024, on 4 January, CD PROJEKT RED announced that Phantom Liberty – the storyline expansion for
Cyberpunk 2077 – had sold over 5 million copies around the world between its launch on 26 September 2023
and the end of that year.
On 20 March Go On Board – creators of The Witcher: Old World board game – announced another project
in partnership with CD PROJEKT RED: a board game set in the Cyberpunk 2077 universe. The corresponding
crowdfunding campaign is set to launch on 3 September on the Gamefound platform.
On 28–31 March CD PROJEKT RED, in collaboration with Xbox and PlayStation, organized a free-of-charge trial
of the base console edition of Cyberpunk 2077. Every owner of current-generation consoles could play the
game at no cost for five hours, experiencing all the extensions introduced in Updates 2.0 and 2.1.
On 11 April, at the 20th gala BAFTA Awards ceremony the Cyberpunk 2077 dev and support team took first prize
in the “Evolving Game” category, which is awarded by the jury to games with outstanding post-release support.
On 20 May, at the Digital Dragons gala, awards were presented to the best Polish games of 2023, with Phantom
Liberty carrying “Best Polis Game” and “Best Polish Narrative” categories.
On 4 July, after the close of the reporting period, another Cyberpunk board game was announced. Cyberpunk:
Edgerunners Board Game, developed by No Loading Games in partnership with CD PROJEKT RED, is schedu-
led to retail in 2025.
On 22 August an official meetup of the local Cyberpunk 2077 community took place in the framework of
gamescom 2024 in Cologne, Germany. On that day, CD PROJEKT RED organizers invited guests to a joint
celebration in a recreated Dogtown setting, well known from Phantom Liberty.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
22 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
The Witcher universe
On 31 January 2024, owing to collaboration between CD PROJEKT RED and Com2uS the mobile RPG – Sum-
moners War: Sky Arena – was visited for a limited time by Witcher franchise characters – Geralt, Ciri, Triss and
Yennefer, marking that game’s 10th anniversary.
On 21 May the Company released REDkit – a modding tool for The Witcher 3: Wild Hunt, enabling users to cre-
ate their own adventures in the world of Geralt of Rivia. The editor provides features for modifying characters,
their costumes, quests, locations, cutscenes and dialogue trees. To mark its release, the Studio also released
a set of tutorials, a video trailer, creator testimonials and a special episode of REDstreams entirely devoted to
the editor, prepared in partnership with professional modders from the Yigsoft group.
On 20 August CD PROJEKT RED announced that The Witcher 3: Wild Hunt was being offered to owners of
PlayStation 4 and PlayStation 5 as part of the PlayStation Plus Extra and Premium game catalogues.
Other events
On 18–22 March the Developer Conference (GDC) took place in San Francisco. During this six-day event
CD PROJEKT RED representatives organized 14 talks, sharing their experiences with developing Cyberpunk 2077
and the Phantom Liberty expansion with other game industry professionals.
On 19–21 the Digital Dragons conference was held in Kraków. This year’s edition featured talks, discussion
panels and workshops organized by nearly 20 CD PROJEKT RED representatives (13 activities in total) and
devoted to artwork, narration, design, audio and communication-related experiences.
On 14–16 June another edition of the Pyrkon festival took place in Poznań, with a range of activities prepared
by CD PROJEKT RED. Studio members organized a cosplay competition for fans of The Witcher and V, and
also took part in a range of discussion panels.
Ticket sales for Art For All launched on 18 July, after the close of the reporting period. This event is aimed at
everyone wishing to develop their skills in the area of creative arts, and will take place on 7 September at EC1,
alongside this year’s edition of the Promised Land Art Festival.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
23 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
GOG.COM
Target and scope of business activity
The GOG.COM platform was launched in August 2008. Its initial mission was to revitalize major PC cult classics
and offer them for sale to international customers. In 2024 the platform was offered in English, French, German,
Russian, Chinese and Polish – this includes full website and game localizations, as well as integration with
locally popular payment channels, accepting payments in sixteen currencies. GOG.COM also carries releases
for the macOS and Linux operating systems.
Activities carried out in this segment focus on digital distribution of videogames via the Company’s proprietary
GOG.COM distribution platform and the GOG GALAXY application. The platform enables customers to purchase
games, remit payment and download game files to their personal devices, while the GOG GALAXY application
provides – among others – automatic updates, cloud saves, online and cross-play features.
Payments collected by GOG sp. z o.o. from customers are split with the Company’s suppliers as agreed upon in
distribution contracts. Typical contracts require the Company to submit sales reports to its suppliers in monthly or
quarterly cycles, not later than 30 days following the close of the given reporting period. With regard to certain
older products the company may be contractually permitted to adapt them to the requirements of modern ope-
rating systems, or to enable multiplayer gameplay if such features were originally provided by the given game.
Key products
As of the publication date of this report, the GOG.COM digital distribution platform offers over 9000 products
from more than 1300 partners. This includes both timeless classics and fresh releases from such well-known
brands as Sony, Bethesda, Disney, Electronic Arts, Ubisoft, Konami and Warner Bros.
The key difference between GOG.COM and its competition is its strong customer focus and the “gamers first”
approach. This is evidenced, among others, by striving to ensure that single-player gamers are distributed in the
DRM-free model, free of restrictions which might otherwise prevent customers from enjoying their purchases.
Products offered on GOG.COM are also richly featured and usually include bonus content such as soundtracks,
maps and wallpapers.
In addition to the above, GOG.COM ensures compatibility of its games with current versions of MS Windows,
macOS and popular distributions of Linux, which is a particular advantage in the case of classic games and
contributes to preservation of videogame history.
The Group uses GOG.COM to market its own products directly to end users – this includes games set in The Witcher
universe, as well as Cyberpunk 2077 together with its expansion – Phantom Liberty.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
24 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Key sources of revenue
Revenues obtained in the GOG.COM segment are directly dependent on the popularity of the offered games
and their respective sales volumes. The Company continuously expands the scope of its cooperation with
suppliers and seeks access to new, attractive products. GOG.COM is also home to seasonal and one-off sales
campaigns, including summer, fall and Christmas bargain packages as well as other events which introduce
new ways to attract gamers.
Key product and marketing events
Digital distribution of videogames
In the first half of 2024 the GOG.COM catalogue was expanded – among others – by games such as Sinking
City, Robocop Rogue City, Sniper Ghost Warrior Contracts 2 Complete Edition, Tomb Raider I–III Remastered,
Alpha Protocol, God of War, Manor Lords, Resident Evil, and Riven.
Sales support
Sales support in the digital distribution segment focuses mainly on adding new attractive items to the catalogue
and carrying out seasonal promotional campaigns.
GOG.COM’s largest promotional campaigns of the first half of 2024 included the seasonal Spring and Summer
Sales. During the latter, over 6 thousand games were offered at bargain prices. The GOG team also organized
other promotional events, including a series of thematic sales focused, among others, on story-rich games,
horrors, strategy games or games featuring characteristic pixel art.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
25 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Key suppliers and clients
GOG sp. z o.o. markets games via online channels directly to millions of individual users worldwide. As such,
the segment does not have key clients in the usual sense of the term.
Chart 7
Sales of products and goods by GOG.COM in the first half of 2024 and the first half of 2023,
by territory
In terms of territorial breakdown, sales in the first half of 2024 followed the pattern established in the preceding
years. During this period the largest group of GOG.COM customers came from the United States (31%), followed
by Germany (14%), Poland (9%), the United Kingdom (6%) and France (6%).
As of 30 June 2024 no single supplier in the GOG.COM segment accounted for more than 10% of the Group’s
consolidated revenues.
Other territories
23%
Spain
2%
Netherlands
2%
Australia
3%
Canada
4%
France
6%
United Kingdom
6%
Poland
9%
Germany
14%
USA
31%
Other territories
23%
Spain
2%
Netherlands
2%
Australia
3%
Canada
4%
France
6%
United Kingdom
6%
Other territories
25%
Sweden
1%
Netherlands
2%
Australia
3%
Canada
4%
France
5%
United Kingdom
6%
Poland
9%
Germany
14%
USA
32%
H1 2023 H1 2024
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
26 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
KEY CORPORATE EVENTS
On 20 February 2024, at an Extraordinary General Meeting of CD PROJEKT, the Earnings Condition (cumula-
tive consolidated net earnings for the years 2024–2027) was set in the framework of Incentive Program B at
3 billion PLN for entitlements assigned in 2024. All materials related to this General Meeting, including resolu-
tions adopted thereby, are available on the Company website.
On 28 March the Management Board of the Company recommended that 99,910,510.00 PLN from the net profit
obtained in 2023 be allocated towards a dividend (at 1 PLN per eligible share). The Management Board further
recommended that the remainder of the divisible net profit for the preceding year, at 344,177,050.72 PLN be
transferred to the Company’s reserve capital. These recommendations were duly endorsed by the Supervi-
sory Board on 16 April. On 14 June the Ordinary General Meeting voted to allocate the Company’s earnings in
accordance with the Management Board’s recommendation, setting the dividend record date to 21 June and
the dividend payment date to 27 June.
