OPERATIONAL EBIT INCREASED 171% TO SEK 653 MILLION
SECOND QUARTER, JULY-SEPTEMBER 2020 (COMPARED TOJULY-SEPTEMBER2019)
Net sales increased by 89% to SEK 2,383.2 million (1,259.7). Net sales of the Games busi- ness area increased by 83% to SEK 1,495.4 million (816.1). THQ Nordic SEK 566.9 million (329.6), Deep Silver SEK 506.8 million (441.7), Coffee Stain SEK 129.9 million (44.7), Saber Interactive SEK 259.1 million (-) and DECA Games SEK 32.7 million (-).
Net sales of Partner Publishing/Film business area increased by 100% to SEK 887.8 million (443.6).
EBITDA increased by 132% to SEK 969.0 million (418.1), corresponding to an EBITDA margin of 41%.
Operational EBIT increased by 171% to SEK 652.5 million (240.7) corresponding to an Operational EBIT margin of 27% (19%).
Cash flow from operating activities amounted to SEK 804.7 million (284.8). Investments in intangible assets amounted to SEK 484.1 million (391.9). Free Cash Flow amounted to SEK 311.5 million (-115.8).
Adjusted earnings per share was SEK 1.80 (0.65).
Organic growth in constant currency for the Games Business Area amounted to 61% in the quarter.
Total game development projects increased 57% to 135 (86). Total headcount increased 49% to 4,445 (2,981) where total game developers increased 58% to 3,593 (2,272).
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
Apr 2019-
Key performance indicators, Group
2020
2019
2020
2019
Mar 2020
Net sales, SEK m
2,383.2
1,259.7
4,451.9
2,401.8
5,249.4
EBITDA, SEK m
969.0
418.1
1,934.1
807.6
1,821.3
Operational EBIT, SEK m
652.5
240.7
1,364.3
444.8
1,033.0
Cash flow from operating activities, SEK m
804.7
284.8
1,537.0
723.1
1,728.3
Free cash flow, SEK m
311.5
-115.8
515.5
-68.5
-0.1
Total investments in intangible assets, SEK m
484.1
391.9
981.6
770.0
1,653.4
Total game development projects
135
86
-
-
103
Total internal and external game developers
3,593
2,272
-
-
2,365
Total headcount
4,445
2,981
-
-
3,109
Sales growth, %
89
-1
85
14
3
EBITDA margin, %
41
33
43
34
35
Operational EBIT margin, %
27
19
31
19
20
In this report, all figures in brackets refer to the corresponding period of the previous year, unless otherwise stated.
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
1
CEO COMMENTS
OPERATIONAL EBIT INCREASED 171% TO SEK 653 MILLION
The Group had yet another stable quarter with growing sales and profitability exceeding management expectations, driven in particular by a record strong performance of our back catalogue.
Net sales increased by 89% to a record SEK 2,383.2 million (1,259.7) whereof the Games business area contributed SEK 1,495.4 million (816.1) driven by 61% organic growth. Operational EBIT increased 171% to SEK 652.5 million (240.7), driven by strong back catalogue sales, improved quality of new releases and the generally favourable trends for gaming. The profitability was also driven by the fact that we are getting more recurring revenues from games-as-a-service or live-operated titles, for example Satisfactory, Wreckfest, Deep Rock Galactic, World War Z and the DECA catalogue.
It is gratifying to see that our companies attract and retain a lot of great talent. The number of employees has grown 17% on an organic basis in the past year. We continue to strive for long term organic growth by reinvesting our underlying operating cashflow into scaling up existing studios, setting up new studios and making more great games. Despite our efforts to find further growth investments, it is encouraging to see that our free cashflow reached a record SEK 311 million (-116) in the period.
We continue to emphasize our strategy for game development - quality comes first. Games should be released when ready. This will likely be appreciated and rewarded by our fans and gamers by more sold units, over a longer period of time at higher average selling price. Staying true to this strategy, in the recent months we decided to allow more time for polish- ing, bug fixing and completion to a number of titles across the operative groups.
Looking ahead this financial year ending March 31, 2021, we now expect the total value of completed games released to be SEK 1,000-1,100 million including a notable title from THQ Nordic that we still expect to launch within the fourth quarter. The third quarter will have less releases than the fourth quarter. We expect the third quarter to have new releases with expected completion value in the range of SEK 150-175 million followed by fourth quarter in the range of SEK 300-350 million. Looking ahead to the next financial year ending March 31, 2022, management is confident that it will be another record year in terms of new games released, as we see a potential to double the value of completed games compared to the current financial year.
Despite the ongoing covid-19 pandemic, we have been able to maintain operations in a good manner. The employees in our studios have been working from home where they have sustained the development and scheduled releases. It has been impressive to follow how our studios have been able to adapt to the current climate despite challenges to stay productive during the pandemic and to keep the pace at the level prior to the working from home situation. So far, we have no noticeable delays due to the coronavirus. Studios are somewhat affected by how their employees need extra support to maintain work-life balance under these new conditions and prevent ambient stress, a new challenge for management to address and consider.
We are happy to see that DECA Games, our most recent operative group, came off to a good start within the group. DECA Games will be a growth driver for the group within free- to-play going forward.
The outlook for the games market is positive. In 2020 according to Newzoo, the global market is projected to generate USD 159 billion which represents a 9% year-on-year growth. Embracer Group are a small fish in the big pond and currently represents 0.5-1% of the total market. The global market is expected to continue grow with a forecast exceeding USD
200 billion by the end of 2023. One strong factor for the continued growth is the next-generation consoles PlayStation 5 and Xbox Series X/S that are launching this month. Initially the demand will outstrip the supply, but long-term the next-generation consoles expected installed base will outperform the previous generation according to Ampere Analysis.
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
2
Coupled with the on-going transition to digital distribution, which affects publisher's gross margins, will have a positive effect on Embracer Group.
The Group continues to grow within new segments of the gaming market, like Vertigo Games specializing in VR and DECA Games with a catalogue of free-to-play and mobile titles. VR is expecting to grow from USD 3.3 billion in 2019 to 5.7 billion in 2023 according to Superdata, thanks to improved equipment that increases convenience and player expe- rience. Mobile is the biggest segment at USD 77 billion in 2020 and showed no signs of slowing down with an estimated growth of 13% year-over-year. With over 2.7 billion players (Newzoo) the games market is becoming a global mass-market. New ways of playing and accessing games like streaming will help open up the market to a larger audience.
I am pleased to see that the operating groups are initiating an increased number of potential acquisitions. During the quarter we added eight new companies to the operative groups. The Embracer strategy to build a truly independent eco-system based on committed entrepreneurs and developers that share the same ambitious long-term mindset. I'm a firm believer in giving great people trust to make their own decisions. The M&A market is more active than ever and the past three months we have actively been engaging with more than 100 entrepreneurs who want to be part of the Embracer family, including a dozen sizable businesses that has the potential to create new operative groups under the parent com- pany. We patiently and disciplined continue to execute our M&A strategy across the group.
To support this M&A ambitions, we completed a directed share issue of SEK 5,7 billion on October 8. The new share issue further strengthens our financial position. I was happy to see that all of our existing institutional investors participating along with a wide range of new long term investors, including Canada Pension Plan Investment Board. It is important for me as a founder and major shareholder to have reputable and sizable long-term shareholders that share the same 20 years+ horizon of building something sustainable and substantial.
To conclude, I would like to send my thanks to all of our colleagues, customers, business partners, and shareholders contributing to our growing family's prosperity and success. I would like to personally wish you all a safe and relaxing upcoming holiday period.
All the best from Värmland
November 18, 2020, Karlstad, Sweden
Lars Wingefors
Co-founder & CEO
Hagudden, Fryken, Värmland
Photo: Tommie Svanström Ohlsson
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
3
FINANCIAL PERFORMANCE
All comments refer to the quarter unless otherwise stated.
CONSOLIDATED NET SALES
Consolidated net sales
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
by business area, SEK m
2020
2019
Change
2020
2019
Change
Games - THQ Nordic
566.9
329.6
72%
1,054.7
514.7
105%
Games - Deep Silver
506.8
441.7
15%
1,119.5
815.1
37%
Games - Coffee Stain
129.9
44.7
191%
302.4
127.5
137%
Games - Saber Interactive
259.1
-
-
608.2
-
-
Games - DECA Games
32.7
-
-
32.7
-
-
Games Subtotal
1,495.4
816.1
83%
3,117.5
1,457.5
114%
Partner Publishing/Film
887.8
443.6
100%
1,334.4
944.3
41%
Consolidated Net Sales
2,383.2
1,259.7
89%
4,451.9
2,401.8
85%
Consolidated net sales in the quarter increased by 89% or SEK 1,123.5 million compared to last year. All business areas contributed to the growth, of which the recently acquired companies Saber Interactive contributed SEK 259,1 million and DECA Games with SEK 32.7 million. Business area Games - THQ Nordic, Coffee Stain and Deep Silver showed growth over last year, mainly driven by new releases and solid back catalog sales. Organic growth in constant currency for the Games Business Area amounted to 61% in the quarter.
The growth in Partner Publishing/Film business area is mainly driven by larger releases in the quarter compared to last year.
CONSOLIDATED EXPENSES
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
Apr 2019-
Operating expenses, SEK m
2020
2019
2020
2019
Mar 2020
Goods for resale
-1,034.1
-635.1
-1,794.0
-1,163.1
-2,576.0
Other external expenses
-359.7
-191.8
-651.9
-369.3
-784.0
Personnel expenses
-398.8
-258.2
-777.5
-481.4
-1,130.0
Depreciation, amortization and
impairment of property, plant and
equipment and intangible assets
-795.6
-341.7
-1,541.6
-649.9
-1,475.9
Total operating expenses
-2,588.2
-1,426.8
-4,765.0
-2,663.7
-5,965.9
Consolidated expenses has increased due to a number of additional acquisitions and general growth of underlying business. Goods for resale mainly includes cost of replication, license fees and royalties. Growth in goods for resale was relatively low compared to growth in net sales, resulting in an increased gross margin of 57% (50%). The improved gross margin is mainly due to a higher gross margin in both business area Games and Partner Publishing/film compared to last year. Gross margin improvement in business area Games is mainly driven by the addition of Saber which has a high proportion of royalty income and an important Work For Hire business.
