Interim Report January – September 2022

“Our hard work during the first half of the year continued during the third quarter as we juggled a slowing mobile gaming market, continued to support employees impacted by the war in Ukraine, and established a new development funnel for our games,” said Vlad Suglobov, CEO of G5 Entertainment. “Sherlock was a highlight again, delivering 104% growth year-over-year and 13% advance quarterly, in USD terms. Our expanding range of Own games now stands for 73% of sales compared to 66% one year ago. Gross Margin was a record 68%. Without the effects of the UA boost and the write-offs our Q3 EBIT margin would have been a stable 16%. Due to the changes to our development funnel, we have written off the full capitalized amounts for all games that have not been launched globally, in the total amount of SEK 73 M. These write-offs are due to the higher development funnel benchmarks, are one-time event, on paper only, have zero impact on our cash flow, and will not affect the decision on dividend. We have finished Q3 with the highest end cash position for the third quarter ever.”

July – September 2022

• Revenue for the period was SEK 359.9 M (327.6), an increase of 10 percent compared to the same period in 2021. In USD terms revenue declined 10 percent year-over-year.
• Gross margin increased to 68 percent (64 percent), as larger share of revenue is coming from own games and lower store fees, primarily from Microsoft.
• EBIT for the period was SEK -22.8 M (56.5). EBIT was significantly impacted by write-offs in the period.
• Write-offs amounted to SEK 72.5 M (0.0) primarily related to a change in the company's development funnel which is described in more detail in the report. Adjusted for non-cash write-offs, EBIT was SEK 49.7 M (56.5) corresponding to an EBIT margin of 14% (17).
• Net result for the period was SEK -26.1 M (50.0).
• Earnings per share for the period, before dilution, was SEK -3.11 (5.82).
• Cash flow amounted to SEK -50.9 M (-39.2), affected by share repurchases of SEK -28.2 M (-88.1) and delayed payments related to the UA boost in the second quarter.
• Cash amounted to SEK 182.3 M (130.9), which is the highest ever cash position at the end of the third quarter.
• Average Daily Active Users (DAU) was 1.8 million, unchanged compared to the same period in 2021. Average Monthly Active Users (MAU) was 6.4 million, a decrease of 4 percent compared to the same period in 2021. Average Monthly Unique Payers (MUP) was 181.8 thousand, a decrease of 8 percent while Average Monthly Average Gross Revenue Per Paying User (MAGRPPU) was USD 61.2, a decrease of 5 percent.

This disclosure contains information that G5 Entertainment AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014) and the Swedish Securities Markets Act (2007:528). The information was submitted for publication, through the agency of the contact person, on 09-11-2022 07:00 CET.

For additional information, please contact:
Vlad Suglobov, CEO, investor@g5e.com
Stefan Wikstrand, CFO, +46 76 00 11 115

About G5 Entertainment
G5 Entertainment AB (Publ) (G5) develops and publishes high quality free-to-play games for smartphones, tablets and personal computers that are family friendly, easy to learn, and targeted at the widest audience of both experienced and novice players. The company distributes its games through the G5 Store, Apple App store, Google Play, Amazon Appstore and Microsoft Store. The company’s portfolio includes popular games like Jewels of Rome®, Sherlock: Hidden Match-3 Cases, Jewels of the Wild West®, Hidden City®, Mahjong Journey®, The Secret Society® and Wordplay: Search Word Puzzle™.

Through its head entity G5 Entertainment AB (Publ), G5 Entertainment Group is publicly listed on Nasdaq Stockholm’s main market mid cap segment under trade symbol G5EN.ST. For six years in a row, G5 Entertainment was ranked in Deloitte’s Top 50 Fastest Growing Tech Companies in Sweden.

More information about G5 Entertainment can be found at: https://corporate.g5e.com