MTG Q1 2021 Interim Report

Key insights

6 takeaways

01
Modern Times Group achieved a 9% increase in net sales to SEK 1,011 million in Q1 2021, driven by an 8% organic growth rate in the gaming vertical.See it on page 8
02
The gaming segment's performance was bolstered by the strategic acquisitions of Hutch and Ninja Kiwi, helping to offset an 18% decline in the esports division caused by pandemic-related event cancellations.See it on page 2
03
Adjusted EBITDA improved to SEK 100 million, supported by internal cost-saving measures and the strength of the gaming portfolio.See it on page 8
04
The company reported a net loss of SEK 124 million, a marginal improvement from the SEK 132 million loss recorded in Q1 2020.See it on page 1
05
ESL Gaming secured a three-year, $100 million sponsorship renewal with Intel to maintain market positioning despite current esports volatility.See it on page 7
06
Financial stability was strengthened through share issues, resulting in a cash and cash equivalents balance of SEK 1,750 million by the end of the quarter.See it on page 14

Summary

Modern Times Group achieved a 9% increase in net sales during the first quarter of 2021, reaching SEK 1,011 million. This growth was primarily fueled by a robust performance in the gaming vertical, which saw an 8% organic growth rate and benefited significantly from the strategic acquisitions of Hutch and Ninja Kiwi. While the gaming segment served as the primary engine for revenue expansion, the esports division faced persistent challenges, recording an 18% decline in total reported growth due to the ongoing impact of pandemic-related event cancellations and reduced publisher activations.

Despite the headwinds in the esports sector, the company successfully improved its adjusted EBITDA to SEK 100 million, reflecting the efficacy of internal cost-saving measures and the strength of the gaming portfolio. Financial stability was further bolstered by a series of share issues, which strengthened the equity position and resulted in a cash and cash equivalents balance of SEK 1,750 million. Although the company reported a net loss of SEK 124 million, this figure represents a marginal improvement over the SEK 132 million loss recorded in the same period of the previous year.

Operational highlights underscore a focus on long-term market positioning, most notably through a record-breaking three-year, $100 million sponsorship renewal between ESL Gaming and Intel. By balancing active venture capital investments with a diversified gaming portfolio, the company is positioning itself to capitalize on the anticipated return of live esports events. The current strategy remains centered on leveraging these diversified assets to drive sustainable growth across global markets, effectively navigating the volatility inherent in the digital entertainment and competitive gaming landscape.