English

Continued stable profit and strong cash flow despite challenging advertising market

Report this content

FINANCIAL - 1 OCT 2022 – 31 dec 2022

  • Net sales amounted to MSEK 80.3 (MSEK 89.6), a decrease of 10.4%.
  • EBITDA amounted to MSEK 7.6 (MSEK 11.6), a decrease of 34%.
  • EBIT amounted to MSEK 6.3 (MSEK 10.6), a decrease of 40%.
  • Profit before tax amounted to MSEK 6.8 (MSEK 9.3), a decrease of 27%.
  • Cash flow from operating activities before changes in working capital amounted to MSEK 4.3 (MSEK 11.6) during the quarter.
  • Earnings per share during the quarter amounted to SEK 0.2 (SEK 0.3)

FINANCIAL - 1 JAN 2022 – 31 dec 2022

  • Net sales amounted to MSEK 289.8 (MSEK 199.3), a growth of 45%.
  • EBITDA amounted to MSEK 32.1 (MSEK 27.4), an increase of 17%.
  • EBIT amounted to MSEK 27.3 (MSEK 24.7), an increase of 11%.
  • Profit before tax amounted to MSEK 26.2 (MSEK 23.5), an increase of 11%.
  • Cash flow from operating activities before changes in working capital amounted to MSEK 27.8 (MSEK 24.2).
  • Earnings per share during the period amounted to SEK 1.0 (SEK 0.8)

CEO comment

Continued stable profit and strong cash flow despite a challenging advertising market

M.O.B.A. Network had a turnover of SEK 80.3 million (-10%) with an EBITDA of SEK 7.6 million during the year's fourth quarter. The uncertain market situation meant that the rise in digital advertising that we usually see in the last quarter of the year did not occur, and we note that the advertising market was very strong in the fourth quarter of 2021. At the same time, we know that the gaming industry has a strong attractiveness, and we expect a market recovery over time. After the quarter, M.O.B.A. Network's shares started trading on the OTCQX and are now available to investors in North America.

The global economy negatively affected the digital advertising market during the fourth quarter, and inflation and the interest rate situation have negatively affected costs and margins. We follow our long-term strategy and have continued to invest in the business according to plan, affecting the cost base in the short term but strengthening our growth going forward.

Despite strong headwinds in the market, we continue to deliver profit, positive cash flow, and earnings per share. It shows that our long-term focus on profitability with good cost control is paying off.

Our strategy is developed so that every business area, regardless of the market situation, has the prerequisites for solid growth when the market turns upwards. The gaming industry continues to have a strong attractiveness, in our opinion. Furthermore, experience from previous downturns, such as during Covid, has shown that it does so quickly and powerfully when recovery occurs.

Our strategy is to constantly broaden our offer to content creators to create opportunities for increased advertising sales and audience. Today, we have a strong position on YouTube through the Union For Gamers (UFG) network. We see growth opportunities and opportunities to gain access to an expanded audience via platforms such as Tiktok and Twitch. The growth potential on these platforms is great, and we are making progress by creating more partnerships and building more relationships with content creators. This strategy will be in place for a long time to come.

We also work long-term to attract more audiences to our web-based brands. An example is our well-known brand MobaFire.com. Since the high levels during Covid, when we broke several records in terms of audience growth, we have not seen an increasing trend, which means that we are investing in an expanded content plan and stronger collaborations with selected profiles. Several of our other brands, for example ResetEra and MMORPG, consistently deliver good numbers, but we generally believe that all of our brands have growth potential, which is something we are aiming to achieve every day.

During the first quarter, we will launch some exciting partnerships that will be positive for our long-term growth, both for our web-based brands and the content creator business.

Interesting M&A-market

In line with our strategy, we continue to look at exciting acquisition opportunities that meet our acquisition criteria. A positive effect of the market situation is that we see more interesting cases with attractive valuations in the M&A market. We also notice reduced competition around potential acquisitions, as other previously active players in the market who focused more on growth than profitability find it challenging to participate in acquisition dialogues.

Trading on OTCQX - OTC Markets Group

We have seen increased interest in the M.O.B.A Network from investors in North America and therefore applied to have the shares tradable on the OTCQX, the trading platform for securities not listed on a national exchange. From January 25, 2023, the company is available to investors in North America, which makes it easier for international investors and institutions to have exposure to the M.O.B.A Network. Trading on QTCQX also opens opportunities to be present on the capital market in North America and provides more significant opportunities to acquire companies with an equity component.

Looking ahead

I am satisfied that under the current market situation, we continue to show profitability and positive cash flow and have a strong balance sheet with a cash balance of SEK 48 million.

M.O.B.A. will continue to act according to our long-term strategy, invest in the business, and evaluate attractive acquisitions that meet our criteria. Our entire global team is motivated and working focused together to deliver the best experiences for gamers worldwide. The team and I look forward to the coming years with confidence!

Significant events during the period 1 October 2022 – 31 December 2022, in brief

  • The company applied to have the shares tradable on the OTCQX in the United States. OTCQX is a US trading platform operated by OTC Markets Group for securities not available on a national exchange. The purpose of being admitted to trading on the OTCQX is to satisfy an increasing interest from American investors and to increase accessibility to the American capital market. Upon possible approval, M.O.B.A.'s shares will be traded with an American ticker symbol and a share price in USD..

Significant events after the period 1 October 2022 – 31 December 2022

  • The company was approved to enter stock trading on the OTCQX trading platform in the United States, trading of the stock on OTCQX will start on January 25, 2023. M.O.B.A.'s shares will trade on OTCQX under the ticker “MOBNF”. U.S. investors can now find up-to-date financial information and real-time stock trading information for M.O.B.A. stock at www.otcmarkets.com.
  • The Board proposes that no dividend be paid for the period January 2022 - December 2022. The Board intends to continue applying a growth-oriented strategy, including organic growth and an offensive acquisition strategy.

This disclosure contains information that M.O.B.A Network AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 15-02-2023 07:30 CET.

Stockholm 2023-02-15

Björn Mannerqvist, CEO

Mail: info@wearemoba.com

Web: https://wearemoba.com

Certified Adviser - FNCA Sweden AB

M.O.B.A Network AB acquires, develops and operates gaming communities for the global gaming market. The company owns one of the world's largest networks in gaming communities, with 20 web-based global brands and the YouTube network Union For Gamers (UFG) with over 1,000 content creators. The company's business areas consist of advertising sales on the company's communities and video sales via the YouTube network.

Subscribe

Documents & Links