Q4 18/19

May 22, 2019

Hello. Welcome to this Q5 presentation by Atikju Nordic. We have Lars Wingerfors here today, CEO and Founder of the company, and he is here to present record strong sales and earnings, very strong performance from all the game segments have to say, and Deep Silver perhaps as the star performer this quarter. Also another acquisition with very interesting IPs, so it will be interesting to hear more about that as well. Without further ado, I'll leave it over to you, Lars. Go ahead. Thank you and good morning, everyone. I'm happy to announce another stable quarter. The revenues grow 158 percent to a bit more than SEK1.6 billion. We had a stable growth in operational EBIT as well with about 200% to SEK396,000,000. Also happy about the stable cash flow from operating activities being SEK777,000,000 in the quarter. And the quarter results, especially the profitability was driven of a good of performance was notable on Metro Exodus and especially on satisfactory. Also during the quarter, we as previous communicated, we raised SEK 2,100,000,000 in new shares. We acquired Warhorse Studios and SEK 18.2 in Australia. But also in the report this morning, I noted 2 agreements, 1, new development agreement with the brilliant developers for A Games for an unannounced AAA project, along with a wording in the report about that we have signed multiple deals with digital distribution platforms for subscription, streaming and download services since the beginning of the year. And they will have a notable impact for the years to come. Looking at the P and L. The EBITDA grew 1 174% to SEK 619,000,000 in the quarter. Again, the operation EBIT grew 2 17 percent to €396,000,000 and the operation EBIT margin being 24%. On a trailing 12 months basis, the business grew 384 percent to SEK 5,100,000,000 and EBITDA to more than SEK 1,300,000,000 and operational EBIT to SEK 777,000,000. The operational EBIT margin being 15% for the trailing 12 months period. Diving into the games business areas. We had a star performer in the quarter being deep silver with total revenues in the quarter of 794 million. And the pro form a again was especially and the absolute majority being Metro Exodus that had a great reception in the market from both critics, but especially from consumers. Looking at coffee stain, our great team in Shabda that we acquired in November had a satisfactory release of their early access product developed in Shradde. In Tuzd, they generated revenues of SEK98 1,000,000 and largely driven by the digital sales performance of Satisfactory on Epic Game Store. Also at the Deep Silver again, we, in the end of the quarter, had a smaller, but notable release of Outward, a fantastic open world survival RPG developed by a very small team in Canada that came as, I would say, exceeding our more modest expectations and it's continuing to perform on digital platforms. Tischu Nordic in Vienna, our funding business, had a stable quarter with revenues of SEK143 1,000,000, not really driven by any bigger title. They had 11 releases in the quarter. In the comparable period last year, we released, I would say, a notable release of MX versus ATV, so the comparable period was a bit more tricky this year. Looking at the breakdowns of the Publishing, the overall Publishing segment, the digital sales was 61% in the quarter. Looking at the new release, again driven by Metro Exodus and Satisfactory, was 75% of the total revenues. And owned titles represented 84% of the revenues in the quarter. Looking at the Part and Publishing business area, we had a number of notable releases in the quarter. However, the Q1, calendar quarter in the year is doesn't have the holiday season business. So it's really driven by any notable release you would have. And we have 4 titles I would like to point out being Kingdom Hearts from Square Enix, Resident Evil 2 from Capcom in certain territories, Deltrady 2 from our friends, Coldmasters in the U. K. And Devil May Cry 5 from Capcom. Total revenues in the quarter was SEK596 1,000,000. Now looking at the depreciation and amortizations in the 5th quarter. Again, I would like to point out the operation EBIT and how it all works. So starting with the EBITDA in the quarter being SEK 619,000,000, We're having the amortization of our games development being SEK 192,000,000 and then other intangible assets being mainly films and then a bit of other and then it becomes operational EBIT. And then under operational EBIT, because we are reporting under reporting under K3, the Swedish accounting standard, we amortize all in all acquisition related immaterial rights on the 5 year straight period. So in the quarter, we had IP rights amortizations of SEK 166,000,000 and goodwill of SEK43,000,000 and surplus values of 15,000,000 and then the reported EBIT becomes 172,000,000. If we were to report under other standards, we would not have this in our books. Also in the quarter, we finalized the PPA for the Koch Media acquisition, and we were allocating SEK479,000,000 to IPs that are being amortized from the acquisition dates on a 5 year straight period. And that decision was made in the quarter, and that then became additional amortization of SEK 108,000,000, whereof SEK84,000,000 relates to previous We also had preliminary PPAs of the 4 recent acquisitions of Kofistein, Bagbir, Warhorse and SEK18.2 billion. And we currently have SEK 1,400,000,000 in acquisition related that will be amortized over 5 