Embracer Group Ab Class B · OMXSTO:EMBRAC_B
Embracer Group Ab Class B — Q1 2023 Earnings Presentation
25 slides from Embracer Group Ab Class B's earnings presentation, Aug 18, 2022
Slide 1: Embracer Group Interim Report April–June 2023
Q1 FY 2023/24 EMBRACER GROUP INTERIM REPORT APRIL – JUNE 2023
Slide 2: Disclaimer
EMBRACER GROUP - INTERIM REPORT Q1 FY 23/24 Disclamer IMPORTANT INFORMATION – PLEASE READ THE FOLLOWING BEFORE CONTINUING READING representation or warranty, express or implied, is made by the Company or any of its affiliates, directors, advisors, employees and representatives as to the accuracy, co
Slide 3: Brief Summary: Interim Report Q1 FY 2023/24
BRIEF SUMMARY Interim Report Q1 FY 2023/24 Net Sales Group YOY GROWTH Dead Island 2 and Remnant II SEK 10,450m 47% performance jumpstart FY 2023/24 GROUP ORGANIC GROWTH GROUP PRO FORMA GROWTH 20% 17% The restructuring program is on track Adjusted EBIT YOY GROWTH Exciting pipeline looking ahead for 1
Slide 4: Operating segments
Operating segments
Slide 5: Operative Groups by segment
OPERATING SEGMENTS | Q1 PERFORMANCE Operative Groups by segment PC / CONSOLE GAMES Internal Headcount: 10,469 | Internal Studios: 103 MOBILE GAMES Internal Headcount: 1,196 | Internal Studios: 11 NET SALES AND ADJUSTED EBIT PER SEGMENT | Q1 FY 2023/34 4500 3,996 4000 3,184 3500 837 (21%) ENTERTAINME
Slide 6: PC/Console Games
PC/Console Games NET SALES REVENUE SPLIT SEKm & ADJUSTED EBIT MARGIN BACK CATALOG SALES SEKm TOP 10 BACK CATALOG 3,996 4,500 2,500 50 4,000 44% 45 3,500 1,589 2,000 40 3,000 35% 34% 35 32% 1,500 30 2,500 26% 26% 25 2,000 21% 1,000 20 1,500 16% 15 1,000 10% 500 10 500 5 0 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 7: Exciting pipeline ahead for FY 2023/24
PC/Console Games Exciting pipeline ahead for FY 2023/24
Slide 8: Project ROI (Contribution / Investment)
PC/Console Games PROJECT ROI (CONTRIBUTION/INVESTMENT) DETAILS >100 14.0 Average title project data: • Based on reported numbers until 13.0 Sales 294 SEKm, Contribution 207 SEKm 30 June 2023 and Investment 86 SEKm. 12.0 • Sample includes projects with sales SEK 20.3 Bn above 40 SEKm or investment ab
Slide 9: PC/Console Games investments and project pipeline
PC/Console Games INVESTMENTS AND COMPLETED GAME DEVELOPMENT PROJECT PIPELINE # SEK 10,673 m 250 in capitalized development as of Q1 215 1,800 6 1,600 200 5 55 1,400 4.8x 62 1,200 56 150 4 3.6x 1,000 3.4x 3.3x 3.1x 3.2x 3 800 2.6x 100 2.5x 52 2.1x 167 600 2.0x 2 153 1.8x 124 400 1.4x 50 73 1 200 0.8x
Slide 10: Mobile Games
Mobile Games NET SALES SEKm & ADJUSTED EBIT MARGIN NET SALES DRIVERS 2,000 50 1,573 1,488 1,441 1,438 40 1,317 1,500 Sudoku.com Blockudoku Jigsaw Puzzle 29% 29% 30 1,000 25% 22% 19% 20 500 DRAGONVALE 10 Number Match Art Puzzle Nonogram.com 0 0 ORGANIC GROWTH PRO FORMA GROWTH Q1 Q2 Q3 Q4 Q1 FY 22/23
Slide 11: Tabletop Games
Tabletop Games NET SALES SEKm & ADJUSTED EBIT MARGIN STRONG PIPELINE 4,500 4,146 40 4,000 35 3,500 3,247 3,184 3,074 30 3,000 2,665 25 2,500 21% 20 2,000 17% 14% 15 1,500 1,000 10 8% 3 PRESTIGIOUS INDUSTRY AWARDS 6% 500 5 - 0 Q1 Q2 Q3 Q4 Q1 FY22/23 FY23/24 Net sales Adjusted EBIT margin, % ORGANIC G
