STOCKHOLM, July 23[rd] 2020 — Modern Times Group MTG AB (publ) (“MTG”) today publishes its Q2 2020 financial results report. MTG’s gaming vertical demonstrated its best quarterly result ever, and the esports vertical reports a relatively strong quarter despite the pandemic impact compared to the financial guidance from 1H 2020.
“InnoGames demonstrated strong performance in the second quarter and continued to invest heavily into marketing to support future growth. The positive development was driven in part by effects of the ongoing coronavirus pandemic, which has led to increased gaming. This resulted in higher Daily Active Users (DAU) and Average Revenue Per Daily Active User (ARPDAU), which grew by 10 percent and 17 percent, respectively, compared with the corresponding period last year,” President and CEO Jørgen Madsen Lindemann states in the report.
“The esports vertical performed better than anticipated compared with the financial guidance for the first half of 2020. This was driven by new agreements with media partners such as Twitch, higher esports services (ESS) revenue and stronger performance by our business to consumer (B2C) product. Equally important factors included good cost control and a more favorable revenue mix with a larger high margin media component during the quarter,” he continues.
MTG’s Q2 2020 financial report highlights follow below. For the full report please see the attached file or www.mtg.com.
Record quarter for the gaming vertical
- The gaming vertical delivered its best quarter ever in respect to both revenue and profits, while investing heavily into marketing to support future growth. The positive performance was driven by growing Daily Active Users (DAU) and Average Revenue Per Daily Active User (ARPDAU) in the wake of the ongoing pandemic.
- Despite being impacted by the ongoing coronavirus pandemic, the esport vertical performed relatively strongly compared to the financial guidance provided for H1 2020. This was driven by higher esport services (ESS) revenue, good cost control and a more favorable revenue mix with a larger media component during the quarter.
Q2 2020 financial highlights
- Net sales level with last year at SEK 1,096 (1,095) million
- Adjusted EBITDA of SEK 167 (88) million, with adjustments for Long-term incentive (LTI) programs of SEK 60 (23) million and M&A transaction costs of SEK 3 (4) million
- EBITDA of SEK 104 (61) million
- Operating income (EBIT) of SEK 31 (-10) million
- Net income from continuing operations of SEK -19 (-38) million
- Basic earnings per share of SEK -1.00 (-1.19)
- Net cash flow from operations of SEK 121 (-69) million
| Financial overview |
|
|
|
|
|
|
| (SEKm) |
Q2
2020 |
Q2
2019 |
H1
2020 |
H1
2019 |
FY
2019 |
|
| Continuing operations |
|
|
|
|
|
|
| Net sales |
1,096 |
1,095 |
2,020 |
2,035 |
4,242 |
|
| of which esport |
353 |
444 |
652 |
780 |
1,712 |
|
| of which gaming |
743 |
648 |
1,368 |
1,252 |
2,531 |
|
| of which central operations and eliminations |
0 |
3 |
0 |
3 |
0 |
|
|
|
|
|
|
|
|
| Costs before depreciation and amortization |
-992 |
-1,034 |
-1,985 |
-2,016 |
-4,352 |
|
| Adjusted EBITDA 1) |
167 |
88 |
146 |
125 |
239 |
|
| Adjusted EBITDA margin |
15% |
8% |
7% |
6% |
6% |
|
|
|
|
|
|
|
|
| Adjustments |
-63 |
-27 |
-111 |
-106 |
-349 |
|
|
|
|
|
|
|
|
| EBITDA |
104 |
61 |
35 |
19 |
-109 |
|
| Amortization |
-49 |
-45 |
-100 |
-89 |
-202 |
|
| Depreciation |
-23 |
-25 |
-45 |
-49 |
-96 |
|
| of which PPA |
-30 |
-30 |
-61 |
-60 |
-120 |
|
|
|
|
|
|
|
|
| EBIT |
31 |
-10 |
-110 |
-120 |
-407 |
|
| EBIT margin |
3% |
-1% |
-5% |
-6% |
-10% |
|
|
|
|
|
|
|
|
| Net income |
-19 |
-38 |
-151 |
-171 |
-458 |
|
| Basic earnings per share (SEK) |
-1.00 |
-1.19 |
-3.37 |
-3.64 |
-8.19 |
|
|
|
|
|
|
|
|
| Discontinued operations 2) |
|
|
|
|
|
|
| Net income |
-1 |
1,458 |
0 |
15,055 |
14,852 |
|
|
|
|
|
|
|
|
| Total operations |
|
|
|
|
|
|
| Net income |
-19 |
1,420 |
-151 |
14,884 |
14,394 |
|
| Basic earnings per share (SEK) |
-1.01 |
20.42 |
-3.38 |
219.89 |
212.44 |
|
|
|
|
|
|
|
|
| Net cash flow from operations |
121 |
-69 |
82 |
-171 |
-188 |
|
| CAPEX |
44 |
67 |
86 |
105 |
239 |
|
|
|
|
|
|
|
|
| Net sales growth y-o-y |
|
|
|
|
|
|
| Organic growth |
0% |
10% |
-3% |
6% |
7% |
|
| Acquisitions/divestments |
- |
-1% |
- |
-1% |
-1% |
|
| Changes in FX rates |
0% |
4% |
2% |
5% |
4% |
|
| Change in reported net sales |
0% |
13% |
-1% |
10% |
10% |
|
| 1) See page 24 for details of adjustments to EBITDA. Alternative performance measures used in this report are explained on page 25 |
|
| 2) Consists of the adjusted result for NENT, Nova and Zoomin in 2019 |
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SCROLL FOR MORE
Financial calendar
| Financial report Q3 |
November 4th 2020 |
| Capital Markets Day |
October 9th 2020 |
SCROLL FOR MORE
Conference call
MTG AB will hold a conference call at 3.00pm CEST which will be hosted by President & CEO Jørgen Madsen Lindemann and CFO Maria Redin.
Dial in details:
Standard International: +44 2071 92 8338
Sweden +46 856 618 467
UK: +44 800 279 6619
US: +1 646 741 3167
The access pin code for the call is 397 44 38
To listen to a streamed webcast - listen only - of the conference call visit:
https://edge.media-server.com/mmc/p/yoz98v62
This information is information that Modern Times Group MTG AB (publ.) is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Markets Act. The information was submitted for publication, through the agency of the contact persons set out below, at 02.00pm CEST on July 23 2020.
For more information:
Lars Torstensson, EVP Communications & Investor Relations
Direct: +46 (0)702-734 879, lars.torstensson (at) mtg.com
Oliver Carrà, Public Relations Director
Direct: +46 70 464 44 44, oliver.carra (at) mtg.com
Reach us: communications@mtg.com
Download high-resolution photos: Flickr
Follow us: mtg.com / Twitter / LinkedIn
About MTG
MTG (Modern Times Group MTG AB (publ.)) (www.mtg.com) is a strategic and operational investment holding company in esports and gaming entertainment. Born in Sweden, the shares are listed on Nasdaq Stockholm (‘MTGA’ and ‘MTGB’).