years relating to those 4 acquisitions. So investments, where total investment was $326,000,000 the absolute majority being obviously our games investments. Internal capitalized development, and we capitalized all development until release for our series was 116,000,000 dollars in the quarter and looking at external games development was €189,000,000 in the quarter. The completed games development was $220,000,000 in the quarter for games completed. And looking at this graph here, investments in Games Development by quarter, you can see we are having a growing investments every quarter into Games Development. Both revenues and profitability going forward. Cash flow, we had a stable cash flow, SEK777,000,000 in the quarter. In the comparable period last year, we had SEK700 million, but that number was driven, if you remember, by a big part being forefighting that we had in our company at Koch Media. This quarter, we had a very small bit of forefighting, but so that is the difference. Looking at the balance sheet, total assets, SEK8.6 billion. So I think it's relevant just to comment a bit on that, especially on intangible assets being SEK 3,700,000,000. I would like to break that down to in the balance sheet as end of the quarter, we had $394,000,000 of finished completed games, those games that being amortized over the 24 months period, 43% the 1st 3 months, 43% 9 months and 43% 12 months. And then we had ongoing game development projects in the balance sheet of SEK 1,100,000,000. And other intangible assets, mainly films, were SEK 150,000,000 IP rights now being SEK 1,000,000,000 about SEK 1,000,000,000 and that is including the PPA for Culture Media. Another surplus values relating to business areas, films and partner publishing being SEK 168,000,000 then finally, Goodwill being SEK830,000,000. And here you can also see the current receivables end of quarter was SEK 1,300,000,000 compared to SEK 600,000,000 in the comparable period last year. Cash end of the quarter was close to SEK 3,000,000,000 and including the credit facilities, we had SEK 4 SEK4.5 billion available. So M and A. I was happy to announce another acquisition 30 minutes later, and I will talk more about this very soon. But don't expect acquisitions every quarter. It just happens, turn out to be that way. But in general, I would say we are having a good position in M and A. This is something we're working every day on at the mother company level. I spend a lot of time on M and A. We've now raised capital, but I we are patiently executing this. For me, it's very important to find the right companies and teams to join the group. And it's important we find what we say reasonable terms for both parties that is delivering value for both parties, along with understanding the sellers and their culture and values. We have a very long list of companies within development, within publishing, within partner publishing as long as IPs. So there is no shortage of potential targets. But this is not something I would like to rush. So patiently, we will execute this. And I think our strategy of giving autonomy to the local management and empowering them to make decisions is a winning formula when competing with companies and groups that are substantially bigger than we Mentioning M and A, I was very proud and happy to welcome Warhorse to the group. I've been down to Prague, and I would say even more after the acquisition, I'm really happy to have them on board. They are really a fantastic development studio. So they have the winning formula to create some amazing games and they are now currently working with the final DLC for the Deliverance, and then they will start into full production of the next coming big projects. Also happy to have 18.2 from Sydney on board. And the team management team are well into the industry and the integration has been very smooth. In the quarter, I was we were raising SEK 2,100,000,000 and I was proud, happy to see a factorization from the majority of our existing institutions, along with a handful of new long term owners such as Verstappe Funden, Andropefonden and Ondidenfonder. All of you are very important for our coming growth of the company, and I'm I will take care of your capital well. That's my ambition. So looking at the pipeline, here you can see a picture of RekFest and RekFest is coming soon on console. It's a fantastic product, but it's not a very big team. So and again, I would like to state, it's very, very important, whatever content we bring out that we polish and make sure we're delivering experience to the consumer that could be sold for many years and well received on the market. Looking to the closest periods, we have a number of releases. We have Spellforce coming up very soon from our teams in Munich, Grimlore, our internal team. Spellforce is a title they've been working on since the release, and I would say it's performing, and they have some ambitious plans for the future. Kingdom Come Deliverance would have a royal edition along with the DLC very soon. The Monster Jam, from our dear friends, we have licensed Monster Jam from Feld Entertainment and our internal studio, Rainbow Studios in Phoenix, are delivering a new game end of the quarter end of the current quarter. Wreckfest, I mentioned. Shenmue 3 from ISNET in Tokyo, we are working hard on. It will be published both digitally and physically from Deep Silver Buy mutants from our internal dear friends here in