On 14 June 2024 the Ordinary General Meeting of CD PROJEKT also approved amendments to the Remune-
ration Policy of Members of the Management Board and Members of the Supervisory Board of the Company.
The full wording of resolutions adopted at the OGM is available on the Company website.
EVENTS FOLLOWING THE BALANCE SHEET DATE
No significant events affecting this report occurred after the balance sheet date.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
27 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
EFFECT OF THE ARMED CONFLICT IN UKRAINE
ON THE ACTIVITIES OF THE CD PROJEKT GROUP
Effect on earnings
In response to the Russian armed invasion of Ukraine, on 3 March 2022 the Management Board of CD PROJEKT
decided to suspend sales of CD PROJEKT Group products as well as games distributed on the GOG.COM plat-
form on the territory of Russia and Belarus.
The Company estimates that throughout the 12-month period between March 2021 and February 2022 the
aggregate share of Russia and Belarus in revenues from sales of products in the CD PROJEKT RED segment
and in GOG.COM sales revenues amounted to 5.4% and 3.7% respectively.
Risks associated with the armed conflict in Ukraine
The Company continually monitors the effects of the current political and economic situation in Ukraine, Russia
and Belarus upon the activities of the CD PROJEKT Group.
The Company has terminated collaboration with Russian and Belarussian suppliers. At the present time the
Company does not intend to initiate any further collaboration with such entities.
As of the publication date of this report the Group’s operating activities proceed unhindered, and the effect of the
Russian armed invasion of Ukraine do not have a direct significant negative impact on the Group’s operations.
In the Management Board’s opinion, the armed conflict in Ukraine does not materially affect the quantitative
data contained in the financial statement, does not provide a reason to suspect impairment of assets, should
not have a significant negative effect on the Group’s earnings in 2024, and does not jeopardize continuation
of the Company’s activities within 12 months of the end of the reporting period.
Insofar as possible, the above assessment of the effect of the armed conflict in Ukraine upon the Company’s
activities reflects the Company’s knowledge as of the publication date of this report. Consequently, it is liable
to change in the event of abatement or escalation of the conflict.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
28 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
DISCLOSURE OF SEASONAL OR CYCLICAL ACTIVITIES
CD PROJEKT RED
The revenues and financial result of the CD PROJEKT RED segment are strongly affected by the videogame
release schedule. CD PROJEKT RED usually takes between 3 and 6 years to produce a game. Historically, the
Studio had focused on a single large development project at a time, with initial conceptual work on a new game
occurring before the previous game was complete and ready to be released.
Chart 8 Effect of new releases on the quarterly revenues from sales of products, goods and materials by
CD PROJEKT RED in 2011–2024 (PLN thousands)
CD PROJEKT RED also engages in smaller-scale projects – such as add-ons for its own games or adapting
existing products to work on new gaming platforms. Such projects may be carried out directly by the Company
or by its external partners.
Currently, the CD PROJEKT Group carries out parallel development of several games (including in collaboration
with external dev teams).
With regard to games which have already been released, their yearly sales breakdown is dependent on the
schedule of periodic promotional activities. In most cases, strong sales are reported in the second and fourth
quarter, while the first and the third quarter (the latter of which overlaps with the summer vacation season) see
weaker sales.
In addition to pure development activities, the Company also actively manages its franchises in other fields,
working to continually expand its target audience, and exploring new media types and platforms.
0
200 000
400 000
600 000
800 000
1 000 000
1 200 000
1 400 000
1 600 000
Q1/2011
"The Witcher 2" (PC) Q2/2011
Q3/2011
Q4/2011
Q1/2012
"The Witcher 2" (X360) Q2/2012
Q3/2012
Q4/2012
Q1/2013
Q2/2013
Q3/2013
Q4/2013
Q1/2014
Q2/2014
Q3/2014
Q4/2014
Q1/2015
”The Witcher 3” Q2/2015
Q3/2015
Expansion: ”Hearts of Stone” Q4/2015
Q1/2016
Expansion: ”Blood and Wine” Q2/2016
Q3/2016
Q4/2016
Q1/2017
Q2/2017
Q3/2017
Q4/2017
Q1/2018
Q2/2018
Q3/2018
Q4/2018
Q1/2019
Q2/2019
Q3/2019
”The Witcher 3" (Nintendo Switch) Q4/2019
Q1/2020
Q2/2020
Q3/2020
"Cyberpunk 2077" Q4/2020
Q1/2021
Q2/2021
Q3/2021
Q4/2021
Q1/2022
Q2/2022
Q3/2022
Q4/2022
Q1/2023
Q2/2023
Expansion: ”Phantom Liberty” Q3/2023
Q4/2023
Q1/2024
Q2/2024
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
29 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
GOG.COM
The digital videogame distribution market, which is the main area of activity of GOG.COM, is characterized
by seasonal fluctuations in revenues. On an annual basis, the highest revenues are typically obtained in the
fourth quarter while the lowest revenues correspond to the third quarter. Sales in Q2 and Q4 are boosted by
promotional activities organized in these periods.
The sales volume is also strongly dependent on the timing of new releases in each reporting period.
Chart 9 Sales of goods and materials in the GOG.COM segment in 2020–2024 (PLN thousands)
0
40 000
80 000
120 000
160 000
200 000
Q1
Q2
Q3
Q4
2020 2021 2022 2023 2024
Cyberpunk 2077
Phantom
Liberty
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
30 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Disclosure of external and internal factors affecting
further growth of the CD PROJEKT Group
Future growth of the Company and its Group is critically dependent on the ability to retain world-class creators
and specialists, and to attract a growing number of experts, both Polish and foreign, to work on the Group’s
future releases. Strategic directions related to talent acquisition, team development and support were presented
in the CD PROJEKT Group Sustainability Report for 2023.
Another important factor which may support the Group’s growth is effective implementation of CD PROJEKT RED’s
development plans announced in October 2022 as part of the Group’s Strategy Update, along with further
broadening of the recognizability and popularity of the Group’s franchises (including via cooperation with
external entities), and enriching games based on the Group’s proprietary IP with multiplayer gameplay elements.
In addition to the above, the activities of CD PROJEKT Group member companies are affected by external
factors such as the macroeconomic outlook, legal reforms and changes in taxation. In this sense, CD PROJEKT
is in a similar position to many other companies conducting business on domestic and international markets.
Given the specific nature of the gamedev industry, the growth and activities of Group member companies are
also significantly affected by external changes in the scope of technologies which may assist and enhance the
game development process.
In the second half of 2024 the CD PROJEKT Group intends to focus on organic growth of its business activities.
CD PROJEKT RED
Key factors which determine the growth of the CD PROJEKT RED segment include ongoing projects, the scale of
development work associated with those projects and their perceived popularity among gamers. In this context,
the most significant factors shaping the current results of the CD PROJEKT Group include the popularity of pre-
viously published games set in The Witcher and Cyberpunk universe. In future periods the growth prospects and
earnings posted by the Group will depend on the progress and market reception of new development projects.
Regarding the upcoming quarterly periods, a particularly important area of activity covers ongoing develop-
ment of previously announced projects, along with upscaling of activities carried out by the newly established
CD PROJEKT RED dev team in Boston.
Another notable process at CD PROJEKT RED – in the context of the studio’s development – is the ongoing
deployment of Unreal Engine 5, improving the engine’s support for open-world games, as well as adaptation
and optimization of parts of the engine to align it with the creative underpinnings of subsequent projects, which
is one of the main assumptions of the Company’s strategic collaboration with Epic Games. Use of this engine
should significantly streamline the game development process. The Company’s agreement with Epic Games
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
31 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
also provides for dedicated technical support for CD PROJEKT RED releases on the part of Epic Games. Working
with UE5 significantly broadens the Studio’s recruitment opportunities given that Unreal Engine is familiar to
many game developers.
Maintaining the observed growth dynamics of the CD PROJEKT RED segment will depend on further enhance-
ment of its world-class videogame development skillset and on the capacity for effective communication with
the global gaming community. Both aspects are crucial for Studio’s ongoing transformation – labeled RED 2.0 –
which aims, among others, to apply the agile methodology in the videogame development process, thereby
improving product quality. Migration to a dual franchise publishing model supported by several independent,
parallel projects paves the way for potential optimization of production and financial activities, increases the
frequency of releases along with the associated revenues, mitigates important risk factors and makes it easier
for Company employees to seek professional fulfillment.
GOG.COM
Sales in the GOG.COM segment have, in the recent years, benefitted from customers’ increasing tendency
to turn to online channels for purchases.
GOG.COM growth also depends on raising awareness of the platform among gamers and on seeking additional
brand-new products to add to its lineup. Accordingly, GOG sp. z o.o. actively communicates with leading global
developers and publishers of videogames, continually expanding its list of business partners and products
offered. Each new release on GOG.COM contributes to the platform’s popularity and drives up sales. Beyond
adding new products, GOG sp. z o.o. also seeks to expand its user base by attracting new gamers – those
who have not yet set up a GOG.COM account. During the recent years the Company has been successful
in this regard, owing to its PR activities and synergies resulting from cooperation with CD PROJEKT S.A. The
GOG.COM customer pool continues to grow at a steady pace.
