Good morning, and welcome everyone to this 2025 results presentation. I'm Mikkel Weider, CEO of Everplay Group, and with me is Rashid Varachia, our CFO. We will take you through the year of 2025 and look a little ahead. Since most of you probably haven't met me before, I should probably say a few words about myself before we get started. So I have started several gaming companies during my life, including Nordisk Games, which grew to 1,300 employees via M&A and organic growth. I was the founder and CEO for seven years, and we invested in and acquired nine different game companies, including Avalanche, Supermassive, Raw Fury, and MercurySteam. I have during my life been at 15 different boards and worked with games of all sizes, from indie games and AA games to AAA games.
When they called from Everplay, I was engaged with a handful of different game companies, but I thought the opportunity sounded too exciting. I really liked the strategy and all the people I met during the process, so I said yes. I started on January 5, just a couple of months ago, and will talk a little about my early findings and thoughts later in the presentation. Let's get started. 2025 saw solid revenues of GBP 166 million, which is 5% up when excluding physical distribution, and the performance of the new releases were really good. We saw an 11% growth of adjusted EBITDA for the year, reaching GBP 48.5 million, which represent a 29% margin, up 3.1% from the previous year.
We will pay a total dividend for the year of 2.9 pence per share, representing a payout of GBP 4.2 million in total. We ended the year with almost GBP 52 million in cash, despite active M&A activities and dividend payouts. Overall, we are set to grow. We have a very nice pipeline of games coming out, many new partnership, and a strong back catalog. Our strategy remains on track. What happened in 2025? We launched 11 new titles. They overall performed very well. They actually generated 80% more revenues than all the new titles the past year. We signed several new large partnerships. We took a minority stake in SuperMedia Group connected to a strategic partnership with Bulkhead. We acquired the rights of the popular Hammerwatch franchise, including a range of long-term publishing rights.
If we look at our individual companies, Team17, our largest company, had a very nice year, reaching more than GBP 100 million in revenues and 20 million units sold. The quality of our new launches in 2025 were a lot higher than the previous year, reaching an average user score of 87% compared to 61% the year before. A big shout out from me to everyone who worked on these games. Date Everything was the breakaway hit of the new releases with more than 750,000 copies sold. Yet our back catalog actually still accounted for 75%, which I think is really good and very high compared to most game studios out there.
I would say it's fair to say that 2026 looks even better with more than 10 new games coming out, which is more than twice the releases of last year. Also including some really big ones, Hell Let Loose: Vietnam, Golf With Your Friends 2, and WARDOGS. It's worth mentioning that the bulk of releases will come out in the latter part of this year. If we look at astragon, they had a less good year than Team17. We terminated the physical distribution business, which hurt the top line but streamlined our business. We also saw underwhelming launches of the two main new titles during the year. Seafarer had a rocky launch in early access with several bugs and issues, while Firefighting Simulator: Ignite was a better launch, but still saw less traffic and sales than we had hoped for.
We're currently improving and adding content to both titles. Seafarer will come out of early access and into full launch at the end of the year and should be in a much better state at that point. We also lacked important large update for our main titles, which we are changing onwards. In 2026, we look forward to several new releases, whereas not all have been announced yet. We're cautiously optimistic for the year. Lessons have been learned and more content is coming out. As for Team17, the larger launches will also fall in the second half of the year. When one company is under-delivering, it's of course nice to have a portfolio of companies, so we are not too depending on a few launches. StoryToys had a really great year. Revenues rose an impressive 25% to GBP 30 million.
StoryToys did 740 updates during the year, which is about three launches per workday and 40% more than the previous year. We ended the year with 376,000 active subscribers. The growth came from several places. StoryToys had a highly successful launch of the LEGO DUPLO Bluey app, which had more than 1 million downloads in the first month and reached number one in the App Stores. StoryToys also secured several new partnerships and license agreements, including some large partnerships with both Netflix and Apple. If we look ahead, 2026 has started well. We crossed 300 million downloads in the beginning of the year in total, and we have a lot of content coming out, mostly on existing apps, but also some new and unannounced apps. Now over to Rashid for a more financial review.