Stockholm, Experient101. I'm, as always, quite I would like to use excited for this product, but I will also make sure the game will be released when it's ready. Dead Island 2, still being worked on. Stay tuned. Wey Sen 3 from our friends at Inexile that now are part of Microsoft, we will publish our title when that title is announced to be published. There's Broadus 3 coming out from MiniME production, our not our, but the external team in Munich. Iron Harvest is a new signing in the quarter from the old friends of King Art. They're, I would say, good looking RTS upcoming titles in UIP. And then we have 4 top secret projects being mentioned here in the presentation, one being the already mentioned new projects from Warhorse that will come out in the future. We have a project of the guys and women's at Volition. We have another top secret project that I'm very excited about at our friends at Coffee Stain North here in Stockholm. And again, the signed projects from 4A Games to come in the future. In total, we have 80 games under development, whereof, 32 are announced and 48 is unannounced. In the quarter Q1 of the fiscal year, the current quarter, April to June, we also had a few notable releases from our business partners at Partner Publishing, I would like to mention. Team Sonic Racing from Siga. We have F1 2019 now coming end of June this year from Coldmasters. We have Wolfenstein, Jan Glod from Bethesda in certain territories and MotorGP 'nineteen also in June from milestone in certain territories, along with a number of other leases. That is the Q5 presentation. If you don't mind, Oskar, I could go on with the Piranha Bytes presentation. Or would you like to follow-up exactly on the Q5? You're welcome to. I will leave it up to you. It will come up later. I think we can continue with the Piranha Bytes presentation and then we can have a full Q and A for both presentations. So I'm glad to announce and welcome Piranha Bytes to the family. At 6:30 this morning, we announced the acquisition of all assets, IPs and the start up of a new company with all the employees of Piranha Bytes. Piranha Bytes is an iconic legendary RPG studio from Essen in Germany. They have made one of the most iconic RPGs ever Gothic. In Gote, they follow-up with Risen, and Risen was a game series published by Deep Silver. And after Risen and Deep Silver, our guys at Tischko Nordik in Vienna signed their new franchise, Elex. And Elex, for the shareholders that's been with me from the beginning, was one of our first major releases that was delivering great Q4 results 2017, not great, stable. So looking at the transaction, it's a true veteran studio that has very experienced people making these games. And the assets includes, as stated, Gothic. And Gothic is a very iconic, if you are into this market especially RPGs and if you're into the markets of Europe, Gothic is one of the absolute first benchmark products in the industry. We are communicating here that the portfolio has generated approximately SEK 18,000,000 in net revenues the past 3 years, And we are not disclosing the exact purchase price, but it's estimated to be about similar to 3 years of royalty payments for the upcoming releases of Pronobytes. As all the studios that we are acquiring, we are buying a great team, and we are giving them a lot of autonomy and creative freedom to operate. We are supporting them the ways they like. And obviously, we are keen that their next projects will be delivering even more exciting product. Now having all IPs under one roof, I think we have great opportunities to work with the old assets and IPs and the team and the group to make Prona Bites and these IPs something that will delivering great experiences and numbers for years to come. Looking at the products, If you are into single player RPGs, I could really recommend it. It could be a bit harsh or tough in the first hours, but if you're into it, you're really getting sucked into the experience. Looking at team, we'll be still be led by the current CEO, Michael Rive, who has been with the company for 26 years, along with Pankrans and his team that has been one of the founders and is one of the absolute key persons to manage this business. So please stay tuned for the future. Thank you. All right. Time for some Q and A, and I'll start with a few questions and I'll leave it over to the web for some questions as well. So first of all, as we've already concluded, Metro Exodus was the big driver in this quarter. Can you speak a little bit about how happy you are with the performance on different platforms, physical and digital, shed some light on the performance? I think I would point out, I would we are especially happy with the digital performance of Metro Exodus. Obviously, this being a single player huge game, it has a substantial physical revenue as well. And it's been okay business, but I think the digital performance in this case has a bit overachieving the overall expectations within Metro Exodus. Platforms, well, in general, obviously, Metro Exodus is a console game and the majority absolute majority of the revenue is being console. And we've been working with Microsoft in a number of years. So it has been a strong performer on both Xbox and PlayStation. Then we can see a growing fan base on PC. As you noted, we made a decision to give exclusivity to Epic Games Store. However, delivering the already preordered units on steam. Yes. There's a lot of stuff happening in the platform