+120.4%

Revenue increase vs Q4 2020

+73.9%

Adjusted EBITDA increase vs FY 2020

Azerion Holding B.V. - Interim Unaudited Financial Results Q4 2021 and Preliminary Unaudited Financial Results Full Year 2021

Azerion Holding B.V. - Interim Unaudited Financial Results Q4 2021

and Preliminary Unaudited Financial Results Full Year 2021

Revenue more than doubled in Q4 2021

Highlights of Q4 2021

  • Revenue for the quarter amounted to EUR 126.3m, an increase of EUR 69.0m, or 120.4%, as compared to Q4 2020 (EUR 57.3m). Of that increase EUR 32.8m was attributable to acquisitions made in 2021 and EUR 36.2m to the underlying business as it stood at the end of 2020 across Platform and Premium Games
  • Adjusted EBITDA for the quarter amounted to EUR 19.1m, an increase of EUR 7.8m, or 68.9%, as compared to Q4 2020 (EUR 11.3m)
  • All activities have continued to perform well throughout Q4 2021
  • During Q4 2021, Azerion completed the acquisition of Titan Gate AD (also known as PubGalaxy) and Inskin Media Ltd

Highlights of Full Year 2021

  • Revenue amounted to EUR 308.1m, an increase of 57.9% as compared to the full year 2020 (EUR 195.1m) On a pro forma basis, including the revenue that would have been recognized if all acquisitions in 2021 were part of the group for the full year 2021, revenue is estimated at approximately EUR 384.5m
  • Adjusted EBITDA amounted to EUR 46.1m, an increase of 73.9% as compared to the full year 2020 (EUR 26.5m). On a pro forma basis, including the contribution that would have been recognized if all acquisitions in 2021 were part of the group for the full year 2021, adjusted EBITDA is estimated at approximately EUR 54.3m
  • Before acquisitions completed in 2021, the underlying business as it stood at the year ended 2020 delivered revenue for full year 2021 of EUR 255.5m, representing approximately 31% growth on reported revenue for full year 2020
  • In 2021, Azerion completed the acquisition of Genba Digital Limited, Whow Games Gmbh, Delta Projects AB, Strossle International AB, Kmobile AB, Sublime Skinz Lab SAS, Admeen B.V., Titan Gate AD and Inskin Media Ltd.

Financial Overview (Unaudited)

Financial results (EURm)

Pro

Forma

of the Azerion Holding B.V.

Q4 2021

Q4 2020

FY 2021

FY 2020

FY21

Revenue

126.3

57.3

308.1

195.1

384.5

COGS

(76.8)

(38.5)

(186.9)

(125.1)

Gross profit

49.6

18.8

121.2

69.9

Operating Expenses

(39.8)

(8.5)

(89.5)

(48.1)

Reported EBITDA

9.7

10.3

31.7

21.9

Adjusted EBITDA 1

19.1

11.3

46.1

26.5

54.3

Revenue growth, % (YoY)

120.4%

57.9%

Gross margin, %

39.2%

32.7%

39.3%

35.8%

Adjusted EBITDA growth % (YoY)

68.9%

73.9%

Adjusted EBITDA margin, %

15.1%

19.7%

15.0%

13.5%

14.1%

1 As defined in section 1.1 of the Terms & Conditions of the Senior Secured Callable Fixed Rate Bonds ISIN: SE0015837794. Please also refer to the Definitions section of this Interim Report for more information.

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Azerion Holding B.V. - Interim Unaudited Financial Results Q4 2021 and Preliminary Unaudited Financial Results Full Year 2021

CEOs' message on the results of Azerion Holding B.V.

"The fourth quarter of 2021, and the full year 2021 in general, have evidenced significant progress for Azerion. We are very pleased to report strong revenue and EBITDA growth, both for Q4 2021 as compared to Q4 2020, as well as for the full year 2021 compared to the full year 2020.

Q4 2021 revenue increased 120.4% to EUR 126.3m, while adjusted EBITDA for the same period increased 68.9% to EUR 19.1m. Full year 2021 revenue increased 57.9% to EUR 308.1m, and adjusted EBITDA increased for the same period 73.9% to EUR 46.1m.

We view these results as powerful support for the vision we have had for Azerion since inception - of a truly integrated technology platform able to deliver digital games and digital advertising across all formats and devices and benefiting from the flywheel effects of our scaled owned, operated and distributed content. Our content strategy drives user engagement, thereby attracting advertisers as our primary customer and revenue source, with significant additional content and distribution reach through our digital partnerships, all attracting game creators to contribute their own games and content to our platform driving more users and even greater engagement.

Our efforts have again been aimed at improving and increasing the various elements of our platform thereby adding to this flywheel effect. For example, we recently entered into a strategic partnership with Bidstack, making Azerion the exclusive commercial partner for Bidstack's AAA game in-game advertising; we welcomed pop icon Hello Kitty into our Habbo and Woozworld metaverses and Teletubbies into Habbo and Hotel Hideaway; we engaged users with another in-game concert in Hotel Hideaway; and we connected many new advertisers and digital publishers to our platform and further integrated and optimised our technological product suite.

Finally, during the year, we put significant time and effort into preparing for our business combination with special purpose acquisition company EFIC1. As a result, on 2 February 2022, we were proud to become a public company listed on Euronext Amsterdam. The business combination and the subsequent listing of Azerion will not only give us access to the capital markets, but will also help us raise our profile amongst our customer and partner groups and talented workforce globally. Furthermore, in a consolidating and competitive market, it will help us stay financially flexible, whilst fuelling our business expansion, both organically and through further acquisitions.

Our operational and strategic progress in 2021 makes us more confident than ever in the exciting future ahead."