Further growth of activities in the GOG.COM segment, including the potential to acquire unique know-how and
experience, and to fully leverage the Company’s technological expertise, will be influenced by development
of features which support sales on the platform, including better integration of GOG GALAXY monetization
mechanisms with the GOG.COM storefront, as well as increased focus on expanding the GOG.COM catalogue
with classic games.
OTHER FACTORS
The growth of the CD PROJEKT Group will also be affected by development work carried out by its subsidiary –
The Molasses Flood. In addition, the Boston studio is working on a separate game set in The Witcher universe,
codenamed Sirius.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
32 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Disclosure of factors which, in the Issuer’s opinion, will have
an effect on its earnings during at least the coming quarter
The ongoing third quarter coincides with the vacation season and marks an annual low point in the intensity of
marketing activities which affect sales volumes. In the current year one exception was the Steam Summer Sale,
which commenced on 27 June and ended on 11 July. The Group’s current release schedule foresees no new releases
in the remainder of the third quarter of 2024.
Disclosure of significant agreements
5
CD PROJEKT did not enter into any significant agreements during the reporting period.
Key threats and risks related to the remaining
months of the current financial year
The CD PROJEKT Group is exposed to a range of risks, both financial and non-financial, associated with its
operating activities. The goal of risk management at the Company is to ensure proper identification, assessment,
analysis and further handling of risks.
Persistent external and internal risk factors which may affect the Group’s activities and growth prospects, and
are known to the Management Board, are described in the risk management section of the Management
Board Report on CD PROJEKT Group Activities in 2023, while financial risks are detailed in the Consolidated
Financial Statement of the CD PROJEKT Group for 2023. The Company perceives the risks identified therein
as applicable to the remaining months of the current financial year.
5 An agreement is regarded as significant if the projected total value of liabilities arising under the agreement exceeds 10% of the
consolidated assets of the Group.
CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
CD PROJEKT GROUP
BUSINESS ACTIVITY
FINANCIAL RESULTS
CORPORATE GOVERNANCE
RESULTS OF OPERATIONS
OF THE CD PROJEKT GROUP
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
34 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Discussion of the key economic and financial figures
disclosed in the consolidated financial statements
CONSOLIDATED INCOME STATEMENT
Table 3 Consolidated income statement of the CD PROJEKT Group (in PLN thousands)
01.01.2024 –
30.06.2024
01.01.2023 –
30.06.2023
*
change change %
Sales revenue .%
Sales of products .%
Sales of services .%
Sales of goods for resale and materials - -.%
Cost of sales of finished goods,
services, goods for resale and materials
.%
Costs of products and services sold .%
Cost of goods for resale and materials sold - -.%
Gross profit/(loss) on sales .%
Selling expenses - -.%
Administrative expenses, including: .%
cost of research projects .%
Other operating income - -.%
Other operating expenses - -.%
(Impairment)/reversal of impairment
of financial instruments
- - -
Operating profit/(loss) .%
Finance income - -.%
Finance costs - -.%
Profit/(loss) before tax .%
Income tax - -.%
Net profit/(loss) .%
*restated data
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
35 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
DESCRIPTION AND ASSESSMENT OF THE FACTORS AND UNUSUAL EVENTS AFFECTING
THE RESULTS OF OPERATIONS OF THE CD PROJEKT GROUP IN THE FIRST HALF OF 2024
The strong sale of Cyberpunk 2077 together with the Phantom Liberty expansion had the greatest impact on
the results of the CD PROJEKT Group for the first half of 2024. However, the sale of The Witcher 3: Wild Hunt
continued to be important for the Group’s results.
As part of the production of games, the most important capital expenditure on research and development
projects incurred during the reporting period related to the Polaris and Sirius projects, which are in the
development phase, and the Orion and Canis Majoris projects, which are at an earlier phase of production,
i.e. the research phase.
In the first half of 2024, there were no significant unusual events affecting the Group’s results of operations.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
36 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
DISCUSSION OF THE CONSOLIDATED INCOME STATEMENT OF
THE CD PROJEKT GROUP BY OPERATING SEGMENT
CD PROJEKT RED segment
Table 4 Income statement of the CD PROJEKT RED segment (in PLN thousands)
01.01.2024 –
30.06.2024
01.01.2023 –
30.06.2023
*
change change %
Sales revenue .%
Sales of products .%
Sales of services .%
Sales of goods for resale and materials - -.%
Cost of sales of finished goods,
services, goods for resale and materials
.%
Costs of products and services sold .%
Cost of goods for resale and materials sold - -.%
Gross profit/(loss) on sales .%
Selling expenses - -.%
Administrative expenses, including: .%
cost of research projects .%
Other operating income - -.%
Other operating expenses - -.%
(Impairment)/reversal of impairment
of financial instruments
- - -
Operating profit/(loss) .%
Finance income - -.%
Finance costs - -.%
Profit/(loss) before tax .%
Income tax - -.%
Net profit/(loss) .%
*restated data
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
37 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
The total Sales revenue of the CD PROJEKT RED segment in the first half of 2024 was significantly higher
than in the comparative period, mainly due to strong sales of the Phantom Liberty, a feature expansion of the
Cyberpunk 2077 game, following its release on 26 September 2023.
Sales of products had the largest share in the sales revenue of the CD PROJEKT RED segment for the period
under review and primarily related to:
■ royalties resulting from the sale of Cyberpunk 2077 and the Phantom Liberty expansion;
■ royalties resulting from the sale of The Witcher 3: Wild Hunt with the Hearts of Stone and Blood and Wine
expansions;
■ licence revenue from CD PROJEKT RED studio franchises;
■ revenue related to other products of the segment.
In the first half of 2024, Sales of services comprised mainly revenue relating to services provided to related
entities.
Sales of goods for resale and materials of the CD PROJEKT RED segment in the period discussed comprised
mainly revenue from the sale of ready-made physical sets and elements of physical sets of own titles (media,
boxes, figurines, gadgets) to distributors.
The most significant component of the Cost of finished goods, services, goods for resale and materials
sold of the CD PROJEKT RED segment was the Cost of products and services sold, where mainly the cost of
amortization of expenditure on development projects (own games manufactured) is presented. The value
of the said item in the first half of 2024 and its increase compared with the corresponding comparative period
was affected mainly by the amortization of expenditure on the Cyberpunk 2077 game, including its expansion
Phantom Liberty.
In the first half of 2024, the Cost of sales of goods for resale and materials contained the cost of manufacture
of ready-made physical sets of own titles sold to distributors and components of these sets.
The Cost of sales of the CD PROJEKT RED segment in the period discussed comprised:
■ costs of promotion and sales support of the CD PROJEKT RED segment, mainly those relating to the promotion
of Cyberpunk 2077, including the Phantom Liberty expansion;
■ costs associated with product development as part of own franchises;
costs of maintenance and updating of the CD PROJEKT RED studio games being sold, mainly those relating to
Cyberpunk 2077 and the Phantom Liberty expansion.
Compared with the first half of 2023, the segment reduced both the total level of promotion and sales support
costs (mainly due to the absence of current and future promotional events) and the total costs of maintenance
and updates of the games released.
A significant surge in Administrative expenses of the CD PROJEKT RED segment in the first half of 2024 is
mainly due to an increased scale of work on future games in the early stages of production (the research phase,
preceding the development phase and the start of their capitalization as part of Expenditure on development
projects forming part of Non-current assets), relating primarily to the Orion, Canis Majoris and Hadar projects,
and the work on the studio’s proprietary technologies.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
38 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Moreover, the segment reports the following costs under Administrative expenses:
■ fixed remuneration of the administrative teams and the external costs of third party services classified in this
category which, in step with an increase in the employment levels and the scale of operations of the seg-
ment’s companies, are growing gradually;
■ performance-based remuneration of the management;
■ the cost associated with the functioning of the Incentive Plans A and B which are based on entitlements to the
Company’s shares.
As regards Other operating income and expenses, the segment recognized mainly the revenue from utilization
of the tax relief for innovative employees and from the lease of office space (and the accompanying maintenance
costs) in the real estate complex located at ul. Jagiellońska 74 and 76 in Warsaw. In the comparative period,
a significant and one-off impact on the value of these items came from a partial reversal of the write-down of
development expenditure incurred up to the end of 2022 (in the amount of PLN 21 531 thousand) associated
with determination of a new framework for the Sirius project being developed by The Molasses Flood studio,
and the write-off of a part of the expenditure on the Project in the first quarter of 2023 (PLN 2 745 thousand).
In the first half of 2024, the CD PROJEKT RED segment showed an excess of Finance income over Finance
costs higher than the one reported in the comparative period. This is mainly due to an increase in interest
income on bonds.
A significantly lower Income tax expense recognized in the income statement for the first half of 2024 com-
pared with the comparative period was mainly due to re-estimation of the deferred tax performed in the first
quarter of the year, primarily with regard to the R&D tax relief available for utilization and an allowance for
a part of the tax on licence receivables collected in other jurisdictions (the withholding tax), which was lower
than in the comparative period.