The year-over-year increase in other external expenses and personnel expenses is primarily explained by acquisitions made versus corresponding quarter last year and increased internal investments in the Group's gaming portfolio of SEK 96.8 million. The net increase excluding capitalized game development amounts to SEK 211.7 million and is mainly driven by increased overhead to manage the growing games portfolio as well as increased general
administration expenses to further strengthen the Group's corporate capabilities. Costs for sales and marketing increased in the quarter, mainly explained by more releases than in the comparison period.
Kingdoms of Amalur: Re-Reckoning
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
4
CONSOLIDATED DEPRECIATION AND AMORTIZATION EXPENSES
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
Apr 2019-
Depreciation and amortization, SEK m
2020
2019
2020
2019
Mar 2020
Intangible assets
Game development
-222.2
-143.7
-413.3
-306.1
-587.1
Other intangible assets (Film etc.)
-43.4
-26.5
-97.8
-43.0
-171.8
Sub-total
-265.7
-170.2
-511.2
-349.1
-758.9
Acquisition-related depreciation
IP-rights
-104.2
-100.5
-206.4
-169.6
-359.4
Surplus value Partner Publishing/Film
-15.3
-12.0
-30.4
-20.2
-43.1
Goodwill
-401.1
-51.7
-776.4
-97.2
-285.1
Sub-total
-520.6
-164.3
-1,013.2
-287.0
-687.6
Total intangible assets
-786.3
-334.5
-1,524.4
-636.1
-1,446.5
Tangible assets
-9.3
-7.4
-17.2
-13.8
-29.4
Total depreciation and amortization
-795.6
-341.7
-1,541.6
-649.9
-1,475.9
The increased amortization of games is mainly explained by the higher value of finalized game development in the quarter versus last year. The increase in depreciations of other intangible assets (Film etc.) in the quarter is mainly due to the fact that KSM is not included in the comparison period. The increase in acquisition related depreciations over last year in the quarter is primarily explained by that more acquisitions were completed during the year where the acquisition of Saber Interactive accounts for the largest portion.
Depreciation and amortization principles
Game development; Amortization of finished game development projects - degressive amortization over two years; 1/3 amortization during months 1 to 3 following release,
1/3 amortization in months 4 to 12 following release and the remaining 1/3 in months 13 to 24 following release.
Other intangible assets (Film etc); The majority of other intangible assets are related to the Group's film business and are amortized based on actual sales in relation to expected sales of the relevant title.
IP-rights; Amortization of IP rights related to Games - straight-line amortization over five years.
Surplus value Film & Partner publishing; Amortization of surplus values related to Partner Publishing/Film - straight-line amortization over five years.
Goodwill; Amortization of Goodwill - straight-line amortization over five years.
CONSOLIDATED EARNINGS
The increase of the Group's EBITDA, from SEK 418.1 million to SEK 969.0 million, and Operational EBIT, from SEK 240.7 million to SEK 652.5 million, for the quarter is mainly explained by the increase in net sales and improved gross margin compared to the same period last year.
EBITDA and EBIT for the period includes Profit from revaluation of shares in associated company Palindrome of SEK 41.4 million. The profit is recognized in accordance with Swedish GAAP K3 and relates to Embracer´s increased ownership in Palindrome during the quarter. The profit has no cash flow impact and has therefore been excluded from Operational EBIT.
The increase in Operational EBIT contributed to the increasing EBIT but was significantly lowered by increased acquisition-related depreciations, of SEK 356.3 million. EBIT increased, from SEK 76.4 million to SEK 173.4 million, in the quarter.
CONSOLIDATED CASH FLOW AND FINANCIAL POSITION
Cash flow from operating activities before changes in working capital for the quarter was SEK 852.1 million (364.7). The increase is mainly due to increased earnings from operations. Cash taxes for the quarter amounted to SEK -28.9 million (-53.4). Change in working capital amounts to SEK -47.5 million (-79.9).
Aquanox
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
5
There was no effect of forfaiting in the quarter for the current year or the previous year.
Cash flow from operating activities after change of working capital for the period was SEK 804.7 million (284.8). Cash flow from investing activities was SEK -1,267.2 million (-1,203.3), where SEK -773.9 million (-802.7) relates to acquired companies.
The Group's investments in intangible fixed assets amounted to SEK -484.1 million (-391.9), related to capitalized expenditure for ongoing game development of SEK -444.7 million, film rights SEK -36.8 million and other SEK -2,6 million. Investments in buildings, property, plant and equipment amounted to SEK -12.8 million (-8.6). Change in financial assets amounted to SEK 3.6 million (-0.1).
Cash flow from financing activities amounted to SEK 513.7 million (619.6) and is mainly related to increased utilization of existing credit facilities.
Cash and cash equivalents at the end of the period were SEK 3,579.1 million compared to SEK 3,525.1 million as of June 30, 2020. The Group also had unutilized credit facilities of SEK 1,086.9 million compared to SEK 1,623.9 million as of June 30, 2020. The Group's total available cash and unutilized credit facilities were SEK 4,665.9 million at the end of the quarter compared to SEK 5,149.0 million as of June 30, 2020. As per September 30, 2020 the Net Cash of the Group amounted to SEK 1,281.3 million compared to SEK 813.7 million as per June 30, 2020.
CONDITIONAL PURCHASE PRICE OVERVIEW
As of 30 September 2020 the Group had provisions of 724.6 MSEK for earnouts with expected settlement according to the table below.
Provisions for conditional
Financial year when settlement is expected
purchase price, SEK m
20/21
21/22
22/23
23/24
>24/25
Total
Provisions to be settled in cash
9.4
23.3
137.5
100.1
414.2
684.4
Provisions to be settled by shares 1)
40.2
40.2
Total
9.4
23.3
137.5
100.1
454.4
724.6
361,744 shares are not issued and will be issued if certain earnout targets are met. If all shares are issued the dilution amounts to 0.09% of the outstanding shares and 0.053 percent of the outstanding votes per 30 September 2020.
In addition, out of the 385.4 million shares outstanding there are approximately 57.9 million shares with clawback rights as per 30 September 2020. These shares have already been issued to cover for future earnout obligations.
INTANGIBLE ASSETS
The Group had intangible assets of SEK 13,768.2 million at the end of the quarter, compared to SEK 10,971.1 million at the end of the previous quarter, June 30, 2020, distributed as follows:
Intangible assets - Specification, SEK m
Sep 30, 2020
Sep 30, 2019 Jun 30, 2020 Mar 31, 2020
Completed games
604.8
392.9
511.5
438.6
Ongoing game development projects
2,427.7
1,582.4
2,274.4
2,117.7
Other intangible assets (film etc.)
212.2
283.0
192.6
250.1
Intangible assets
3,244.7
2,258.3
2,978.5
2,806.4
IP-rights
1,463.2
2,071.8
1,337.6
1,479.8
Surplus value Partner Publishing/Film
167.5
208.3
152.1
173.0
Goodwill
8,892.8
983.2
6,502.9
1,411.7
Acquisition related intangible assets
10,523.5
3,263.3
7,992.6
3,064.5
Total
13,768.2
5,521.6
10,971.1
5,870.9
Desperados 3
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
6
PRELIMINARY PURCHASE PRICE ALLOCATION
During the quarter Embracer closed the following acquisitions; Deca Games, 4A Games, Palindrome, Rare Earth, Vermila, Sola Media, Pow Wow Entertainment, NWI Interactive and Vertigo. The acquired companies have been included into Embracer's consolidated financial reporting from each respective closing date. A summary of the preliminary purchase price allocations is provided below:
SEK m
On-going game development
22
Finished game development
5
IP-rights/Trademarks
124
Other intangible assets
6
Total intangible assets
157
Total financial assets
17
Total tangible assets
10
Net working capital
11
Cash and cash equivalents
164
Provisions
-9
Other long term liabilities
-53
Total net assets acquired excluding surplus value
296
Goodwill
2,979
Surplus - value IP
97
Surplus - film
27
Deferred tax liabilities
-37
Total surplus value net of taxes
3,065
Total net assets acquired
3,362
Acquired cash
-164
Shares issued
-2,084
Earnout
-357
Other
-58
Net cash outflow on acquisition of business
699
Cash outflow relating to
earlier acquisitions
80
Total Net Cash outflow
on acquisitions of business
779
The above surplus values SEK 3,103 million is the base for the Amortization related to acquisitions closed in the quarter below. The difference between SEK 3,103 million and SEK 3,292 million relates to amortizations in Q2 and currency rates.
Non-operational Depreciations and Amortizations - Forecast
Q3
Q4
FY
FY
FY
FY
FY
FY
SEK m
20/21
20/21
21/22
22/23
23/24
24/25
25/26 26/27
Total
Amortization related to acqui-
sitions closed in the quarter
-166
-166
-666
-666
-666
-666
-297
0
-3,293
Amortization related to acquisi-
tions closed previous quarters
-468
-467-1,857-1,809-1,534-1,257
0
0
-7,391
Non-operational Deprecia-
tions and Amortizations
-634
-633-2,523-2,475-2,200-1,923
-297
0
-10,683
Forecast is based on the average exchange rate during the quarter for EUR and USD. Forecast is based on the purchase price allocations as per 30th September, which contain both preliminary and finalized purchase price allocations.
Spellforce 3: Fallen God
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
7
DECA GAMES
As part of Embracer's consolidated financial reporting DECA Games has implemented the Swedish GAAP K3.
Revenues are reported on a gross basis within Business Area - DECA Games, which is consistent with peers in the industry of live-ops/mobile gaming.
