EX-99.3 4 exhibit993_2025.htm EX-99.3 Document

Exhibit 99.3

2024 Annual Business Report


Table of Contents

1.Business Overview
(1)Business Results and Financial Statements for the Past Three Fiscal Years (2022 – 2024)

2.Company Overview
(1)Registered Purpose of the Company
(2)Description of Primary Business
(3)Problems Confronting the Company
(4)Business Offices and Game Development Facilities
(5)Stock
(6)Debenture
(7)Major Shareholders
(8)Investment in Other Companies
(9)Directors Holding Concurrent Positions
(10)Material Transactions with Related Parties
(11)Significant Creditors
(12)Employees
(13)Directors and Auditors
(14)Material Events after the End of Fiscal Year 2024

3. Consolidated Financial Statements as of and for the fiscal years ended December 31, 2024 and 2023
(1)Consolidated Financial Positions
(2)Consolidated Comprehensive Income
(3)Consolidated Statements of Changes in Equity
(4)Consolidated Statements of Cash Flows

4. Separate Financial Statements as of and for the fiscal years ended December 31, 2024 and 2023
(1)Financial Positions
(2)Comprehensive Income
(3)Statements of Appropriation of Retained earnings
(4)Statements of Changes in Equity
(5)Statements of Cash Flows






1. Business Overview
(1)Business Results and Financial Statements for the Past Three Fiscal Years (2022 – 2024)

(In thousands of Korean Won)
Category202420232022
Current assets388,828,361320,313,123250,876,266
• Quick assets388,828,361320,313,123250,876,266
Non-current assets73,268,52756,133,36041,433,074
• Investment asset49,376,74735,451,23426,732,334
• Property and Equipment, net5,344,4964,179,6023,520,385
• Intangible asset6,765,8935,989,5963,867,939
• Other non-current asset6,277,3195,279,5921,574,623
Total assets462,096,888376,446,483292,309,340
Current liabilities36,037,10341,707,39328,335,116
Non-current liabilities7,406,0503,977,7103,382,407
Total liabilities43,443,15345,685,10331,717,523
Share capital3,474,4503,474,4503,474,450
Capital surplus27,482,68327,482,68327,482,683
Other components of equity---
Retained earnings387,696,602299,804,247229,634,684
Total equity418,653,735330,761,380260,591,817
Revenues179,302,825242,775,498232,717,405
Operating income44,190,43170,755,03562,144,800
Net income before income tax102,345,51192,062,74075,203,609
Net income87,892,35570,169,56354,914,724

2. Company Overview
(1)Registered Purpose of the Company
1)Software consulting, development and supply
2)Development and sales of software and CD
3)Information-technology-related software development
4)Production, development, distribution, sales, and consulting of software, including game software, as well as corresponding licensing
5)Online network game services
6)Applied package-related software development
7)Production and sales of computer programs
8)Import and export of software
9)E-commerce
10) Character development business
11) Animation business
12) Real estate leasing
13) Service-area restaurant business
14) Media-related business
15) Printing and publication
16) Record & video production and distribution
17) Production, development, distribution, sales, and consulting of digital content, including digital content based on the technology of NFT and blockchain as well as corresponding licensing
18)Sports facility business including golf practice facilities and screen golf courses
19)Any other businesses incidental to the above businesses

(2)Description of Primary Business
Gravity Co., Ltd. (the “Company”) is the developer of Ragnarok Online, an MMORPG, which was launched in August 2002 and is commercially offered in 91 markets worldwide, including Korea, Japan, Taiwan, Thailand, Southeast Asia, the United States, Europe and Middle East as of December 31, 2024.


Having strong global network and success from Ragnarok Online, the Company is expanding its business areas from online game development and publishing to cultural contents business based on various platforms, such as development of games for smartphones, console and IPTV, and animation and game character merchandising.
In addition, the Company has 9 subsidiaries, such as Gravity NeoCyon, Inc. in Korea, Gravity Interactive, Inc. in the United States, Gravity Communications Co., Ltd in Taiwan. Gravity Game Tech Co., Ltd. in Bangkok, Thailand, PT Gravity Game Link in Jakarta, Indonesia, Gravity Game Arise Co., Ltd. in Tokyo, Japan, Gravity Game Hub PTE., Ltd in Singapore, Gravity Game Vision., Ltd in Hong Kong and Gravity Game Unite Sdn. Bhd. in Malaysia.

