Stillfront Q1 2018 Interim Report

Key insights

6 takeaways

01
Stillfront Group reported Q1 2018 net revenues of 315 million SEK, marking an 11% quarter-over-quarter growth.See it on page 21
02
The company achieved an adjusted EBITDA margin of 34% and an adjusted EBIT margin of 24% for the first quarter of 2018.See it on page 21
03
User acquisition costs totaled 85 million SEK, representing 27% of net revenue, with a business model designed to reach breakeven on marketing spend within six months.See it on page 7
04
The portfolio maintains a user base of 5 million monthly active users and 1 million daily active users, anchored by the Empire and Big Farm brands.See it on page 15
05
Operations consist of 430 employees across nine studios in Europe, the Middle East, and North America, utilizing a decentralized model to manage game lifecycles.See it on page 2
06
Strategic objectives for 2018 include achieving an EBIT margin exceeding 30% and pursuing further expansion through M&A and organic growth.See it on page 25

Summary

Stillfront Group’s Q1 2018 interim report outlines the company’s position as a market leader in free-to-play browser and mobile strategy games. The primary thesis centers on achieving high financial predictability and stability through a diversified portfolio of long-lifecycle intellectual properties, data-driven user acquisition, and a decentralized studio model. By leveraging established brands and proprietary game engines, the company aims to minimize risk while maximizing the return on marketing spend and operational efficiency.

Key financial performance indicators for the first quarter of 2018 include net revenues of 315 million SEK, representing an 11% quarter-over-quarter growth. The group achieved an adjusted EBITDA margin of 34% and an adjusted EBIT margin of 24%. The portfolio is supported by 5 million monthly active users and 1 million daily active users, with significant revenue contributions from blockbuster titles such as the Empire and Big Farm brands. The company maintains a strong focus on performance-based marketing, with user acquisition costs totaling 85 million SEK, or 27% of net revenues, and a proven model where marketing investments typically reach breakeven within six months.

The report covers global operations across nine studios located in Europe, the Middle East, and North America, employing 430 professionals. The company’s methodology relies on rigorous, data-driven lifecycle management, where game development, testing, and marketing spend are continuously evaluated against return on investment metrics. Strategic priorities for the remainder of 2018 include organic growth, the realization of synergies from the Goodgame Studios acquisition, and continued expansion through M&A. Long-term financial targets include maintaining an EBIT margin exceeding 30% and pursuing organic growth that outpaces the broader gaming market.