World of Adventures™

December 19, 2014

Bulletin from Extraordinary General Meeting in G5 Entertainment AB (publ.)

An extraordinary general meeting of G5 Entertainment AB (publ) was held at Hotel Kung Carl, Birger Jarlsgatan 21 in Stockholm, on December 19, 2014.

Petter Nylander was elected chairman of the meeting.

The meeting decided on the issue of up to 176,000 warrants. The right to subscribe for the warrants shall, with deviation from shareholders’ preferential rights, be given to managers and senior executives. The program shall include a maximum of 20 employees. Each warrant will entitle the holder to subscribe for one (1) share in the company at an issue price of 300 per cent of the volume-weighted average quoted closing price during the period from and including January 7, 2015 to and including January 16, 2015 on Nasdaq Stockholm’s list for shares in G5. Upon full exercise of the warrants, up to 176,000 shares (subject to any recalculation), equivalent to about two percent of the total number of outstanding shares and voting rights, will be issued. If fully subscribed, the company's share capital will increase by SEK 17 600, resulting in a dilution of two percent. Board members are not entitled to subscribe for warrants with the exception of the company's CEO.

The decision was unanimous.

More information about the Company can be found on www.g5e.se/corporate.

For additional information please contact:
Odd Bolin, CFO, +46 70 428 3173

PDF

November 19, 2014

Notice of Extraordinary General Meeting for decision on warrants to management and senior executives.

Notice has today been issued to an Extraordinary General Meeting of G5 Entertainment AB (publ.) (the "Company"), reg. no 556680-8878. The EGM will be held at 2 pm (CET) on Friday, December 19, 2014, at Hotel Kung Carl, Birger Jarlsgatan 21, Stockholm, Sweden. Registration will commence at 1.30 pm.

Shareholders who wish to participate at the annual general meeting must:

  • be recorded in the share register maintained by Euroclear Sweden AB on Friday, December 12, 2014 (the record date is Saturday, December 13, 2014);
  • no later than 4 pm (CET) Thursday, December 18, 2014, have given notice of their participation and potential assistants to G5 Entertainment AB, Riddargatan 18, 114 51 Stockholm, or by e-mail egm@g5e.se.

The purpose of the EGM is to decide on issuance of warrants to management and senior executives. The entire notice is available at the Company’s website (http://www.g5e.com/corporate). It will also be sent free of charge by mail to those shareholders who contact the Company on any of the above ways and ask for summons by mail and provide an address.

This information was sent for publishing 8 am on Wednesday, November 19, 2014.

More information about the Company can be found on http://www.g5e.se/corporate.

For additional information please contact:
Odd Bolin, CFO, +46 70 428 3173

PDF

November 07, 2014

Magnus Uppsäll chairman of G5’s nomination committee

G5 Entertainment’s nomination committee has elected Magnus Uppsäll as its chairman.

In addition to Magnus Uppsäll, who represents Proxima Limited, the nomination committee consists of

  • Petter Nylander (representing Wide Development Limited)
  • Jeffrey Rose (representing Purple Wolf Limited)
  • Christoffer Häggblom, Rite Internet Ventures
  • Marianne Flink (representing Swedbank Robur)

Shareholders wishing to submit proposals to G5 Entertainment’s nomination committee may do so by mail to G5 Entertainment AB (publ), Riddargatan 18, 114 51 Stockholm, Sweden or by e-mail to nomination@g5e.se. Please note that proposals must be received by the nomination committee no later than March 1, 2015.

Inquiries:
Odd Bolin, CFO, +46 70 428 3173

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October 31, 2014

Interim Report January-September 2014

July-September 2014

  • Consolidated revenue for the period is 44 653 (21 910) kSEK, an increase of 104% compared to the same period 2013.
  • Operating result for the period is -846 (-4 637) kSEK. Excluding write-downs and re-listing expenses the operating result was 1 966 kSEK.
  • Net result for the period is -2 209 (-3 595) kSEK.
  • Earnings per share for the period before and after dilution is -0.25 (-0.41) SEK.
  • Cash flow before financing activities during the period is 7 527 (-5 231) kSEK.
  • The result for the period is affected by write-downs of capitalized development costs and advances to external developers in the amount of 2 443 kSEK.