Atilla Aytekin and Umut Akpinar

CEOs and Founders of Azerion

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Azerion Holding B.V. - Interim Unaudited Financial Results Q4 2021 and Preliminary Unaudited Financial Results Full Year 2021

Background information: Azerion Holding B.V. and Azerion Group N.V.

Azerion Holding B.V. is the main holding subsidiary of Azerion Group N.V. ("Azerion Group"), a public company listed on Euronext Amsterdam (symbol: AZRN). The Azerion Holding B.V. Interim Unaudited Financial Results Q4 2021 and Preliminary Unaudited Financial Results Full Year 2021 are released as required by the terms and conditions of the listed Senior Secured Callable Fixed Rate Bonds (ISIN: SE0015837794).

Azerion Group (previously EFIC1) expects to publish its audited financial results for the full year 2021 by the end of April 2022. These results will not include the audited full year 2021 financial results for Azerion Holding B.V. as these financial results relate to a period before the business combination between Azerion Group (then EFIC1) and Azerion Holding B.V. was completed, with that completion taking place on 1 February 2022. It is intended however, that the audited full year 2021 results for Azerion Holding B.V. will be published separately by the end of April 2022.

The first financial results for the post business combination Azerion Group will be the half year 2022 interim financial results, further details for which will follow closer to the time.

3

EUR 126.3m

Revenue Q4 2021

Azerion Holding B.V. - Interim Unaudited Financial Results Q4 2021 and Preliminary Unaudited Financial Results Full Year 2021

Financial overview Q4 2021

Revenue

Revenue for the quarter amounted to EUR 126.3m, an increase of EUR 69.0m, or 120.4%, as compared to Q4 2020 (EUR 57.3m). Of that increase, approximately EUR 32.8m was attributable to acquisitions made in 2021, while EUR 36.2m was attributable to the underlying business as it stood at the end of 2020 across Platform and Premium Games.

During Q4 2021, Azerion completed the acquisition of two companies, Titan Gate AD (also known as PubGalaxy) and Inskin Media LTD.

EUR 19.1m

Adjusted EBITDA Q4 2021

Earnings

Azerion delivered EUR 19.1m adjusted EBITDA for the quarter compared to EUR 11.3m in Q4 2020, an increase of EUR 7.8m. The increase was mainly driven by acquisitions. Non-recurring items amounted to EUR 9.4m, mostly related to expenses driven by acquisitions and activities relating to our listing.

Earnings before tax amounted to EUR 4.7m compared to EUR 0.3m in Q4 2020. This result was driven by the operational performance described above, increased financial costs mostly driven by the bond financing raised in 2021, a one-off gain in consolidated security disposals and other gains in FX.

Cash flow

The Group's cash flow from operating activities in Q4 was EUR 19.0m mostly driven by movements in working capital. Cash flow from investing activities amounted to negative EUR 13.1m, the majority of which related to acquisitions completed in 2021. Cash flow from financing activities totalled negative EUR 11.6m mainly related to bond interest, lease interest (IFRS 16) and other debt repayments.

Capex

Azerion capitalizes development costs which are related to asset development, a core activity to support innovation in our platform. These costs primarily relate to developers' time devoted to the development of games, platforms, and other new features, EUR 4.0m were capitalized in Q4 2021, equivalent to 16.8% of personnel costs.

Acquisitions

On 15th October, Azerion acquired Titan Gate AD (also known as PubGalaxy), headquartered in Bulgaria, a publisher-centric digital monetisation platform which had been recognised by Deloitte as one of the fastest-growing tech companies in Central Europe2.

On 16th October, Azerion acquired Inskin Media, a UK-basedmulti-screen,high-impact digital advertising company, connecting premium publishers with leading brands globally.

2 Source: Deloitte Technology Fast 50 Central Europe 2017 Report

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Azerion Holding B.V. - Interim Unaudited Financial Results Q4 2021 and Preliminary Unaudited Financial Results Full Year 2021

Financial position and financing

Azerion's net interest bearing debt3 amounted to EUR 193.5m, as at 31 December 2021. Net interest-bearing debt mainly comprises the Company's outstanding bond loan with a nominal value of EUR 200m (part of an in total EUR 300m framework) and lease liabilities with a balance of EUR 19.0m less the cash and cash equivalents position of EUR 35.3m.

Significant events after the reporting period

Azerion and EFIC1, a special purpose acquisition company (SPAC) listed on Euronext Amsterdam, successfully completed their business combination on 1 February 2022. As part of the completion of the business combination, the legal form of the combined company has been converted into a limited company (naamloze vennootschap) and it has been renamed Azerion Group N.V. ("Azerion Group"). The first day of trading on Euronext Amsterdam under the new name of Azerion Group's shares and warrants was on 2 February 2022.

The completion of the business combination supports Azerion Group in its ambitions to become a leading global digital entertainment and media platform. The business combination furthermore provides for a strong complementary partnership accelerating future value creation for all stakeholders through continued investments in Azerion Group's growth, both organically and through M&A. Azerion Group expects this listing over time to create a new long-term supportive shareholder base, enable Azerion Group to incentivise the existing and future management team and senior staff and continue to attract high calibre individuals.

With the completion of the business combination, there will be a significant equity cash injection to the group, which will be used to continue to pursue value-accretive acquisitions and to further invest in organic growth initiatives, as well as general corporate purposes.

Current Trading

We are very pleased with the performance of the business during Q4 2021 and we continue to see the business performing well in Q1 2022 to date.

3 As defined in section 1.1 of the Terms & Conditions of the Senior Secured Callable Fixed Rate Bonds ISIN: SE0015837794. Please also refer to the Definitions section and the notes of this Interim Report for more information.

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Azerion Group NV published this content on 28 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 February 2022 06:51:06 UTC.