Maximum Entertainment Ab Class B · OMXSTO:MAXENT_B
Maximum Entertainment Ab Class B — Zordix — Merger or Acquisition (November 2021)
26 slides from Maximum Entertainment Ab Class B's merger presentation, November 2021
Slide 1: Wallcross Investor Presentation
WALLCROSS INVESTOR PRESENTATION November 2021 1 1
Slide 2: Disclaimer
DISCLAIMER THIS INVESTOR PRESENTATION (THE “INVESTOR PRESENTATION") HAS BEEN PRODUCED BY ZORDIX AB (PUBL) (THE “COMPANY") SOLELY FOR USE IN CONNECTION WITH THE CONTEMPLATED OFFERING OF SHARES OF SERIES B (THE “SHARES") (THE "TRANSACTION") AND MAY NOT BE REPRODUCED OR REDISTRIBUTED IN WHOLE OR IN PAR
Slide 3: Risk factors (I/III)
Risk factors (I/III) RISK FACTORS Risk factors deemed to be of importance for Zordix AB (publ) (the "Company"), and its direct and indirect subsidiaries (together with the Company the "Group"), the Group's business and future development and risks relating to the Company's contemplated directed issu
Slide 4: Risk factors (II/III)
Risk factors (II/III) Financial risks Future capital requirements In 2019, the Company began to implement its new strategy, which involves long-term investments in its own IP rights, investments within its own publishing business and acquisitions of other companies, in order to master the entire val
Slide 5: Risk factors (III/III)
Risk factors (III/III) Risks related to the Company's shares The price of the shares may be volatile The trading price of the shares on Nasdaq First North Growth Market could fluctuate significantly in response to a number of factors beyond the Company's control, including quarterly variations in op
Slide 6: Transformative acquisition
Transformative acquisition 6
Slide 7: Acquisition of Maximum Games – Deal summary
Acquisition of Maximum Games (“MG”) – Deal summary Acquisition of a SEK 630m FY21E revenue business with global reach • MG covers the entire value chain: funding, development, porting, publishing, QA, localization, Leading publisher PR, marketing, and distribution with fast growth and • Generates co
Slide 8: Building a global gaming powerhouse
Building a global gaming powerhouse Combined group with financial resources and manpower to accelerate growth + Net Revenue Q3 YTD SEK 314m SEK 427m SEK 743m 20211 Gross Profits Q3 YTD SEK 115m SEK 126m SEK 241m 20211 EBITDA Q3 YTD 20211 SEK 43m SEK 33m SEK 76m Investment in game development Q3 YTD
Slide 9: Paving the way to a world-leading indie to AA publisher
Paving the way to a world-leading indie to AA publisher Combined group can fill highly profitable gap in AA market AAA • Indie titles have USD 0.5 – 2.0m development games Industry is budgets while AAA budgets are >USD 50m focused on • Due to funding restraints smaller publishers focus indie or AAA
Slide 10: Combined company IP pipeline shows strong line-up
Combined company IP pipeline shows strong line-up High visibility games pipeline ensures steady revenue streams Game pipeline over next twelve months (Music) (Off-road) Own IP1 (Battle Royale) (Action RPG) (Racing) (Platformer) (Puzzle) (RTS) (Adventure) Licensed IP (Shooter) (RPG) Unannounced title
Slide 11: Deal structure
Deal structure Accretive transaction financed through a share issue High level preliminary structure Indicative ownership structure post-transaction Enterprise value USD 42m / SEK 357m Zordix 72% EV / Sales 2021E2 0.6x Maximum Games 11% EV / EBITDA 2021E2 6.5x New issue 17% TOTAL 100% Issue consider
Slide 12: Indicative timeline
Indicative timeline Private Placement settlement and acquisition closing Preliminary timeline T-1 • Announcement and launch day of the Private Placement and acquisition press release T • Allocation and outcome of the Private Placement and EGM notice published T+2 • Allocation and outcome of the Priv
Slide 13: Introduction to Maximum Games
Introduction to Maximum Games 13
Slide 14: A fast-growing global top 20 publisher
A fast-growing global top 20 publisher Scale, diversity of operations, and track record make MG an ideal M&A platform Strategic rationale Overview of business structure 1 MG Team • Gain presence in new geographies, especially Operations Transformative lucrative and hard-to-penetrate US and Asia and