January-September 2014

  • Consolidated revenue for the period is 124 399 (71 289) kSEK, an increase of 74% compared to the same period 2013.
  • Operating result for the period is 6 663 (8 692) kSEK. Excluding write-downs and re-listing expenses the operating result is 10 884 kSEK.
  • Net result for the period is 3 559 (7 635) kSEK.
  • Earnings per share for the period before and after dilution is 0.40 (0.88) SEK.
  • Cash flow before financing activities during the period is 5 349 (-13 693) kSEK. This includes fees of 1 778 kSEK to advisors in connection with the listing on Nasdaq Stockholm.
  • The result for the period is affected by write-downs of capitalized development costs and advances to external developers in the amount of 2 443 kSEK.

Important events during the third quarter

  • G5 has during the quarter shown substantial and profitable growth, and generated record monthly and quarterly revenue.
  • Revenue from free-to-play games grew 147% compared to 13Q3, and accounted for 77% of total revenue in 14Q3 (54% in 13Q3).
  • Revenue from unlockable games was slightly lower than in 14Q2 but stable.
  • The accumulated number of downloads of the group’s games (not counting updates) surpassed 180 million.
  • The group continued working on improving free-to-play games in its portfolio and working on new free-to-play games.

Important events after the end of the period

  • In free-to-play business model, the group’s increased marketing spending allows balancing the inflow of new users during the "low" season in the application stores and accelerate user acquisition during the "high" season. During 14Q3 and after the end of the period, many new great hardware devices, smartphones and tablets, were announced and/or launched to the market in time for the holidays, which should benefit the installed base of devices G5 games are addressing. With the new higher level of marketing expenses and new game updates and releases coming out, the management is looking forward to 14Q4 and 15Q1, historically the strongest quarters in the year.
  • The company continues to work on upcoming new free-to-play games, with the aim to have more than 10 free-to-play games in the portfolio before 2015. Most of new games that are scheduled to come out before the end of the year are owned by G5 and developed either internally or by 3rd party studios under work-forhire
    contracts.
  • The group’s office in Kharkov continues business as usual. It is the group's policy to keep critical code and materials backed up outside Ukraine, keep intellectual property rights in EU entities, and transfer funds to subsidiaries on as-needed basis.

For further information, please contact:
Vlad Suglobov, CEO, investor@g5e.com
Odd Bolin, CFO, +46 70 428 3173

PDF

October 08, 2014

Preliminary results July-September 2014

Based on the information available, for the period July-September 2014, the management forecasts quarterly revenue* of approximately 44 MSEK, which corresponds to achieving 101% revenue growth compared to the same period of 2013.

* G5 reports revenue net of application store fees, which may represent up to 30% of end user price.

The group’s interim report for the period January-September 2014 is going to be released on October 31, 2014.

More information about the company can be found at: www.g5e.se/corporate
For additional information please contact:
Vlad Suglobov, CEO, investor@g5e.se
Odd Bolin, CFO, +46 70 428 3173

PDF

August 15, 2014

Interim Report January-June 2014

April-June 2014

  • Consolidated revenue for the period is 40 635 (21 822) kSEK, an increase of 86% compared to the same period 2013.
  • Operating result for the period is 2 353 (3 387) kSEK. Excluding re-listing expenses the operating result was 3 492 kSEK.
  • Net result for the period is 1 740 (3 241) kSEK.
  • Earnings per share for the period before and after dilution is 0.20 (0.37) SEK.
  • Cash flow before financing activities during the period is -9 365 (-5 314) kSEK. This includes a tax payment for which a refund in excess of 4 MSEK is expected during the third quarter, and fees in excess of 1 MSEK to advisors in connection with the listing on NASDAQ OMX Stockholm.

January-June 2014

  • Consolidated revenue for the period is 79 746 (49 379) kSEK, an increase of 61% compared to the same period 2013.
  • Operating result for the period is 7 509 (12 817) kSEK. Excluding re-listing expenses the operating result is 8 918 kSEK.
  • Net result for the period is 5 768 (11 230) kSEK.
  • Earnings per share for the period before and after dilution is 0.66 (1.32) SEK.
  • Cash flow before financing activities during the period is -2 178 (-8 339) kSEK. This includes a tax payment for which a refund in excess of 4 MSEK is expected during the third quarter, and fees in excess of 1 MSEK to advisors in connection with the listing on NASDAQ OMX Stockholm.

