Company Description for Admission to Trading: Coffee Stain Group AB

Coffee Stain Group AB is preparing to list its class B shares on Nasdaq First North Premier following the distribution of Embracer Group holdings to Embracer shareholders. The listing will take place on 11 December 2025, with a record date of 9 December 2025. Swedish “Lex Asea” tax rules apply, and no brokerage fee will be charged for the transaction. The company’s disclosure is not audited and contains forward‑looking statements that carry risk factors.

Revenue concentration remains a core concern: approximately 90 % of sales derive from six flagship titles, including Goat Simulator, Satisfactory and Valheim. These games generate robust free‑cash‑flow through DLCs, expansions and platform deals, yet the concentration exposes the group to rapid industry shifts, technology upgrades, cyber‑security threats and talent attrition. The decentralized studio model and heavy reliance on intellectual‑property protection further heighten vulnerability to IP disputes and regulatory non‑compliance. Currency exposure from USD‑denominated sales, goodwill impairment risk, and potential liquidity volatility for newly listed shares add to the financial uncertainty.

Financially, FY 2024/25 adjusted EBIT fell from SEK 240 million to SEK 126 million, with margins dropping from 50 % to 31 %. Cash EBIT and free cash flow also declined, driven by higher acquisition amortisation and tax payments. Despite this volatility, the company maintains a healthy cash‑EBIT margin (~44 % FY24/25) and a debt‑free cash position of SEK 500 million as of Q2 2025/26, providing flexibility for growth or shareholder returns. Dividend policy remains uncertain; Swedish law and board discretion may preclude payouts if distributable funds are insufficient or debt levels rise.

Governance is structured around a six‑member board led by CEO Anton Westbergh, with CFO Erik Sunnerdahl appointed in 2025. Share‑class distinctions grant A shares ten votes each and B shares one vote, with a total of 225 million shares after a late‑2025 split and bonus issue. The company’s articles of association outline preferential rights, capital limits, and procedures for issuing new shares, all governed by Swedish company law. Digital distribution agreements with major platforms secure publishing rights and IP ownership, while all related‑party transactions are declared arm’s‑length. The group’s competitive strengths lie in a capital‑light early‑access model, strong community engagement, and a diversified pipeline across sandbox, simulation and cooperative action genres.