Lovely. Thank you, Mikkel. I'm just going to start with group revenue and then just walk everyone through the individual businesses. On a group revenue, they were broadly flat, as Mikkel mentioned earlier, at GBP 166 million. Excluding physical distribution, it was a 5% increase year-on-year. Now the growth drivers come in from the success of new titles such as Date Everything, Bluey, and Worms Across Worlds on Apple Arcade, and our new strategic partnership deals with Netflix Games. On Team17, it was an 8% growth year-on-year, reaching a record GBP 106 million in revenue with 20 million units sold. Six new games drove a 700% increase in new release revenues.
Outstanding performance from titles such as Date Everything and other titles included Swarm and Worms Across Worlds on Apple Arcade. Our back catalog contracted by 13%, mainly due to strong performance from Dredge in 2024, which was an exceptional year for our back catalog titles and revenue generated from fewer new titles in the prior year. astragon was the only division which contracted with a decline of 33%, in part driven by a strategic decision to exit low margin direct physical distribution. Excluding physical distribution, astragon revenues decreased by 18%. The two new titles which were released during the year, Firefighting Simulator: Ignite and Seafarer: The Ship Sim, both performing unfortunately below expectations. This was somewhat unfortunate, but we're expecting the business to bounce back in FY 2026.
Finally on StoryToys, as Mikkel mentioned, it was an exceptional performance and revenues were up 25% to GBP 30.4 million. They released 740 app updates, subscriber numbers increased to 376,000 and peak monthly active users of 12.9 million, reaching 286 million lifetime downloads. Performance driven by major new Netflix and Apple Games partnerships, including LEGO DUPLO WORLD and Barbie Color Creations, along with three launches on Apple Arcade games. Our new release revenue increased 80% to GBP 41 million during the year versus GBP 23 million in FY 2024 due to an increased number of titles and stellar performance of Team17 titles and LEGO Bluey from StoryToys.
Our back catalog contributed 75% of group revenues, which was in line with its five-year average. The total back catalog revenues were GBP 125 million, which was a 13% decline versus the prior year. This was on the back of an exceptionally strong FY 2024, which grew by 27%. Our first-party IP revenue declined 9% to GBP 56 million, reflecting a softer performance at astragon. Team17 was up 2%, supported by Hell Let Loose and Golf With Your Friends. Finally on this slide, our third-party revenue grew 4% to GBP 110 million, with strong contributions from Overcooked franchise, Date Everything, Dredge, and LEGO DUPLO WORLD. Gross profit increased significantly by 10% to GBP 76.3 million versus GBP 69 million in the prior year.
Gross margins also increased by 4.4% to 46%, mainly due to exit from physical distribution business and no material impairment. Just as a reminder, during FY 2024, a GBP 4.6 million charge was booked for title impairment. Overall, royalty payments were lower year-on-year due to a favorable sales mix at Team17 and a higher weighting of StoryToys revenue, which carry lower royalties. Finally, development costs increased modestly to support expansion onto new subscription services, for example, Worms Across Worlds on Apple Arcade and LEGO DUPLO WORLD. Despite flat revenue, significant improvements on adjusted EBITDA, which grew just over 11% to GBP 48.5 million. Adjusted EBITDA margins also increased 3.1%, reflecting higher gross margin than flat admin costs.
Acquisitions related adjustments declined from GBP 13.8 million to GBP 12 million due to the end of acquisition related incentive payments. Net finance income increased to over GBP 1.2 million. Finally, our effective tax rate increased very slightly to 25.5%. Our capitalized development costs increased to GBP 33.2 million, mainly driven by Team17 by new titles such as Golf With Your Friends 2, Hell Let Loose: Vietnam, and astragon Police Simulator: Patrol Officers and Ranger's Path.
Finally, in terms of our closing cash, which was adverse versus the prior year, due to our dividend payment of GBP 5.3 million, increases in tax and increase in acquisition-related payments, for example, GBP 4.6 million publishing rights across the group, and other variances, including working capital and capital capex. Finally, as Mikkel mentioned at the start of the call, we are pleased to announce a final dividend of 2.9p for the year.
As mentioned in the beginning, I'm a newcomer to this business, and coming into a new company, of course, has its benefits as it allowed me to see the company with fresh eyes and a little bit from the outside. I wanted to take this opportunity to give my view on the company, after close to three months in. It's always a little exciting to start a new job. Is everything as good as they told you in the hiring process, or do you uncover larger problems once you're on the inside? Well, fortunately, I can say that the company is in a better shape than I had hoped for. Yes, there is stuff to do, but overall, I'm very impressed with the company and the organization.