Slide 12: Entertainment & Services
Entertainment & Services NET SALES SEKm & ADJUSTED EBIT MARGIN 2,500 2,328 25 2,000 1,832 20 1,487 1,500 1,360 15% 15 14% 1,000 9% 811 784 10 8% 671 8% 500 466 465 5 4% 4% 3% 1% ORGANIC GROWTH PRO FORMA GROWTH 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 FY21/22 Net sales FY22/23 Adjusted EBIT margin, % FY23/24 7
Slide 13: Market update
OPERATING SEGMENTS | Q1 PERFORMANCE Market update GLOBAL VIDEO GAMES MARKET REVENUE FORECAST GLOBAL MARKET Forecast USD billion PC * Console * expected to grow by expected to grow by 193 188 196 205 212 +0.5% +7% 183 in 2023 in 2023 179 144 Mobile * Tabletop ** expected to grow by down in Q1 by +0.8
Slide 14: Financial Performance
at eZ Financial Performance
Slide 15: Financial development
FINANCIAL PERFORMANCE | Q1 Financial development GROSS MARGIN DEVELOPMENT SEKm DEVELOPMENT OF MARKETING COSTS SEKm 12,000 120% 1,400 10,000 1,200 20% 20% 20% 10,450 100% 1,000 17% 641 8,000 16% 76% 76% 80% 73% 15% 66% 65% 66% 63% 800 13% 13% 6,000 58% 56% 60% 600 10% 10% 10% 10% 4,000 40% 400 2,000
Slide 16: Cash flow and net debt
FINANCIAL PERFORMANCE | Q1 Cash flow and net debt FY23/24 FY22/23 TTM June 30, June 30, March 31, SEKm SEKm Q1 Q1 Q1 2023 2022 2023 Adjusted EBITDA 2,697 1,867 10,696 Cash 3,952 10,227 4,662 Cash Tax -229 -180 -951 Current investments 17 1,533 18 Other items -319 91 -698 Current liabilities to credi
Slide 17: Adjusted EBIT forecast reiterated
FINANCIAL PERFORMANCE | Q1 Adjusted EBIT forecast reiterated FORECAST ADJUSTED EBIT Financial Year 23/24 SEK 7,000 – 9,000 million Based on the performance year-to-date, we have increased confidence in our forecast range. In the PC/Console Games segment, a solid earnings growth is expected, driv
Slide 18: Q1 update on the restructuring program
Q1 update on the restructuring program
Slide 19: Today's speaker
Q1 UPDATE ON THE RESTRUCTURING PROGRAM Today’s speaker MÜGE BOUILLON FINANCE WORKSTREAM LEAD, EMBRACER GROUP & CFO, ASMODEE 19
Slide 20: Reminder of the objectives
Q1 UPDATE ON THE RESTRUCTURING PROGRAM Reminder of the objectives Increased cash conversion, improved efficiency and reduced capex targeting : At least At least Net debt below SEK SEK 2.9bn annual SEK 0.8bn annual 8.0bn by end of FY capex savings overhead savings 23/24 Including impact of SEK 2.0bn
Slide 21: Program focus areas and phases
Q1 UPDATE ON THE RESTRUCTURING PROGRAM Program focus areas and phases Main Focus Areas being addressed in phases 13 June 31 March Capex and Opex 2023 2024 savings Opex and initial phase 1st phase capex savings Capital allocation Further capex savings and 2nd phase capital allocation initiatives Effi
Slide 22: Where we are today
Q1 UPDATE ON THE RESTRUCTURING PROGRAM Where we are today Good progress being made and tracking towards the targets • First round review of Capital Expenditure completed - initial initiatives to reduce Capex and number of projects and studios have commenced Opex savings • Review of Overheads complet
Slide 23: A few final remarks
EMBRACER GROUP | Q1 FY 2023/24 A FEW FINAL REMARKS 23
Slide 24: Q&A
Q&A Until ~10:00 CEST
Slide 25: Embracer Group
EMBRACER* GROUP