Smilegate paid nearly 100 billion won in dividends to founder Kwon Hyuk-bin, chief vision officer (CVO), even as both sales and profit fell last year.
According to an audit report on the 14th, Smilegate's sales for fiscal 2024 were 1.4365 trillion won, down 5.6% from a year earlier. Operating profit fell 30.1% to 359.8 billion won, and net profit decreased 36.1% to 302.3 billion won.
What stands out is that large-scale dividends were paid as profitability deteriorated across the board. Smilegate executed cash dividends totaling 168.4 billion won from retained earnings last year.
The company is an unlisted firm in which CVO Kwon Hyuk-bin holds 100% equity, so most of the dividends accrue to Kwon. Excluding the 69.6 billion won in 2024 dividends among this amount, the dividends that went to Kwon last year came to 98.7 billion won.
This year, Smilegate absorbed its holding company and major subsidiaries to shift to a single-corporation structure. It integrated Smilegate Entertainment, the developer of "Crossfire," and Smilegate RPG, the developer of "LOST ARK," to simplify its governance and improve management efficiency.
In the industry, the restructuring and large dividends are also being interpreted as preliminary steps with an eye toward a future initial public offering (IPO) or securing investment funds.
However, the company has not offered a separate position on future capital market plans or investment strategy.