The consolidated Net profit of the CD PROJEKT RED segment for the first half of 2024 amounted to
PLN 168 831 thousand and was PLN 78 463 thousand (86.8%) higher than in the comparative period.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
39 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
GOG.COM segment
Table 5 Income statement of the GOG.COM segment (in PLN thousands)
01.01.2024 –
30.06.2024
01.01.2023 –
30.06.2023
*
change change %
Sales revenue .%
Sales of products - - - -
Sales of services - -.%
Sales of goods for resale and materials .%
Cost of sales of finished goods, services,
goods for resale and materials
.%
Costs of products and services sold - - -.%
Cost of goods for resale and materials sold .%
Gross profit/(loss) on sales - -.%
Selling expenses - -.%
Administrative expenses, including: .%
cost of research projects - - - -
Other operating income .%
Other operating expenses - -.%
(Impairment)/reversal of impairment
of financial instruments
- - - -
Operating profit/(loss) .%
Finance income .%
Finance costs .%
Profit/(loss) before tax - -
Income tax .%
Net profit/(loss) - -
*restated data
The total Sales revenue of the GOG.COM segment comprises mainly Sales of goods for resale and materials
related to the digital distribution of games from GOG.COM’s external suppliers to final customers, carried out
via the GOG.COM platform and the GOG GALAXY application.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
40 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Three seasonal promotions – the New Year Sale, Spring Sale and Summer Sale (taking place partly in July) had
the largest impact on the development of sales of goods for resale and materials of the GOG.COM segment
in the first half of 2024. During the promotions, players could choose from several thousands of products at
reduced prices, such as Cyberpunk 2077: Phantom Liberty and Baldur’s Gate 3.
Despite the number of new releases being lower than in the comparable period of the previous year,
GOG made several popular titles available for players to purchase in the first half of 2024, such as Manor Lords
(early access), God of War and two classic titles that are vital to GOG’s mission: Alpha Protocol and the first
part of Resident Evil. In addition, the effect of worldwide interest in the series based on the Fallout games was
evident during the period under review, which translated into higher sales of games from this particular series.
The Cost of sales of services, goods for resale and materials, which accompanies sales directly, increased com-
pared with the comparative period in line with higher revenue.
In the period discussed, Selling expenses of the GOG.COM segment decreased slightly compared with 2023.
Among the Selling expenses reported in the GOG.COM segment, the following items have the most significant
share:
■
the remuneration of the team responsible for operating, development and promotion of the GOG.COM platform,
as well as maintenance and further development of the GOG GALAXY application;
■ transaction costs related to the processing of payments on the GOG.COM platform;
■ the costs of the ICT infrastructure related to making sales;
■ the costs of the marketing activities concerning the promotion of the GOG.COM platform and games available
on the platform;
■ the costs of amortization, including amortization of completed development projects relating to technologies
used for handling sales and serving GOG’s customers.
The main components of the Administrative expenses of the GOG.COM segment are the remuneration of
the administrative teams, remuneration of the Company’s Management Board, as well as the costs of other
external services classified in this category. An increase in Administrative expenses in the period discussed in
relation to the comparative period was mainly due to an increase in the current costs of salaries and wages,
costs relating to external advisory services, and the occurrence of one-time costs of pre-implementation analy-
ses in connection with the planned optimization and expansion of the systems supporting financial processes.
In addition, in the period discussed, the segment recorded an increase in other operating income relating
primarily to one-time revenue on integration of the GOG.COM shop with external services.
In the first half of 2024, the GOG.COM segment showed an excess of Finance income over Finance costs.
Finance income comprises mainly income on forward FX hedging contracts and interest on bank deposits,
whereas finance costs include mainly foreign exchange losses.
The Net profit of the GOG.COM segment for the first half of 2024 amounted to PLN 1 031 thousand.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
41 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Table 6 Net profitability ratio – Alternative Performance Measure
01.01.2024 –
30.06.2024
01.01.2023 –
30.06.2023
01.01.2024 –
30.06.2024
01.01.2023 –
30.06.2023
01.01.2024 –
30.06.2024
01.01.2023 –
30.06.2023
CD PROJEKT GROUP CD PROJEKT RED GOG.COM
Net profit margin
(Net profit / sales revenues)
.% .% .% .% .%
-.%
The Net profitability ratio presents additional information, indicating what part of Sales revenue remains within
the enterprise in the form of a Net profit after covering all the costs and tax charges shown in the Income sta-
tement. An increase in the value of this ratio means an increase in the effectiveness of the activities carried out,
related to the level of the Sales revenue earned. The ratio used is a standard and commonly used measure
in financial analysis, and its usefulness was analysed in terms of the information provided to investors on the
effectiveness of the activities of the CD PROJEKT Group and its segments.
In the first half of 2024, the Group’s Net profitability ratio was 40.0% and was higher than in the corresponding
period of the prior year, both on the consolidated and stand-alone basis.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
42 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
CONSOLIDATED STATEMENT OF FINANCIAL POSITION OF THE CD PROJEKT GROUP
Table 7 Consolidated statement of financial position of the CD PROJEKT Group (in PLN thousands)
30.06.2024 31.12.2023
*
change change %
NON-CURRENT ASSETS .%
Property, plant and equipment .%
Intangible assets .%
Expenditure on development projects .%
Investment properties - -.%
Goodwill .%
Shares in non-consolidated
subordinated entities
.%
Prepayments and deferred costs - -.%
Other financial assets - -.%
Deferred tax assets .%
Other receivables .%
CURRENT ASSETS - -.%
Inventories - -.%
Trade receivables - -.%
Current income tax receivable .%
Other receivables .%
Prepayments and deferred costs - -.%
Other financial assets .%
Bank deposits over months .%
Cash and cash equivalents - -.%
TOTAL ASSETS .%
*restated data
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
43 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
30.06.2024 31.12.2023
*
change change %
EQUITY .%
Share capital .%
Supplementary capital .%
Share premium .%
Other reserves .%
Foreign exchange differences
on translation
- - -.%
Retained earnings/(Accumulated losses) - - -.%
Net profit (loss) for the period - -.%
NON-CURRENT LIABILITIES - -.%
Other financial liabilities - -.%
Other liabilities - -.%
Deferred income - -.%
Provision for retirement and similar
benefits
.%
Other provisions - -.%
CURRENT LIABILITIES - -.%
Other financial liabilities - -.%
Trade payables .%
Current income tax liabilities .%
Other liabilities - -.%
Deferred income .%
Provision for retirement and similar
benefits
.%
Other provisions - -.%
TOTAL EQUITY AND LIABILITIES .%
*restated data
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
44 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
DISCUSSION OF THE CONSOLIDATED STATEMENT OF
FINANCIAL POSITION OF THE CD PROJEKT GROUP
Assets
The item Expenditure on development projects, in which the Group recognizes expenditure on the development
of new products and technologies, incurred and deferred, had the largest share in the value of the Group’s
Non-current assets as at the end of the first half of 2024, as well as the greatest impact on the increase in the
balance thereof. An increase in the item discussed is mainly due to expenditure incurred by the CD PROJEKT RED
segment on the production of future games in an advanced development phase (mainly Polaris and Sirius)
in the amount higher than the amortization of the productions completed (mainly Cyberpunk 2077 including
the Phantom Liberty expansion and The Witcher 3) .
The balance of Property, plant and equipment primarily consists of:
■ the value of the real estate complex at ul. Jagiellońska 74 and 76, the recognized part thereof being the part
to be used by CD PROJEKT S.A. for its own purposes;
■ expenditure on construction work on the CD PROJEKT campus in Warsaw (Assets under construction) which
contributed to an increase in the balance of the item compared with 31 December 2023;
■
plant and machinery, where the Group recognizes, among other things, computers, servers and other electronic
devices used in its activities;
■ assets in respect of the right of use of leased office space (with the corresponding value of Other financial
liabilities in respect of concluded contracts on the lease of space being recognized on the Equity and liabilities
side at the same time).
The most significant items recognized in Intangible assets are mainly the value of the CD PROJEKT corporate
brand and the The Witcher trademark, as well as the value of the copyright and computer software held by the
Group. The value of the item did not change materially in 2024.
Goodwill is composed of amounts resulting from accounting for the merger of the parent company with the
CDP Investment Group on 30 April 2010 and accounting for the acquisition of a development studio located in
Wrocław by CD PROJEKT S.A. from Strange New Things sp. z o.o. sp. k. on 18 May 2018. The Goodwill reported
did not change over the discussed period.
The balance of Investment properties consists of the values of the properties at ul. Jagiellońska 74 and
ul. Jagiellońska 76, the parts thereof classified as earmarked for lease.
The value of Shares in non-consolidated subordinated entities comprises mainly the shares in The Molasses
Flood LLC, Boston, CD PROJEKT RED Vancouver Studio Ltd. and CD PROJEKT SILVER Inc.
The value of Inventories as at the end of the first half of 2024 consists mainly of ready-made physical sets
and elements of physical sets of the editions of games of own production intended for CD PROJEKT RED’s
external distributors.
The consolidated balance of Trade receivables decreased in the period discussed mainly due to the receipt
of royalties earned in the CD PROJEKT RED segment in the fourth quarter of 2023, especially royalties for the
very satisfactory first full quarter of distribution of the Phantom Liberty add-on to the Cyberpunk 2077 game.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
45 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
The balance of the Group’s Other receivables as at the end of June 2024 comprises mainly receivables in
respect of the withholding tax deducted by foreign recipients of the licences granted by the CD PROJEKT RED
segment, VAT settlements, settlements with the Social Insurance Institution (ZUS), advances to suppliers and
security deposits.
