Everyone, welcome to our Q2 presentation. We start with slide number two to just briefly present our company, then we will walk through the performance during the second quarter on both the business side, operations side, and the financial side. Stillfront, we focus on a particular part of the gaming market, that is free-to-play online strategy games. We think for many reasons that is the most interesting sector of the gaming market, we should touch upon why we think so during this presentation. We have a strong position in this particular part of the market with 12 studios that have in common, we have 5.9 million monthly active users where 1.3 million play our games every single day.
We have a track record, which we think is quite massive in terms of the number of players that have played our games, that have passed half a billion registered users in our games, and the lifetime revenues from our studios now exceeds EUR 2 billion. We also have on the first slide on the upper right corner, you can see the geographical distribution, both of our offices also of our revenues. We have one clear change from previous quarter, that is that Asia now is up to 23% from previous 17%. That is something we will come back to during the presentation. Also note that the user data on this slide is excluding Kixeye since we consolidate Kixeye from Q3 and forward. Let's go to slide number three. There you see the highlights for the quarter.
We are happy to record a record in terms of revenues and profitability. Our revenues grew by 46% year-on-year, and our EBIT grew by 110% and amounted to 32% EBIT margin. For the first time, we have reached our long-term financial goals, which were that we should grow at least at market pace. We have now organic growth, which is at least three times that organic growth, the market growth. We have last 12 months, 31% EBIT margin. We have reached our long-term financial target. During the quarter, we had SEK 99 million in user acquisition costs, which represents 21% in relation to our net revenue. We also established a new debt financing, we conducted a new share issue to support our further growth as well as the Kixeye acquisition.
Operational-wise, I would like to highlight that we are very pleased with the way that we have developed this growth, mainly through a very successful and rewarding live ops. For most of our products, that means that we have had a lot of updates, we have had a lot of activity of events and similar that have been very rewarding for the user numbers in our products, and very appreciated from our loyal user base. We also have paired that with very solid profitability of our marketing campaigns, and we are pleased to see that Nida Harb 3 has become the largest single product in our portfolio during Q2. As mentioned, we also made an acquisition of Kixeye, which is an industry leader and a strategy game pioneer, truly, which we will come back to. That also was concluded in Q2.
Also finally, the operational highlights are that within the area of live ops, we have been able to see that a lot of synergies taking place where one studio elaborates on how to configure certain events or similar, and that knowledge is really hard currency for other studios and other games as well. We can really see that synergies are coming into play. Turning to slide number four, to look into our portfolio and update you the performance of the second quarter. We have a very good balance in our portfolio. We think it has improved even further during the quarter, both in terms of the different areas, which all three areas are growing for the third quarter in a row.
That, of course, in itself gives a good balance, but also the fact that our largest product now is 18%, even though it has been growing, it's still not more than 18%. We have a good balance amongst our largest products, but also that several mid-size products are growing, and that is important and promising for several quarters to come. Also we have a good balance between more mature products as well as younger products. Looking at the whole portfolio before going into each area, we can also conclude that we are now up to 59% mobile share of our revenue. Looking into the Empire brand, which deposits represent 36% of the total.
Empire has four products as of today, SEK 163 million in deposits, which is more or less on par with last year. With only SEK 13 million in UAC, quite a small portion in relation to deposit. As mentioned, we can again see sequential growth. Since Q3 last year, the Empire brand has been growing by 18%, which is satisfactory we think. Again, we can see in our numbers, and we will come back to that we have a very strong monetization through effective live ops. Since also the UAC is quite low, it's a very strong EBIT contribution from the Empire brand. Looking to the Big Farm, which consists of three products, deposit SEK 80 million, it has really contributed to growth, 9% up. The UAC is lower than for last year, SEK 32 million, still decently high.
