Tomb Raider Chronicles - EMBRACER GROUP PUBLISHES Q4 23/24 INTERIM REPORT

Embracer Group has published the interim report for Q4 2023/24, the period January-March 2024. Embracer Group has an extensive catalog of over 900 owned or controlled franchises including Tomb Raider and 111 internal game development studios including Crystal Dynamics and Eidos.

"Over the last year, Embracer has made significant progress in shaping the future of the Group. We have improved the balance between growth and cash flow generation. The divestments of parts of Saber Interactive and Gearbox Entertainment will improve profit margins and cash conversion, and reduce financial leverage, while the subsequent intention to initiate a separation of the group into three separate publicly listed companies, sets a clear strategic direction. For the full year, excluding the contribution from the divested assets, we reached Net sales of SEK 39.7 billion, Adjusted EBIT of over SEK 7.3 billion and EBITDAC of SEK 6.3 billion on a pro forma basis," says Lars Wingefors, CEO and co-founder of Embracer Group.

The PC and Console Games segment saw "negative organic growth of -13% in the quarter, mainly explained by a soft performance for divested assets, with tough comparisons from a high contribution from deals signed by Saber Interactive in Q4 last year. The pro forma growth in the quarter was 3%, excluding divested assets. The quarter saw several small- and mid-sized new game releases, which supported growth. Overall, a few titles, including Tomb Raider I-III Remastered and Deep Rock Galactic: Survivor performed well. "

The Tabletop Games segment saw adjusted EBIT grow "by over 50% YoY to SEK 380 million in Q4, with a notably improved margin YoY supported by a better product mix and a free cash flow above 100% of Adjusted EBIT in the full year. The organic growth amounted to -3% in the quarter and 7% for the full year."

The Mobile Games segment "had another strong quarter, with over 50% Adjusted EBIT growth YoY to SEK 514 million. The Adjusted EBIT margin came in at 38%, with stronger-than-expected profitability driven by a product mix shift towards more hardcore games, lower user acquisition costs and an optimization of the balance between current and future potential profits. "

The Entertainment and Services segment "had a quieter quarter, as expected, with fewer new releases and products compared to previous quarters, both for PLAION Partner Publishing & Film and for Middle-earth Enterprises."

"We see great potential in The Lord of the Rings IP and believe the universe can become a key driver in the coming decades, with the aim to delight fans across the globe. New Tomb Raider stories in streaming and film will allow us to further nurture and grow another unique IP, taking it to new heights. Strong partners, such as Warner Bros. Discovery and Amazon MGM Studios, that complement our capabilities are an important part of our IP strategy."

On the proposed separation into three entities, Lars Wingefors said that "it is encouraging that shareholders share our view of the transformational separation. So far, the processes are tracking according to plan. There is significant untapped potential within the group, which I am confident the new structure will unleash."