The consolidated value of the current and non-current Prepayments and deferred costs recognized as at the
end of the analysed period and a decrease in these balances were mainly affected by the amount of the so-cal-
led minimum guarantees, i.e. advances and prepayments made by GOG.COM to its suppliers towards fees for
the distribution of the games offered on the GOG.COM platform, not recognized in the income statement by
the balance sheet date. In addition, the item includes, among other things, deferred fees for software, licences
and rights and prepayment related to marketing activities.
The consolidated balance of current and non-current Other financial assets as at the end of June 2024 com-
prises primarily the value of domestic and foreign Treasury bonds purchased by CD PROJEKT S.A. to diversify
credit risk, including the measurement of derivative financial instruments securing the value of bonds in foreign
currencies.
The total value of financial reserves in the form of Cash and cash equivalents, Bank deposits over 3 months
and liquid financial assets in the form of purchased Treasury bonds (recognized in total in current and non-
-current Other financial assets) held by the Group as at 30 June 2024 amounted to PLN 1 365 322 thousand
and increased by PLN 55 863 thousand during the first half of 2024.
Non-current assets accounted for 57.3% and Current assets for 42.7% of the total assets of the CD PROJEKT
Group as at the end of June 2024.
Equity and liabilities
As at 30 June 2024, the CD PROJEKT Group’s equity amounted to PLN 2 484 354 thousand and increased
by PLN 81 131 thousand compared with the end of 2023. An increase in equity due to the net profit for the first
half of the year exceeded a decrease due to the payment of a dividend for 2023.
In current and non-current Other financial liabilities, the Group recognizes mainly liabilities in respect of the
perpetual usufruct of land at the Jagiellońska 74 and Jagiellońska 76 complexes in Warsaw and liabilities in
respect of the concluded agreements for the lease of office space.
The balance of the Group’s Trade payables did not change significantly during the first half of 2024. It comprised,
among other things, liabilities of the GOG.COM segment relating to payments to the providers of the service
for the last sales period and the minimum guarantees contracted for new titles of the GOG.COM platform, as
well as current trade payables of the CD PROJEKT RED segment.
Other liabilities as at the end of June 2024 comprised mainly the Group’s liabilities in respect of VAT, social
security and future services.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
46 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
In Deferred income (current and non-current) as at the end of June 2024, the Group’s segments recognized
mainly:
■ CD PROJEKT RED - prepayments received or due in respect of royalties related to pre-sale and sale in future
periods, including the so-called minimum guarantees from publishers and distribution partners;
■ GOG.COM - the value of pre-orders for games with a release date in future periods, placed by customers;
■ GOG.COM - deferred income relating to the company’s customers (GOG Portfolio);
■ CD PROJEKT RED - deferred income concerning subsidies.
The balance of current and non-current Provision for retirement and similar benefits includes primarily
a holiday pay provision in the CD PROJEKT RED segment.
A decrease in the balance of Other provisions (current and non-current) of the CD PROJEKT Group resulted
mainly from a decrease in provisions for performance-based remuneration in the CD PROJEKT RED segment,
related to the payment of bonuses for 2023 in the period discussed.
In the Equity and liabilities of the CD PROJEKT Group as at 30 June 2024, Equity represented 93.4%, whereas
Current and Non-current liabilities represented 6.6%.
The consolidated statement of financial position broken down into individual business segments of the Group
is contained in the Interim condensed consolidated financial statements of the CD PROJEKT Group for the
period from 1 January to 30 June 2024.
DESCRIPTION OF THE STRUCTURE OF ASSETS AND EQUITY & LIABILITIES OF THE CONSO-
LIDATED BALANCE SHEET, INCLUDING FROM THE PERSPECTIVE OF LIQUIDITY
As at the end of the first half of 2024, the CD PROJEKT Group had assets with a carrying amount of PLN 2 660
007 thousand. Within these assets, liquid financial reserves maintained in bank accounts in the form of bank
deposits and Treasury bonds (foreign and domestic) amounted to PLN 1 365 322 thousand and represented
51.3% of total assets. Assets with limited liquidity (Property, plant and equipment, Expenditure on development
projects, Investment properties and Shares in non-consolidated subordinated entities) totalling PLN 877 192
thousand represented 33.0% of total assets. As at 30 June 2024, the total of Trade receivables, Other current
receivables and Inventories amounted to PLN 147 439 thousand, whereas the total value of current and non-
-current liabilities amounted to PLN 175 653 thousand. As at the end of the first half of 2024, the Group did not
have any external liabilities in respect of loans or borrowings.
The accumulated cash and cash equivalents, deposits and Treasury bonds ensure the Group’s high liquidity
and may be used to secure the financing of the Group’s further development, including the financing of the
development of future products and technologies, promotional support for scheduled premières, securing future
investment opportunities and ensuring provisions for possible unplanned situations or emerging opportunities.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
47 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
CONSOLIDATED STATEMENT OF CASH FLOWS OF THE CD PROJEKT GROUP
Table 8 Consolidated statement of cash flows of the CD PROJEKT Group (in PLN thousands)
01.01.2024 –
30.06.2024
01.01.2023 –
30.06.2023
*
OPERATING ACTIVITIES
Net profit/(loss)
Total adjustments:
Depreciation and amortization of property, plant and equipment, intangible
assets, expenditure on development projects and investment properties
Amortization of development projects recognized as cost of goods sold
Foreign exchange (gains)/losses ( )
Interest and shares in profits ( ) ( )
(Gains)/losses on investing activities ( )
Increase/(Decrease) in provisions ( ) ( )
(Increase)/Decrease in inventories
(Increase)/Decrease in receivables
Increase/(Decrease) in liabilities, excluding loans and borrowings ( ) ( )
Change in other assets and liabilities ( )
Other adjustments
Cash from operating activities
Income tax expense
Withholding tax paid abroad
Income tax (paid)/refunded ( ) ( )
Net cash from operating activities
INVESTING ACTIVITIES
Inflows
Sale of intangible assets and property, plant and equipment
Repayment of loans granted -
Expiry of bank deposits over months
Redemption of bonds
Interest on bonds
Interest received on deposits
Inflows from execution of forward contracts
Other inflows from investing activities
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
48 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
01.01.2024 –
30.06.2024
01.01.2023 –
30.06.2023
*
Outflows
Acquisition of intangible assets and property, plant and equipment
Expenditure on development projects
Expenditure on intangible assets
Acquisition of investment properties and capitalization of expenditure
Loans granted -
Purchase of shares in a subsidiary
Purchase of bonds and cost of their purchase
Placement of bank deposits over months
Net cash from investing activities ( ) ( )
FINANCING ACTIVITIES
Inflows
Settlement of lease receivables
Interest received
Outflows
Dividends and other distributions to shareholders
Payment of lease liabilities
Interest paid
Net cash used in financing activities ( ) ( )
Net increase/(decrease) in cash and cash equivalents ( ) ( )
Change in cash and cash equivalents in the balance sheet ( ) ( )
Cash and cash equivalents as at the beginning of the period
Cash and cash equivalents as at the end of the period
*restated data
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
49 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
DISCUSSION OF THE CONSOLIDATED STATEMENT OF CASH FLOWS OF THE CD PROJEKT GROUP
Under Operating activities in the first half of 2024, the CD PROJEKT Group reported net cash inflows of
PLN 250 929 thousand, i.e. PLN 129 330 thousand higher than in the comparative period.
The consolidated net profit was adjusted for:
I. Non-cash items (a total increase):
■ Amortization and depreciation (an increase);
■ Amortization of development projects, recognized as the cost of sales, corresponding primarily to the
amortization of expenditure on the development projects related to Cyberpunk 2077 together with the
Phantom Liberty expansion and The Witcher 3 edition for new generation consoles, Xbox Series X|S
and PlayStation 5;
■
Foreign exchange gains/(losses), a decrease resulting mainly from the measurement of foreign Treasury
bonds and foreign currency deposits over 3 months;
■ Gains/(losses) on investing activities, an increase resulting from transactions in bonds and derivative
financial instruments;
■ Increase/(decrease) in provisions, a decrease resulting mainly from a decrease in the balance of pro-
visions for performance-based remuneration;
■ Other adjustments, an increase resulting mainly from the elimination of the accounting for costs of the
incentive plans and adjustments to amortization/depreciation recognized in the cost of sales and in
other operating expenses;
II. Items related to changes in current assets and current liabilities (a total increase):
■ (Increase)/decrease in inventories, an increase in the balance of cash flows as a result of a drop in
inventories;
■ (Increase)/decrease in receivables, an increase in the balance of cash flows resulting primarily from
a decrease in the balance of receivables in the CD PROJEKT RED segment, related to the inflow of
royalties reported for the fourth quarter of 2023;
■ Increase/(decrease) in liabilities, excluding loans and borrowings, a decrease in the balance of cash
flows in consequence of a decrease in the balance of the Group’s liabilities;
■ Change in other assets and liabilities, an increase in the balance of cash flows resulting mainly from a
decrease in the so-called minimum guarantees contracted by GOG.COM during the reporting period;
III. Item recognized in other sections of the statement of cash flows – Interest and shares in profits, resulting
in a decrease in the cash flows shown under operating activities;
IV. Difference between the corporate income tax recognized in the income statement (a decrease) and the tax
actually paid during the first half of 2024, taking into account settlements related to withholding tax.