DEPENDENCY ON FOREIGN EXCHANGE RATES
Embracer operates on a global market and reports financial performance in SEK and thus has a dependency towards foreign currencies, mainly USD and EUR. The SEK has strengthened after quarter end versus USD and EUR. Everything else being equal, this would have a negative impact on net sales in SEK. However, organic growth in net sales in local currency would not be affected.
PARENT COMPANY
The Parent Company's net sales for the quarter were SEK 252.9 million (183.0) and profit before tax was SEK -241.2 million (95.1). The negative outcome is explained by unrealized currency exchange loss on loan to a subsidiary. Profit after tax was SEK -189,3 million (74.2).
Investments in intangible assets in the quarter were SEK 150.1 million (189.9).
Cash and cash equivalents as of September 30, 2020 were SEK 2,083.3 million (2,069.5). The Parent Company's equity at the end of the period was SEK 11,965.9 million (5,552.0).
MotoGP 20
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
8
OPERATIONAL OVERVIEW
BY BUSINESS AREA
BUSINESS AREA: GAMES - THQ NORDIC
Business Area: Games - THQ Nordic released the following new products in the quarter ended September 2020:
Title
Publishing Label
IP Owner Platforms
Channels
Destroy All Humans!
THQ Nordic
Own
PC, PS4, Xbox One
Digital & Physical
Kingdoms of Amalur Re-Reckoning
THQ Nordic
Own
PC, PS4, Xbox One
Digital & Physical
MX vs ATV All Out
THQ Nordic
Own
Switch
Digital & Physical
Little Big Workshop
HandyGames
Own
PS4, Xbox One,
Digital
Switch
One Hand Clapping - Early Access
HandyGames
External
Stadia
Digital
Spitlings
HandyGames
External
PC, PS4, Xbox One,
Digital
Switch
Through the Darkest of Times
HandyGames
External
PS4, Xbox One,
Digital
Switch
Net sales of THQ Nordic increased 72% to SEK 566.9 million (329.6) compared to the same period last year.
THQ Nordic reports a new record quarter. In the period, the major revenue drivers were Destroy all Humans! and Kingdoms of Amalur: Re-Reckoning - both exceeding management expectations. Back catalogue sales continued showing a strong momentum, driven by Spongebob Squarepants: Battle for Bikini Bottom - Rehydrated released during Q1.
THQ Nordic has established two new studios during the quarter; the first one, Ashborne Games, Brno, Czech Republic is a newly founded studio with an experienced team, focusing on strategy and RPG games. The second one, Rainbow Studios Montréal got its name from Rainbow Studios based in Phoenix, USA. This will allow the Rainbow Team a better access to the local talent pool in the Montréal area.
In August, THQ Nordic acquired the Austria-based Pow Wow Entertainment GmbH. The studio employs 22 developers with AAA- and Games-as-a-Service experience. The team is working on two unannounced games one of which is based on an existing THQ Nordic-owned IP.
Facts
Studios
Ashborne Games
Alkimia Interactive
Black Forest Games
Bugbear Entertainment
Experiment 101
(Brno, Czech Republic)
(Barcelona, Spain)
(Offenburg, Germany)
(Helsinki, Finland)
(Stockholm, Sweden)
Grimlore Games
Gunfire Games
HandyGames
Mirage Game Studios
Nine Rocks Games
(Munich, Germany)
(Austin, USA)
(Giebelstadt, Germany)
(Karlstad, Sweden)
(Bratislava, Slovakia)
Pieces Interactive
Piranha Bytes
Pow Wow Entertainment
Rainbow Studios
Rainbow Studios
(Skövde, Sweden)
(Essen, Germany)
((ienna, Austria)
(Phoenix, USA)
(Montréal, Canada)
Publisher
Internal headcount Studios
HandyGames (Giebelstadt, Germany)
599 (442)
15 (10)
THQ Nordic (Vienna, Austria)
Chronos: Before the Ashes
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
9
BUSINESS AREA: GAMES - COFFEE STAIN
Net sales of Business Area: Games - Coffee Stain increased 191% to SEK 129.9 million (44.7) compared to the same period last year.
Coffee Stain had another strong quarter, with Satisfactory as the major revenue driver, followed by Deep Rock Galactic. Goat Simulator continues to be a solid contributor to back catalogue sales performing well on all seven published platforms.
After the end of the quarter, Coffee Stain announced several organizational changes. Stefan Hanna, one of the original founders of Coffee Stain, was appointed new CEO of Coffee Stain Studios. He replaces Johannes Aspeby who will move to work for Coffee Stain Publish- ing. Albert Säfström, one of the publishing founders, was appointed new CEO of Coffee Stain Publishing, replacing Tim Badylak, who moves on to new ventures. Anton Westbergh remains as Group-CEO of Coffee Stain.
Facts
Studios
Lavapotion
Coffee Stain Studios
Coffee Stain North
Box Dragon
(Gothenburg, Sweden)
(Skövde, Sweden)
(Stockholm, Sweden)
(Gothenburg, Sweden)
Publisher
Internal headcount Studios
Coffee Stain Publishing (Skövde, Sweden) 72 (55)
4 (3)
Satisfactory
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
10
BUSINESS AREA: GAMES - DEEP SILVER
Business Area: Games - Deep Silver released the following new products in the quarter ended September 2020:
Title
Publishing Label
IP Owner
Platforms
Channels
Iron Harvest
Deep Silver
External
PC
Digital & Physical
Pathfinder
Kingmaker:
Deep Silver
External
PS4, Xbox One
Digital & Physical
Definitive
Edition
Wasteland 3
Deep Silver
External
PC, PS4, Xbox One
Digital & Physical
Windbound
Deep Silver
External
PC, PS4, Xbox One
Digital
Relicta
Ravenscourt
External
PC, PS4, Xbox One
Digital
Net sales of Deep Silver increased 15% to SEK 506.8 million (441.7) compared to the same period last year.
Deep Silver had a solid quarter, where the three new releases Wasteland 3, Windbound and Iron Harvest were the major revenue drivers. All titles performed in line with management expectations.
The back catalogue sales continued to exceed management expectations with a solid performance of the evergreen franchises Metro and Saints Row-series. Also Kingdom Come: Deliverance, Hunt: Showdown and Outward continued to perform well.
During the quarter, Koch Media/Deep Silver acquired the Dutch-based Vertigo Games, which develops, publishes and distributes games exclusively for Virtual Reality (VR). The VR-AAA title After the Fall is expected to launch during 2021. The addition of Vertigo Games will add a number of quality VR titles to Deep Silver's back catalogue.
Milestone performed above management expectations during the quarter, mainly driven by the increasing digital sales, based on the new consumer behavior due to covid-19 restric- tions.
MotoGP 20, released during the last quarter, continued to perform well during this quarter. The title got a lot of good visibility in connection to the real championship and has been well received by its community and fans.
Milestone released Ride 4 after the end of the period and has been well received by its audience, gaining better reviews than its predecessor and performed above management expectations.
Facts
Studios
Deep Silver Dambuster Studios
Milestone
Voxler
Warhorse Studio
(Nottingham, U.K)
(Milan, Italy)
(Paris, France)
(Prague, Czech Republic)
Deep Silver FishLabs
Deep Silver Volition
Vertigo Games
(Hamburg, Germany)
(Champaign, USA)
(Rotterdam, Netherlands)
Publisher
Internal headcount Studios
Deep Silver (Munich & London)
1,527* (1,358*)
7 (5)
Milestone (Milan, Italy)
* Koch Media Group included
Vertigo Games (Rotterdam, Netherlands)
Chorus
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
11
BUSINESS AREA: GAMES - SABER INTERACTIVE
Business Area: Games - Saber interactive released the following new products in the quarter ended September 2020:
Title
Publishing Label
IP Owner
Platforms
Channels
World War Z Dronemaster
Exclusive
Update DLC
External
license
PC, PS4, Xbox One
Digital
SnowRunner Season 1:
Search & Recover DLC
External
Own
PC, PS4, Xbox One
Digital
Net sales of Saber Interactive were SEK 259.1 million (-) during the quarter.
Saber Interactive had a solid quarter. The strongest revenue driver was Snowrunner followed by World War Z which continued to outperform expectations on the back of strong sales following the DLC release Dronemaster Update that added cross-platform support. In September WWE 2K Battlegrounds was released. Since WWE 2K Battlegrounds is published by 2K, Saber Interactive didn't recognize any revenue during the quarter for this title.
Notable contributions also came from Work-for-Hire projects. Following the Switch-release in the previous quarter ended June, Crytek released Crysis 1 in September on more platforms.
Despite the challenging global covid-19 pandemic, Saber Interactive has had ongoing discussions with more M&A-candidates wanting to join the group. The collaboration between Saber Interactive and the other operational groups of Embracer Group has grown stronger during the period and shows Embracer's ecosystem's potential.
During the quarter, Saber Interactive acquired two new companies; Malta-based 4A Games and US/Canada based New World Interactive. 4A Games is the studio behind the successful Metro franchise and a long-term development partner to the Embracer owned publisher Deep Silver. New World Interactive is an award-winningindie-spirited creator and developer of First-Person-Shooter IPs founded in 2010.
After the reported quarter, New World Interactive announced the opening of a new development studio, New World East in Montréal, Canada. The new studio will provide ongoing, post-release support for Insurgency: Sandstorm and provide crucial development support for an unannounced future title.
Saber Interactive continues to expand its team targeting experienced executives in the game development space and recently hired Todd Hollenshead, former CEO of ID Software, as the new Head of Publishing as well as Bradley Doan, former CEO of Sperasoft, as the new Head of Production.