The sequential growth of 1.5%, which also since Q3 represents 19% growth, which is a stable and good number. Big Farm: Mobile Harvest is one of the top three growing products organically in our portfolio. Into core products, which represents 46% of the deposits during the quarter, it continue to deliver very high growth, 133% year-on-year. We have a UAC which also is growing but still is very sound in relation to the deposit numbers. It amounted to SEK 55 million. As mentioned, Nida Harb now the largest, or during Q2, the largest product in our portfolio recorded SEK 88 million, which is a fantastic sequential growth as well. We have Shakes & Fidget and Strike of Nations, which for the first time is part of our top products in core.
We also launched in mid late June a new product called Game of Trenches from eRepublik Labs. Looking on next slide number five into some user data and comments on that. For the difference both the number of monthly actives and the daily actives, and on next slide, monthly paying users, it's important to notice as we have declined in year-on-year, in particular for some of our products, that we had a really high intake in Q2 2018, which is the comparison quarter. Actually, Q2 2018 was the quarter where we had the highest UAC in relation to our net revenues ever since we made the merger with Goodgame. That is important to notice. Also we had high intakes in Q4 and Q1. That is in the perspective you should see how these user data have developed.
Still, even though we have this effect, we can see that the monthly active users are on all-time high, and the daily active users are on nearly all-time high. We are pleased with that. We can also just comment that Game of Trenches launch was not contributing so much since it was in the end of the quarter. Again, no Kixeye numbers in this. Turning to next slide number six, the paying user base. Also as mentioned on the previous slide, also the comparison and the fact that we have had high intakes also have an impact, however less, but on paying users. You can see that we have a stable year-on-year growth of 15%, but we do have a decline in Empire, which is 20%, a quite high number.
We have analyzed that, and we are not so concerned about that because looking at the data, we can see that it's users that typically have come in, which is a usual pattern when you increase the total amount of users rapidly, that you can see that some users come in, they pay once or twice or three times or a short period, and then they leave the game. That kind of users that have left, and as we have seen many times, the loyal users are still there, and they really enjoy the new content that we have provided. We are not concerned about that number, and we are confident that that will be stable going forward.
That is also why I think we have a repeat of that analysis that it's the fact as we see how the average revenue per monthly paying user has developed, where we by far have the highest number ever, and it's very pleasing to see that Empire is contributing with a significant step upwards. The new content has been really appreciated amongst our loyal users. Also with live, over all product areas, we have a very good development sequentially over making the total being at all-time high levels of 782 SEK per paying user and month. The main reason to conclude and to connect to the operational highlight for the whole group is that live ops, not only new releases, but also very successful events.
Not the least the events for Mini Heroes during Ramadan and other holidays. Overall, it's very pleasing to see that we can draw a lot of synergies between the different studios, how to make the live ops more efficient. That is basically what the average revenue per monthly paying user development proves. Turning to slide number seven. A few words about Kixeye. I think you easily understand we are not reporting as we are not consolidating Kixeye. We are not reporting any new numbers. Before just going in to repeat why we think this is a very interesting and important acquisition, just repeating the Q1 numbers that we announced in conjunction with the acquisition. We announced the acquisition that was that Kixeye in Q1 had SEK 128 million in revenues with an adjusted EBITDA of SEK 65 million. A very strong profit margin.
We said then, and we say again, that we think that was a representative quarter. We also expect them to have some seasonality, just as we have in our other studios. We're very pleased to see that already we have started to work on several synergies, on marketing, on distribution, and on several other areas as well. That is very pleasing. In general, regarding Kixeye, I just would like to repeat that this is a type of company which is bullseye for us when we look into the market to find new studios to join. They are pioneering in the areas which is really what we know. We understand their business very well, but they also add value in terms of high production value products that are really appreciated by a loyal user base.
We are as pleased we were when we announced it, we are still that pleased at this point in time. We turn to slide number 8, which is the operational update on our business and the numbers. As mentioned, we have revenues of SEK 480 million during the quarter with an adjusted EBIT of SEK 153 million, which represents 32% EBIT margin. That growth of 46% year-over-year, we are very pleased with that. That is mainly organic. The organic growth are well in the 30s, which we think is a very strong number for the organic growth. The profitability of 32% is, of course, a good number as we have 30% as our long-term target. We are also very pleased to reach that level, even though we have a higher portion of mobile revenues since they have lower gross margin.