Important events during the second quarter

  • On June 10, the shares of G5 Entertainment AB (short name: G5EN), a small cap company within the technology sector, started trading on the main market of NASDAQ OMX Stockholm.
  • G5 has during the quarter shown substantial and profitable growth, and generated record monthly and quarterly revenue.
  • Revenue from free-to-play games grew 202% compared to 13Q2, and accounted for 71% of total revenue in 14Q2 (43% in 13Q2).
  • Revenue from unlockable games was slightly lower than in 14Q1 but seems to have stabilized.
  • The accumulated number of downloads of the group’s games (not counting updates) surpassed 170 million.
  • The group continued working on improving free-to-play games in its portfolio and working on new free-to-play games.

Important events after the end of the period

  • The management is growing increasingly confident that going forward seasonality is not going to affect the revenue as much as it did in previous years. The group’s increased marketing spending allows balancing the inflow of new users during the "low" season in the application stores.
  • The company continued to work on upcoming new free-to-play games, with the aim to have more than 10 free-to-play games in the portfolio before the end of 2014. Most of new games that are scheduled to come out before the end of the year are owned by G5 and developed either internally or by 3rd party studios under work-for-hire contracts.
  • The group’s office in Kharkov continues business as usual. It is the group's policy to keep critical code and materials backed up outside Ukraine, keep intellectual property rights in EU entities, and transfer funds to subsidiaries on as-needed basis.

For further information, please contact:
Vlad Suglobov, CEO, investor@g5e.com
Odd Bolin, CFO, +46 70 428 3173

PDF

July 21, 2014

Postponement of warrant issue

The board of G5 Entertainment AB (G5) has decided to postpone the issue of new warrants to employees that was resolved during the annual general meeting on May 20.

The board has concluded that considering the development of the price of the G5 share since the annual general meeting, the terms of the issue have become such that its purpose, namely to offer key employees an attractive yet affordable incentive to contribute to the company’s long-term success, won’t be achieved as intended.

The board intends to make a new proposal for an issue of warrants with updated terms, for the shareholders to approve later during the fall.

More information about the company can be found at: www.g5e.se/corporate
For additional information please contact:
Vlad Suglobov, CEO, investor@g5e.se
Odd Bolin, CFO, +46 70 428 3173

PDF

July 07, 2014

Preliminary results April-June 2014

Based on the information available, for the period April-June 2014, the management forecasts quarterly revenue* of approximately 40 MSEK, which corresponds to achieving 83% revenue growth compared to the same period of 2013.

*G5 reports revenue net of application store fees, which may represent up to 30% of end user price.

The group’s interim report for the period January-June 2014 is going to be released on 15th August 2014.

More information about the company can be found at: www.g5e.se/corporate
For additional information please contact:
Vlad Suglobov, CEO, investor@g5e.se
Odd Bolin, CFO, +46 70 428 3173

PDF

June 09, 2014

G5 Entertainment approved for listing on NASDAQ OMX Stockholm

NASDAQ OMX Stockholm’s Listing Committee has approved an application for listing of G5 Entertainment AB’s (publ) (“G5 Entertainment” or “the Company”) shares on NASDAQ OMX Stockholm, Small Cap. Trading is expected to commence on June 10, 2014.

As a result of the listing on NASDAQ OMX Stockholm, the trading of G5 Entertainment’s shares on Aktietorget will be discontinued. Last day of trading on Aktietorget is expected to be on June 9, 2014. Shareholders do not need to take any action in conjunction with the listing and the share will be traded under the same ticker symbol, G5EN. No new shares will be issued in conjunction with the listing.

G5 Entertainment has developed a business model that is both successful and scalable, as illustrated by the Company’s history. Coupled with the underlying market conditions and trends in the mobile games market, the Company is optimistic about the future.

