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Embracer Group FY2023 Q1 Earnings Release

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Aug, 2023 APRIL – JUNE 2023
Q1
FY 2023/24
EMBRACER GROUP
INTERIM REPORT

Disclamer
EMBRACER GROUP – INTERIM REPORT Q1 FY 23/24
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2

Interim Report Q1 FY 2023/24
BRIEF SUMMARY
3 Source: as of June 30, 2023
Net Sales Group
SEK
10,450m
Adjusted EBIT S EK
1,673m 47
%
YOY GROWTH
27 %
YOY GROWTH
GROUP ORGANIC GROWTH
GROUP PRO FORMA GROWTH
20 % 17 %
Adjusted EPS
S EK
1.23 (1.18)
AFTER FULL DILUTION
SEK 7,000m
–9,000m FY 2023/24
(REITERATED)
Adjusted EBIT forecast
Dead Island 2 and Remnant II
performance jumpstart FY 2023/24
RELEASED IN Q2
RELEASED IN Q1
The restructuring program is on track
Exciting pipeline looking ahead for FY 2023/24…
+ a strong slate of other notable releases

Operating segments

Operative Groups by segment
OPERATING SEGMENTS | Q1 PERFORMANCE
5 Source: as of June 30, 2023
MOBILE GAMES
Internal Headcount: 1,196 | Internal Studios: 11
ENTERTAINMENT & SERVICES
Internal Headcount: 967 | Internal Studios: 3
TABLETOP GAMES
Internal Headcount: 2,579 | Internal Studios: 22
837(21%)
424(29%) 206
(6%)
284(15%)
0
5 00
1000 1500
2000 2500
3000 3500 4000
4500
Net sales Adjusted EBIT and Adjusted EBIT margin
PC / CONSOLE GAMES
Internal
Headcount: 10,469 | Internal Studios: 103
3,996
1,438
3,184
1,832
PC / CONSOLE GAMES TABLETOP GAMESE&S
NET SALES AND ADJUSTED EBIT PER SEGMENT | Q1 FY 2023/34
MOBILE GAMES

NEW RELEASES
PC/Console Games
6 Source: as of June 30, 2023
BACK CAT ALOG SALES SEKm NET SALES REVENUE SPLIT SEKm& ADJUSTED EBIT MARGIN
44%
35% 32%
26% 26%
34%
16%
10%
21%
0 5 10
15 20 25 30
35 40 45 50 0
500
1,000 1,500
2,000
2,500
3,000 3,500 4,000 4,500
Q1Q2Q3Q4Q1Q2Q3Q4Q1
FY 21/22 FY 22/23FY 23/24
Back catalog sales New releases sales Other Adjusted EBIT, margin %
3,996
0
500
1,000 1,500
2,000
2,500
Q1Q2Q3Q4Q1Q2Q3Q4Q1
FY 21/22 FY 22/23FY 23/24
1,589
TOP 10 BACK CATALOG
ORGANIC GROWTH PRO FORMA GROWTH
38 % 20 %
REMNANT II

PC/Console Games
Exciting pipeline ahead for FY 2023/24

0.0 1.0 2.0 3.0
4.0
5.0 6.0 7.0
8.0 9.0
10.0 11.0
12.0 13.0 14.0
0 510 152025
Project ROI (Contribution / Investment)
Quarters since release
PC/Console Games
8 Source: as of June 30, 2023
• Based on reported numbers until
30 June 2023
• Sample includes projects with sales
above 40 SEKm or investment above
40 SEKm (69 projects)
• ROI = Contribution / Investment
• Contribution = Gross Profit less
marketing expenses from release to 30
June 2023.
• Investment = Capitalized Development
Expenses including follow -on
investment.
SEK 20.3 Bn
in net Sales
SEK 14.3 Bn
in Contribution
Average title project data:
Sales 294 SEKm , Contribution 207 SEKm
and Investment 86 SEKm.
SEK 5.9 Bn
in Total Investments
DET AILS PROJECT ROI (CONTRIBUTION/INVESTMENT)
>100
2.41x in average
1.0x in break even

PC/Console Games
9 Source: as of June 30, 2023
PROJECT PIPELINE # INVESTMENTS AND COMPLETED GAME DEVELOPMENT
1.8x
1.4x
3.4x
4.8x
2.6x
3.1x
2.5x
3.6x
2.0x
0.8x
3.2x 3.3x
2.1x

1
2 3
4
5
6 0
200 400 600 800
1,000
1,200
1,400
1,600 1,800
Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1
FY 20/21 FY 21/22FY 22/23FY
23/24
Value of completed game development
Investments in game development
Investment in game development as X times completed Games
73
124
167 153
52
56
55
62
0
50
100 150 200 250
Q1 Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1
FY 20/21 FY 21/22FY 22/23FY
23/24
Unannounced Announced
215 SEK 10,673 m
in capitalized development as of Q1

