Converting The Pearl Abyss Earnings Calls To USD

With Pearl Abyss' next quarterly earnings call less than two days away, now is a good time to review how I convert South Korean won to US dollars. Normally my currency conversions for game sales are pretty close for the entire year. From 2019-2021, the conversions were less than 1.5% off from the amount listed in the presentation versus what Pearl Abyss Iceland reported to the Icelandic taxing authority. But in 2022, the figure was off by 10%. What happened?

History converting investor call data to actual USD

The method I chose to perform the conversion was to take the amount of won reported and use the currency conversion rate for the last business day of the quarter to perform the conversion. Then for the year, I added up the quarterly totals. For the first three years Pearl Abyss owned CCP, that calculation worked. In 2019, the calculation was off by only 0.4%. In 2020, the conversion overcounted CCP's game revenue by 1.3%. And in 2021, I undercounted CCP's game revenue by 1.5%.

But 2022 was different. Inflation and a war in Europe really caused some currency fluctuations concerning the US dollar, the currency used by CCP to conduct its financial reports. For the earnings calls, Pearl Abyss takes the figures reported by CCP and converts to won. I then convert the won number reported back to US dollars. Hilarity ensues.

I did note in my coverage last year that the currency fluctuations were rather severe. I didn't realize just how much I was off for one or two quarters, however. But people do want to see CCP's sales in USD, so I made the attempt.

Now, to address the lede I buried so well. According to PAI's financial reporting, game revenue was down 12.1% last year, from $63.8 million in 2021 to $56.1 million in 2022. Croda over at marketsforISK has already done his yearly analysis of the finances. Also, Pearl Abyss Iceland recorded a $70 million loss for 2022. From listening to the earnings call in February, I don't believe that amount was included in what Pearl Abyss told the analysts on the call. Tomorrow's call might have some surprises.