Also regarding Nida Harb 3, which has grown tremendously well for us and developed well, also have a royalty cost as that is developed by a Chinese developer. Even though we have those two circumstances, we still managed to reach the 32% EBIT margin paired with the 46% growth. As mentioned, for the first time, we have exceeded our long-term financial target. I would like to emphasize that if you look at the upper right rolling 12 months revenues, you can see that it's actually not only in a very stable and predictable growth rate, it's actually exponentially growing, which is for us very important to pair the predictability and the stability in the revenue development with, of course, having a strong growth rate.
You can also see below that how our EBIT has developed also in a progressive curve and with a steady increase of our EBIT margin. We are also very happy to see how the different products in our portfolio from one quarter to another, some of the products have stronger development, but all 32 games are contributing with revenues and profitability every single day. That is what explains much of the predictability and stability in our portfolio and our financial performance. With that, I will hand over to my colleague, Andreas, CFO, to go deeper into the numbers.
Thank you. Good morning, and thank you for joining us this morning. I will go into slide number nine. That's the income statement for Q2. We had deposits of SEK 451 million. We had an IFRS effect of SEK 19 million, which relates to in-game currency being consumed during the quarter. The full year effect of the year is SEK 6 million, because we had a negative effect of this in Q1 of SEK 13 million. Other games-related revenues is SEK 10 million, that gives us a total net revenue of SEK 480 million for the quarter. Platform fees amounted to SEK 122 million, which gives the gross margin for the period of 75%. Onward capitalized, i.e., the staff cost of the activate is SEK 38 million, in total, we spent SEK 43 million in Q2, which is a total CapEx of 9% over net revenue.
This number, as you have seen before, fluctuates over time, but this is representative and in line with our target. Other costs, a total SEK 328 million. Whereof, for the ordinary course of the business, this represents SEK 248 million. Depreciation, amortization, in total SEK 43 million, with the following breakdown: SEK 14 million relates to PPA items, SEK 22 million relates to capitalized product development costs, and SEK 7 million relates to IFRS 16 leases treatment and tangible assets. We had a very busy Q2. We had items affecting comparability in the quarter with a net effect affecting EBIT of SEK 26 million. This is impacted by transaction-related costs to the acquisition of SEK 20 million and a net effect on the assessment on earn-outs provision of negative SEK 5 million, which is driven by mainly better business performances on studios. Net financial items for the period was SEK 23 million.
Of these, 11 million SEK were interest net, 6 million SEK was non-cash charge on earn-out and FX impact for the period. We had 6 million SEK of non-recurring items that relates to the bridge facility, in regards to the Kixeye acquisition and the bond issue. Unadjusted EBIT of 105 million SEK for the quarter, and taxes for the period, slightly lower than previous quarter, but it's still in the higher range because we have more profits on higher rate tax countries. We end the period results with a net result of 73 million SEK. Moving over to slide 6. Sorry, slide 10, balance sheet. Intangible assets contains mainly goodwill from acquisition of 1.6 billion SEK, 1.7 billion SEK, and then we have 553 million SEK of capitalized development products.
The cash that was in transit for the acquisition of Kixeye has been booked as an account receivable on the balance sheet and as an investment in the cash flow. The discounted bond, we discount that, outstanding by annual period was SEK 1 billion or SEK 1.1 billion almost. The most important thing here is that we did strengthen our financial position in the period with first the direct share issue of SEK 500 million, and then we additionally raised a new five-year bond of SEK 500 million. The combination of the already existing bond maturing in 2022 and the new bond maturing in 2024, coupled with our bank facility structures, gives the company a good maturity profile as well as to strengthen balance sheets.