(3)Problems Confronting the Company
Since the Company operates in a highly competitive industry, the Company is making every effort to enhance its development capacity and to maintain and increase its market share in overseas markets to preserve its competitive advantage.
The Company is in need of diversified revenue structure, continuous global market expansion and new business initiatives for sustainable revenue growth. The Company is doing its best diversely to expand new markets, to publish mobile games, to develop mobile games and to do IP licensing business.

(4)Business Offices and Game Development Facilities
ClassificationLocation
Head Office(Nuritkum Square R&D Tower) 15F, 396 World Cup buk-ro, Mapo-gu, Seoul 121-795, Korea
Game Development Facilities
(Nuritkum Square R&D Tower) 15F, 396 World Cup buk-ro, Mapo-gu, Seoul 121-795, Korea

(5)Stock

1) Total number of shares
(As of December 31, 2024)
Total number of shares authorizedTotal number of shares issuedTotal number of shares unissued
40,000,000 shares6,948,900 shares33,051,100 shares

2) Type of Stock issued (Par value per share: KRW 500)
(As of December 31, 2024)
TypeNumber of sharesTotal par value%
Registered common stock6,948,900 sharesKRW 3,474,450,000100 %

(6)Debenture: None.

(7)Major Shareholders
(As of December 31, 2024)
ShareholderShares Owned%Transaction with the Company
GungHo Online Entertainment, Inc.4,121,73759.31
-
Others2,827,16340.69-
Total6,948,900100.00-



(8)Investment in Other Companies

(As of December 31, 2024)
CompaniesRelationship with the Company
NameLocationCommon StockMain businessShares owned%Relationship
Gravity Interactive, Inc.California, USAUSD 10,540,000Online and Mobile Game Service290,000100.00%Subsidiary
Gravity NeoCyon, Inc.Seoul, KoreaKRW 6,990,985,000
Mobile game development1,398,197100.00%Subsidiary
Gravity Communications Co., LtdTaipei, TaiwanNTD 155,100,000Online and Mobile Game Service15,510,000100.00%Subsidiary
PT Gravity Game Link
Jakarta, Indonesia
IDR 43,221,000,000Online and Mobile Game Service3,025,47070.00%Subsidiary
Gravity Game Tech Co., Ltd.Bangkok, ThailandTHB 188,049,960Online and Mobile Game Service18,804,994100.00%Subsidiary
Gravity Game Arise Co., Ltd.Tokyo, JapanJPY 100,000,000Online and Mobile Game Service200,000100.00%Subsidiary
Gravity Game Hub PTE., Ltd. SingaporeSGD 6,819,991Online and Mobile Game Service691,500100.00%Subsidiary
Gravity Game Vision., Ltd.Hong KongHKD 3,900,001Online and Mobile Game Service39,001100.00%Subsidiary



























(9)Directors Holding Concurrent Positions
NameCompany
NamePositionResponsibility
Hyun Chul ParkGravity Co., Ltd.CEOOverall management
Gravity NeoCyon, Inc.Executive DirectorChief Operating Officer
Gravity Interactive, Inc.President-
Yoshinori KitamuraGravity Co., Ltd.Executive DirectorChief Operating Officer
Chief Compliance Officer
Gravity Interactive, Inc.CEOOverall management
Gravity NeoCyon, Inc.CEOOverall management
Gravity Communications Co., Ltd.CEOOverall management
PT Gravity Game LinkCEOOverall management
Gravity Game Tech Co., Ltd.CEOOverall management
Gravity Game Arise Co., Ltd.CEOOverall management
Gravity Game Hub PTE., Ltd.CEOOverall management
Gravity Game Vision., Ltd.CEOOverall management
Gravity Game Unite Sdn. Bhd.CEOOverall management
Heung Gon KimGravity Co., Ltd.Executive DirectorChief Financial Officer
Gravity NeoCyon, Inc.Executive DirectorChief Financial Officer
Gravity Interactive, Inc.Vice President-
Gravity Communications Co., Ltd.Executive DirectorChief Financial Officer
PT Gravity Game LinkExecutive Director-
Gravity Game Tech Co., Ltd.Executive Director-
Gravity Game Arise Co., Ltd.Executive Director-
Gravity Game Hub PTE., Ltd.Executive DirectorChief Financial Officer
Gravity Game Vision., Ltd.Executive DirectorChief Financial Officer
Gravity Game Unite Sdn. Bhd.Executive Director-