The negative balance of Net cash outflows on investing activities in the first half of 2024 was mainly due to
outflows related to capital expenditure on assets, including primarily Expenditure on development projects
(i.e. the work on new games) and Property, plant and equipment, as well as the negative balance of net cash
outflows related to bank deposits and Treasury bonds.
Negative Net cash from financing activities of the CD PROJEKT Group in the first half of 2024 was mainly due
to the payment of a dividend (PLN 99 911 thousand) for 2023.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
50 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
In total, in the first half of 2024, the CD PROJEKT Group generated negative Net cash outflows of
PLN 29 074 thousand, while at the same time it invested PLN 143 870 thousand in assets (expenditure on
development projects, property, plant and equipment and intangible assets), increased the balance of bond
and bank deposits over 3 months by a total of PLN 84 937 thousand, and paid a dividend for 2023 to the
shareholders of PLN 99 911 thousand.
INFORMATION ON LOANS AND BORROWINGS IN THE FIRST HALF OF 2024
In the reporting period, the CD PROJEKT Group did not have any external liabilities in respect of loans or
borrowings.
INFORMATION ON LOANS GRANTED IN THE FIRST HALF OF 2024
In the reporting period, none of the CD PROJEKT Group companies granted any loans to non-Group entities.
As at 30 June 2024, the debt resulting from a loan granted to The Molasses Flood LLC by CD PROJEKT S.A.
amounted to USD 734 thousand.
INFORMATION ON SURETIES AND GUARANTEES GRANTED IN THE FIRST
HALF OF 2024 AND OTHER MATERIAL OFFBALANCESHEET ITEMS
Information on sureties and guarantees and other material off-balance-sheet items is presented in the Interim
condensed consolidated financial statements of the CD PROJEKT Group for the period from 1 January to
30 June 2024.
TRANSACTIONS WITH RELATED ENTITIES
Within the activities of the CD PROJEKT Group in the first half of 2024, there were mainly the following types
of transactions between related entities:
■
sale of licences between CD PROJEKT S.A. and GOG sp. z o.o., The Molasses Flood LLC, as part of the activities
carried out by the individual entities;
■
sale relating to research and development projects involving the creation of games and technologies by
CD PROJEKT RED Inc., The Molasses Flood LLC and CD PROJEKT RED Vancouver Studio Ltd. for CD PROJEKT S.A.;
■ provision of services such as: accounting, human resources and payroll management, legal, financial, admini-
strative and management services rendered mainly by CD PROJEKT S.A. to related entities;
■ lease of office space by CD PROJEKT S.A. to GOG.COM sp. z o.o., and sublease of office space between The
Molasses Flood LLC and CD PROJEKT RED Inc.;
■ sale of CD PROJEKT RED Inc.’s services to CD PROJEKT S.A., related to the coordination of publishing and
promotional activities in North America;
■ a loan granted to The Molasses Flood LLC by CD PROJEKT S.A.;
■ other transactions arising from current operating activities, e.g. costs of employee relocation or reinvoicing of
jointly incurred costs.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
51 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Transactions between related entities are concluded on an arm’s length basis as part of the normal business
activities carried out by the CD PROJEKT Group entities. Detailed information about the terms and conditions
of the transactions between related entities is contained in the Interim condensed consolidated financial
statements of the CD PROJEKT Group for the period from 1 January to 30 June 2024.
EXPLANATION OF THE DIFFERENCES BETWEEN THE FINANCIAL RESULTS SHOWN IN THE
SEMIANNUAL REPORT AND THE PREVIOUSLY PUBLISHED FORECASTS FOR A GIVEN YEAR
The CD PROJEKT Group has not published any financial forecasts, therefore, no explanations are given for the
differences between the financial results shown in the report.
DESCRIPTION OF THE UTILIZATION OF ISSUE PROCEEDS BY THE
COMPANY BY THE DATE OF PUBLICATION OF THE REPORT
In the period from 1 January to 30 June 2024, the Company did not issue any new shares.
CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
CD PROJEKT GROUP
BUSINESS ACTIVITY
FINANCIAL RESULTS
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
53 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Entity contracted to audit financial statements
On 4 July 2024 the Supervisory Board of CD PROJEKT S.A., acting on advice of the Audit Committee of the
Company’s Supervisory Board recommending extension of the Company’s contract with its licensed auditor,
decided to select Grant Thornton Polska PSA with a registered office in Poznań as the entity contracted to conduct
an audit and review of the separate and consolidated financial statements of the Company for 2024 and 2025.
Grant Thornton Polska PSA has also been contracted to audit the financial statement of GOG sp. z o.o.
Shareholders controlling at least 5% of the vote at the General Meeting
The Company’s share capital amounts to 99 910 510 PLN, divided into 99 910 510 shares with a nominal value
of 1 PLN per share. The shareholding structure is determined on the basis of formal notifications issued by
shareholders who control at least 5% of the total number of votes at the General Meeting of Shareholders.
Table 9 Shareholders controlling at least 5% of the vote at the General Meeting as of the publication date
of this report
Shareholder Qty. of shares
Percentage share
in share capital (%)
Number of
votes controlled
Percentage share of
total number of votes
at the GM (%)
Marcin Iwiński .% .%
Michał Kiciński
*
.% .%
Piotr Nielubowicz .% .%
Nationale-Nederlanden
Powszechne Towarzystwo
Emerytalne S.A. (all funds
collectively)
**
.% .%
incl. Nationale-Nederlanden
Otwarty Fundusz
Emerytalny**
5 030 225 5.03% 5 030 22 5.03%
* As disclosed in the most recent notification submitted to the Company on 13 November 2023
** As disclosed in the most recent notification submitted to the Company on 12 August 2024
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
54 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Changes in ownership of major packages of Company stock
since the publication of the previous periodic report
According to notifications filed with the Company, the only changes in ownership of major stock packages occu-
rring since the publication of the previous periodic report concern shares and votes controlled by investment
funds managed by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A., including Nationale-
-Nederlanden Otwarty Fundusz Emerytalny, as well as by The Goldman Sachs Group, Inc.
The Goldman Sachs Group, Inc.
During the reporting period the Company received four notifications concerning changes in ownership of stock
and control of votes by funds managed by The Goldman Sachs Group, Inc.
According to the notification received on 8 August 2024, the total percentage share of votes controlled by
The Goldman Sachs Group Inc. from indirectly held shares and other financial instruments as of 5 August 2024
was 5.02%, including 3.52% of votes linked to other financial instruments (securities on loan and swap contracts).
According to the notification received on 19 August 2024, the total percentage share of votes controlled by
The Goldman Sachs Group Inc. from indirectly held shares and other financial instruments had dropped below
the 5% threshold, to 4.97%, on 14 August 2024, and subsequently, according to another notification received
on 20 August, again exceeded the 5% threshold on 15 August (rising to 5.09%, which includes 3.97% of votes
linked to other financial instruments, i.e. securities on loan and swap contracts).
According to the most recent notification, received on 22 August 2024, the total percentage share of votes
controlled by The Goldman Sachs Group Inc. from indirectly held shares and other financial instruments had
again dropped below the 5% threshold (to 4.59%) on 19 August.
Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A. /
Nationale-Nederlanden Otwarty Fundusz Emerytalny
During the reporting period the Company received two notifications from concerning changes in ownership of
stock and control of votes by funds managed by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne
S.A., including Nationale-Nederlanden Otwarty Fundusz Emerytalny.
According to a notification filed on 11 July 2024 the total number of shares held and votes controlled by funds
managed by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A. increased from 4 986 246
(i.e. 4.991% of the total number of votes) to 5 026 246 (i.e. 5.031% of the total number of votes).
According to a notification filed on 12 August 2024 Nationale-Nederlanden Otwarty Fundusz Emerytalny increased
the number of Company shares in its possession and votes under its control to 5 030 225, which corresponds to
5.0347% of the total number of votes. As a result of the aforementioned transaction, the total number of shares
held and votes controlled by funds managed by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne
S.A. (including shares and votes controlled by Nationale-Nederlanden Otwarty Fundusz Emerytalny) increased
to 5 417 124, which corresponds to 5.4220% of the total number of votes.
The shareholding structure arising as a result of the above-mentioned notifications is presented in the above table.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
55 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Agreements which may result in changes in the proportions
of shares held by shareholders and bondholders
INCENTIVE PROGRAMS FOR 20232027
On 18 April 2023 the General Meeting of the Company voted to institute two new incentive programs for the
financial years 2023–2027 replacing the 2020–2025 incentive program: Incentive Program A and Incentive
Program B respectively.