Facts
Studios
Saber Interactive
4A Games
New World Interactive
(Vila Nova de Gaia, Portugal)
(Kiev, Ukraine)
(Calgary,Canada)
(Saint Petersburg, Russia)
(Silema, Malta)
(Denver, USA)
(Alcobendas, Spain)
(Sundsvall, Sweden)
(Minsk, Belarus)
Publisher
Internal headcount
Studios
Saber Interactive
966 (-)
9 (-)
Snowrunner
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
12
BUSINESS AREA: GAMES - AMPLIFIER GAME INVEST
Amplifier Game Invest screens and invests in internationally talented companies in the games industry. The strategy is to give top talented game developers full creative integrity, while offering financial and commercial support. Amplifier Game Invest either sets up new studios based on a start-up offering or acquires existing studios.
Amplifier Game Invest has continued to expand its team by adding more key people thereby broading its expertise in order to support to the growing team of studios in their global portfolio.
During the quarter Amplifier Game invest made the following transactions and acquisitions:
Acquisition of the remaining 50% of the shares in Palindrome Interactive, a 14-person strong game studio located in Skövde, Sweden, making Palindrome Interactive a wholly owned subsidiary.
Acquisition of the Austria-based development studio Rare Earth Games with a team of highly experienced industry veterans. Rare Earth Games focus on action-packed multiplayer game titles for PC, Consoles and Cloud services.
Acquisition of the ten-person strong game development studio Vermila Studios. Vermila Studios is currently working on their first production, Crisol: Theater of Idols, a first-person horror adventure.
Increased their holding from 20% to 41% in Kavalri Games, a development studio based in Stockholm.
Facts
Studios
S T U D I O S
Vermila Studios
Palindrome Interactive
Tarsier Studios
Destiny Bit
(Madrid, Spain)
(Skövde, Sweden)
(Malmö, Sweden)
(Ravenna, Italy)
Rare Earth Games
Misc Games
C77
River End Games
(Vienna, Austria)
(Sandnes, Norway)
(Belleveue, USA)
(Gothenburg, Sweden)
Publisher
Internal headcount
Studios
-
158 (3)
8 (-)
Fishing North Atlantic
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
13
BUSINESS AREA: GAMES - DECA GAMES
Net sales of DECA Games were SEK 32.7 million (gross revenues for the period August 13 until September 30) (-).
DECA Games was announced the sixth operative group within Embracer Group at its acquisition August 13. It's a platform for building a new business vertical, applying the established asset care strategy to a new market segment: Mobile and Free-To-Play. This market segment is highly complementary to Embracer Group's existing, fast growing business within PC/console game development and publishing.
DECA Games had a solid first six weeks within the Group. Existing games at the time of the acquisition, Realm of the Mad God and Dragonvale have been performing above expectations as a result of covid-19 and increased content increased releasing pace of new content to existing games. During the quarter, DECA Games acquired two new franchises, Almost a Hero and Gods and Glory. The company has multiple ongoing M&A discussions including new franchises and entrepreneurs wanting to join the group.
Remote operations have been efficient and the integration has gone smoothly, despite the challenging circumstances with the ongoing pandemic.
Facts
Studios
DECA
DECA
DECA
Games Bulgaria
Games Berlin
Games
(Veliko Tarnovo, Bulgaria)
(Berlin, Germany)
(remote)
Publisher
Internal headcount
Studios
Deca Games (Berlin, Germany)
67 (-)
3 (-)
Realm of the Mad God
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
14
BUSINESS AREA: PARTNER PUBLISHING/FILM
Net sales in the Partner Publishing/Film business area increased 100% to SEK 887.8 million (443.6) compared to the same period last year, mainly driven by larger game releases as well as increased film revenues.
In the Partner Publishing business segment, Marvel Avengers from Square Enix and F1 2020 from Codemasters were the major revenue drivers during the quarter. Mentioned notable releases and the general performance of the Partner Publishing business segment exceeded management expectations, despite the difficulties presented by the covid-19 restrictions to the traditional retail business.
The strong back catalogue performance and digital sales during the quarter were assessed to be driven by consumers' demand patterns affected by the covid-19 pandemic. While the lockdown had already significantly impacted the retail landscape in the quarter ending June, the reporting quarter was dominated by recovery and increasing numbers of customers buying games physically.
Partner Publishing does not expect any major new release during the quarter ending December. Releases for the quarter ending December will include Kingdom Hearts Melody of Memory, Mortal Kombat 11 Ultimate and DIRT 5.
The Film business segment had a strong quarter exceeding management expectations. Revenue more than doubled compared to same period last year driven by the full integration of the KSM business. Digital sales where at high levels, whereas physical sales still suffered from the covid-19 lockdowns. The film business released more than 70 titles during the quarter, including The Witch Next Door in cinemas and IP Man 4 for home video.
During the quarter, Koch Films acquired Sola Media, a Germany based sales agent of international film and TV-rights, distributing children and family films across the globe. Sola Media's titles Dreambuilders and Elfkins were the major revenue drivers in the period. The upcoming release of Forgotten Christmas is affected by the covid-19 lockdowns on certain markets. but is still planned to be released in both Switzerland and Austria.
Koch Film also launched a B2C subscription channel, "Aniverse" on Amazon Prime video channels, the launch was well received and has so far exceeded management expectations.
After the quarter end Koch Films had a successful launch of their own YouTube channel for movie streaming called "Moviedome".
Game Outlet Europe AB, the niche distributor of retro-products and deep back catalogue games, based in Karlstad, Sweden continued to have a positive development. During the period it announced its own publishing label for niche titles, Clear River Games, that released its first title, Ys Origin in EMEA territories. The retro segment had a continued great performance of 8BitDo products where Game Outlet Europe has the European distribution.
Facts
Internal headcount
1,540* (1,371*)
* Koch Media Group and Game Outlet Europe included
Biomutant
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
15
ONGOING DEVELOPMENT AND UPCOMING RELEASES
The Company invested SEK 445 million in its growing ongoing development pipeline that will be driving growth and profitability in the coming years.
The finalized value of the completed and released games during the quarter were SEK 311 million driven by the releases of Destroy all Humans!, Iron Harvest and Wasteland 3.
Announced releases in the Games business area as of November 18, 2020
Publishing
Title
Label
IP Owner Platforms
Channels
Biomutant
THQ Nordic
Own
PC, PS4, Xbox One
Digital & Physical
Chronos: Before the Ashes
THQ Nordic
Own
PC, PS4, Xbox One,
Digital & Physical
Switch, Stadia
Destroy all Humans!
THQ Nordic
Own
Stadia
Digital
Gothic - Remake
THQ Nordic
Own
PC, next gen consoles
Digital & Physical
Kingdoms of Amalur
THQ Nordic
Own
PS4, Xbox One, PC
Digital
Expansion: Fatesworn
Knights of Honor II: Sovereign
THQ Nordic
Own
PC
Digital & Physical
Scarf
THQ Nordic
External
PC
Digital
Spongebob: Battle for Bikini
THQ Nordic
External
Stadia
Digital
Bottom Rehydrated
The Guild 3 (full version)
THQ Nordic
Own
PC
Digital & Physical
A Rat´s Quest
HandyGames
External
PS4, Xbox One, PC, Switch
Digital
Aces of the Luftwaffe
HandyGames
Own
Mobile
Digital
Squadron - Extended Edition
Airhead
HandyGames
External
PS4, Xbox One, PC, Switch
Digital
El Hijo
HandyGames
External
PC, PS4, Xbox One, Switch
Digital
Endling - Extinction is Forever
HandyGames
External
PC, PS4, Xbox One, Switch
Digital & Physical
One Hand Clapping
HandyGames
External
PS4, Xbox One, PC, Switch
Digital
Pile Up!
HandyGames
External
PS4, Xbox One, PC, Switch
Digital
Townsmen VR
HandyGames
Own
PC, PS4
Digital
Chorus
Deep Silver
Own
TBC
Digital & Physical
Chivalry 2
Deep Silver
External
PC, PS4, Xbox One
Physical
Dead Island 2
Deep Silver
Own
TBC
Digital & Physical
Iron Harvest
Deep Silver
External
TBC
Digital & Physical
Phoenix Point
Deep Silver
External
PS4, Xbox One
Digital & Physical
MXGP 2021
Milestone
Own
PC, PS5, PS4, Xbox One
Digital & Physical
Ride 4
Milestone
Own
PS5, Xbox series X
Digital & Physical
Let's Sing 2021
Ravenscourt
External
PS4, Switch
Digital & Physical
Proto Corgi
Ravenscourt
External
PC, Switch
Digital
Midnight Ghost Hunt
Coffee
Stain
Shared
PC
Digital
Satisfactory - Update 4
Coffee
Stain
Own
PC
Digital
Songs of Conquest
Coffee
Stain
Own
PC
Digital
Valheim
Coffee
Stain
External
PC
Digital
SnowRunner Season 2:
Explore & Expand
External
Own
PC, PS4, Xbox One
Digital
For latest release dates please refer to above mentioned publishers.
Goat Simulator
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
16
EVENTS AFTER THE QUARTER
SIGNIFICANT EVENTS AFTER THE QUARTER
On the October 8, Embracer Group successfully completed a directed share issue of SEK 5,782 million. The new share issue further strengthen the Company's financial position and enable the company to continue its long track-record of successful acquisitions by comple- menting its operations by adding new game publishers, development studios or other gam- ing related-assets. The demand in the private placement was significant from both Swedish and international institutional investors, including Canada Pension Plan Investment Board acquiring new class B shares for a total amount of approximately SEK 2.1 billion.
In connection with the private placement, Embracer Group's founders consolidated their ownership in Embracer Group whereby Lars Wingefors AB acquired shares from the other founders Erik Stenberg, Mikael Brodén, Klemens Kreuzer and Reinhard Pollice. Post transaction, the co-founders became owners in Lars Wingefors AB and will no lon- ger own shares directly through their own holding companies in Embracer Group.
The transactions are expected to be completed in the end of the calender year.