The listing will provide G5 Entertainment with further access to the Swedish and international capital markets to support its growth and continued development. The Board of Directors expects that the listing of the shares will generate increased attention and brand awareness among existing and potential customers, developers and consumers. Moreover, the larger institutional investor base active on NASDAQ OMX Stockholm will allow the Company to attract capital at a lower cost and with greater ease, should external capital be needed.

A prospectus for the listing will be published on June 10, 2014 and made available on the Company’s website, www.g5e.com.

For further information, please contact:
Vlad Suglobov, CEO, investor@g5e.com
Odd Bolin, CFO, +46 70 428 3173

PDF

May 21, 2014

Bulletin from Annual General Meeting in G5 Entertainment AB (publ.)

The annual general meeting of G5 Entertainment AB (publ) was held at Hotel Kung Carl, Birger Jarlsgatan 21 in Stockholm, on May 20, 2014.

Petter Nylander was elected chairman of the meeting. During the meeting CEO Vlad Suglobov gave a presentation of the 2013 financial year and the current status of G5 Entertainment AB.

The meeting approved the parent company and consolidated financial statements. These can be found in G5 Entertainment AB’s annual report for 2013. The meeting decided unanimously to discharge the board and the CEO from liability for the financial year 2013. The meeting also decided that the profit for the year should be carried forward. 

Pär Sundberg, Vlad Suglobov, Petter Nylander, Martin Bauer and Jeffrey Rose were reelected as members of the board. Petter Nylander was appointed chairman of the board. It was resolved that the remuneration to the board should comprise of SEK 240 000 to the chairman and SEK 150 000 to each of the other members appointed by the general meeting and not employed by the company. It was also resolved that fees for the upcoming term, in addition to directors ' fees, shall be paid to the members of the company's Audit Committee, and that the fee to the chairman of the Audit Committee shall amount to SEK 30 000 and SEK15 000 each to be paid to the other members of the Audit Committee.

The meeting resolved to adopt new Articles of Association which includes the following changes and additions: (a) the ability to appoint deputies is eliminated (§ 7), (b) the notice period of extraordinary general meeting will be extended to at least three weeks (§ 9), and (c ) certain clarifications and editorial changes to § 11.

The meeting resolved to adopt the Board’s proposal for guidelines for remuneration to senior executives.

The meeting resolved to adopt the Nomination committee’s proposal for supplementing of the guidelines for the appointment of the Nomination committee.

The meeting resolved to authorize the board for the period until the next annual general meeting, on one or more occasions, to decide to issue a maximum of 880 000 shares in order to facilitate acquisitions and raising capital.

The meeting also decided on the issue of up to 176,000 warrants. The right to subscribe for the warrants shall, with deviation from shareholders’ preferential rights, be given to managers and senior executives. The program shall include a maximum of 20 employees. Each warrant will entitle the holder to subscribe for one (1) share in the company at an issue price of 150 per cent of the volume-weighted average quoted closing price during the period from and including May 21, 2014 to June 3, 2014 on Aktietorget’s list for shares in G5. Upon full exercise of the warrants, up to 176,000 shares (subject to any recalculation), equivalent to about two percent of the total number of outstanding shares and voting rights, will be issued. If fully subscribed, the company's share capital will increase by SEK 17 600, resulting in a dilution of two percent. Board members are not entitled to subscribe for warrants with the exception of the company's CEO.

All decisions were unanimous


More information about the Company can be found on www.g5e.se/corporate.

For additional information please contact:
Odd Bolin, CFO, +46 70 428 3173

PDF

May 15, 2014

Interim Report January-March 2014

January-March 2014

  • Consolidated revenue for the period is 39 111 (27 557) kSEK, an increase of 42% compared to the same period 2013.
  • Operating result for the period is 5 156 (9 430) kSEK.
  • Net result for the period is 4 029 (7 989) kSEK.
  • Earnings per share for the period before and after dilution is 0.46 (0.97) SEK.
  • Record cash flow before financial activities during the period, 7 187 (-3 148) kSEK.