NET SALES DRIVERS
Mobile Games
10 Source: as of June 30, 2023
Sudoku.comNonogram.com
Number Match Blockudoku
Art Puzzle Jigsaw
Puzzle
USER ACQUISITION COST DAILY ACTIVE USERS & MONTHLY ACTIVE USERS (PRO FORMA)
NET SALES SEKm& ADJUSTED EBIT MARGIN
307
300
283 316
312
36 36 34 34 33
– 10
20 30 40
50 60 70

50
100 150
200 250 300
350
Q1
Q2Q3Q4Q1
FY 22/23 FY 23/24
MAU DAU
million
SolitaireSuper Stylist
Pixel Art – 12 % -12 %
1,488 1,441 1,573
1,3171,438
19 % 22 %
29%
25%
29 %
0
10 20
30
40
50
0
5 00
1,000
1,500 2,000
Q1
Q2Q3Q4Q1
FY 22/23 FY 23/24
Net sales, SEK m Adjusted EBIT, margin %
883
755733
555
641 59%
52 % 47 % 42% 45 %
-2 8
18 28 38 48
58 68 78 88
0
2 00
4 00 6 00
8 00
1,000
Q1
Q2Q3Q4Q1
FY 22/23 FY 23/24
UAC, SEK m UAC, % of net sales
DRAGONVALE
ORGANIC GROWTHPRO FORMA GROWTH

Tabletop Games
11 Source: as of 30 June, 2023
NET SALES SEKm& ADJUSTED EBIT MARGIN
NEW RELEASES
STRONG PIPELINE
3 PRESTIGIOUS INDUSTRY AWARDS
9 % 7 %
2,665 3,2474,146
3,0743,184
17%
14%
21%
8
% 6%
0 5
10 15 20
25
30
35
40 –
500
1,000 1,500 2,000
2,500 3,000 3,500
4,000 4,500
Q1 Q2Q3Q4Q1
FY22/23 FY23/24
Net sales Adjusted EBIT margin, %
CAT AN
ORGANIC GROWTHPRO FORMA GROWTH

83 %
Entertainment & Services
12
NET SALES
SEKm& ADJUSTED EBIT MARGIN
466
4651,360
811671 784 2,328
1,487 1,832
9
%
14%
8%
4% 3%
1%
8%
4%
15%
0
5 10
15 20
25
0
5 00
1,000 1,500
2,000
2,500
Q1
Q2Q3Q4Q1Q2Q3Q4Q1
FY21/22 FY22/23FY23/24
Net sales Adjusted EBIT margin, %
Source: as of June 30, 2023
70 %
ORGANIC GROWTH PRO FORMA GROWTH

Market update
OPERATING SEGMENTS | Q1 PERFORMANCE
13 Source: as of June 30, 2023 | * Newzoo | ** NPD / Circana and Asmodee
144 179
193
183188196205
212
2019
2020202120222023202420252026
PC *
expected to grow by
+0.5 %
in 2023
The European Tabletop
market grew across all
key product areas
Mobile *
e
xpected to grow by
+0.8 %
in 2023
Console *
e xpected to grow by
+7 %
in 2023
USD billion Forecast
2019-
26 CAGR 6% Source: Newzoo
Tabletop **
down in Q1 by
-1.3 %
YoY
GLOBAL VIDEO GAMES MARKET REVENUE FORECAST GLOBAL MARKET

Financial Performance

Financial development
FINANCIAL PERFORMANCE | Q1
15 Source: as of June 30, 2023
GROSS MARGIN DEVELOPMENT SEKm DEVELOPMENT OF MARKETING COSTS SEKm
DEVELOPMENT OF OPERATING EXPENSES, NET SEKm
2,751
19% 20% 17%
25% 23% 22% 21%
29% 26%
0% 5%
1 0% 1 5% 2 0% 2 5%
3 0% 3 5% 4 0% 0
500
1,000
1,500 2,000
2,500
3,000
Q1 Q2Q3Q4Q1Q2Q3Q4Q1
FY 21/22 FY 22/23FY 23/24
Operating Expenses, net Operating Expenses, net, as % of sales
ADJUSTED EBIT SEKm
1,673 37%
30%
22% 20% 19% 22%
17%
10%
16%
0% 1 0%
2 0% 3 0% 4 0%
5 0% 6 0% 0
500
1,000 1,500
2,000
2,500
Q1 Q2Q3Q4Q1Q2Q3Q4Q1
FY 21/22 FY 22/23FY 23/24
Adjusted EBIT Adjusted EBIT margin, %
10,450
76% 76% 66% 73% 65% 66% 56% 58% 63%
0% 2 0%
4 0% 6 0% 8 0%
100%
120% 0
2,000 4,000
6,000
8,000
10,000
12,000
Q1Q2Q3Q4Q1Q2Q3Q4Q1
FY 21/22 FY 22/23FY 23/24
Net sales Gross margin
444
641
13%
17%
20% 20%
16%
13%
10% 10% 10%
0% 5%
1 0%
1 5%
2 0% 0
200 400 600 800
1,000 1,200 1,400
Q1 Q2Q3Q4Q1Q2Q3Q4Q1
FY 21/22 FY 22/23FY 23/24
Marketing, Non UAC Marketing, UAC – Mobile Marketing, as % of Net Sales

