Starbreeze AB (publ) Interim Report Q1 2022

2022-05-11 07:30:00
First quarter 2022
  • Net sales totaled SEK 23.5 million (27.9). PAYDAY accounted for SEK 23.3 million (26.9).
  • EBITDA* totaled SEK 4.6 million (22.6).
  • Depreciation, amortization and impairment totaled SEK 14.5 million (14.5).
  • Profit/loss before tax amounted to SEK -23.8 million (-4.2).
  • Basic and diluted earnings per share totaled SEK -0.03 (-0.01).
  • Cash and cash equivalents amounted to SEK 112.6 million (148.5).
  • On March 9, Mountain Master Heist, the fourth and final chapter in the City of Gold series, was successfully released.

CEO Tobias Sjögren remarks on the report: WE'RE DEVELOPING NEW IP FOR FUTURE GAME RELEASES

We continue to grow our development team according to plan, and in the first quarter of this year our team has grown by 12 employees to reach a total of 150 employees at the end of the quarter.

The development of PAYDAY 3 is on schedule, and the development of PAYDAY 2 content continues with the same high level of ambition as last year. Mountain Master Heist, the fourth and final chapter in the City of Gold series, was successfully released during the quarter. Interest in PAYDAY 2 remains strong and our MAU for the quarter peaked at just over 800,000 players. This high level of engagement demonstrates how popular the game still is 8 years after its launch.

In terms of sales, there was a year-on-year decline in PC sales during the quarter from SEK 22.6 million last year to SEK 19.0 million this year, while console sales were in line with last year. The decline in PC sales is related to a number of factors. A strong end to 2021 linked to activities carried out at the end of the year such as the 10th anniversary of the PAYDAY IP and the 8th anniversary of PAYDAY 2 likely had a dampening effect on sales in the first quarter. A return to a more normal way of life after the previous Covid restrictions probably meant that sales fell slightly, while the turmoil we see around us and the atrocities we see in Ukraine in particular create uncertainty. We have also seen an increase in the volume of game releases over the past six months, leading to increased competition for players' attention. In the coming quarters, we will continue to release high-quality content for PAYDAY 2 at a higher frequency than in 2021, and also packaged as larger bundles to ensure that we maintain high sales going forward.

Our publishing department is focused on continuing to develop sales of PAYDAY 2 on current and additional platforms, and I am confident that the actions we are taking will contribute positively to sales going forward.

EBITDA for the quarter amounted to SEK 4.6 million, which, as expected, is lower than in the corresponding period last year. According to our development plan, our team relating to PAYDAY 3 will peak in 2022. According to our strategy we continue to expand our organization to be capable of developing more games and business opportunities resulting in higher personnel costs than in the previous year. EBITDA was also negatively impacted by the lower volume of PC sales.

We are currently evaluating several opportunities to grow our portfolio of games and diversify our business. This may be achieved by acquiring other businesses and brands, publishing third-party games, and developing more entertainment products and games based on the PAYDAY IP.

During the quarter, we launched a project to develop a new game in-house with a view to release in 2025. This game might be based on a licensed brand, but we are also working on developing new IPs internally.

Our strategy for new games is to use our experience in games as a service, and our ability to build strong communities that create long-term entertainment value for our players and long-term revenue for Starbreeze. More games and proprietary IPs means that we are ensuring that there is a long-term and differentiated revenue model to help strengthen Starbreeze as a company.

Tobias Sjögren

CEO Starbreeze

Cision