At the Extra General Meeting the 16th of November, it was resolved to authorize the Board to issue shares, convertibles and/or warrants in the amount not exceeding ten percent (46,793,296 shares) of the total number of shares in the company with the primarily purpose to raise new capital to increase the flexibility of the Company or in connection with acquisitions.
After the end of the quarter the loan, including accrued interest, of USD 101.0 million from the sellers of Saber Interactive was refinanced with an external bank loan of SEK 96 million on favourable terms. The sellers provided a discount of USD 5.0 million in connection with the repayment of the loan. In addition, Embracer realized an unrealized currency gain of approximately SEK 112 million (SEK/USD at 8.84). The net effect of the refinancing will have a positive effect on Embracer´s financial net with approximately USD 5.0 million equal to SEK 44.4 million in Q3 (SEK/USD 8.84). The transaction does not have any effect on Embracer´s available funds.
RELEASES AFTER THE END OF THE QUARTER
During the period October 1, 2020 until November 18, 2020, the following titles were released:
Publishing
Title
Label
IP Owner
Platforms
Channels
Aquanox - Deep Descent
THQ Nordic
Own
PC
Digital & Physical
Desperados 3 DLC2:
THQ Nordic
Own
PC, PS4, Xbox One
Digital
Five Steps Ahead
Desperados 3 DLC3:
THQ Nordic
Own
PC, PS4, Xbox One
Digital
Once More With Feeling
Spellforce 3: Fallen God
THQ Nordic
Own
PC
Digital
Chicken Police - Paint It Red!
HandyGames
External
PS4, Xbox One, PC,
Digital
Switch
Little Big Workshop
HandyGames
Own
PC
Digital
- The Evil DLC
Neighbours Back From Hell
HandyGames
Own
PS4, Xbox One, PC,
Digital
Switch
Maneater
Deep Silver
Extern
PS5, Xbox series X
Physical
Ride 4
Milestone
Own
PC, PS4, Xbox One
Digital & Physical
Let's Sing Queen
Ravenscourt
Own
PS4, Xbox One,
Digital & Physical
Switch
9 Monkey's of Shaolin
Ravenscourt
External
PC, PS4, Xbox One,
Digital & Physical
Switch
Fishing North Atlantic
Misc
Own
PC
Digital
Little Big Workshop
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
17
OTHER INFORMATION
SUSTAINABILITY AND GOVERNANCE
During the quarter, the focus has been on the next step in completing the implementation of our Compliance Code, ensuring awareness in the whole group by conducting training. This is accomplished through a gamified version, in the same playful way as "the Code" available on our website. The training started in October, and we are proud of the commitment and participation that the employees in our parent company and in our subsidiaries have shown.
The Compliance Code training is carried out annually, and examples of areas covered are anti-corruption, privacy and data security, diversity and inclusion, and our whistleblowing service. We recognize the importance of training our employees. A total of 41% of our global group completed the training the first month. At Embracer parent company level, all employees have also completed a course in data privacy and the General Data Protection Regulation.
Our first sustainability report was published in the Annual Report 19/20 and laid the foundation for setting future goals and key performance indicators
Our work with green initiatives continues and together with a united climate group consisting of several Nordic gaming companies we have launched the website PlayCreateGreen.org. The site will feature best practices from gaming companies and inspire the games industry to promote climate-smart behavior. The site is functioning as a handbook and is a long- term project and part of the commitment we made together with the climate group in the UN's initiative Playing for the Planet.
Our cross-border initiative, the Ambassador program, has begun to work actively in small groups focusing on areas where they believe they make the greatest impact and what matters most from a sustainability perspective.
Destroy Alla Humans
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
18
ANALYSTS FOLLOWING EMBRACER GROUP
Company
Name
Phone
Mail
Carnegie
Oscar Erixon
+46
8 58 86 89 73
oscar.erixon@carnegie.se
Berenberg
Benjamin May
+44 20 346 52 667 benjamin.may@berenberg.com
SEB
Mathias Lundberg
+46
8 522 297 94
mathias.lundberg@seb.se
Bernstein
Matti Littunen
+44 207 170 50 09
matti.littunen@bernstein.com
Nordea Markets
Erik Lindholm-Röjestål
+46
101 570 310
erik.lindholm-rojestal@nordea.com
Pareto Securities
Lars-Ola Hellstrom
+46
8 402 5277
lars-ola.hellstrom@paretosec.com
Handelsbanken
Fredrik Olsson
-
frol16@handelsbanken.se
Redeye
Tomas Otterbeck
-
tomas.otterbeck@redeye.se
ABG Sundal Collier
Jesper Birch-Jensen
+46
8 566 286 13
Jesper.Birch-Jensen@abgsc.se
Citi
Thomas A Singlehurst
+44 20 7986 4051
thomas.singlehurst@citi.com
Kepler Cheuvreux
Hjalmar Ahlberg
+46
708 62 50 79
hahlberg@keplercheuvreux.com
Goldman Sachs
Alexander Duval
-
alexander.duval@gs.com
Note: Redeye and ABG Sundal Collier are commissioned by Embracer Group.
ANALYSTS AND ESTIMATES
During the quarter we launched a new IR-service at embracer.com providing consensus estimates. The estimates are collected by Infront and based on predictions made by analysts who cover Embracer Group.
THE SHARE
Change from
TOP 10 OWNERS, AS OF SEPTEMBER 30, 2020
June 30, 2020
Class A
Class B
Share of
Share of
Class B
Name
shares
shares
capital, %
votes, %
shares
Lars Wingefors
19,504,401
88,571,196
28.04
41.34
Matthew Karch and Andrey Iones
6,399,137
35,386,220
10.84
14.49
Swedbank Robur Funds
25,651,868
6.66
3.74
-447,870
Erik Stenberg
4,223,172
19,177,800
6.07
8.95
Handelsbanken Funds
18,588,798
4.82
2.71
-1,064,447
Didner & Gerge Funds
11,233,848
2.91
1.64
-376,921
Mikael Broden
1,450,134
6,585,189
2.08
3.07
Ken Go
6,301,591
1.63
0.92
6,301,591
ODIN Funds
5,300,000
1.38
0.77
650,000
First Swedish National Pension Fund
4,920,256
1.28
0.72
-3,449,504
TOTAL TOP 10
31,576,844
221,716,766
65.71
78.35
ALL OTHER SHAREHOLDERS
1,822,293
130,333,855
34.29
21.65
TOTAL
33,399,137
352,050,621
100.00
100.00
Source: Holdings by Modular Finance.
TOP 15 MANAGEMENT & CO-FOUNDER OWNERS, AS OF SEPTEMBER 30, 2020
Class A
Class B
Share of
Share of
Owner
Co-Founder
shares
shares
capital, %
votes, %
Lars Wingefors
Embracer Group
19,504,401
88,571,196
28.04
41.34
Matthew Karch and Andrey Iones
Saber Interactive
6,399,137
35,386,220
10.84
14.49
Erik Stenberg
Embracer Group
4,223,172
19,177,800
6.07
8.95
Mikael Broden
Embracer Group
1,450,134
6,585,189
2.08
3.07
Ken Go
DECA Games
6,301,591
1.63
0.92
Luisa Bixio
Milestone
3,802,126
0.99
0.55
Klemens Kreuzer
THQ Nordic
605,352
2,748,963
0.87
1.28
Reinhard Pollice
THQ Nordic
347,043
1,966,572
0.60
0.79
Richard Stitselaar and Kimara Rouwit
Vertigo Games
1,928,210
0.50
0.28
Pelle Lundborg
Embracer Group
869,898
769,649
0.43
1.38
Anton Westbergh
Coffee Stain
1,206,333
0.31
0.18
Klemens Kundratitz
Koch Media
1,127,928
0.29
0.16
Vincent Van Brummen
Vertigo Games
747,851
0.19
0.11
John Coleman
Vertigo Games
406,956
0.11
0.06
Stefan Ljungqvist
Experiment 101
270,270
0.07
0.04
TOP 15
33,399,137
170,996,854
53.03
73.61
ALL OTHER SHAREHOLDERS
181,053,767
46.97
26.39
TOTAL
33,399,137
352,050,621
100.00
100.00
Holdings by management above are in general owned trough various wholly owned companies.