Important events during the first quarter

  • G5 has returned to profitable growth while generating record monthly and quarterly revenue and record positive cash flow before financial activities.
  • Revenue from free-to-play games grew 254% compared to 13Q1, and accounted for 66% of total revenue in 14Q1 (27% in 13Q1).
  • Revenue from unlockable games was stable during the quarter.
  • The accumulated number of downloads of the group’s games (not counting updates) surpassed 150 million.
  • The group continued working on improving the free-to-play games in its portfolio and working on new free-to-play games.
  • Preparations for the listing on Nasdaq OMX Stockholm, including implementing committees and structures in compliance with the Swedish Corporate Governance Code, are ongoing. Completing such preparations is a prerequisite for accomplishing the listing.

Important events after the end of the period

  • Historically, G5 has seen pronounced seasonality Q1 to Q2, where the first quarter would be strong due to inflow of new users after the holiday period, and then the second quarter would be weaker. The decline in revenue 13Q1 to 13Q2 constituted 21%. In 2014 no such pronounced seasonality is evident. While the organic inflow of new users has declined in Q2, the increased user acquisition expenses (almost five-fold growth April 2013 to April 2014) now produce substantial inflow of new users. A larger percentage of free-to-play games in the portfolio helps maintain the revenue, as in free-to-play games players are monetized over much longer periods of time compared to unlockable games.
  • The group’s office in Kharkov continues business as usual. It is the group's policy to keep critical code and materials backed up outside Ukraine, keep intellectual property rights in EU entities, and transfer funds to subsidiaries on as-needed basis.

Inquiries:
Vlad Suglobov, CEO, investor@g5e.com
Odd Bolin, CFO, +46 70 428 3173

PDF

April 25, 2014

Dividend policy and financial targets

The Board of Directors of G5 Entertainment AB has on April 24, 2014 adopted the following dividend policy and financial targets.

G5 Entertainment Dividend Policy

G5 Entertainment is active in a market that grows quickly, and in order to benefit from this growth, the company intends to continue re-investing profits in activities that promote organic growth, such as product development and marketing. Future dividends will be subject to G5 Entertainment’s future earnings, cash flows, working capital requirements, and general financial condition. In addition, investments in acquisitions as part of the company’s growth strategy may impact the level of future dividends. Although the Board of Directors has no reason to believe
that dividend payments under this policy will not be made in the future, there can be no assurance that any annual dividend will actually be paid, nor can there be any assurance as to the amount to be paid in any given year.

The Board of Directors will propose to the Annual General Meeting 2014 that no dividend is paid for 2013.

G5 Entertainment financial targets

The market for casual mobile games continues to grow quickly, and G5 Entertainment aims at continuing to grow revenue in line with or faster than the market.

Investments in activities that promote organic growth may from time to time have a negative effect on the operating margin, but the company aims at achieving an operating margin of 30% over time.

More information about the company can be found at: www.g5e.se/corporate

For additional information please contact:
Vlad Suglobov, CEO, investor@g5e.se
Odd Bolin, CFO, +46 70 428 3173

PDF

April 22, 2014

Notice to Annual General Meeting

Notice has today been issued to the Annual General Meeting of G5 Entertainment AB (publ.) (the “Company”),
reg. no 556680-8878. The AGM will be held at 4.30 pm (CET) on Tuesday, 20 May 2014, at Hotel Kung Carl, Birger Jarlsgatan 21, Stockholm, Sweden. Registration will commence at 16.00.

Shareholders who wish to participate at the annual general meeting must:

  • be recorded in the share register maintained by Euroclear Sweden AB on Wednesday,
    14 May 2014;
  • no later than 4 pm (CET) Monday, 19 May 2014, have given notice of their participation and potential assistants to G5 Entertainment AB, Riddargatan 18, 114 51 Stockholm, by facsimile +46 8 545 075 49 or by e-mail agm@g5e.se.

The entire notice is available at the Company’s website (http://www.g5e.com/corporate) and at Aktietorget’s website (http://aktietorget.se). It will also be sent free of charge by mail to those shareholders who contact the Company on any of the above ways and asks for summons by mail and provide an address.

More information about the Company can be found on www.g5e.se/corporate.