(10)Material Transactions with Related Parties
① Sales and purchases
(In thousands of Korean Won)
NatureRelated Companies20242023
SalesPurchasesSalesPurchase
Parent companyGungHo Online Entertainment, Inc.16,550,53515,94617,681,83615,379
Related companyGungHo Online Entertainment America559184,657-54,884
SubsidiariesGravity Interactive, Inc.8,492,456793,64310,194,9891,604,089
Gravity NeoCyon, Inc.373,1278,299,769353,4375,895,579
Gravity Communications Co., Ltd.(*1)15,425,6603,311,71919,240,6214,584,439
PT Gravity Game Link136,99581,750126,912151,217
Gravity Game Tech Co., Ltd. (*1)18,717,621-7,510,24160,685
Gravity Game Arise Co., Ltd.751,8003,520,16710,0323,191,285
Gravity Game Hub PTE., Ltd.9,830,668-32,108,671-
Gravity Game Vision Limited (*1)41,073,877-15,286,908-
Total111,353,29816,207,651102,513,64715,557,557
(*1) In 2024 sales, the dividend received KRW 43,120,174 thousand is included, and in 2023 sales, the dividend received KRW 12,072,740 thousand is included.

② Receivables and Payables
(In thousands of Korean Won)
NatureRelated Companies20242023
ReceivablesPayablesReceivablesPayables
Parent companyGungHo Online Entertainment, Inc.3,240,4722,7551,839,8472,685
Related companyGungHo Online Entertainment America57397,210-1,380
SubsidiariesGravity Interactive, Inc.2,210,555154,3463,079,218559,178
Gravity NeoCyon, Inc.245,6001,617,933364,6761,020,207
Gravity Communications Co., Ltd.684,193889,3841,214,7551,217,102
PT Gravity Game Link65,65819,38526,42647,333
Gravity Game Tech Co., Ltd.3,764,723194,0221,818,381266,354
Gravity Game Arise Co., Ltd.104,986490,42231,145360,322
Gravity Game Hub PTE., Ltd.1,377,7304,2136,804,7454,213
Gravity Game Vision Limited5,711,6939211,322,583921
Total17,406,1833,470,59116,501,7763,479,695

(11)Significant Creditors: The Company had no significant creditors As of December 31, 2024.

(12)Employees
(As of December 31, 2024)
CategoryDirectors & OfficersDevelopersMarketing/OperatingFinance/AdministrationTotal
Employees1823812038414
















(13)Directors and Auditors
(As of December 31, 2024)
NamePositionMain workTransaction with the Company
Hyun Chul ParkCEOChief Executive Officer-
Yoshinori KitamuraExecutive Director
Chief Operating Officer
Chief Compliance Officer
-
Heung Gon KimExecutive DirectorChief Financial Officer-
Kazuki MorishitaExecutive Director--
Kazuya SakaiExecutive Director--
Koji YoshidaExecutive Director--
Jung YooIndependent DirectorMember of audit committee-
Yong Seon KwonIndependent DirectorMember of audit committee-
Kee Woong ParkIndependent DirectorMember of audit committee-
Hyo Eun LimIndependent Director--
Geum Ok SimIndependent Director--

(14)Material Events after the end of fiscal year 2024: Gravity Game Unite Sdn. Bhd., a 100% subsidiary in Malaysia, was established on March 12, 2025.