I think there is a good energy, and the culture is strong. While there has been several changes in the management the last years, especially in Team17, I feel, we have a range of great people now, to take the company to the next level, and we are well-positioned for growth. The back catalog is also as strong as I could have hoped for, which creates stable cash flows and predictability, which is very nice, of course. I already like the vertical strategy of the company with focused divisions before I joined, but, getting on the inside, I can really appreciate the focus of each division. If you like an Astragon or StoryToys game, you will most likely like the new games coming out from them as well. Team17 can also do a lot of cross-promotion between their titles.
Some of the stuff I would like to focus more on in the coming years are to have a stronger tech focus, including AI. I'd also like to look more at processes and reutilization. We want to add more service elements and upsales for evergreen titles. For example, having more paid DLCs attached to our bigger games. I'm also looking at how we can work more together and create synergies across the group. Of course, we want to do more M&A. Over the last 18 months, my predecessors have worked with different strategic pillars, and I think there overall has been good progress on these pillars in 2025, pillars that I fully support. There has been an ambition to strengthen our first-party IPs and games we fully own ourselves.
In 2025, we launched two new games with first-party IP, and we have 10 projects in the pipeline for our owned IPs. I think there has been good progress in this pillar. Another focus has been to find and grow new innovative third-party games, that is games made by other companies with their IPs. There has been solid progress here as well, not everything was a breakaway hit, and we have more than 10 new third-party games coming out already in 2026. A third focus has been to be very mindful of costs and to improve margins. Gross margins are now up 4.4%, and adjusted EBITDA was up 3.1%, which makes the company a very profitable one compared to a lot of our peers.
Finally, we wanted to drive more growth and, adjusting for the removal of physical distribution, the company did see growth in 2025, and we also managed to acquire IPs and games for the future back catalog. On the organization side, there has been several changes. Aside from having a new CEO, me, if you're in doubt, Team17 promoted Harley Homewood to be the General Manager in November, and he's doing a great job so far, I think. In Team17, we have recently grouped our games in three overall pillars with a franchise director for each of them, so we more easily can reutilize knowledge, technology, and do cross-promotion within the clusters.
In Astragon, we have exited the distribution business but also slimmed the organization overall to focus on the core titles and have a more simplified organization, making it easier to get higher margins. In general, we want to scale without adding proportionally more people. We think it's important to stay nimble and agile and use technology and processes in smarter ways instead of just hiring more people. An example, Team17 has more than twice the amount of launches in 2026 compared to last year, while not adding to the total head count. I think that is quite impressive. Finally, we have hired a few additional central resources to assist all divisions. Overall, we are creating a stronger foundation for organic growth and acquisitions. As mentioned, I want us to become stronger in tech and AI. AI has evolved a lot the last couple of months, really empowering developers in tech.
New tools in AI will allow us in Everplay to create more larger and richer game while not adding costs. AI can also help us optimize our internal processes and logistics. In general, I think AI will result in a greater demand for publishers like us, someone who can help developers' games to stand out in the crowd. With more games being launched, discoverability will be key. In many ways, AI strengthens our reason to be. It's, of course, very important we follow the evolution closely. To reap the fruits, we need to be at least early adopters. We need to be stellar in marketing and publishing, and we need to be very agile and adapt to changing technologies while still doing it in an ethically correct way. We have been working with AI for a while.
We have an AI council and AI tools for all our people, and we have various cases across the group, cases we want to expand on and distribute across the group. Some examples, StoryToys are actively using AI in engineering, doing 40,000 lines of code per month. We're also using AI in QA several places around the group, for example, for performance testing and automation. But overall, I think we can go further, and I want to empower our employees even more. Now a short break from talking. Let's watch a showreel of some of the games coming out this year. Games, if you ask me. Some of the bigger ones are Hell Let Loose: Vietnam, Golf With Your Friends 2, Bus Simulator, Silver Pines, and WARDOGS. We have some unannounced titles we look forward to presenting later in the year.
Now the very, last slide of the presentation. Overall, I believe we are well-positioned to continue the growth with a strong pipeline and back catalog. As mentioned earlier on, some of the larger games are scheduled for the second part of the year, which gives some additional weight to H2 result. Overall, I believe we are on track to deliver the adjusted EBITDA for the year in line with current market expectations.