Metro Exodus - Sam's Story
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
19
TOP 50 INSTITUTIONAL OWNERS,
Change from
AS OF SEPTEMBER 30, 2020
June 30, 2020
Class A
Class B
Share of
Share of
Class B
Name
shares
shares
capital, %
votes, %
shares
Swedbank Robur Funds
25,651,868
6.66
3.74
-447,870
Handelsbanken Funds
18,588,798
4.87
2.73
-1,064,447
Didner & Gerge Funds
11,233,848
2.91
1.64
-376,921
ODIN Funds
5,300,000
1.39
0.78
650,000
AP1 Första AP-fonden
4,920,256
1.28
0.72
-3,449,504
Avanza Pension
4,272,869
1.11
0.62
485,795
Dan Sten Olsson Family and Foundation
4,045,004
1.06
0.59
225,000
TIN Funds
4,056,869
1.05
0.59
403,382
AP2 Andra AP-fonden
3,416,211
0.89
0.50
-1,362,527
Livförsäkringsbolaget Skandia
3,214,081
0.83
0.47
-90,969
Janus Henderson Investors
3,015,714
0.79
0.44
-176,202
Futur Pension
2,756,884
0.72
0.40
-9,078
Martin Larsson (Chalex AB)
2,532,899
0.66
0.37
-28,198
Danske Invest (Lux)
2,282,000
0.60
0.33
9,000
BlackRock
2,134,488
0.56
0.31
141,888
AFA Försäkring
2,011,989
0.52
0.29
915,245
Skandia Funds
1,969,850
0.51
0.29
48,000
Länsförsäkringar Funds
1,874,514
0.49
0.27
-196,550
DNB Funds
1,855,614
0.48
0.27
1,070,482
Nordnet Pensionsförsäkring
1,458,546
0.38
0.21
115,152
JP Morgan Asset Management
1,295,874
0.34
0.19
176,865
Allianz Global Investors
1,153,593
0.30
0.17
-192,407
Naventi Funds
1,124,367
0.29
0.16
-127,027
Sensor Funds
1,101,092
0.29
0.16
Highclere International Investors LLP
1,057,257
0.28
0.16
-1,144,832
Aktia Asset Management
1,009,542
0.26
0.15
-38,590
Svenska Handelsbanken AB for PB
981,563
0.25
0.14
-33,840
Vanguard
926,367
0.24
0.14
2,635
Fondita Funds
920,000
0.24
0.13
Schroders
861,208
0.23
0.13
102,333
Amundi
843,014
0.22
0.12
RAM Rational Asset Management
789,317
0.21
0.12
Evli Funds
765,000
0.20
0.11
102,500
Global X Management Company LLC
754,349
0.20
0.11
491,200
Kuwait Investment Authority
750,000
0.19
0.11
76,132
Consensus Asset Management
710,000
0.19
0.10
240,665
Michael Knutsson
700,000
0.18
0.10
Varma Mutual Pension Insurance Company
675,000
0.18
0.10
Knutsson Holdings AB
650,000
0.17
0.09
100,000
CamGestion
620,770
0.16
0.09
DJE Kapital AG
607,900
0.16
0.09
Lancelot Asset Management AB
600,000
0.15
0.09
-50,000
American Century Investment Management
575,469
0.15
0.08
128,322
Nordea Funds (Lux)
527,974
0.14
0.08
Carnegie Funds
515,000
0.13
0.08
Handelsbanken Liv Försäkring AB
489,799
0.13
0.07
72,004
Delaware Investments
468,841
0.12
0.07
-73,392
Deka Investments
450,267
0.12
0.07
Van Eck
444,592
0.12
0.07
123,753
BNP Paribas Asset Management
406,044
0.11
0.06
-97,280
TOTAL TOP 50 INSTITUTIONAL OWNERS
0
129,366,501
33.68
18.90
ALL OTHER SHAREHOLDERS
33,399,137
222,684,120
66.32
81.10
TOTAL
33,399,137
352,050,621
100.00
100.00
Source: Holdings by Modular Finance.
INTERNATIONAL OWNERSHIP
INSTITUTIONAL OWNERSHIP
TOP 50 INSTITUTIONAL
VS MANAGEMENT
BY CAPITAL
BY CAPITAL
International
Top 50
Top 15
Swedish
Management
institutions
institutions
institutions
/Co-Founders
23.7%
78.3%
33.6%
53.0%
Other shareholders
13.4%
Ride 4
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
20
INFORMATION ABOUT NASDAQ FIRST NORTH GROWTH MARKET
Nasdaq First North Growth Market ("First North") is an alternative marketplace operated by the constituent exchanges of Nasdaq Stockholm. It does not have the same legal status as a regulated marketplace. Companies quoted on First North are subject to First North's rules, rather than the legal requirements set for trading on a regulated marketplace. An investment in a company trading on First North implies higher risk than one in a company listed on a regulated market. Companies must apply to the exchange and gain approval before trading on First North can commence. A Certified Adviser guides the company through the listing process and also ensures that the company continuously satisfies First North's standards.
FNCA Sweden AB is Embracer Group's certified adviser who may be contacted at: info@fnca.se or +46-8-528 00 399.
RISKS AND UNCERTAINTY FACTORS
Embracer Group is exposed to risks, particularly the dependence on key persons, dependence of the success of game development, the sales performance of launched games, dependence on a few distributors and the success and performance of acquisitions. The complete risk analysis is found in the company's most recent Annual Report.
ACCOUNTING AND VALUATION POLICIES
This Interim Report has been prepared in accordance with the Swedish Annual Accounts Act. The accounting and valuation policies applied are consistent with the Swedish Accounting Standards Board's Category 3 (BFN K3) regulation and are unchanged since the latest published Annual Accounts, and the Swedish Accounting Standards Board's BFNAR 2012:1.
The Company's accounting policies are stated in its most recent Annual Report.
Amounts are reported in Swedish kronor, rounded to the nearest million unless otherwise stated. Rounding to the nearest million may mean that amounts are not consistent when added. Amounts and figures stated in brackets are comparatives for the corresponding period of the previous year.
AUDITOR'S REVIEW
This Interim Report has not been subject to review by the Company's auditor.
FORTHCOMING REPORTS
Interim Report Q3, October-December 2020
18 February, 2021
Interim Report Q4, January-March 2021
20 May, 2021
Interim Report Q1, April-June 2021
18 August, 2021
FOR MORE INFORMATION
Find more information about the Company at its website: embracer.com
For any questions on this report, please contact:
Lars Wingefors, Co-founder & CEO, lars.wingefors@embracer.com
The Guild 3
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
21
SIGNATURES AND ASSURANCE
The Board of Directors and the Chief Executive Officer offer their assurance that this Interim Report gives a true and fair view of the Group's and Parent Company's operations, financial position and results of operations and describes the significant risks and uncertainties facing the Group and Parent Company.
Karlstad, Sweden, November 18, 2020
Kicki Wallje-Lund
Chairman of the Board
David Gardner
Ulf Hjalmarsson
Jacob Jonmyren
Matthew Karch
Erik Stenberg
Lars Wingefors
Chief Executive Officer
This Interim Report is information that is mandatory for Embracer Group to make public pursuant to the EU Market
Abuse Regulation. The information was submitted for publication, through the agency of the contact person
set out above, at 06:00 CET on November 18, 2020
Neighbours back from Hell
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
22
CONSOLIDATED INCOME STATEMENT
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
Apr 2019-
SEK m
2020
2019
2020
2019
Mar 2020
Net sales
2,383.2
1,259.7
4,451.9
2,401.8
5,249.4
Work performed by the Company for its own use
and capitalized
273.4
176.6
521.3
307.8
752.8
Other operating income
64.1
66.9
128.6
111.9
305.9
Profit from revaluation of associated companies
41.4
41.4
Total operating income
2,762.1
1,503.3
5,143.2
2,821.4
6,308.1
Operating expenses
Goods for resale
-1,034.1
-635.1
-1,794.0
-1,163.1
-2,576.0
Other external expenses
-359.7
-191.8
-651.9
-369.3
-784.0
Personnel expenses
-398.8
-258.2
-777.5
-481.4
-1,130.0
Depreciation, amortization and impairment of property,
plant and equipment and intangible assets
-795.6
-341.7
-1,541.6
-649.9
-1,475.9
Total operating expenses
-2,588.2
-1,426.8
-4,765.0
-2,663.7
-5,965.9
Profit from participation in associated companies
-0.5
14.3
3.2
Operating profit
173.4
76.4
392.5
157.7
345.4
Profit from financial items
Other interest income, etc.
112.0
9.4
114.4
18.0
94.3
Other interest expenses, etc.
-21.8
-6.1
-59.9
-12.7
-30.9
Total financial items
90.2
3.3
54.6
5.3
63.4
Profit
after financial items
263.6
79.7
447.1
163.0
408.8
Profit
before tax
263.6
79.7
447.1
163.0
408.8
Tax on profit for the period
-35.8
-15.1
-128.8
-45.6
-125.5
Net profit for the period
227.8
64.6
318.3
117.4
283.3
Attributable to:
Equity holders of the parent
228.1
65.0
319.1
118.2
284.9
Non-controlling interests
-0.3
-0.4
-0.8
-0.8
-1.6
Earnings per share, SEK
0.60
0.21
0.85
0.38
0.91
Average number of outstanding shares, million
378
310
373
309
311
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
23
CONDENSED CONSOLIDATED BALANCE SHEET
SEK m
Sep 30, 2020
Sep 30 2019
Mar 31, 2020
Intangible assets
13,768.2
5,521.6
5,870.9
Property, plant & equipment
203.0
169.9
184.5
Financial assets
395.0
218.1
251.1
Inventories
380.5
385.4
352.8
Current receivables
1,983.2
1,579.4
1,467.6
Cash and bank balance
3,579.1
2,867.9
2,510.3
Total assets
20,309.0
10,742.3
10,637.2
Share capital
1.1
0.9
0.9
Other capital reserves
12,921.8
5,289.1
5,300.5
Recognized profit including profit for the period
815.9
895.3
1,093.9
Provisions
1,547.2
1,214.0
1,241.0
Non-current liabilities
1,174.9
214.6
221.8
Current liabilities
3,848.1
3,128.3
2,779.1
Total liabilities and equity
20,309.0
10,742.3
10,637.2
Interest-bearing receivables amount to
3,579.1
2,867.9
2,510.3
Interest-bearing liabilities amount to
3,229.4
1,768.4
1,490.9
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
24
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Other paid-up
Other equity
Minority
Consolidated
SEK m
Share capital
capital
including net profit
interest
equity
Amount as of April 1, 2020
0.9
5,300.5
1,068.8
25.1
6,395.4
Translation difference
-688.2
-688.2
New share issue
0.2
7,656.0
7,656.2
Issue costs 1)
-43.7
-43.7
Tax effect
9.0
93.3
102.3
Other
-0.6
-0.6
Net profit
318.3
-0.8
317.5
Amount as of September 30, 2020
1.1
12,921.8
792.2
23.7
13,738.8
Issue costs constitutes of cost of rights issue SEK 43.7 million and tax effects of the cost SEK 9.0 million.
