Embracer Group Ab Class B · OMXSTO:EMBRAC_B
Embracer Group Ab Class B — Q4 2023 Earnings Presentation
30 slides from Embracer Group Ab Class B's earnings presentation, May 24, 2023
Slide 1: Q4 FY 2023/24 Embracer Group Full Year Report
Q4 FY 2023/24 EMBRACER GROUP FULL YEAR REPORT APRIL 2023 – MARCH 2024
Slide 2: Disclaimer
Q4 & FULL YEAR REPORT FY 2023/24 Disclaimer IMPORTANT INFORMATION – PLEASE READ THE FOLLOWING BEFORE CONTINUING READING express or implied, is made by the Company or any of its affiliates, directors, advisors, employees and representatives as to the accuracy, completeness or verification of any info
Slide 3: Q4 FY 2023/24 Highlights
HIGHLIGHTS FROM Q4 & FULL YEAR REPORT Q4 & Full Year report FY 2023/24 Q4 FY 2023/24 Highlights Net Sales Group YOY GROWTH Solid growth in earnings and SEK 8,875m -5% cash flow in Q4 Adjusted EBIT YOY GROWTH Restructuring program successfully SEK 1,426m +56 % finalized – notable deleveraging expecte
Slide 4: Operating segments
1. Operating segments
Slide 5: PC/Console Games
PC/Console Games NET SALES REVENUE SPLIT SEKm & ADJUSTED EBIT MARGIN BACK CATALOG SALES | SEKm TOP 10 BACK CATALOG 5,000 50% 2,500 45% 4,000 3,126 40% 2,000 35% 3,000 30% 26% 25% 1,500 1,693 1,648 1,476 2,000 20% 16% 1,000 15% 1,000 10% 10% 514 5% 500 0 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY 21/22 FY 22/2
Slide 6: Project ROI (Contribution / Investment)
PC/Console Games PROJECT ROI (CONTRIBUTION/INVESTMENT) DETAILS > 50 20 Average title project data: • Based on reported numbers until Sales 268 SEKm, Contribution 191 SEKm and March 31, 2024 Investment 82 SEKm. 18 • Sample includes projects with sales SEK 26.2 bn above 40 SEKm or investment above in
Slide 7: Investments and completed game development
PC/Console Games Investments and completed game development INVESTMENTS AND COMPLETED GAME DEVELOPMENT* | SEKm 1,800 3.6x 1,671 1,693 1,672 1,690 1,600 1,633 3.3x 3.2x 1,492 1,400 1,405 1,382 1,200 1,114 1,120 1,000 2.0x 2.1x 950 1.9x 1.9x 800 803 780 1.5x 718 600 545 531 501 400 0.8x 200 262 0 Q4 Q
Slide 8: Solid pipeline of new games for FY 2024/25
PC/Console Games Solid pipeline of new games for FY 2024/25 Source: as of March 31, 2024 | Release slates can be subject to change, and will in this case be communicated through their respective publisher 8
Slide 9: Mobile Games
Mobile Games NET SALES SEKm & ADJUSTED EBIT MARGIN DAILY ACTIVE USERS & MONTHLY ACTIVE USERS NET SALES DRIVERS 2,000 50% 350 100 million 95 90 300 45% 307 316 85 1,759 40% 80 1,500 38% 35% 250 75 70 Sudoku.com Blockudoku Alien Invasion 1,366 65 28% 1,317 200 229 30% 60 55 1,000 25% 25% 50 150 45 37
Slide 10: Tabletop Games
Tabletop Games NET SALES SEKm & ADJUSTED EBIT MARGIN STRONG PIPELINE 5,000 40% 4,500 35% 4,000 30% 3,500 3,000 25% 3,074 3,117 2,500 20% 2,000 15% 1,500 12% NEW RELEASES 10% 1,000 8% 380 500 5% 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY 22/23 FY 23/24 RELEASED AFTER THE QUARTER Net Sales Adjusted EBIT Margin,
Slide 11: Entertainment & Services
Entertainment & Services NET SALES SEKm & ADJUSTED EBIT MARGIN 3,000 100% 90% 2,500 80% 2,000 70% 60% 1,500 50% 1,487 40% 1,000 1,265 30% 811 500 20% 48 10% 4% 4% 4% 0 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY 21/22 FY 22/23 FY 23/24 © 2024 Middle Earth Enterprises, LLC. All rights reserved. The Lord of the
Slide 12: Market update
OPERATING SEGMENTS Market update GLOBAL VIDEO GAMES MARKET REVENUE FORECAST GLOBAL MARKET USD billion Forecast PC1 Console1 expected to grow by expected to decline by +4% -1% 3% 207 199 193 184 188 in 2024 in 2024 179 183 COVID PEAK 144 Mobile1 Tabletop2 expected to grow by grew by +3% +0.4% in 2024
Slide 13: Financial performance
Financial performance S er
Slide 14: Financial development