For additional information please contact:
Odd Bolin, CFO, +46 70 428 3173

PDF

April 02, 2014

Preliminary results January-March 2014

Based on the information available, for the period of January-March 2014, the management forecasts record quarterly revenue* of 40 MSEK, which corresponds to achieving 45% revenue growth compared to the same period of 2013. As communicated in Q4 2013 report, the management expects profitable and cash flow positive first quarter.

The group’s development office in Kharkov, Ukraine continues business as usual and has not been affected by recent events. As communicated in Q4 2013 report, G5 holds intellectual property rights and backs up critical code and materials outside of Ukraine, and only transfers funds to subsidiaries in Ukraine and elsewhere on an as-needed basis.

* G5 reports revenue net of application store fees, which may represent up to 30% of end user price.

The group’s interim report for the period January-March 2014 is going to be released on 15th May 2014.

More information about the company can be found at: www.g5e.se/corporate
For additional information please contact:
Vlad Suglobov, CEO, investor@g5e.se
Odd Bolin, CFO, +46 70 428 3173

PDF

February 24, 2014

Year-End Report January-December 2013

October – December 2013 (Fourth quarter)

  • Consolidated revenue for the period is 28 718 (20 689) kSEK, an increase of 39% compared to the same period 2012.
  • Operating result for the period is -20 518 (9 637) kSEK. Earnings per share for the period before and after dilution is -2.19 (2012: 1.11) kr.
  • The result for the period is affected by one-time expenses in connection with the planned re-listing in the amount of 2 344 kSEK, write-downs of capitalized development costs and advances to external developers in the amount of 15 586 kSEK, and temporary higher than usual user acquisition and developer royalty expenses.
  • Operating result excluding re-listing expenses and write-downs is -2 588 kSEK. Earnings per share excluding these items, before and after dilution is -0.29 kr.

January – December 2013 (Full year)

  • Consolidated revenue for the period is 100 007 (80 928) kSEK, an increase of 24% compared to the same period last year.
  • Operating result for the period is -11 826 (25 861) kSEK. Earnings per share for the period before and after dilution is -1.34 (2012: 2.77) kr.
  • The result for the year is affected by one-time extraordinary expenses in connection with the planned re-listing in the amount of 3 783 kSEK, and write-downs of capitalized development costs and advances to external developers in the amount of 18 008 kSEK.
  • Operating result excluding these items is 9 965 kSEK. Earnings per share excluding such items before and after dilution is 1.14 kr.
  • The Board of Directors will propose to the Annual General Meeting that no dividend is paid for 2013.

Important events during the fourth quarter (Oct - Dec 2013)

  • Transition to free-to-play (F2P) accomplished, G5 has returned to top line growth. December became a new record revenue month for the group. The fourth quarter became a new record revenue quarter for the group.
  • Revenue from free-to-play-games grew over 300% year-on-year compared to 12Q4, and accounted for 64% of total revenue in 13Q4 (22% in 12Q4).
  • Unlockable games revenue stabilized and grew month-by-month in Q4.
  • The level of user acquisition expenses was seasonally elevated to above 20% of total revenue in 13Q4. It is expected to be around 15% of revenue going forward. Royalty to developers in the quarter was above normal at 50% of revenue. It is expected to return to the normal range of 30-40% going forward.
  • As part of the transition to free-to-play-games, and reflecting the changing market reality for unlockable games, the Board decided to write down 15 586 kSEK of capitalized development costs and advances to external developers, based on the management’s reassessment of the unlockable games portfolio and development pipeline. The write-down corresponds to more than 50% of the total capitalized development costs and advances for unlockable games. The write-down has no liquidity effect, and the group’s liquidity position continues to be strong.
  • In accordance with the decision by the Board of G5 made in the beginning of 2013, the company applied for a listing on Nasdaq OMX Stockholm during 13Q3. Preparations for the listing, including implementing committees and structures in compliance with the Swedish Corporate Governance Code, are ongoing. Completing such preparations is a prerequisite for accomplishing the listing.

