Nitro Games Oyj : Interim Report Jan – Sep 2021 EN

Interim	Report

		2021	/ NITRO	GAMES	OYJ
	- SEPTEMBER
JANUARY

The Interim Period January - September 2021

•

• Revenues (Jan - Sep): 1 404,6 KEUR (1 085,5 KEUR).
• EBITDA: -2 059,9 KEUR (-1 449,4 KEUR).
• EBIT: -2 474,5 KEUR (-1 791,9 KEUR).
• Net result: -2 490,5 KEUR (-1 806,8 KEUR).
• Earnings per share (EPS) -0,2(-0,2).
• Cash and cash equivalents: 3 666,6 KEUR (30 September 2021). (Numbers in brackets refer to the corresponding year-on-year period)

July - September 2021

• Revenues (Jul - Sep): 969,1 KEUR (100,8 KEUR).
• EBITDA: -512,1 KEUR (-819,5 KEUR).
• EBIT: -626,1 KEUR (-933,7 KEUR).
• Net result: -633,7 KEUR (-936,7 KEUR).
• Earnings per share (EPS) -0,1(-0,1).
  (Numbers in brackets refer to the corresponding year-on-year period)

Significant Events During July - September 2021

• Signed & started a new project with Snap to develop and bring a new game to the Snapchat platform.
• Signed approx. 2,2 million EUR development agreement with Digital Extremes for an unannounced project.
• Signed approx. 600 000 EUR mobile game development agreement with a UK-based PC and console games developer.

Significant Events After Period

• Signed approx. 200 000 EUR expansion to a game development service agreement with a US-based mobile games publisher.

Solid Progress Continues

•

"We've continued our solid progress throughout the year, on all fronts of our business. This reflects in the step-by-step increase in revenues, improving EBITDA, increasing the number and value of B2B customers, increasing the number of games in our portfolio, and most importantly; increasing the amount of professional talent in our teams globally.

Overall, the third quarter was a good step forward on all fronts. This is the right direction, but we're far from satisfied. We seek to continue delivering sequential improvements towards profitability, while we keep executing our long-term strategy towards our vision. I'm looking forward to continuing our journey and delivering shareholder value long-term."

says Jussi Tähtinen, CEO of Nitro Games.

About Nitro Games

•

Nitro Games is a free-to-play mobile game developer and publisher. Nitro Games team is a multinational group of mobile gaming professionals that has the expertise from development to publishing to live-operations. The Company focuses on producing mobile games with high production value for mid-core audience. Nitro Games is specialized in the category of shooter games. With Nitro Games' powerful NG Platform and the NG MVP process, the Company

is able to carry out market validation with its games during development. Nitro Games has developed games based on its own IP such as Lootland, Heroes of Warland, Medals of War, Raids of Glory. The company offers its services also to selected customers and has developed several successful projects to leading mobile gaming companies.

Nitro Games' shares are listed on Nasdaq First North Growth Stockholm with the ticker NITRO. The Certified Adviser is FNCA Sweden AB, [e-mail], [phone].

www.nitrogames.com

Finnish Business ID: FI21348196

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Key Financials

	Jul-Sep	Jul-Sep	Jan-Sep	Jan-Sep	Full Year
	2021	2020	2021	2020	2020
					(Audited)
Revenue (EUR thousand)	969,1	100,8	1 404,6	1 085,5	1 171,3
Operating profit/loss (EUR thousand)	-626,1	-933,7	-2 474,5	-1 791,9	-2 783,2
Operating profit/loss % (EBIT %)	-64,6 %	-926,4 %	-176,2 %	-165,1 %	-237,6 %
EBITDA (EUR thousand)	-512,0	-819,6	-2 059,9	-1 449,4	-2 326,6
EBITDA %	-52,8 %	-813,1 %	-146,7 %	-133,5 %	-198,6 %
Net profit /loss (EUR thousand)	-633,7	-936,7	-2 490,5	-1 806,8	-2 810,9
Cashflow generated from operations (EUR thou-	-942,9	-781,0	-2 620,2	-1 346,4	-1 514,7
sand)
Equity ratio (%)	33,0 %	40,5 %	33,0 %	40,5 %	25,0 %
Number of shares, average	10 668 934	8 326 230	9 908 204	6 671 818	7 089 966
Number of shares at the end of the period	10 668 934	8 326 230	10 668 934	8 326 230	8 326 230
Number of Share options	1 344 236	1 286 236	1 344 236	1 286 236	1 287 736
Equity per share (EUR)	0,2	0,3	0,2	0,3	0,2
Earnings per share (EUR) undiluted	-0,1	-0,1	-0,2	-0,2	-0,3
Earnings per share (EUR) diluted	-0,1	-0,1	-0,2	-0,2	-0,3
Net debt (EUR thousand)	1 261,9	-313,4	1 261,9	-313,4	1 500,9
Number of employees	36	37	37	36	36

Word From Jussi Tähtinen, CEO

Solid progress continues

We've continued our solid progress throughout the year, on all fronts of our business. This reflects in the step-by-step increase in revenues, improving EBITDA, increasing the number and value of B2B customers, increasing the number of games in our portfolio, and most importantly; increasing the amount of professional talent in our teams globally.

Our revenues continued to increase, both year-on-year and compared to our previous quarter this year. We also continued our step-by-step improvement on our EBITDA. These are steps in the right direction and sequential improvements towards profitability.

These improvements in our financial position are a direct result of the good job we've been doing in business development and our B2B service business. During and after the quarter we've succeeded in signing follow-up orders with our existing customers, as well as in gaining new customers. This is part of our strategy, where we're seeking to decrease the volatility and risk by diversifying our B2B project portfolio. Naturally, these new follow-up agreements also act as a validation for the quality of our work.

Parallel to our B2B service business, we've also been hard at work with the other leg of our strategy; our game portfolio. We seek to deliver a portfolio of action and shooter games to have several shots on goal in the hit-drivenfree-to- play mobile market. Our game lifecycle funnel is very data driven. We validate our progress in smaller steps and determine our next steps based on the data & learnings, rather than following preset schedules through the game lifecycle. During the quarter we have focused on doing market testing and preparing for upcoming soft launches. Our first game with Snap has now successfully completed the production phase and is currently at the beginning of the soft-launch phase. We're excited to progress through this phase and see the results of the soft launch, as this is our first time working on this new instant gaming platform. The other games in our portfolio are progressing well, and we're preparing for more soft launches moving forward. We've also increased our level of activity in the early stages of our game funnel, to ensure we have a constant flow of

new game concepts to take to our MVP process for market

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validation. These are important investments that help us secure a strong lineup of new releases for 2022 and beyond.

During the quarter, we've strengthened our team with new hires in business development, as we seek to expand our sales activities. Parallel to that, we are expanding our network of partner studios to secure the required resources. Our shared processes and technology ensure we maintain high quality on all fronts, while we plan to keep our in-house team lean and effective. This setup allows us to expand the number of projects we work on in a scalable way.

Overall, the third quarter was a good step forward on all fronts. This is the right direction, but we're far from satisfied. We seek to continue delivering sequential improvements towards profitability, while we keep executing our long- term strategy towards our vision. I'm looking forward to continuing our journey and delivering shareholder value long-term.

Jussi Tähtinen, CEO