3. Consolidated Financial Statements as of and for the fiscal year ended December 31, 2024 and December 31, 2023
(1)Consolidated Statements of Financial Position
GRAVITY CO., LTD. (In thousands of Korean Won)
December 31, 2024December 31, 2023
Assets
Current assets
653,609,789546,899,006
Cash and cash equivalents
228,898,026184,081,815
Short-term financial instruments
324,304,040277,215,000
Accounts receivable, net
81,152,45871,212,897
Other receivable, net
1,572,1823,637,586
Prepaid expenses
8,115,2922,993,884
Other current financial assets
6,601,5194,438,717
Other current assets
2,966,2723,319,107
Non-current assets
32,849,15331,281,715
Property and equipment, net
9,957,08610,150,750
Intangible assets, net
7,056,5486,369,958
Other non-current financial assets
1,766,5881,824,076
Other non-current assets
8,451,4436,984,797
Deferred tax assets
5,617,4885,952,134
Total assets686,458,942578,180,721
Liabilities
Current liabilities
108,648,807106,433,493
Account payables
67,929,91161,777,889
Deferred revenue
26,760,73218,092,463
Withholdings
1,587,7593,072,036
Accrued expenses
2,651,4262,313,022
Income tax payable
6,507,22716,927,054
Other current liabilities
3,211,7524,251,029
Non-current liabilities
9,446,6768,019,266
Long-term account payables
220,108677,520
Long-term deferred revenue
2,571,8621,784,849
Other non-current liabilities
5,361,0253,174,635
Deferred tax liabilities
1,293,6812,382,262
Total liabilities118,095,483114,452,759
Equity attributable to owners of the parent company567,672,221463,087,831
Share capital
3,474,4503,474,450
Common shares
3,474,4503,474,450
Capital surplus
26,979,36127,098,264
Other components of equity
23,800,5514,016,535
Retained earnings
513,417,859428,498,582
Non-controlling interest691,238640,131
Total equity568,363,459463,727,962
Total liabilities and equity686,458,942578,180,721


(2)Consolidated Statements of Comprehensive Income
GRAVITY CO., LTD. (In thousands of Korean Won)
20242023
Revenues500,845,120725,515,935
Online games
76,989,13181,017,362
Mobile games
405,675,976629,604,084
Other revenue
18,180,01314,894,489
Cost of revenues306,903,066484,958,333
Gross profit193,942,054240,557,602
Selling, general and administrative expenses
107,753,36479,552,396
Operating Profit86,188,690161,005,206
Non-operating income and expenses20,158,3447,693,403
Financial income
30,888,98923,266,528
Financial costs
(9,925,670)(14,934,727)
Other non-operating income
788,898913,359
Other non-operating expenses
(1,593,873)(1,551,757)
Profit before income tax expense106,347,034168,698,609
Income tax expense21,444,82636,716,548
Profit for the year84,902,208131,982,061
Owners of the parent company
84,919,277132,019,054
Non-controlling interests
(17,069)(36,993)
Other comprehensive income19,849,6381,566,080
Items that may be subsequently reclassified to profit or loss
19,825,6841,558,944
Foreign currency translation adjustments
19,768,0171,536,445
Non-controlling interest of foreign currency translation adjustments57,66722,499
Items that will never be reclassified to profit or loss
23,9547,136
Remeasurement of defined benefit liabilities
15,9994,415
Non-controlling interest of remeasurement of defined benefit liabilities
7,9552,721
Total comprehensive income for the year104,751,846133,548,141
Owners of the parent company
104,703,293133,559,914
Non-controlling interests
48,553(11,773)
Earnings per share attributable to the equity holders of the parent company
Basic earnings per share
12,22118,999
Diluted earnings per share
12,22118,999



(3)Consolidated Statements of Changes in Equity
GRAVITY CO., LTD. (In thousands of Korean Won)