space. And I mean, first of all, what do you expect to have the largest impact on the industry in terms of subscription, streaming and these more downloaded oriented platforms such as Epic in the next 2 years? It's not really the way I see it for me to comment on. We are partnering with the industry in many ways. We are partnering with them within Partner Publishing, but they also partner to deliver our content on various digital platforms. And our strategy is to deliver our content on whatever platform that arises that reaches the consumers and that we can have reasonable terms. I don't think anyone could foresee how the future will look. There is a great trust and belief in the streaming There is There is substantially bigger companies entering the market. I don't want to like to be in the middle of the dance floor. I'm standing watching and delivering the content here. We do not have a strategy to reach these consumers on our own with our own platforms. Okay. Very good. And I mean some of these just one last question on platforms. Some of these content platforms are have been and continue to be quite aggressive. In general, I mean, as a developer and publisher, how when do companies sort of recognize revenue in general? Is it when games are delivered to platforms? Or is it across a longer period of time? Or how does that work in general? Yes. I think, first of all, I would like to point out this that we have signed multiple deals that has a notable value for us. That will lower our financial risk going forward for a number of projects. And it's not only one part here. We have signed deals with multiple companies since the beginning of the year. And agreements are, 1st of all, confidential. Secondly, for business reasons, I would like to keep them confidential. But also the kind of agreement varies. You can make guarantees, you can make some commitments, you can make marketing commitments, you can make contribution to development. So there is not a single kind of agreement in this. And obviously, we are having accounting standards and we're working hard with our auditors to if any revenues to be booked according to what's relevant and for but I would say there is not extraordinary income in the quarter. Okay. That's very helpful. And Metrix was very successful, but obviously being a single player game, which perhaps is a bit front end loaded. And you mentioned satisfactory has continued strong momentum. Can you say something about Metro Exodus? I don't think I used the word continued strong momentum. I think that is your words, Oskar, but I was happy to see the successful release of the Early Access Satisfactory in March. And obviously, as all releases, you have a good number of players coming in the 1st hours and days, and then it's kind of declining. Satisfactory in fear is a product that could live for many years and to be sold to many, many more consumers. But I think we should be reasonable here and don't expect too much too soon. Let's wait and see how this progress over the coming quarters. And switching over to satisfactory, which I suppose was the other very positive thing in this report. Yes. That's what satisfactory I was just talking about, yes. Yes. What makes this game unique? And the game was released quite late in Q5. I suppose it's a word-of-mouth sort of effect that could have a positive effect for the rest of the year as well? Yes. I think it's overall, it's a game you're coming back to and it's a game you can play for, in theory, less number of hours. In comparison to a game like Darksiders and Metro Exodus, that's a big difference. That opens up other kind of opportunities. And in terms of communication, how the game the word-of-mouth is spread between players and friends that are engaging with the game. You can see a great engagement from Twitch and YouTube audience on this game in particular. And Satisfactory, the studio behind Satisfactory, Coffee Stain, they released a game last year as well in early access and that is not yet out in the full version. What can we expect? When is it finalized? And also what type of business model will it have with expansions or something similar? I think Deep Rock Galactic is a fantastic product and it has a great team in Copenhagen and Gossip Games. And together with Poffenstein, they're making decisions with content, pricing. And whenever the game is ready, they will announce and release the product. You can see it's still performing reasonably well on biggest performance, especially on steam. So I think the team are keen to delivering a true great product. And when they feel they have that, they will release the full version, but I don't want to disclose that here. Okay. And both these titles that we discussed, Satisfactory and Metro Exodus were released on Epic Games exclusively. What can you say about their I mean, how happy are they with the start they've had? Well, I think Epic is a great business partner. I don't want to comment about their platform. I'm just happy to see they are investing and they are delivering a product that, I would say, a notable number of people have bought our games on. So that is really what I'd like to say about that. Okay. Switching over to Part and Publishing quickly. Strong quarter in a seasonally weak quarter, I suppose. Now I think the next generation of consoles is obviously coming sooner or later is everyone's best guess, I think. What you hear about the discussions and what can we