End of the period, the company had SEK 444 million of unutilized credit facilities, as well as SEK 324 million in cash, which creates further financial flexibility for growth. Non-current liabilities is in total SEK 319 million. This is mainly attributable to provision for earn-out and the utilized credit facility. Net debt, SEK 904 million. This gives us an adjusted leverage ratio pro forma of just under 1.4, and an adjusted interest coverage ratio pro forma of 6.5. It's very important to note here that in the EBIT contribution has not included Kixeye. We have fully included the debt of completing the acquisition. Jumping into slide three. Sorry, 11. Cash flow. Cash from operation. We have a healthy cash flow generation in this quarter. We are still slightly impacted by the increase of mobile game. The cash from operation result was SEK 135 million.
Investment, a quarter that was fueled by heavy investment, primarily the Kixeye acquisition, SEK 878 million, and payment for earn-out in the quarter of SEK 116 million, and investment in intangibles and tangible assets of SEK 43 million. In terms of cash flow from financing, as previously said, we did a direct share issue of SEK 500 million and a bond issue of SEK 500 million. We also reduced some credit facilities during the quarter, and we had issue costs of SEK 17 million. Net cash flow for the period, SEK 52 million, positive, and a cash balance by the end of the period of SEK 324 million. I will hand over to Jörgen.
Thank you, Andreas. To finalize the presentation, we think we have a very strong position in the games market. The games market is large and it's growing. The stock is growing actually, and already largest in several years in the entertainment market. We are very pleased with being a leading player within free-to-play online strategy games. We have been able to build and constantly expand our portfolio of products, which diversify our revenue streams in a very good way. We also have been able to do that with a very capital-efficient growth. As Andreas elaborated on our investments for the period in games are approximately SEK 450 million, which is 9% in relation to our net revenue. We have D&A in the same range. We're not expanding our balance sheet in the same way that we expand our revenues and profitability.
Also in addition, I think that we have proven that we have a good track record when it comes to M&A, and we are absolutely confident that Kixeye will contribute for a long time, not only with its own performance, but also with synergies going forward. We can combine high profitable growth and strong financial position, and we do it with leverage, but a conservative leverage. I think that is very good for the Stillfront shareholders. Also concluding then the presentation with, again, see that we have reached our long-term financial targets, but that is not in any way some kind of end station. It's just a platform and a new beginning for taking Stillfront to completely different levels of size and further profitability. That was the last thing from our side, and I think we open up for questions.
Thank you. If you do wish to ask a question, please press zero one on your telephone keypad. If you wish to withdraw your question, you may do so by pressing zero two to cancel. The first question comes from the line of Oscar Erixon from Carnegie. Please go ahead.
Good morning, guys. Thank you. I have a few questions from me. First of all, a really strong performance from core products and Nida Harb 3, really impressive sequential growth there. Can you give some flavor on that, what is happening, frankly? Sequential growth is really strong. Has anything in particular happened, or yeah, some more input on that would be great. Thank you.
Thank you, Oscar. Well, I think it is exactly what we spoke about. It has been a very successful and intensified live operations that the team has been conducting. It's very clear that they have been excelling and learning and improved their operations significantly through the help of other studios. In particular, Goodgame Studios have been supporting them, we know since earlier with marketing and distribution or primarily marketing to get the growth from previous quarters. Now that has extended to also be support both on data and advice on what kind of events to arrange and how to do that in a very efficient way.
I'm very pleased to see that both the tremendous good work that Babil has done, the understanding they have, which is unique for their region, which is very hard for someone else to do from outside, but also that they take in advice and experiences and data from our other studios. That is basically it. It's not so much driven by user acquisition as it is from live ops.
Okay, great. That's very helpful. I won't ask on Empire and Big Farm because I think you touched upon that quite well. I have to ask about the ad revenues that you discussed in the presentation. What has changed your view there with regards to ad revenues? Typically when you have high monetization gains, you would tend to not have ad revenues, but it'd be great to hear your thinking there around that. Thank you.
Yeah. Ad revenues is a revenue stream which I think we have not utilized that opportunity fully. Still, even though it has increased, it's still a quite small portion of our total revenues. I think it will be a small but important contribution rather than being a main revenue driver. We are at a couple of % of our revenues during this quarter. I think it's important and good add-ons, but it's not the main driver and will not be the main driver. In terms of potential, well, I see it would be possible to get up our ad revenues to maybe 5% of our total revenues or even 6%, 7%, but that will be what I expect, not higher than that.