Share capital
Capital surplus
Other components of equityRetained EarningsTotal
Non-controlling
interest
Total
Equity
Balance at January 1, 20233,474,45027,098,2642,475,675296,479,528329,527,917651,904330,179,821
Profit for the year
---132,019,054132,019,054(36,993)131,982,061
Defined benefit obligation adjustments
--4,415-4,4152,7217,136
Gain on overseas operations translation
--1,536,445-1,536,44522,4991,558,944
Balance at December 31, 20233,474,45027,098,2644,016,535428,498,582463,087,831640,131463,727,962
Balance at January 1, 20243,474,45027,098,2644,016,535428,498,582463,087,831640,131463,727,962
Total comprehensive income for the year
Profit for the year
---84,919,27784,919,277(17,069)84,902,208
Defined benefit obligation adjustments
--15,999-15,9997,95523,954
Gain on overseas operations translation
--19,768,017-19,768,01757,66719,825,684
Transaction with owners
Subsidiaries paid-in capital increase -(13,001)--(13,001)(3,008)(16,009)
Non-controlling interest exchange-(105,902)--(105,902)5,562(100,340)
Balance at December 31, 20243,474,45026,979,36123,800,551513,417,859567,672,221691,238568,363,459



(4) Consolidated Statements of Cash Flows
GRAVITY CO., LTD. (In thousands of Korean Won)
20242023
Cash flows from operating activities78,555,174132,429,737
Cash flows generated from operating activities95,574,035150,231,732
Profit for the year
84,902,208131,982,061
Adjustments
14,492,99536,164,732
Changes in operating assets and liabilities
(3,821,168)(17,915,061)
Interest received
15,053,91510,434,574
Interest paid
(130,027)(156,631)
Income tax paid
(31,942,749)(28,079,938)
Cash flows from investing activities
　(47,034,392)(116,579,700)
Cash inflow from investment activities21,836　24,103
Proceeds from disposal of property and equipment
6,67321,024
Decrease in other current financial assets
6,6673,079
Decrease in other non-current financial assets8,496-
Cash outflow from investment activities(47,056,228)(116,603,803)
Increase in short-term financial instruments
(42,264,550)(110,179,175)
Purchase of property and equipment
(613,947)(2,461,226)
Purchase of intangible assets
(4,147,357)(3,337,218)
Increase in other non-current financial assets
(30,374)(626,184)
Cash flows from financing activities　(4,641,636)(4,083,272)
Cash inflow from financing activities--
Cash outflow from financing activities(4,641,636)　(4,083,272)
Repayment of lease liabilities(4,525,288)　(4,083,272)
Expense on subsidiaries share issuance(16,009)-
Acquisition of non-controlling interest(100,339)-
Effects of exchange rate changes on cash and cash equivalents17,937,0652,437,709
Net increase (decrease) in cash and cash equivalents44,816,21114,204,474
Cash and cash equivalents at beginning of the year184,081,815169,877,341
Cash and cash equivalents at end of the year228,898,026184,081,815


4. Separate Financial Statements as of and for the fiscal year ended December 31, 2024 and December 31, 2023.

(1)Statements of Financial Position
GRAVITY CO., LTD. (In thousands of Korean Won)
December 31, 2024December 31, 2023
Assets
Current assets388,828,361320,313,123
Cash and cash equivalents
64,263,19832,157,091
Short-term financial instruments
278,000,000249,000,000
Accounts receivable, net
35,651,27031,529,998
Other receivable, net
3,409,2191,760,646
Prepaid expenses
1,226,6721,148,345
Other current financial assets
5,897,5854,476,977
Other current assets
380,417240,066
Non-current assets73,268,52756,133,360
Investments in subsidiaries
49,376,74735,451,234
Property and equipment, net
5,344,4964,179,602
Intangible assets, net
6,765,8935,989,596
Other non-current financial assets
1,999,8361,164,926
Other non-current assets
6,277,3195,279,592
Deferred tax assets
3,504,2364,068,410
Total assets462,096,888376,446,483
Liabilities
Current liabilities
36,037,10341,707,393
Accounts payables
22,597,27624,162,504
Deferred income
6,027,9074,627,119
Withholdings
829,4301,230,318
Accrued expenses
1,277,6851,101,738
Income tax payable
3,435,3518,270,305
Other current liabilities
1,869,4542,315,409
Non-current liabilities
7,406,0503,977,710
Long-term account payables
220,108677,520
Long-term deferred revenue
2,571,8621,790,097
Other non-current liabilities
4,614,0801,510,093
Total liabilities43,443,15345,685,103
Equity
Share capital3,474,4503,474,450
Common shares
3,474,4503,474,450
Capital surplus27,482,68327,482,683
Retained earnings387,696,602299,804,247
Total equity418,653,735330,761,380
Total liabilities and equity462,096,888376,446,483