Incentive Program A
Incentive Program A is aimed at persons who are not members of the Company’s Management Board. According
to the adopted provisions, entitlements will be assigned under this program in each financial year belonging to the
2023–2027 period (i.e. in five stages). The total number of entitlements assigned under Incentive Program A may
not exceed 1,500,000. Entitlements shall vest either by: (I) extending an offer to participants to claim subscription
warrants which incorporate the right to take up the equivalent number of shares issued in the framework of
a conditional increase in the Company share capital, or (II) extending an offer to participants to purchase from the
Company a certain number of own shares which the Company will have previously acquired in the framework of
a buy-back program instituted specifically for this purpose. The take-up and exercise of subscription warrants or
purchase of own shares from the Company, as appropriate, will require participants to fulfill the loyalty condition
(which is defined as the existence of a legal relationship between the participant of Incentive Program A and the
Company or an affiliate thereof throughout the vesting period). The share take-up or purchase price in the exercise
of entitlements assigned under Incentive Program A will be equivalent to the nominal price of Company shares.
In each case, the vesting period is at least 3 years long.
As of the publication date of this report:
I) 100 444 entitlements have been assigned at the first stage of Incentive Program A (in 2023), 92 197 of
which remain outstanding;
II) 183 189 entitlements have been assigned at the second stage of Incentive Program A (in 2024), 177 513 of
which remain outstanding.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
56 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Incentive Program B
Incentive Program B is aimed at members of the Company’s Management Board as well as persons who do
not hold membership of the Management Board. According to the adopted provisions, entitlements will be
assigned under this program in each financial year belonging to the 2023–2027 period (i.e. in five stages). The
total number of entitlements assigned under Incentive Program B may not exceed 3,500,000. Entitlements shall
vest either by: (I) extending an offer to participants to claim subscription warrants which incorporate the right
to take up the equivalent number of shares issued in the framework of a conditional increase in the Company
share capital, or (II) extending an offer to participants to purchase from the Company a certain number of own
shares which the Company will have previously acquired in the framework of a buy-back program instituted
specifically for this purpose. The take-up and exercise of subscription warrants or purchase of own shares from
the Company, as appropriate, will depend on confirmation by the Company of the fulfillment of the earnings
condition (for 70% of entitlements), the market condition (for 30% of entitlements), certain individual conditions
applied on a case-by-case basis, as well as – in all cases – the loyalty condition (which is defined as the existence
of a legal relationship between the participant of Incentive Program B and the Company or an affiliate thereof
throughout the vesting period). The base share take-up or purchase price in the exercise of entitlements assi-
gned under Incentive Program B will be equivalent to the closing price of Company stock on the last trading
day preceding the adoption of a resolution enrolling the given participant in the program. The program provides
for a potential reduction in the take-up or purchase price coupled with a proportional reduction in the number
of entitlements exercisable by the given participant. The base vesting period is equivalent to four consecutive
financial years beginning with the year during which the given stage of the program began (with an option to
shorten the vesting period to 3 years for entitlements linked to the earnings condition, should the four-year
earnings target be met within the corresponding three-year period).
As of the publication date of this report:
I) 662 000 enitlements have been assigned at the first stage of Incentive Program B (in 2023), 656 000 of
which remain outstanding;
II)
723 500 entitlements have been assigned at the second stage of Incentive Program B (in 2024), all of
which remain outstanding.
Earnings condition – applicable to 70% of entitlements assigned during each stage of Incentive Program B
The earnings condition is considered fulfilled if, during the given vesting period, the CD PROJEKT Group
posts sufficient earnings, which are defined as the consolidated net profit from continuing activities aggre-
gated with the costs of estimating entitlements assigned during the given stage of Incentive Program B
as entered in the accounting records of CD PROJEKT Group member entities. For entitlements assigned
during the first stage of Incentive Program B (in the financial year 2023) the earnings condition for the
years 2023–2026 is 2 billion PLN, while for entitlement assigned during the second stage of Incentive
Program B (in the financial year 2024) the earnings condition for the years 2024–2027 is 3 billion PLN.
For each subsequent stage of Incentive Program B, associated with the financial years 2025, 2026 and
2027 respectively, the corresponding four-year earnings condition will, in each case, be determined by the
General Meeting in the form of a resolution (on the Management Board’s request).
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
57 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Market condition – applicable to 30% of entitlements assigned during each stage of Incentive Program B
The market condition is defined as a as a change in the price of Company stock on the Warsaw Stock Exchange
in such a way that the percentage difference between the closing price of Company stock on the final trading
session of the final year subject to verification in the context of the above-mentioned earnings condition com-
pared to the closing price of Company stock on the final trading session of the year preceding the year covered
by the given stage of Incentive Program B is equal to or greater than the corresponding percentage change in
the value of the WIG index increased by 10 percentage points over the same period.
Disclosure of the control system of employee share programs
The share-based incentive programs in force as of the publication date of this report, i.e. Incentive Program A
and Incentive Program B for the years 2023–2027 were introduced by the General Meeting of the Company
on 18 April 2023. Detailed regulations applicable to these programs were adopted by the Management Board
of the Company on 21 May 2023 and subsequently approved by the Supervisory Board on 23 May 2023.
The full wording of these regulations is available on the Company’s corporate website.
Implementation of both programs is overseen by the Supervisory Board and the Management Board of
CD PROJEKT S.A.
Disclosure of the purchase and redemption of own shares
The Company did not purchase any own shares during the reporting period.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
58 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Company shares held by members of the Management
Board and the Supervisory Board
Table 10 Shares held by members of the Management Board and Supervisory Board of the Company
*
Name Position
as of
28.08.2024
as of
30.06.2024
as of
31.12.2023
Adam Kiciński
Management Board Member,
Chief Strategy Officer
Piotr Nielubowicz
Management Board Member,
Chief Financial Officer
Adam Badowski
Management Board Member,
Joint Chief Executive Officer
Michał Nowakowski
Management Board Member,
Joint Chief Executive Officer
Piotr Karwowski
Management Board Member,
Joint Chief Operating Officer
Paweł Zawodny
Management Board Member,
Joint Chief Operating Officer
Marcin Iwiński
Chairperson
of the Supervisory Board
Katarzyna Szwarc
Deputy Chairperson
of the Supervisory Board
Maciej Nielubowicz Supervisory Board Member
*based on declarations and notifications filed with the Company
Persons discharging managerial and executive responsibilities at CD PROJEKT S.A. do not directly hold any
shares of CD PROJEKT S.A. subsidiaries which are members of the CD PROJEKT Group.
Management structure
In line with legal requirements stemming from the Code of Commercial Companies, official bodies of the Company
include, in addition to the General Meeting of Shareholders, the Management Board and the Supervisory Board.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
59 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Composition of the Management Board of CD PROJEKT S.A.
Michał Nowakowski – Joint Chief Executive Officer, Member of the Board
Jointly-responsible for the company’s long term vision, coordinates the company’s acti-
vities and its management. In particular responsible for the Company’s business strategy
and effective sales policy. Supports development of new product lines and manages the
Company’s back catalog (franchise flywheel). Shapes long-term business relations with key
partners. Represents company in relation with the investors.
Directly supervises the following:
Business development | Comic Book and Animation narrative | Investor Relations
Adam Badowski – Joint Chief Executive Officer, Member of the Board
Jointly-responsible for the company’s long term vision, coordinating the company’s activities
and its management. In particular responsible for the Company’s creative vision, and for
managing, developing and maintaining the Company’s creative teams. Develops and defines
the unique image and style which distinguish the Company and its products on the market.
Directly supervises the following:
Game direction | Story | Global Art | Audio & Music | Localization & English adaptation
Adam Kiciński – Chief Strategy Officer, Member of the Board
Responsible for the Company’s strategy and for its implementation.
Directly supervises the following:
Strategy
Piotr Nielubowicz – Chief Financial Officer, Member of the Board
Responsible for the Company’s financial strategy, and for financial and non-financial repor-
ting and legal area. Oversees strategic corporate projects, key investments and Company’s
climate and environmental policy.
Directly supervises the following:
Finance | Accounting | Taxes | Legal
Piotr Karwowski – Joint Chief Operating Officer, Member of the Board
Responsible for the Company’s game development processes and optimization of its
operational capabilities, including in-house production, external games development and
management of the Group’s studios. Additionally oversees development of online and
user experience competencies.
Directly supervises the following:
Game production | Studio operations | IT & Security | Online | UX
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
60 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Paweł Zawodny – Joint Chief Operating Officer, Member of the Board
Responsible for shaping the Company’s tech strategy and optimization of its operatio-
nal capabilities. Plays a pivotal role in driving both the technological and organizational
transformation of CD PROJEKT RED. Oversees the Company’s activities in the scope of
employment, talent management and work methodology, ensuring they are aligned with
the Company’s broader transformation objectives.
Directly supervises the following:
HR | Culture, Diversity & Inclusion | Technologies (including R&D)
Jeremiah Cohn – Chief Marketing Officer, Member of the Board
Responsible for the Company’s global marketing strategy, product communication and bran-
ding in support of franchise development. Oversees efforts to build recognition of the Company,
its IP, and product releases by shaping engagement with fans and the gamers community.