Okay, great. Is this for specific games or is this broader? Secondly, also with the difference between deposits and revenues, could you please explain, maybe for Andreas to explain the IFRS effects, which I find I don't entirely understand given the strong growth. Thanks.
The IFRS effect, it relates to the in-game currency have been spent or consumed. It shows that people have bought in some previous quarters, and we saw that in Q1, we had a negative IFRS effect of SEK 13 million, and then they are consuming what they have paid for. There are many different angles to this. It depends on how we run our campaigns in live ops. It depends on each game, et cetera. If you look it over a period, then you see that these numbers reconcile. If you look at Q4, for example, last year, we also had a negative effect. They sort of net each other out over a period. I would like to emphasize what Andreas said, that this is really consumed from the players in our game during the quarter.
It's not completely strange or something which is odd. It's basically what the users have bought earlier quarters in-game currency. They have a balance, and they utilize that during the quarter. It really represents activity from our users.
Got it. Very strong quarter, and I'm interested in also hearing your view on the outlook. You wrote in a presentation that you had solid profitability on marketing campaigns. Can you please explain that and also compare it to Q2 last year, where you said that it wasn't really a strong marketing profitability and how that plays out or might play out now in Q3 and Q4?
Yeah. As you know, we don't give firm forecasts for many reasons, but I would still comment on the marketing and so on. We have, and we have always had, and we will continue to have a very EBIT-oriented and profit-oriented view on marketing campaigns. We target over all products, all quarters, all markets, and everything that we should recoup net marketing money in 180 days. We have been able to achieve that for a very long time, and we have achieved that this year. As you know, we pointed out in Q4 and especially in Q1 that we significantly overperformed compared to that. We are conservative in terms of spending and complete the data rhythm. When we said solid, we think that we are in the range of what we target, of course.
That is important to understand that we are very EBIT oriented, and we have been able to achieve 180 days net return on marketing spend. Having said that, of course, as always, different quarters are differently strong, so to speak, in general in the market. That has been the case for a long time. Usually Q4 and Q1 are the strongest quarter. Q2 are neutral, and Q3 is a bit weaker due to seasonality and vacations, and it's warmer outside, and you're maybe not playing as much as you do otherwise. That pattern, there's no reason to expect that that pattern will be different this time. What we did that was interesting that you raised that question was in Q2 2018, where we had very high spend, as I mentioned, the highest spending ever in relation to net revenues.
In hindsight, maybe it was still profitable, as the summer became very warm last year, if we knew that, we maybe would have spent a bit less then. Nevertheless, really important that we are very disciplined and we have still, including Q2 last year, been able to reach 180 days money net back.
Great. That's very helpful. A final question from me. I want to touch upon the Kixeye acquisition as well, and especially War Commander: Rogue Assault, which I understand you have high hopes for. What is the status of that game now? Is it fair to assume that you will begin a heavier user acquisition spending now in say September or the autumn, the strong period of year?
Yes, we are still as enthusiastic about Rogue Assault as we were when we announced. We have followed the product and the company for more than a year. We think we have received confirmations on the opportunities with that product. What we usually do. We have done in this case, is that we analyze or we did prior to the acquisition. We have analyzed the product. We know with our expertise from the other studios, we go in. We think that we can improve the product. It's a really high production value product. We still think that some bits and pieces could be improved. That is what is in the making now. We do that since we know, or it's very likely that that will have a positive impact to get into that growth, the planned user acquisition spending to achieve higher growth.
That is in the making. I would also expect with the seasonality taken into account, that it's very likely and we still expect that in Q4 we will be able to grow War Commander: Rogue Assault from the levels where we are today. That is correct, and we feel very enthusiastic about those opportunities. I can also add one thing because that was not so clear, I think when we presented Kixeye, is that Kixeye also have a distribution capability through kixeye.com, which is one thing we also look in. The synergies are not only going in one direction, they are going for sure in two directions, both on live ops but also on distribution. kixeye.com is a very good portal for browser games. We're looking into distributing other Stillfront products on the Kixeye distribution platform.
