Quarterly Report July - September 2019 Everysport Media Group AB (publ)

Results continue to improve

This is a translated version of the Swedish original, in case of deviations is the Swedish version considered to be the one to apply.

This information is such information that Everysport Media Group AB (publ.) Is required to publish in accordance with the EU Market Abuse Regulation.The information was provided, through the agency of the above contact person, for publication on October 24th, 2019.

Summary of the third quarter 2019

• Net sales: 21,0 mkr (20,6 mkr)

• EBITDA: 2,7 mkr (2,3 mkr)

• Profit after tax -0,7 mkr (-1.0 mkr)

• Earnings per share: -0,01 kr (-0,01 kr)

• Cashflow from operating activities: 0,5 mkr (1,7 mkr)

Summary of the first nine months 2019

• Net sales: 67,6 mkr (65,8 mkr)

• EBITDA: 6,5 mkr (6,3 mkr)

• Profit after tax: −3,5 mkr (−3,6 mkr)

• Earnings per share: −0,03 kr (−0,03 kr)

• Cashflow from operating activities: 1,7 mkr (4,4 mkr)

CEO, Hannes Andersson, comments:

The high level of activity from the first half of the year continued during the third quarter. The declining advertising market was offset by successful launches of subscription services and other consumer products, where growth was strong and delivered with high margin.

Growth in our primary focus areas led to an EBITDA of SEK 2.7 million (SEK 2.3 million) for the group, which is the highest achieved EBITDA during a quarter in the company's history.

Through our media platform, Everysport Media Platform (EMP), new versions of FotbollDirekt and HockeySverige were launched, as well as premium services for each product. A number of new features were launched at Eliteprospects, which will contribute to an increase in premium subscribers on the site. We continued to invest in new products and services, that builds a platform for future growth.

One of our priorities is to implement our strategy both in Sweden and internationally. We see an increase in demand for our services in our neighboring countries, which builds a foundation for further expansion. Growth in North America remain strong. Our largest site, Eliteprospects, grew by 67% in the US in the third quarter compared to previous year, 58% in Canada and is now visited by half a million unique visitors per week from the region.

In digital advertising, the trend in the Swedish market has been somewhat declining, primarily due to the reduced activity of iGaming companies as a result of tougher regulations. However, we see an increased demand for high quality content and other creative solutions from the same companies, who are planning to increase their investments in 2020, when larger sports events take place (European Championship in football, Summer Olympics).

We look bright on the future and are optimistic about our goal of establishing a leading market position within both sports media and iGaming information. ESMG is well equipped to continue to show growth, both in Sweden and internationally, when we look at an eventful 2020.

Forward-looking statement

The forward-looking statements is left unchanged, compared to previous report.

We will continue to invest in existing and new products and strengthen our positions both in Sweden and internationally. Investments will increase the group’s mass of costs in the short run and it can take a few quarters until revenues match the costs associated with these investments. That being said, our assessment is that the group on a full-year basis in 2019 will increase sales compared to 2018 and achieve an EBITDA result higher than 2018 on a full year basis.

Significant events during and after the end of the period

On September 18, the Board of Directors called an Extraordinary General Meeting to decide on a merger of shares, where 25 shares were proposed to be merged into one. In order to carry out a merger of shares, the articles of association were required to be amended. The Extraordinary General Meeting was held on October 18, and the Board's proposal to amend the Articles of Association, the aggregation of shares and the Board's authorization to carry out the aggregation of shares were voted on.

Net Sales, earnings and financial position during the period

Net Sales

Net sales for the second quarter amounted to SEK 21.0 million (SEK 20.7million). An increase of 1,8% compared with the same quarter last year.

Despite a declining trend in digital advertising in Sweden, the Group's sales increased overall during the third quarter due to growth in new products and markets.

EBITDA and EBIT

EBITDA for the third quarter amounted to SEK 2,7 million (SEK 2,3 million).

Although investments in new products and markets have led to increased personnel and other costs, EBITDA earnings have improved as a result of growth in new products with a higher margin. The investments have not only had a positive impact in the short term, but they are also strategically important from a long-term value-creating perspective. The variable operating costs have decreased as a result of the completion of a number of external sales assignments, which in the past led to high commission costs.

EBIT for the third quarter amounted to SEK 2019 million to SEK -0.5 million (SEK -0,8 million). The EBIT result during Q2 2019 is affected by depreciation of goodwill and development projects of SEK -3.1 million (SEK -3.1 million).

Amortization of goodwill will continue as long as the company applies the K3 regulations and there is still balance of goodwill. Depreciation is not affecting cash flow.

Capitalized work on own account during the quarter amounts to SEK 1.0 million (SEK 0.1 million)

Financial position

At the end of the period, Everysport Media Group AB (publ.) has equity of SEK 12.7 million (SEK 16.9 million) and an equity ratio of 26% (31%)

Cash and cash equivalents at the end of the period were SEK 2.7 million (2.9).

Share and shareholders

As of the date on 30th of September, 2019, 113,562,412 shares were issued. All shares have equal rights to the company's profit and assets.

Decision has, through the extraordinary general meeting of 2018-01-16, been adopted to adopt an incentive program for the Board of Directors and an incentive program for the CEO and other senior executives and certain employees of Everysport Media Group (publ.). The incentive programs entail an issue of a maximum of 6,754,847 warrants. Each warrant entitles the holder to convert for one new share in the company at a price of SEK 0.57 per share. The exercise of the warrants shall be possible during the period from January 13, 2020 to June 13, 2020.

The total number of shares at full future dilution amounts to 120,317,259.

At the end of the third quarter, Everysport Media Group AB (publ.) had 855 shareholders.

Employees

The average number of full time equivalents during the period was 66.

Accounting principles

The consolidated accounts for Everysport Media Group AB have been drawn up in accordance with the K3 regulatory framework.

Audit

This report has not been reviewed by auditors.

Further reporting dates

The quarterly report for the period October - December 2019 will be published on the 20th of February 2020.

The quarterly reports for Everysport Media group are published on the company’s website www.esmg.se

Stockholm 2019-10-24

Hannes Andersson

CEO

For further information, please contact:

Hannes Andersson
CEO
Phone: +467 07 36 56 25
E-mail: hannes.andersson@esmg.se