Directly supervises the following:
Marketing | PR | Franchises
The Management Board manages all Company matters which are not otherwise reserved to the General Meeting
and the Supervisory Board. In particular, the Management Board:
■ works to ensure that Company matters are managed in a clear and effective manner, and in compliance with
the applicable laws;
■ determines the Company’s strategy and its main business objectives, and is responsible for ensuring imple-
mentation thereof;
■ manages Company matters and represents the Company in courts of law and otherwise;
■
exercises due diligence in the decision-making process, acts within the boundaries of acceptable risk, and
remains loyal to the Company.
Chart 10
Tenure of incumbent members of the Management Board as employees at the Group’s mem-
ber companies (in years)
Paweł Zawodny
Jeremiah Cohn
Piotr Karwowski
Michał Nowakowski
Adam Badowski
Piotr Nielubowicz
Adam Kiciński
30
25
22
19
17
10
6
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
61 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Changes in the composition of the Management
Board of CD PROJEKT S.A.
Since 1 January 2023 the Management Board of the Company consists of seven Members. No changes in
the composition of the Management Board occurred during the reporting period and up until the publication
date of this report.
The following changes in the description of roles and names of positions held by Members of the Management
Board took effect on 1 January 2024:
■ since 1 January 2024 Adam Kiciński holds the position of Chief Strategy Officer (CSO);
■
the position of Chief Executive Officer (CEO) is held jointly by Adam Badowski and Michał Nowakowski. Both Adam
Badowski and Michał Nowakowski officially introduce themselves as Joint Chief Executive Officers (Joint CEO).
Composition of the Supervisory Board and
Audit Committee of CD PROJEKT S.A.
The following persons are incumbent Members of the Supervisory Board of CD PROJEKT S.A.:
The Audit Committee is composed of the following members:
Marcin
Iwiński
CHAIRPERSON
OF THE SUPERVISORY
BOARD
Katarzyna
Szwarc
DEPUTY CHAIRPERSON
OF THE SUPERVISORY
BOARD
Maciej
Nielubowicz
SECRETARY
OF THE SUPERVISORY
BOARD
Michał
Bień
MEMBER
OF THE SUPERVISORY
BOARD
INDEPENDENT MEMBER
Jan Łukasz
Wejchert
MEMBER
OF THE SUPERVISORY
BOARD
INDEPENDENT MEMBER
Michał
Bień
CHAIRPERSON
OF THE AUDIT
COMMITTEE
Maciej
Nielubowicz
MEMBER
OF THE AUDIT
COMMITTEE
Jan Łukasz
Wejchert
MEMBER
OF THE AUDIT
COMMITTEE
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
62 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Changes in the composition of the Supervisory Board
and Audit Committee of CD PROJEKT S.A.
No changes in the composition of the Supervisory Board and Audit Committee of the Company occurred during
the reporting period and up until the publication date of this report.
Disclosure of retirement benefits and similar compensation payable
to former members of the Issuer’s executive, supervisory or
administrative bodies, and of any liabilities associated with such benefits,
specifying the aggregate amounts for each category of recipients
As of 30 June 2024 and as of the preparation date of this report the Company had no such liabilities.
Agreements between the Issuer and members of its managing
bodies concerning compensation in the event of their resignation
or dismissal, including dismissal or recall as a result of a merger
As of 30 June 2024 and as of the preparation date of this report there were no provisions in force regula-
ting compensation in the event of resignation or dismissal of members of the Company’s Management Board,
including when their dismissal or recall is due to a merger involving the Company.
Changes in basic management practices at the Company and its Group
No significant changes in basic management policies affecting the Company and its Group occurred in the
first half of 2024.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
63 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
Applicable corporate governance policies
CD PROJEKT S.A. is subject to corporate governance policies set forth in the 2021 Code of Best Practice for
WSE Listed Companies (annexed to Stock Exchange Council resolution of 13/1834/2021 of 29 March 2021).
Information regarding application of policies contained in the 2021 Code of Best Practice for WSE Listed Com-
panies is available on our website under the Corporate Governance tab. Our statement regarding application
of corporate governance policies in 2023 is part of the Management Board Report on CD PROJEKT Group
Activities for the Period Between 1 January and 31 December 2023.
Disclosure of significant legal proceedings
The following legal proceedings took place during the reporting period (the presented status is valid for the
publication date of this report):
CRIMINAL PROCEEDINGS IN WHICH CD PROJEKT S.A. IS RECOGNIZED AS THE VICTIM
Case against natural persons (including former members of the Management Board of Optimus S.A.)
In case no. XVIII K 126/09, following indictment filed by the District Attorney in the District Court for the City of
Warsaw, on 27 October 2016 the District Court convicted Mr. Michał L., Mr. Piotr L. and Mr. Michał D. of violating
sections 296 §1, 296 §3 and others of the Penal Code. The Company acted as an auxiliary prosecutor in the
court of first instance and will retain this status until the trial has concluded. Having found the defendants guilty,
the Court awarded the Company 210 thousand PLN in damages under Art. 46 of the Penal Code. According
to the operative part of the judgement total losses sustained by the Company as a result of the defendants’
actions were estimated at not less than 16 million PLN (this figure follows from standard regulations applicable
to criminal trials). The Company subsequently filed an appeal against the judgment, contesting, among others,
the amount of damages awarded to the Company. An appeal against the full judgement was also filed by the
defendants’ attorneys. On 26 October 2017 the Appellate Court vacated the judgment of the court of first instance
and remanded the case to be retried in full. The District Court for the City of Warsaw subsequently filed the
case under no. XVIII K 316/17. The parent company continues to act in the capacity of an auxiliary prosecutor.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
64 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
LITIGATION INVOLVING THE COMPANY’S SUBSIDIARIES
Case brought by GOG sp. z o.o. before the District Administrative Court in Kraków
On 19 August 2022 the Head of the Małopolska Customs and Tax Office in Kraków issued a decision with regard
to corporate tax liabilities incurred by GOG sp. z o.o., a subsidiary of the Company, in 2016. The Management
Board of GOG sp. z o.o. discharged the liability arising under the aforementioned decision, which, as of the
payment date, amounted to 2 638 thousand PLN. Nevertheless, given its disagreement with the assessment
presented by the tax authority, it appealed the decision on 5 September 2022.
On 22 May 2023 the Head of the Małopolska Customs and Tax Office in Kraków, who also performs the function
of the appeal body in this case, issued a decision upholding the contested decision. On 4 July 2023, given its
continuing disagreement with the position expressed by the tax authority, the Management Board of GOG sp z o.o.
filed a complaint against the aforementioned decision in the District Administrative Court in Kraków. A trial
was held before the District Administrative Court in Kraków on 3 October 2023, as a result of which the Court
issued an injunction repealing the decisions of the Head of the Małopolska Customs and Tax Office in Kraków
of 19 August 2022 and 22 May 2023, and ordering that the matter be processed anew.
On 29 May 2024 the Head of the Małopolska Customs and Tax office in Kraków issued a new decision in which
the corporate tax liabilities due for 2016 were lowered by 116 226 PLN compared to the original decision of
19 August 2022. On 26 June 2024 the Management Board of GOG sp. z o.o., given its continuing disagreement
with the tax authority’s decision, filed a complaint thereagainst with the Director of the Fiscal Administration Autho-
rity in Kraków. As of the publication date of this report GOG sp. z o.o. has not received a reply to this complaint,
and the matter remains at the administrative appeal stage.
On 25 June 2024, in light of the injunction issued by the District Administrative Court in Kraków, GOG sp. z o.o.
was reimbursed 2 578 500 PLN by the First Mazovian Tax Office in Warsaw.
Management Board report on the activities of the CD PROJEKT Group between 1 January
and 30 June 2024 (all figures quoted in PLN thousands unless indicated otherwise)
65 CORPORATE GOVERNANCEFINANCIAL RESULTSBUSINESS ACTIVITYCD PROJEKT GROUP
MANAGEMENT BOARD STATEMENT
Pursuant to the Finance Minister’s ordnance of 29 March 2018 concerning current and periodic information to
be published by issuers of securities, and conditions for regarding as equivalent the information required by
the laws of a non-member state the Management Board hereby declares that, to the best of its knowledge, this
semiannual report on activities of the CD PROJEKT Group presents an accurate description of the development,
achievements and condition of the CD PROJEKT Group, including basic threats and risks applicable thereto.
Michał Nowakowski
Joint Chief Executive Officer,
Management Board Member
Adam Kiciński
Chief Strategy Officer,
Management Board Member
Adam Badowski
Joint Chief Executive Officer,
Management Board Member
Piotr Nielubowicz
Chief Financial Officer,
Management Board Member
Piotr Karwowski
Joint Chief Operating Officer,
Management Board Member
Jeremiah Cohn
Chief Marketing Officer,
Management Board Member
Paweł Zawodny
Joint Chief Operating Officer,
Management Board Member
CD PROJEKT GROUP BUSINESS ACTIVITY FINANCIAL RESULTS CORPORATE GOVERNANCE
CD PROJEKT GROUP
BUSINESS ACTIVITY
FINANCIAL RESULTS
CORPORATE GOVERNANCE
CONTACT FOR INVESTORS: IR@CDPROJEKT.COM
WWW.CDPROJEKT.COM