expect? When will it be released? And what impact will it have on your different segments? I think this is a general expectation of a new generation of consoles in the future. Obviously, we are in a number of well, we are in discussions with all the industry, and I can't disclose any details before they announce anything. But I will say, in general, when you have the shift of generations, you need to be careful and kind of releasing that big new content on that new generation? Or are you kind of releasing that big new content on that new generation? Or are you kind of in the end of it on the current generation? And this is decisions and we have 80 products under development. So along with new technologies such as streaming, there is a lot of decisions excited about the industry. I think it's vibrant and dynamic, and I think we are, again very well positioned in the industry to capitalize on this. And I'm going to try to ask this, although I might not get an answer, but Stadia, you mentioned briefly, very exciting, I think, and seems like the future of gaming, at least to me. Can we expect more news about this during E3, yes, in particular E3, I guess? I don't want to comment on Stadia alone, but I think we have a presence on E3. Tissue Nordic in Vienna has a presence. Deep Silver and Coffee Stain does not have that presence on E3. So Tissue Nordic as a publisher has a a publisher has a presence. We will announce our lineup and news along the way, and I let my companies and great teams doing that when they are ready. Sure. And M and A, Piranha Bytes, interesting acquisition, 3 strong IPs. What is IPs. What is the scale of this acquisition? I mean, you mentioned that it's you had revenues through Corania Bytes of, I think, SEK 180,000,000. Have they scaled up the operations since then? And is this to be considered smaller? I think this sort of business is driven by the release of their development. And they made a game 2017 that we published and we had the revenues and then they had the royalty. They have a new product unannounced, under development and will release it, and we are working hard to expand their audience. And potentially, it could be other things in the future as well. But the company alone, it doesn't really have that revenue that is really channeled through THQ Nordic. In overall group, this transaction alone is not like a key driver financially because if it were, I would having this as insider transaction and disclosing the numbers better. But for me, it's very valuable. Pernodbai has been part of the foundation of the whole group, and it's a great team and I like them as people. So I'm happy to have them on board. Yes. And you mentioned also in the report, I think, an interesting M and A pipeline or an extensive one at least. You have a net cash position of around SEK 2,000,000,000 still at the end of Q5 before this acquisition. SEK 3,000,000,000 SEK 3,000,000,000 SEK 3,000,000,000 SEK 3,000,000,000 SEK 3,000,000,000 SEK 3,000,000 SEK 3,000,000 SEK 3,000,000,000. SEK 3,000,000,000. How are, I mean, price discussions and valuation discussions going? Is it quite stable between quarters years or is it increasing? My preferred way of doing getting more companies within the group is that I get to know people over a number of years, either and preferably doing business with them and get to know them on trade shows and that's the way I prefer and then directly engage with the management owner, preferably without advisers, then you can have direct communication and then get all the advisers in, yes? So that is our preferred route and efficient route to get more confidence to the group. And I would say there is Koch Media added a lot of business relations that potentially could become partner part of the group. So as long as we're growing the group, the more relationships we get, we could potentially add to the family. Coffee Stain had added also a lot of new younger companies into the group. So yes, there is a growing pipeline. I'm not rushing. I'm keen, reasonable terms, understanding and respect each other. That is the key. Perfect. And I have one more question and then I'll leave it over to the floor for a bit. I have a question here from the web, from Ulla Lingouen. He asked why do you use K3 instead sorry, why do you use K3 and operational EBIT instead of a method that is directly comparable to peers? Well, the discussion about doing the main listing in IFRS, I think that is really the discussion. We listed in November 2016, and we have been spending time actually to do business in acquiring businesses and trying to be very transparent, disclosing KPIs, explaining how we are doing our business. And we have a number of time discussed if we are to implement IFRS and do a main listing. And the conclusion has been no, it's not a driver of shareholder value to for me and my management team to spend 6 to 12 months on to do a main listing with IFRS. When analyzing my peers, I would say I respect my peers fully, but I think each and every company has their own way of recognizing revenues and doing amortization. So I think you whatever methods you're using, you need to understand the business. Building a group as this with so much of acquisitions requires a lot of controlling and processes in place, and we are working hard to get even better in compliance. But to make this as a listed company every quarter at the current, it's a lot of requires a lot of efforts. And I think I don't want