Slide 15: Diversified operations split into three divisions
Diversified operations split into three divisions Business split varies by service, risk, margin and investment sizes Development Publishing See Services and Distribution (Revenue included in publishing) overleaf 85% FY21E 15% FY21E Revenue Revenue • Develops IPs through wholly owned studios; • Fund
Slide 16: Publishing activities are diversified by risk and return
Publishing activities are diversified by risk and return Additional investments in high-touch publishing will drive top-line growth Investment / Activity Revenue Sharing Models Description Risk / Return Light Touch Revenue • Invests in complete or nearly complete games – lower risk Publishing 25% -
Slide 17: Strong growth as business mix shifts to publishing
Strong growth as business mix shifts to publishing Focus on higher-margin publishing activities drives overall margin expansion Strong publishing growth Stable distribution activities Overall gross margin trends upwards Driven by continued re-investments Predictable and cash-generative GM volatility
Slide 18: A history of Maximum Games
A history of Maximum Games Operations shift towards publishing and development 2012 2016 2018 2020 2010 Strategic shift to 2014 Established Maximum Launched Modus 6 Modus games Company Publishing and Obtained 11 games launched, Games publishing Games Ireland, released, 12 games in Established Sony a
Slide 19: Global company with offices and direct presence in >30 countries
Global company with 4 offices and direct presence in >30 countries Physical and digital channels combine for truly global reach Long term relationships with key partners 13 FTE 51 FTEs 1 FTE 12 FTEs Global reach through digital channels Office location Maximum Games presence (direct or through partn
Slide 20: Excellent leadership
Excellent leadership Seasoned and long-standing executive team Christina Seelye Thierry Bonnefoi Shane Bierwith Derek Neal Founder and CEO Group CFO EVP of global marketing EVP of production >23 years in software and games >25 years finance experience >18 years in game marketing >18 years production
Slide 21: Key attractions
Key attractions Formation of a group with far reaching global ambitions ACQUISITION OF AN CAPITALIZE ON GAP IN STRENGHTEN CREATE A GLOBAL INDUSTRY LEADING THE AA GAME ZORDIX BUSINESS LEADER IN PUBLISHER PUBLISHING SPACE PROPOSITION PUBLISHING MG has full service Enables MG to enter the Completes Zor
Slide 22: Combined financials and cap table
Combined financials and cap table 22
Slide 23: Pro-Forma Profit & Loss
Pro-Forma Profit & Loss Pro-Forma1 P&L per Q3 YTD 2021 Commentary Zordix Maximum Combined - Significant addition to top line and profitability, doubling the (in SEK '000) Group Games Adj. Group size of the group Net revenue 314 054 428 643 742 697 Own work capitalized 38 630 3 032 41 662 - Goodwill
Slide 24: Pro-Forma Balance Sheet
Pro-Forma Balance Sheet Pro-Forma1 Balance Sheet per Q3 2021 Commentary Zordix Maximum Combined - Approximately SEK 550m goodwill resulting from the (in SEK '000) Group Games Adj. Group transaction Intangible non-current assets 464 416 9 103 549 564 1 023 083 Tangible non-current assets 1 894 4 500
Slide 25: Business poised to take advantage of operational leverage
Business poised to take advantage of operational leverage Flat OPEX despite strong revenue growth EBITDA margins expand as portfolio shifts towards publishing Maximum Games Revenue L4Q Rolling Revenue (USDm) Maximum Games Revenue L4Q Rolling EBITDA (USDm) 80 8 12% 70 10% 60 6 8% 50 40 4 6% 30 4% 20
Slide 26: Indicative ownership structure post acquisition
Indicative ownership structure post acquisition Denotes Board & Management Denotes M&A target sellers A-shares B-shares Total Owner- Votes shares ship Matti Larsson 2,000,000 2,720,000 4,720,000 12.3% 40.2% Votes New issue1 6,351,351 6,351,351 16.5% 11.2% Maximum Games2 4,538,580 4,538,580 11.8% 8.0