Cash flow and net debt
FINANCIAL PERFORMANCE | Q1
16 Source: as of June 30, 2023
SEKm FY23/24
Q1 FY22/23
Q1 TTM
Q1
Adjusted EBITDA 2,6971,86710,696
Cash Tax -229 -180 -951
Other items –
319 91-698
Operating Cash flow 2,1491,778
9,047
Net investment in intangible assets -1,911 -1,204 -6,703
Net investment in tangible assets -103 -76 -524
Net investment in financial assets -223 -32 -252
Net Investment -2,237 -1,312 -7,479
Free Cash Flow before WC
-88 466
1,568
Change in working capital –
511 -1,260 -1,413
Free Cash Flow after WC -599 -794 155
Cash Flow from financing activities 1205,860 2,760
Net investment in acquired companies -392 -1,014 -9,444
Cash Flow for the period -871 4,052 -6,529 SEKm June 30,
2023 June 30,
2022 March
31,
2023
Cash 3,95210,227 4,662
Current investments 171,533 18
Current liabilities to credit institutions –
17,962 -13,865 -683
Current account credit facilities -88 –
208 -17
Non -current liabilities to credit institutions
-2,671 -9,172 -19,560
Net Debt ( -) / Net Cash (+)
-16,752 -11,486
-15,581

Adjusted EBIT forecast reiterated
FINANCIAL PERFORMANCE | Q1
 Based on the performance year -to- date, we have increased confidence in our forecast range.
 In the PC/Console Games segment, a solid earnings growth is expected, driven by the release of more large- and mid-
sized, internally developed games during the financial year. Adjusted EBIT within the PC/Console Games segment
weighted towards H2, driven by improved ROI for releases in H1 and a strong lineup of new releases in H2.
 In the Mobile Games segment, a low single- digit organic growth is expected, with gradually stronger growth during the
financial year. The Adjusted EBIT margin is expected to be largely in line or slightly above FY 2022/23.
 In the Tabletop Games segment, high- single-digit organic growth is expected, driven by the trading cards product area,
with an Adjusted EBIT margin slightly below FY 2022/23. Earnings seasonality is expected to be more pronounced,
driven by cost phasing, timing of new releases and product mix.
SEK 7,000 –9,000 million
Financial Year 23/24
FORECAST ADJUSTED EBIT

Q1 update on the
restructuring program

Q1 UPDATE ON THE RESTRUCTURING PROGRAM
Today’s speaker
19
MÜGE BOUILLON
FINANCE WORKSTREAM LEAD, EMBRACER GROUP & CFO, ASMODEE

Reminder of the objectives
Q1 UPDATE ON THE RESTRUCTURING PROGRAM
At least
SEK 0.8bn annual
overhead savings
At least
SEK 2.9bn annual capex savings Net debt below SEK
8.0bn by end of FY 23/24
Increased cash conversion, improved efficiency and reduced capex targeting :
Compared to Q4 FY 22/23 run-rate Compared to Q4 FY 22/23 run-rate Including impact of SEK 2.0bn direct
share issue completed in July 2023
Measures to be implemented over FY 23/24 reaching full financial run rate impact in FY 24/25.

Program focus areas and phases
Q1 UPDATE ON THE RESTRUCTURING PROGRAM
21
Capex and Opex
savings
Efficiency
improvements
Capital allocation
Clearly defined structure in place under leadership of Executive Management with the
engagement and commitment of Senior Management from across the Group
13 June 2023
Opex and initial phase
capex savings
Further capex savings and
capital allocation initiatives
Further capital allocation initiatives and efficiency improvements including consolidation
31 March
2024
1
st phase
2
nd phase
3
rd phase
For illustrative purposes, not to scale
Main Focus Areas being addressed in phases

Where we are today
Q1 UPDATE ON THE RESTRUCTURING PROGRAM
22
Capex and Opex
savings
Efficiency
improvements Capital
allocation
• First round review of Capital Expenditure completed -initial initiatives to reduce
number of projects and studios have commenced
• Review of Overheads completed –overhead savings initiatives identified within
the range of targets communicated
• Global review of the existing pipeline in progress
• New group-wide investment greenlighting process designed and being rolled out
• Increased external funding of internally developed games and potential
divestment opportunities being worked on as a matter of high priority
Good progress being made and tracking towards the targets
• Important steps taken to create a new process for game investment and game
development progress review.

EMBRACER GROUP | Q1 FY 2023/24
23
A FEW FINAL REMARKS

Until ~10:00 CEST
Q&A