to rush into this. I just want to improve on the processes we're having. And don't want to make a promise if we are to make out for us or remain listing Monday. I think that is, at the moment, not something on the table. I'm focusing on the processes and compliance and the control in the business along with further growth in the businesses and M and A. Fair enough. Seems smart. With that, I think we'll leave it over to the telephone line and also to the web, see if we have any questions there. Thank you for the benefit of the participants on the phones. Okay. We have one question on the phone so far. That's from the line of Lars of Pareto Securities. Please go ahead. Your line is open. Hi, Lars. Let's start with Metro and the Epic performance. Would you say that the sales on the Epic Game Stores has performed in line or better than what you expected in the beginning of the year? I think Epic, along with other digital platforms, has in general performed a bit better than we expected in the beginning of the year. And do you see a continued strong take up at Epic for the game that In a way, yes. However, you need to remember this is a single player game. You have a substantial part of the revenues coming in early. And then the revenues are driven by promotions. Additional sale spikes for the game once you release the DLCs? It will be 2 major DLCs as far as I have got it. Will there be a potential boost of sales then for the original copy as well? Yes. We do have an expectations on the DLCs. Normally, you release DLCs, you have a pickup. But you're also delivering reasons for the consumers to come back to their product and share it with their friends, the experience. But along the line, you can also make new bundles, new gold packs in the future when releasing more content. So that is also a driver looking forward. And another Epic Games Stores product, satisfactory, really strong results. So there is no one off the it's the strongest results from Coffee Stain is mainly due to sold copies of the satisfactory game at Epic Game Store? Yes. That's, I would say, is the right way to put it, yes. Yes. And it was late published late in the quarter as well. On new signed products, you have signed a new product with 4A Games and you have signed a game with for our Iron Harvest with King Art. Will you be investing in both these projects? Investing, yes. Otherwise, we shouldn't count them. Yes. So all A2 products are games we're investing into on the balance sheet. But it's a fair point. We do release products that we are not investing into, and they are not counted in this 80. So possibly a metaphor. Okay. And then on Partner Publishing, Q2 will be lower than last year comparable calendar Q2. But how about the pipeline? How is the pipeline building up for H2 2019? Well, for the current quarter, seasonally is a weaker quarter, and we don't have the same number of releases either in our own publishing or partner publishing segment. So please don't expect too much out of the quarter. We have a number of things coming out. We do have a business, but please be reasonable. Yes. And the pipeline for Q3 and Q4, how is that building up? Yes. Well, it is building up. I think notable, what I could see, we would have reasonable quarters, but not as strong potentially in the release list as previous years in our fiscal year Q2 and Q3. But Q4 at the moment looks very strong release list. But release lists are changing more or less on a daily basis. Obviously, it's perhaps not the biggest products, but there is a of changes. So preferably, we are communicating the upcoming quarter closer to the quarter. And we're also signing new products along the year. So it's a bit hard to have a full sight exactly on each quarter. And 2 more game specific question from me before I hand it over. First of all, preorders on Monster Jam, is it tracking according to expectations? Or what do you see? Well, I think well, I do have some expectations personally on this game and the team to deliver an experience from the Monster Jam fans that I would be pleased with, to start with. And there is a great number of fans from Monster Jam, especially in North America, but also in Europe. That's my expectations. In terms of number of units, I don't think this is a title you are preordering that much. I think this is a title you're buying when it's available and especially on partly in America physical channels. But it's a title that could sell for a good number of periods and years to come. So yes, that's my expectations. And finally, Biomutant, it seems like a perfect fit for Asia. Have you been trying to promote the game in Asia? And have you seen increased interest for the game worldwide? I would say in general, overall, Asia is a great opportunity for us that we haven't engaged in. We don't have an office down there. Bit in We are engaging a bit in Japan, but I think that is a stable opportunity for us going forward. But we don't have the manpower to do everything at once. So I think we are right now, we are just focusing on delivering a great product to the audiences we have communicated with in the West. Let's see what happens if anything happens in Asia. Okay. Yes, do we have any more questions? I was just going to say there's no further questions on the phones at this time. Great. Thank you. I think we have one question from the floor here. Go ahead. Ken Rump from Jefferies. Lars, firstly, that slide of the major games and the top