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
Apr 2019-
SEK m
2020
2019
2020
2019
Mar 2020
Cash flow from operating
activities before changes
in working capital
852.1
364.7
1,722.0
667.6
1,604.2
Change in working capital
-47.5
-79.9
-185.0
55.5
124.1
Cash flow from operating
activities
804.7
284.8
1,537.0
723.1
1,728.3
Cash flow from investing activities
Net investment in acquired companies
-773.9
-802.7
-1,877.7
-802.9
-905.7
Net investment in intangible assets
-484.1
-391.9
-978.5
-770.0
-1,653.4
Net investment in tangible assets
-12.8
-8.6
-29.0
-19.2
-42.4
Net investment in financial assets
3.6
-0.1
-14.0
-2.4
-32.6
Cash flow from financing activities
513.7
619.6
2,454.0
802.8
473.5
Cash flow for the period
51.3
-298.9
1,091.8
-68.6
-432.3
Cash and cash equivalents at beginning of period
3,525.1
3,159.0
2,510.3
2,929.1
2,929.1
Translation difference in cash and cash equivalents
2.7
7.8
-23.0
7.4
13.5
Cash and cash equivalents at end of period
3,579.1
2,867.9
3,579.1
2,867.9
2,510.3
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
25
PARENT COMPANY INCOME STATEMENT
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
Apr 2019-
SEK m
2020
2019
2020
2019
Mar 2020
Net sales
252.9
183.0
442.7
284.3
495.9
Other operating income
0.0
2.7
0.0
2.7
11.1
Total operating income
252.9
185.8
442.7
287.0
507.0
Operating expenses
Other external expenses
-2.6
-6.2
-26.1
-10.6
-64.3
Personnel expenses
-5.3
-2.2
-10.0
-4.0
-12.8
Depreciation, amortization and impairment of property,
plant and equipment and intangible assets
-133.9
-95.4
-217.5
-171.2
-333.3
Total operating expenses
-141.8
-103.8
-253.6
-185.8
-410.4
Operating profit
111.1
81.9
189.1
101.2
96.6
Result from financial assets
1.3
2.5
2.6
4.6
39.7
Interest income, etc.
10.7
16.1
11.0
27.5
83.0
Interest expenses, etc.
-364.4
-5.4
-397.0
-10.4
-21.5
Total financial income/expenses
-352.4
13.2
-383.4
21.6
101.2
Profit after financial items
-241.2
95.1
-194.4
122.8
197.8
Appropriations
0.0
0.0
0.0
0.0
-60.0
Profit before tax
-241.2
95.1
-194.4
122.8
137.8
Tax on profit for the period
51.9
-20.9
41.9
-27.0
-29.7
Net profit for the period
-189.3
74.2
-152.5
95.8
108.1
CONDENSED PARENT COMPANY BALANCE SHEET
SEK m
Sep 30, 2020
Sep 30, 2019
Mar 31, 2020
Intangible assets
434.8
382.7
393.8
Tangible assets
5.5
1.6
Financial assets
9,156.9
2,678.6
2,813.6
Current receivables
1,733.1
771.6
927.7
Cash and bank balance
2,083.3
2,069.5
1,954.5
Total assets
13,413.5
5,902.4
6,091.2
Equity
11,965.9
5,552.0
5,575.1
Untaxed reserves
140.6
95.6
140.6
Provisions
3.6
3.6
3.6
Long-term liabilities
1,117.3
214.6
221.7
Current liabilities
186.1
36.5
150.2
Total liabilities and equity
13,413.5
5,902.4
6,091.2
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
26
SELECTED KEY PERFORMANCE INDICATORS - GROUP
Financial metrics defined or specified pursuant to
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
Apr 2019-
Swedish Accounting Standards Board standards (BFNAR)
2020
2019
2020
2019
Mar 2020
Net sales, SEK m
2,383.2
1,259.7
4,451.9
2,401.8
5,249.4
Operating profit,
SEK
m
173.4
76.4
392.5
157.7
345.4
Profit
before tax,
SEK
m
263.6
79.7
447.1
163.0
408.8
Profit
after tax, SEK m
227.8
64.6
318.3
117.4
283.3
Number of shares at end of period, thousands 1)
385,450
311,905
385,450
311,905
312,067
Average number of outstanding shares, thousands 1)
377,834
309,759
373,135
308,737
311,411
Average number of full-time employees in the period
2,807
1,487
2,494
1,426
1,663
Number of employees at the end of the period
3,024
1,632
3,024
1,632
1,873
Alternative key performance indicators not
Jul-Sep
Jul-Sep
Apr-Sep
Apr-Sep
Apr 2019-
defined or specified pursuant to BFNAR
2020
2019
2020
2019
Mar 2020
Net sales growth, %
89
-1.0
85
14
3
EBITDA, SEK m
969.0
418.1
1,934.0
807.6
1,821.3
EBITDA margin, %
41
33
43
34
35
Operational EBIT, SEK m
652.5
240.7
1,364.3
444.8
1,033.0
EBIT, SEK m
173.4
76.4
392.5
157.7
345.4
EBIT margin, %
7
6
9
7
7
Equity/assets ratio, %
68
58
68
58
60
Adjusted earnings per share, SEK 1)
1.80
0.65
3.32
1.16
2.81
Earnings per share, SEK 1)
0.60
0.21
0.85
0.38
0.91
Dividend per share, SEK
0.0
0.0
0.0
0.0
0.0
Derivation of the alternative KPIs,
operational EBIT and EBITDA
EBIT, SEK m
173.4
76.4
392.5
157.7
345.4
Amortization expenses added back to Operational EBIT
- Goodwill, SEK m
401.1
51.7
776.4
97.2
285.1
- Intellectual property (IP) rights, SEK m
104.2
100.5
206.4
169.7
359.4
- Surplus value of Partner Publishing/Film, SEK m
15.3
12.0
30.3
20.2
43.1
Revaluation of shares in associated companies
-41.4
-41.4
Operational EBIT, SEK m
652.5
240.7
1,364.3
444.8
1,033.0
- Other depreciation and amortization expenses, SEK m
275.0
177.4
528.3
362.9
788.3
Revaluation of shares in associated companies
41.4
41.4
EBITDA, SEK m
969.0
418.1
1,934.0
807.6
1,821.3
Recalculated with respect to the 3:1 split carried out on October 8, 2019 as resolved at the annual general meeting on September 17, 2019. Number of shares for previous periods have been adjusted.
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
27
DEFINITIONS OF ALTERNATIVE KPI's
Embracer Group's definitions of a number of alternative KPI's used in this Interim Report are stated below. Net sales growth is reported by the Company because it regards this KPI as contributing to investor understanding of the Company's historical progress. EBITDA and EBITDA margin are reported because these are metrics commonly used by certain investors, financial analysts and other stakeholders to measure the Company's financial results. The company has chosen to disclose operational EBIT in order to provide a fair picture of the underlying operational performance. This alternative key performance metric excludes amortization of acquisition-related goodwill, surplus values of specific business areas (currently Partner Publishing/Film) and IP values (trademarks, patents, copyrights etc.). The equity/assets ratio is stated because the Company regards this as a metric commonly used by certain investors, financial analysts and other stakeholders to measure the Company's financial position.
DEFINITIONS OF KPI'S, GROUP
Adjusted Earnings per share
Earnings per share
EBIT margin
EBITDA
EBITDA margin
Equity/assets ratio
Free Cash Flow
Net sales growth
Non-operational Depreciation and Amortizations
Operational EBIT
Operational EBIT margin
Profit after tax excluding non-operational depreciations and amortizations net of tax and profit of revaluation of shares in associated companies divided by the average number of shares in the period. Tax related to non-operational depreciation and amortizations calculated using the effective tax rate (no tax effect on goodwill amortizations).
Profit after tax less non-controlling interest divided by the average number of shares in the period. EBIT as a percentage of net sales.
Earnings before interest taxes, depreciation and amortization. EBITDA as a percentage of net sales.
Equity as a percentage of total assets.
Cash Flow for the period excluding net investment in acquired companies and cash flow from Financing activities.
Net sales for the current period divided by net sales for the corresponding period of the previous year.
Amortization of acquisition-related goodwill, surplus values of specific business areas and IP Values (trademarks, patents, copyrights etc).
EBIT excluding non-operational depreciations and profit/loss of revaluation of participation in associated companies.
Operational EBIT as a percentage of net sales.
DEFINITIONS, QUARTERLY INFORMATION
Completed games
Total book value of finished game development
projects (released
games) during the quarter. Upon com-
pletion the released games are reclassified from
On-going Game
Development
Projects to Finished Games
and depreciation starts.
Depreciation
Game development
Depreciation of finished game development projects - degressive
depreciation
over two years. 1/3 depre-
ciation during month 1 to 3 following release, 1/3 depreciation in month 4 to 12 following release and the
remaining 1/3 in month 13 to 24 following release.
Other intangible assets
The majority of other intangible assets (Film etc) relates to the Group's film business and is depreciated
(Film etc)
based on actual sales in relation to expected sales of the relevant title.
IP-rights
Depreciation of IP rights related to Games - straight-line depreciation over five
years.
Surplus value Partner
Depreciation of surplus values related to Partner Publishing/Film - straight-line depreciation over five years.
Publishing/Film
Goodwill
Depreciation of Goodwill - straight-line depreciation over five years.
Digital sales
All net sales not shipped physically.
External game developers
Number of game developers engaged in game development projects by studios that are not owned by the
group (external studios).
External Studios
Number of external development studios engaged in game development projects.
Game development projects
Number of on-going game development projects financed by the
group.
Internal employees,
Number of employees not directly engaged in game development (both employees and contractors).
non-development
Internal game developers
Number of game developers (both employees and contractors) engaged in game development projects by
studios that are owned by the group (internal studios).
Internal Studios
Number of internal development studios.
Net sales split - Games business area
Owned titles
Net sales of game titles that are owned IP:s or titles that are controlled by the group.
Publishing titles
Net sales of game titles of IP:s the group does not own or control.
New releases sales
Net sales of game titles that are released in the current quarter.
by each quarter
Back catalog
Net sales of game titles that are not released in the current quarter.
Number of IP:s
Number of IP:s owned by the group.
Organic growth
Growth in Business Area - Games between periods where net sales from companies acquired in the last five
quarters have been excluded.
Organic growth, CCY
Growth in Business Area - Games between periods where net sales from companies acquired in the last five
quarters have been excluded. The comparison period is adjusted for differences in
exchange rates.