We have strong distribution capabilities at Goodgame on browser products, but here we add another channel. That is something which we didn't emphasize or mention, I think, during presentation of Kixeye, but that is also a value that we see now.
Great. Thank you very much.
The next question comes from the line of Lars-Ola Hellström from Pareto Securities. Please go ahead.
Hi, Jörgen. Hi, Sten, or hi, Andreas. First of all, the monetization was very strong in all three segments. Have we reached a new level in all segments due to live ops frequency of content updates, et cetera? Can these levels be sustained?
It's a very hard question to answer because the very short answer, I don't know. If someone asked me when we had this call one year ago, I think we were very strong in average revenue per paying user. To be bluntly honest, I think that we have achieved a lot of things which I don't really expected a couple of years ago. It's really striking me how much the value of a loyal user base, how high that value is since we can conduct this live ops and we get so good response on new feature updates and events and similar things of live ops.
Also, as mentioned several times already, I also would like again to emphasize how much synergies lie in this area because you test out a lot of things and instead of doing that by singular studios, we share all those experiences across all our 12 studios. Of course that is creating more precision. It's creating more effectiveness in how each of them conduct live ops. What that means in terms of average revenue per paying users going forward is hard to say, but I'm sure that we will continue to be strong and even stronger in this area. Also you must factor in if we grow very fast and increase the intake of users rapidly, then just by mathematics, the average revenue goes down for a short while before we refine the new base of users, and they come further into the game.
To conclude, what this really tells us is that this is a super important and strong area for us, and it has synergies. That's one thing. On the other side, the value of the loyal existing user base are much higher than we expected, say one and a half, two years ago.
Thank you. Going to paying users, the largest drop was for the Empire segment. Is it reasonable to assume that as it's the most mature segment, that it's also the segment that is most affected by seasonality?
Well, I haven't learned yet that that would correlate, but of course we have a seasonality, but to correlate it to the different individual games is difficult. Of course, there are correlations to region. In Europe, we take more clear vacations than in the U.S. and in Asia, for instance, it's that kind of effect. The most impacting factor on that is whether the sun shines and it's warm outside, and weather forecasting is much more difficult than game forecasting. That is the difficult one. As I mentioned, we are not so concerned about that drop. We know based upon data what users it is that has left a paying one. As mentioned, it's users that have not been so deep into the game, and it's users in territories where we don't have the largest average revenues and similar. We are not so concerned about that.
The product area, all product area has three sequential quarters of growth, and Empire, for instance, has 18% growth since Q3 last year.
Also on the seasonality, should we expect that the seasonality effect will be higher in Q3 than in Q2? If I connect it to user acquisition also, is it reasonable to assume that user acquisition cost in total should be lower in Q3 than in Q2?
As I mentioned several times previously, and also today, seasonality is usually in Q3, so that is correct. How much it will be? I don't know how the weather will be the next coming weeks. Of course, usually the traction in the market increases quite rapidly in September, but that also depends on weather in Europe in particular. It's very hard to say how that plays out. It's impossible, I would say. Nevertheless, that don't take away the general traction we have as a company. We grow by 46%, and when we look at all the 12-month numbers, we are very pleased to see how the company develops. Of course, it will be differences from one quarter to another.
Again, I expect there's no reason to expect otherwise that Q4 and Q1 are stronger, just as we expect, but not know that Q3 is a bit weaker. It's the usual pattern we expect.
Mm-hmm. Another question on user acquisition cost. On the Empire segment, would it be reasonable to assume that it will be quite low until it's released a new game within the segment?