secret games, are we meant to take it that that's a guide to the most important games as you see them at the moment and that it's this fiscal year? No. Right. So it could be extending into I would say the 4 bottom ones are notable, my preferred choice. So worth mentioning even though Definitely worth mentioning, but we do have extensive other line of other notable releases that I for some reason Just curious, kind of what gets on to slide. Couldn't fit into the slide here. They are not all coming out this year. So there is no links to the financial year of that top secret projects. Okay. And on Piranha, a couple of questions, appreciating that it's modest in size. Firstly, can you having had a look at what people are saying, it's hard to separate kind of fact from speculation. It seems that LX2 is confirmed, but a date is not. But there's also speculation about a gothic sequel and so on. Can you separate kind of what's released from what's speculated? Well, there is no official release statement, communication about the Elex 2. I think that is not the information I have on my desk. Okay. But they do work on a project that will be announced. Gothic is an absolute iconic IP. I see this super long term. So gothic has pros and cons and opportunities, But I think there is huge expectations from a fan base, and I think we need to be cautious and careful what to do here and when and how. So if anything are being done, that will be communicated from Piranha Bytes and Tissue Nordic in Vienna. And in using it as an example of why businesses choose to join the family, as you describe it, sell their businesses, I think there's a reference in the statement to kind of it kind of implies that some of the people who have sold the business are staying and perhaps some aren't. So this is a chance for some backers to kind of exit financially, but for the key people staying there or Okay. Thanks. Berenberg Bank. Just a couple of questions from me, Lars. Firstly, on with relevance to Epic Store. Clearly, they have lower platform fees, and you've had some good success on the Epic Store in the last quarter. Do you envisage that platform fees will continue to reduce across other platforms as a result of the success of this store? And just secondly, on M and A, clearly, a smaller acquisition here. You've got considerable cash and debt facilities if you choose to exploit them. Is your focus not going to be on larger transactions deal? And then just lastly, on financial reporting, there's been a lot of discussion about calendar versus financial year. Just to clarify, you will be reporting March or April to March going forwards? Yes. April to March going forward, yes. That's our next financial year. First question, Epic Games Store. Do I expect other platforms to lower their fees? Well, I don't know if I think I should comment on that. I think in general, I would embrace and anyone that are delivering me us higher gross margin and profit on our content, obviously, and delivering the same value. And on I think competition is always good. I have competition. I think competition in general is good. So we are embracing Epic at the moment in a number of ways. But I don't know. To answer your questions, I don't know. You don't know if the other No, there's nothing announced on that. So second question was Just on M and A, how in terms of looking at the market prices? Yes, well, to be honest, where does it work take place? We do M and A on the from the group level. We're supporting our groups to do their M and A, but they are doing a lot of the M and A. And they Perna Baez will be part of the Tischko Nordic Group in Vienna. So we are not spending a lot of time in the mother company on that transaction. I'm focusing on game changing transaction for us that could add a 4th or a 5th pillar to the group. But I do like this small, nice, built on acquisitions, and I will continue doing them within the group. So I think we have a question from Pierre. Pierre Maelstrom from Handelsbanken. Just on the deals you mentioned that you've been signing during the year that sort of reduces your financial risk going ahead. It seems to me that these kind of deals, the activity has increased. Would you say that's a result of sort of increased competition among distributors? Or is that more like that they're recognizing that you are important increasingly important as a content creator going ahead? I think it's driven by a handful of really big companies are entering the market space, and they want to build their own we are still we are still a small, humble player from Wernlund. But along the way, we've been growing a bit, and I think we are having a notable range of products now for partners. And the biggest peers we have, they have their own platforms partly, and we don't have our own platforms. And because of that, we're becoming irrelevant partners, I would like to say. Still, the business decisions, what platforms, pricing, release dates, etcetera and content being built are made in the groups. However, we are sharing information, obviously. Thank you. Thank you. Prederig from Nordea. A question on the Epic Game Store. Do you or do they dictate the pricing of the products you put there? Because there have been some feedback from other developers saying they're unhappy with always dictates the price from the beginning. And then we are working together with the platforms to with their And on the acquisition of Piranha, could you say how many