Physical sales
All net sales shipped physically.
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
28
QUARTERLY INFORMATION BY CALENDAR YEAR
2017
2018
2019
2020
Jan-
Apr-
Jul-
Oct-
Full
Jan-
Apr-
Jul-
Oct-
Full
Jan-
Apr-
Jul-
Oct-
Full
Jan-
Apr-
Jul-
Mar Jun Sep Dec year
Mar
Jun
Sep
Dec
year
Mar
Jun
Sep
Dec
year
Mar
Jun
Sep
Consolidated Group
Net sales, SEK m
82
86
85
255
508
633
838
1,273
1,381
4,124
1,631
1,142
1,260
1,509
5,541
1,339
2,069
2,383
EBITDA, SEK m
42
40
35
156
273
226
207
215
326
974
619
390
418
518
1,945
495
965
969
Operational EBIT, SEK m
35
34
28
106
202
131
70
103
197
501
396
204
241
302
1,143
286
712
653
EBIT, SEK m
32
30
24
102
188
107
53
91
152
403
172
81
76
91
421
97
219
173
Profit after tax, SEK m
24
23
19
73
139
81
33
65
114
294
103
53
65
34
254
132
91
228
Number of shares (A&B), adjusted, million 1)
216
216
217
238
222
238
241
265
283
252
283
308
310
312
303
312
368
385
Earnings per share, SEK 1)
0.11
0.11
0.09
0.31
0.63
0.34
0.14
0.25
0.44
1.17
0.37
0.17
0.21
0.11
0.84
0.42
0.26
0.60
Adjusted Earnings per share, SEK 1)
0.12
0.12
0.10
0.33
0.68
0.42
0.19
0.28
0.55
1.50
1.00
0.51
0.65
0.68
2.82
0.97
1.51
1.80
Cash flow from operating activities, SEK m
30
22
29
99
179
700
165
-740
455
579
777
441
283
239
1,740
766
732
805
Free cash flow, SEK m
-
-
-
-
-
-
-
-
-
-
-
47
-116
-207
276
204
311
Sales growth, %
90%
62%
9%
99%
68%
673%
878%
1,403%
441%
713%
158%
36%
-1%
9%
34%
-18%
81%
89%
Organic growth, %
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
74%
51%
Organic growth, CCY, %
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
71%
61%
EBITDA, margin, %
51%
46%
41%
61%
54%
36%
25%
17%
24%
24%
38%
34%
33%
34%
35%
37%
47%
41%
Operational EBIT, margin, %
43%
39%
32%
41%
40%
20%
8%
8%
14%
12%
25%
18%
19%
20%
21%
21%
34%
27%
EBIT, margin, %
39%
35%
28%
40%
37%
17%
6%
7%
11%
10%
11%
7%
6%
6%
8%
7%
11%
7%
Gross Margin (Net sales-COGS), SEK m
57
61
55
186
360
313
372
378
542
1,604
889
614
625
762
2,889
673
1,309
1,349
Gross Margin, %
70%
72%
65%
73%
71%
50%
44%
30%
39%
39%
55%
54%
50%
51%
52%
50%
63%
57%
Net sales per business area
Games - THQ Nordic, SEK m
82
86
85
255
508
135
146
124
352
756
143
185
330
333
991
307
488
567
Games - Deep Silver, SEK m
-
-
-
-
-
257
338
252
187
1,033
794
373
442
467
2,076
515
613
507
Games - Coffee Stain, SEK m
-
-
-
-
-
-
-
-
14
14
98
83
45
36
261
82
172
130
Games - Saber, SEK m
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
349
259
Games - DECA Games, SEK m
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
33
Games, total
82
86
85
255
508
391
484
376
553
1,803
1,035
641
816
836
3,328
904
1,622
1,495
Partner Publishing/Film, SEK m
-
-
-
-
-
242
354
897
828
2,320
596
501
444
673
2,213
436
447
888
Net sales split - Games business area
Owned titles, %
67%
76%
74%
82%
77%
34%
39%
50%
72%
50%
84%
80%
78%
79%
80%
70%
74%
66%
Publishing titles, %
33%
24%
26%
18%
23%
66%
61%
50%
28%
50%
16%
20%
22%
21%
20%
30%
26%
34%
Owned titles, SEK m
55
66
63
208
391
134
189
188
396
907
871
510
637
657
2,675
633
1,194
994
Publishing titles, SEK m
27
20
22
47
116
257
295
188
157
897
164
131
179
178
653
270
428
501
New releases sales by each quarter, %
36%
16%
39%
74%
-
63%
20%
31%
58%
-
75%
18%
32%
35%
-
38%
45%
33%
Back catalog, %
64%
84%
61%
26%
-
37%
80%
69%
42%
-
25%
82%
68%
65%
-
62%
55%
67%
New releases sales by each quarter, SEK m
30
14
34
190
-
246
98
117
321
-
781
118
261
291
-
345
733
488
Back catalog, SEK m
52
72
51
65
-
145
386
259
232
-
254
524
555
545
-
559
889
1,007
Physical sales, %
49%
31%
44%
60%
50%
62%
50%
48%
59%
55%
39%
29%
26%
31%
32%
22%
26%
24%
Digital sales, %
51%
69%
56%
40%
50%
38%
50%
52%
41%
45%
61%
71%
74%
69%
68%
78%
74%
76%
Physical sales, SEK m
40
27
36
150
253
243
242
179
324
988
407
189
215
259
1,070
195
419
352
Digital sales, SEK m
42
59
49
102
251
148
242
197
229
815
628
452
601
577
2,258
709
1,203
1,143
Depreciation and amortization
Game development
-6
-6
-7
-43
-62
-59
-109
-80
-93
-341
-192
-162
-144
-133
-631
-148
-191
-222
Other intangible assets (Film etc.)
-33
-24
-27
-31
-115
-25
-16
-26
-76
-144
-53
-55
-43
Sub-total
-6
-6
-7
-43
-62
-92
-133
-107
-124
-455
-217
-179
-170
-209
-775
-201
-246
-265
Acquisition-related depreciation
IP-rights
-3
-3
-4
-4
-14
-11
-7
-9
-8
-33
-166
-69
-101
-123
-458
-67
-102
-104
Surplus value Partner Publishing/Film
-12
-10
-2
-9
-33
-15
-8
-12
-11
-46
-12
-15
-15
Goodwill
-1
-1
-2
-28
-32
-43
-45
-52
-77
-218
-110
-375
-401
Sub-total
-3
-3
-4
-4
-14
-24
-17
-13
-45
-99
-224-123-164-211-722
-189
-492
-521
Total intangible assets
-10
-9
-10
-47
-76
-116
-150
-120
-169
-554
-441
-302
-334
-420 -1,497
-390
-738
-786
Investments in intangible assets
External game development and advances, SEK m
54
44
59
54
212
115
114
132
167
528
189
225
166
152
732
193
209
172
Internal capitalized development, SEK m
13
14
19
33
80
58
94
102
106
359
116
131
177
221
645
224
248
273
Other intangible assets
-
-
-
11
11
12
31
18
31
91
20
22
43
46
131
40
41
39
IP-rights
-
-
4
-
4
-
0
22
11
32
0
0
6
0
7
8
0
0
Total
67
59
82
98
306
185
239
273
314
1,010
326
378
392
419
1,515
465
498
484
Completed games
Completed games, SEK m
1
2
40
134
176
123
47
50
162
383
220
168
104
152
644
165
253
311
Other KPIs
Total Game Dev projects
32
30
29
36
-
54
51
55
77
-
80
81
86
96
-
103
125
135
Announced Game Dev projects
14
13
13
12
-
19
17
20
29
-
32
34
37
44
-
43
52
53
Unannounced Game Dev projects
18
17
16
24
-
35
34
35
48
-
48
47
49
52
-
60
73
82
Total internal game developers
78
82
163
178
-
536
565
608
613
-
860
882
1,162
1,237
-
1,359
2,076
2,551
Total external game developers
282
306
261
229
-
714
692
740
871
-
807
946
1,110
1,021
-
1,006
1,109
1,042
Total internal employees, non-development
44
44
45
55
-
470
486
554
529
-
541
590
709
713
-
744
790
851
Total number headcount
404
432
469
462
-
1,720
1,743
1,902
2,013
-
2,208
2,418
2,981
2,970
-
3,109
3,975
4,445
Number of studios
Total number External Studios
-
-
-
-
-
18
29
26
26
-
42
48
55
58
-
58
55
56
Total number Internal Studios
-
-
-
-
-
10
10
10
10
-
17
18
18
20
-
26
33
46
Total number Studios
-
-
-
-
-
28
39
36
36
-
59
66
73
78
-
84
88
102
Total number of IP
-
-
-
-
-
91
106
107
119
-
136
138
148
154
-
160
174
195
Recalculated with respect to the 3:1 split carried out on October 8, 2019 as resolved at the annual general meeting on September 17, 2019. Number of shares for previous periods have been adjusted.
EMBRACER GROUP AB (PUBL) | JULY-SEPTEMBER 2020
29
Embracer Group is the parent company of businesses developing and publishing PC, console and mobile games for the global games market. Embracer Group has an extensive catalogue of over 190 owned franchises, such as Saints Row, Goat Simulator, Dead Island, Darksiders, Metro,
MX vs ATV, Kingdoms of Amalur, TimeSplitters, Satisfactory, Wreckfest, Insurgency and World War Z, amongst many others.
With its head office based in Karlstad, Sweden, Embracer Group has a global presence through its six operative groups: THQ Nordic GmbH, Koch Media GmbH/Deep Silver, Coffee Stain AB, Amplifier Game Invest, Saber Interactive and DECA Games. Embracer Group has 46 internal game development studios and is engaging more than 4,000 employees and contracted employees in more than 40 countries.
Embracer Group AB published this content on 18 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 November 2020 09:28:04 UTC
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