I think it's fair to assume that it's lower than the average, yeah. Also, we also plan to publish new games within all areas, including Empire. Of course as launching a new product that will increase the user acquisition cost, but only if it's profitable. If the data supports that we can scale up a new product, we will do so. If the data supports that we will not get this product profitable, we will not do so. We have, as mentioned, 32 products in Q2, adding four products from Kixeye, we have 36 products to optimize our marketing spend over. Again, connecting back to live ops, live ops is the most efficient and profitable way of growing a game. We're not saying that we must spend X or Y millions in that product or that segment.
We optimize live ops as well as we optimize marketing over the whole portfolio. That is one of the key strengths of our group, I would say.
Thank you. A question here maybe for Andreas. The gross margin of 75%, is that boosted by the IFRS effect on the ad revenue? Is that revenue dropping straight down to gross profit line, when it is now recognized?
Yeah, it's boosted because the platform fees are paid on the deposits that are actually being bought. As we have moved into more of a mobile environment if you take that number over deposits, then it's 2%, which sort of reflects we had a positive gross margin effect on IFRS.
It doesn't correlate.
Ad revenue, is it 100% gross margin on ad revenue? It's just dropping through.
Yes.
Yeah.
But then
Thank you. Okay, that's all from me.
The next question comes from the line of Kristoffer Lindström from Redeye. Please go ahead.
Hi, guys. Congratulations to another great report. I will jump into Nida Harb. You mentioned, as you discussed many times here, the live ops, but also the events and Ramadan. Of the growth of the Nida Harb 3 compared to Q1, was the events and income regarding the Ramadan substantial?
Yes, wherever we are in the world, whatever holidays and similar that exist, of course, that is just as Christmas or other holidays in other parts of the world, it's a very good occasion for having special events. Of course, those are annual, so in that respect, that will not come back in Q3, but there are other holidays and events. Just as we have holiday in December affecting our revenues in Europe in particular, this is likely to have an effect, correct. Again, we do a lot of things, but Easter, Christmas, Ramadan, and other types of special time of year is a very good time for making special events.
Compared to last year's Q2, they didn't need to have similar types of events, or is that type of functionality new in the game?
Yeah, that's a good remark, by the way. I think it shows how they have improved their operations. As I mentioned previously, they have really learned from Goodgame and other studios on how to optimize their live ops and to be even more sharp and precise. Our team in the Middle East, the Babil Games, Babil Games has made a tremendous good job in improving their way of conducting live ops. It's a good remark, Jan, that is what you see the difference in the development from Q2 last year.
Yeah. You stated in the beginning of the report that you had 21% from Asia, up from 17%, I think, only in Q1 also, and 17% last year. Could you comment, in which of the product segments do you see the surge in Asian players?
Sorry, I didn't get that question. What was increasing?
Asian revenue, and in which of the product segments you see the increase of Asian players?
That is primarily its core, and Middle East is counted for as being Asia. That is the very short answer. Also we have a quite decent, but not as dramatic curve, but a decent development in Japan as well.
Yeah, mainly attributed to Nida Harb then during the quarter?
Yeah, Babil Games. That's correct.
Yeah, exactly. I think that was it.
Yeah. Thank you.
No, sorry. I noticed that if you deduct the UAC from other aspects, it was quite an increase in terms of relation to sales. Is that due to increased mobile sales and platform fees, or is it just an investment in the company size? New operations, maybe offices?
No, we had in total of SEK 80 million of items affecting comparability. The other cost, which is in total SEK 328.
Of that, or it's SEK 248 that represents ordinary course of the business.
Okay. Yeah. Maybe I'm getting it wrong, but I have deducted the SEK 26 million. You said maybe you have mentioned how much other items affecting in part of the SEK 26 million.
Yeah. The SEK 26 million is the net effect because we also have a positive effect of earn-outs provision on other revenue.
Okay.
The SEK 26 million, they are accounted for in two ways. In the presentation, we have specified where they are accounted for.
Okay. Super then. I will look into that. Okay, great. Thank you.
There are no further questions registered at this point. I'll hand the conference back to you.
All right. Thank you all for dialing in and having questions. I think we are ready, and thank you all for listening in and dialing in.