Important events after the end of the period

  • The group has seen substantial increase in revenue during and after the holiday period. The post-holiday seasonal slide in sales that the group experienced in previous years has not occurred, likely due to higher revenue stability of F2P games.
  • January became a new record revenue month for the group, when the group’s consolidated revenue surpassed 2 MUSD (approx. 13 000 kSEK) for the first time. Average daily revenue in February has been higher than in January so far. Based on January and February sales to date, 14Q1 is likely to become a new record revenue quarter.
  • January and February to date are profitable and cash flow positive. Preliminary sales figures for 14Q1 will be communicated in the first days of April.
  • The total number of downloads of the group’s games (not counting updates) surpassed 150 million.
  • The group's office in Kharkov continues business as usual. It is the group's policy to keep critical code and materials backed up outside Ukraine, keep intellectual property rights in EU entities, and transfer funds to subsidiaries on as-needed basis.

Inquiries:
Vlad Suglobov, CEO, investor@g5e.com
Odd Bolin, CFO, +46 70 428 3173

PDF

February 10, 2014

G5 to write down capitalized development costs for unlockable games

As part of the transition to free-to-play (F2P) games, and reflecting the changing market reality for unlockable games, the Board of G5 Entertainment has decided to write off MSEK 15.6 of capitalized development costs and advances to external developers, based on the management’s reassessment of the unlockable games portfolio. The write-off corresponds to more than 50% of the total capitalized development costs and advances for unlockable games. The write-off has no liquidity effect, and the group’s liquidity position continues to be strong.

Vlad Suglobov, CEO, comments:

"The performance of unlockable games in the market declined substantially in the first half of 2013. Even with a turnaround in Q4 2013 when G5’s unlockable portfolio revenue grew month-by-month, the performance of individual weaker games continued to suffer. The group’s regular assessment of its games portfolio (impairment testing) indicated a need for write-downs of a number of such games. The Board has decided to proactively write down those underperforming games, for a total of 10 MSEK.

The new market conditions for weaker unlockable games have also led the management to review the development pipeline and cancel a number of unlockable games on the way to the market, in favor of focusing resources on F2P games. These cancelations result in a write down of 5.6 MSEK.

These write-downs affect capitalized development costs and royalty advances on the balance sheet only, and have no liquidity effect. The group’s cash position remains strong and sufficient to continue investing in the growth of F2P games portfolio. While further write-downs may be triggered in the future depending on the performance of the unlockable games portfolio, the improving sales of the remaining unlockable games and the higher quality of these games reduce such risk.

The Board has elected to take these charges now as part of the ongoing transition from unlockable games to F2P games. The group’s F2P games portfolio have shown over 300% year-on-year revenue growth in Q4 2013 and accounted for over 60% of the company’s revenue in the quarter. Thanks to the outstanding performance of F2P games, the company has returned to approximately 39% year-on-year revenue growth in Q4 2013, and set new revenue records in the month of December and for the full quarter."

Full year 2013 report is going to be published on 24th February 2014.

More information about the company can be found at: www.g5e.se/corporate
For additional information please contact:
Vlad Suglobov, CEO, investor@g5e.se
Odd Bolin, CFO, +46 70 428 3173

PDF

January 07, 2014

Preliminary results January-December 2013

The group has not yet received all Q4 2013 reports from all distribution channels. Based on the information available, for the period of January-December 2013, the management forecasts revenue of 100 MSEK, which corresponds to achieving 24% revenue growth compared to the same period of 2012, and means that it is likely that October-December 2013 became record quarter for G5, with y-o-y revenue growth of around 39%. Based on the information available, revenue from free-to-play games accounted for over 60% of the group’s revenue during October-December 2013.

Vlad Suglobov, CEO, comments: "Like in previous years, we have seen substantial increase in revenue during the holidays, which so far continued into 2014. During the fourth quarter of 2013, which was likely our record quarter to date, revenue from free-to-play games continued to grow, while revenue from unlockable games was mostly unchanged. Historically, January and February have been very strong months for the group due to holidays and the inflow of new users into smartphone and tablet ecosystem. So far, it looks like we are following this pattern again."

The group’s interim report for the period January-December 2013 is going to be released on 24th February 2014.

More information about the company can be found at: www.g5e.se/corporate
For additional information please contact:
Vlad Suglobov, CEO, investor@g5e.se
Odd Bolin, CFO, +46 70 428 3173

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