years typically they take for the development of each game? I think games like this in general are taking like 3 to 4 years, but it could vary, but And listening into the reports and looking at the reports for your biggest peers, several of them, Activision, Ubisoft and Take 2 have commented that the free to play platform has been a bit troublesome for them and that they might go that route as well. What is your thinking on this changing market dynamic? Well, 1st all, we are a smaller player. And for us, smaller games makes a bigger difference. And we are very diversified, 8 products, 3 groups in many genres and business models. And when other people are leaving the field, it creates bigger opportunities for us. I think I love to have an amazing big 100,000,000 player base free to play game with consumer spending. However, it requires a substantial investment to even think about that. So I think we are building on our knowledge and the IPs and the teams we're having. And sure we will exploit new business models in the future, and it's always a consideration when you're starting up a new development project, what business models obviously there will be. And you said something about adding a new pillar, growth pillar for your segment? Well, a new pillar, we have 3 pillars. We have an ambition to grow through M and A. So whether that being a publisher or being something else. Can you give any flavor as to what do you think the group is lacking now? Is it in terms of geographical footprint or better in the genre? I think that if you look up from that perspective, we are stronger in Europe than in North America. We don't have any presence in Asian markets. We don't have any presence in all business models in the industry. I think there is plenty of room to grow within what we understand and know premium games in the West. That is a huge market that we are focusing on, on PC and console. For me, the key driver is to find reasonable terms that delivers values for both parties. That is the key driver. As long as you identify the company and people, you can think, okay, they are suitable into the group and we could work together. It's all about actual transaction rather than where they are located, for example. And finally, on visibility that you mentioned before, how much more confident are you now on your future revenues? I mean, you said it's notable. I think it's notable that we signed deals and gives us a bit of better confidence about derisking the financial risk in our content pipeline. It makes a difference. However, there is expectation. I'm sure your product has an expectation on certain games in the future. So I don't think this is on the top of things. I think it's just derisking some expectations, I would say. Right. And we have a question from the webcast, which I will read here as from Tom Singlehurst at Citi. He asked, it feels like there's a tidal wave of AAA titles coming down the pipe from across the industry in the next few quarters. Is there a danger that the consumer is overwhelmed? And structurally, does this mean that marketing costs are coming up? Well, it's a tricky question. I think, 1st of all, again, you need to focus on delivering experience that our consumers are willing to buy into. If you do that, there is still a huge market and you could beat or prosper within the competition. I don't see the marketing costs coming up from my view here. I think there is a very strong support in terms of marketing from various platforms as well. When you are doing premium games, AAA games, you can get strong support for platforms. So I think that is one of the key drivers. Okay, great. We have a question down here. Christopher, Redeye. You mentioned Asia, and I think I saw an interview with Clemens regarding Japan. What's your view there? Will you dip your toes with more possible publishing deals or are you looking for M and A strategy? Well, I think first of all, is Tissue Nordic in Vienna as a publisher establishing a marketing office kind of in Japan. I don't think we should overestimate the financial impact of that. And they are now directly thinking of publishing some content and working closer to the Japanese premium games industry. It's not us as a group. It's like the Vienna guys finding their ways in but we are sharing the same name, and there's a bit of confusion here. I love Japan. I love what they're doing there, their ambitions there. But financially, I think it's a long way to go until there is a notable revenue stream for the group. And with E3 coming up, it looks like there will be 2 announcements at least, but that will also It's not issued in Vienna. Yes, it's from Vienna. Yes. Okay. Thank you, Lars. Yes. Question here. Yes, Just another streaming question. And I noticed that your games are on GeForce NOW, which is obviously NVIDIA's streaming platform. Is that one of the deals you've mentioned earlier? Or is that something that 4A has done on themselves? No, we are publishing the game. So any deal for selling the game would be under us. Can you comment more on the key personnel platform? Yes, I think NVIDIA is a great partner for us, yes. And it's we've been working together with on Metro Exodus. Obviously, Metro Exodus being a huge game with amazing graphics and so on, it's been suitable to do a partnership. Okay. And there's no questions from the floor. I think maybe that's it for today, running over time a bit. So thank you very much. Thank you very much.