(2)Statements of Comprehensive Income
GRAVITY CO., LTD. (In thousands of Korean Won)
20242023
Revenues179,302,825242,775,498
Online games
36,477,961 32,778,385
Mobile games
142,121,659 209,449,600
Other revenue
703,205 547,513
Cost of revenues79,520,828 121,571,928
Gross profit99,781,997 121,203,570
Selling, general and administrative expenses
55,591,566 50,448,535
Operating Profit44,190,431 70,755,035
Non-operating income and expenses58,155,080 21,307,705
Financial income
20,047,120 16,603,926
Financial costs
(5,048,084)(7,260,236)
Other non-operating income
44,145,625 13,476,681
Other non-operating expenses
(989,581)(1,512,666)
Profit before income tax
102,345,511 92,062,740
Income tax expense14,453,156 21,893,177
Profit for the year87,892,355 70,169,563
Other comprehensive income--
Total comprehensive income for the year87,892,355 70,169,563


(3)Statements of Appropriation of Retained earnings
GRAVITY CO., LTD. (In thousands of Korean Won)
20242023
Confirmed disposition date:
March 31, 2025
Confirmed disposition date:
March 29, 2024
Retained earnings before appropriation
387,696,602299,804,247
Unappropriated retained earnings carried over from prior year
299,804,247　229,634,684
Profit for the year
87,892,355　70,169,563
Appropriation of retained earnings--
Unappropriated retained earnings to be carried forward
　387,696,602299,804,247


(4) Statements of Changes in Equity
GRAVITY CO., LTD. (In thousands of Korean Won)



Share capitalCapital SurplusOther components of equityRetained EarningsTotal
Balance at January 1, 20233,474,45027,482,683-229,634,684260,591,817
Profit for the year
---70,169,56370,169,563
Balance at December 31, 20233,474,45027,482,683-299,804,247330,761,380
Balance at January 1, 20243,474,45027,482,683 -299,804,247330,761,380
Profit for the year
---87,892,35587,892,355
Balance at December 31, 20243,474,45027,482,683-387,696,602418,653,735


(5)Statements of Cash Flows
GRAVITY CO., LTD. (In thousands of Korean Won)
20242023
Cash flows from operating activities　80,267,527 85,687,105
Cash flows generated from operating activities45,606,597　82,075,516
Profit for the year87,892,355 　70,169,563
Adjustments
(35,637,197)　5,891,373
Changes in operating assets and liabilities
(6,648,561)　6,014,580
Interest received
10,086,534 　8,427,882
Dividend received
43,120,174 12,072,740
Interest paid
(77,204)　(91,294)
Income tax paid
(18,468,574)　(16,797,739)
Cash flows from investing activities　(46,474,806)(94,593,238)
Cash inflow from investment activities7,469 　20,295
Decrease in other current financial assets
6,667 　-
Disposal of property and equipment
802 　20,295
Cash outflow from investment activities(46,482,275)　(94,613,533)
Acquisition of subsidiaries shares
(13,925,514)　(8,718,900)
Increase in short-term financial instruments
(29,000,000)　(81,999,800)
Increase in other non-current financial assets
-(545,000)
Purchase of property and equipment
(207,306)(704,398)
Purchase of intangible assets
(3,349,455)(2,645,435)
Cash flows from financing activities　(2,069,495)(2,060,721)
Cash inflow from financing activities--
Cash outflow from financing activities(2,069,495)(2,060,721)
Repayment of lease liabilities(2,069,495)(2,060,721)
Effects of exchange rate changes on cash and cash equivalents382,881 138,320
Net increase (decrease) in cash and cash equivalents32,106,107 (10,828,534)
Cash and cash equivalents at the beginning of the year32,157,091 42,985,625
Cash and cash equivalents at the end of the year64,263,198 32,157,091