FINANCIAL PERFORMANCE | Q4 Financial development GROSS MARGIN DEVELOPMENT | SEKm DEVELOPMENT OF MARKETING EXPENSES | SEKm 12,000 100% 1,400 40% 1,200 90% 10,000 35% 80% 73% 9,356 1,000 30% 8,000 8,875 898 70% 58% 25% 62% 800 555 60% 6,000 50% 20% 20% 600 5,238 478 40% 4,000 15% 30% 400 10% 10% 2,000
Slide 15: Adjusted EBIT Bridge
FINANCIAL PERFORMANCE | Q4 Adjusted EBIT Bridge Items not Non-cash expense related to previously announced IFRS expense Items affecting SEK, million reported affecting Cash Cash Flow 1 divestment of certain assets within Saber Interactive Flow Specification of items affecting comparability Non-cash
Slide 16: Cash flow and net debt
FINANCIAL PERFORMANCE | Q4 Cash flow and net debt FY23/24 FY22/23 FY 23/24 FY 22/23 March 31, March 31, SEKm SEKm Q4 Q4 TTM TTM 2024 2023 Adjusted EBITDA 2,488 1,938 11,377 9,867 Cash 3,507 4,662 Cash Tax -239 -158 -977 -902 Current investments 0 18 Other items -386 -251 -1,364 -288 Current liabilit
Slide 17: Pro forma financials
FINANCIAL PERFORMANCE | Q4 Pro forma financials “Middle-earth Enterprises & Asmodee “Coffee Stain & Friends” Embracer Group1 Friends” SEK, billion Apr-Mar Apr-Mar Apr-Mar Apr-Mar Apr-Mar Apr-Mar Apr-Mar Apr-Mar 22/23 23/24 22/23 23/24 22/23 23/24 22/23 23/24 Net sales 13.4 14.8 10.5 10.7 12.3 14.2 3
Slide 18: Pro forma net debt and earnouts
FINANCIAL PERFORMANCE | Q4 Pro forma net debt and earnouts Net debt bridge Earnout obligations (cash) Net debt bridge SEK, billion SEK, billion Net debt 31 March, 2024 16.4 “Coffee Stain & Friends” 1.1 Estimated cash inflow from Divestments (5.7) – (5.2) “Middle-earth Enterprises & Friends” 1.8 Pro
Slide 19: Restructuring program summary
3. Restructuring program summary
Slide 20: Today's speaker
RESTRUCTURING PROGRAM SUMMARY Today’s speaker MÜGE BOUILLON DEPUTY GROUP CFO
Slide 21: Restructuring program successfully finalized
RESTRUCTRING PROGRAM SUMMARY Restructuring program successfully finalized Improve efficiency and cash generation, transforming Capex Opex Net debt SEK 2.9bn+ annual SEK 0.8bn+ annual Below Objective Embracer into a leaner, stronger, more focused and Targets savings* in FY24/25 savings1 SEK 8.0bn by
Slide 22: Preparations for the new chapter
4. Preparations for the new chapter
Slide 23: Illustrative timeline for planned spinoffs
UPDATE ON EMBRACER’S INTENTION TO TRANSFORM INTO THREE PUBLICLY LISTED ENTITIES Illustrative timeline for planned spinoffs Rationale Key Milestones • Unlocking value in the high-quality assets of Embracer • Proforma preparations for prospectus Group following the successful completion of the • Legal
Slide 24: Q&A
Q&A Until ~10:00 CEST
Slide 25: Appendix
5. Appendix
Slide 26: Asmodee Group
PRO FORMA FINANCIALS | FY 2023/24 Asmodee Group Asmodee Group FY 2023/24 (April 2023 – March 2024) SEK, billion Q1 Q2 Q3 Q4 FY Net sales 3.2 4.1 4.4 3.1 14.8 Adjusted EBITDA 0.3 0.8 0.9 0.5 2.4 Adjusted EBIT 0.2 0.7 0.8 0.4 2.1 Capex -0.1 -0.1 -0.1 -0.1 -0.3 EBITDAC1 0.2 0.7 0.8 0.4 2.2 1 EBITDAC =
Slide 27: Coffee Stain & Friends
PRO FORMA FINANCIALS | FY 2023/24 “Coffee Stain & Friends” “Coffee Stain & Friends” FY 2023/24 (April 2023 – March 2024) SEK, billion Q1 Q2 Q3 Q4 FY Net sales 2.4 3.0 2.8 2.5 10.7 Adjusted EBITDA 0.9 1.3 1.2 1.1 4.5 Adjusted EBIT 0.6 0.9 0.9 0.7 3.1 Capex -0.6 -0.5 -0.4 -0.4 -2.0 EBITDAC1 0.3 0.8 0.
Slide 28: Middle-earth Enterprises & Friends
PRO FORMA FINANCIALS | FY 2023/24 “Middle-earth & Friends” “Middle-earth Enterprises & Friends” FY 2023/24 (April 2023 – March 2024) SEK, billion Q1 Q2 Q3 Q4 FY Net sales 4.2 3.1 4.2 2.7 14.2 Adjusted EBITDA 1.6 0.9 1.2 0.9 4.6 Adjusted EBIT 1.0 0.4 0.7 0.4 2.4 Capex -0.8 -0.7 -0.6 -0.6 -2.7 EBITDAC
Slide 29: Embracer Group
PRO FORMA FINANCIALS | FY 2023/24 Embracer Group1 Embracer Group1 FY 2023/24 (April 2023 – March 2024) SEK, billion Q1 Q2 Q3 Q4 FY Net sales 9.8 10.2 11.4 8.3 39.7 Adjusted EBITDA 2.7 2.9 3.3 2.5 11.3 Adjusted EBIT 1.7 1.9 2.3 1.5 7.3 Capex -1.4 -1.3 -1.1 -1.1 -4.9 EBITDAC2 1.2 1.6 2.2 1.4 6.3 1 inc
Slide 30: Embracer Group
EMBRACER* GROUP