Hello, and welcome to the presentation of MAG's Q4 report. Here to present today is me, Daniel, I'm the CEO of MAG. Magnus, I'm the CFO of MAG. Our Q4 is June, July, and August. That's the time period we will talk to you about mainly today, and it's a really exciting report. I think we go straight to some highlights. We saw the revenue grow by 29% this quarter. Something we're really happy about. I think even more exciting is the accelerating user acquisitions. We saw UA start to expand a bit in Q3, and we doubled down on that this quarter. It's a really exciting moment in time for MAG. We're gonna talk quite a bit about that during today's presentation. Let's start with a reflection of the year that passed. It was a record year in many aspects, actually. Starting out with net sales, we had SEK 328 million, which is 14% up year-over-year. We saw our Evergreens growing, which is a testament of the strength and engagement of our core users, oldest users, and also a testament to the efficiency at which these games are operated by a Live Ops team. Yeah. During the Q4 months, we launched a new game, so super happy about that. Tile Mansion launched in English-speaking markets, so we've expanded that further through into Q1, and also started to grow the user acquisition investments throughout Q1 as well. Really good start for Tile Mansion. We see strong KPIs, and we expect a lot of growth for that game coming into this financial year. Looking a bit back in time as well, here we see the last nine quarters of revenue in ARPDAU. As we see here, it's a very strong correlation between ARPDAU and revenue. ARPDAU is really the tool we have to create growth. This is nine quarters, but our growth journey really expands back to the last 12 quarters. We've grown every quarter year-over-year. SEK 90 million of revenues from the games is a record for the company. Last quarter, we also had an extraordinary income from switching to a new ad mediation platform, but for the games business, it's the best quarter ever in the history of the company. This is really, as always, a combination of improving products and investing in user acquisition. This quarter, user acquisition is extra important. Yeah. We'll have a look at our audience KPIs. Where DAU comes in at a lower level, so it's negative 21% year-over-year. We attribute this to an influx of fewer but higher value users from our UA activities, which is an important point. We also see this in the ARPDAU, as already mentioned, it's up 36%. A lot of that is these new users coming in, which are much sort of higher value, but also overall the portfolio is performing well, and we have stable or improving performance also in the games that don't have UA support behind them. Yeah. It's a combo of everything. Yeah. As we see here, like the user acquisition is really up significantly versus a year ago, SEK 15 million-SEK 43 million. Thought it made sense to add a picture here of the sequential development of user acquisition as well to see the shift happening here. In the Q3 report, we talked about that out of those SEK 22 million we invested in Q3, SEK 10 million actually happened in May, so was kind of accelerating into Q4, and we shared that. We started Q4 at the same high pace, and as we see here, we've been able to even accelerate that investment pace. Going up with SEK 43 million, even if we started with 30 as a kind of investment pace in early June. We're happy to share that we're going into Q1 as well into the high pace we saw in Q4. This is really a new time for us in terms of being able to invest much more in UA and super exciting. We've been talking about this basically every quarter report for years. We wanna invest more in user acquisition. As long as we kind of can hold on to our requirements on profitability, we wanna invest more, and now we can do that, so super exciting. Yeah. Doing the same for the user base, looking at DAU in the last five quarters sequentially. We see gradually declining DAU, and we do see, as usual, a softness in Q4. We do expect the numbers to stabilize in Q1 as users come back from the softer Q4 levels. Looking at the core of our most engaged old users, we see a stability and strength in that. We have, again, over 70% of all the users that were active in the quarter were active also one year earlier. So that's a solid base. Yeah. Yeah, look at some sales numbers as well. Yeah. In the quarter, we report a record net sales as we said, with 29% up, and that's boosted by UA, of course, during the quarter, and also by a strong U.S. dollar that we have behind us. As always, with sequentially increasing UA and like this quarter, we have a pressure on contributions, so we have a negative impact on that, and it comes down at SEK 35 million this quarter. We also conclude that we end the quarter at a strong cash position, which gives us good room to operate in this UA-friendly environment that we are in right now. Yeah, we also wanna talk about QuizDuel Live. We acquired the company behind the prime time trivia service two years ago with the goal of integrating that trivia show into our biggest trivia game, QuizDuel. Especially targeting the German market where we have the majority of the active players in QuizDuel. Last summer, we started running the live shows with real money prizes. We saw about 10,000 daily participants, and it grew throughout the fall and reached about 20,000 beginning of 2022. I think if that journey had continued, we'd been at a really interesting place right now. Unfortunately, it leveled out, and then it started to decline, and we took a decision here to discontinue the live shows in early September. This doesn't have a significant impact on our revenues, because the participant level was so low, so that's why we also decided to discontinue the service. It does have an impact on how we look at the value of this acquisition in our books. I think it would be good to go through kind of what it looks like and why. Exactly. We probably should comment this here. It comes through in several places in the report as well, so it's part of the adjustments in both EBIT and EBITDA, so we'll come back to. Based on the activity in the quarter and the decisions there, we have revalued the earn-out. We have written down the earn-out in our debt side of the balance sheet and also the goodwill that we have in the asset side. Those two write-downs largely cancel out, but leaves us with a negative impact of SEK 3 million in the P&L, which we have also adjusted for and as part of the adjusted EBIT, but the details are in the report. We also wanna note here that EBITDA is affected by only one of these components, so it looks much stronger than usual in the books. From here on, I'd also recommend to look at adjusted EBITDA in this report to see the operations more clearly going forward. I think it's a good moment also to talk about how we in general look at acquisitions. We've done a number of acquisitions over the last 7-8 years, and this has been our kind of go-to structure to have kind of an upfront payment for the very tangible value we can see, and then have a model about future generations of profits together for the next few years and put that in an earn-out. I think that's a good way to capture potential upside for the sellers and for us as a buyer. If it doesn't happen as we both hope for, it still doesn't have any dramatic effects on the results when we report. I think this captures this really well. This is the approach we're gonna continue to have going forward, to have like, a dynamic payment model so we can capture if profits occur or not. But adjusted EBITDA, as we said, is the number to look at rather than the non-adjusted one. Let's look at the revenue development over the last nine quarters together with the adjusted EBITDA margin. What we can see here, I'm gonna also add the picture of the sequential UA investment. It's of course very correlated. When we accelerate user acquisition, you have a downward pressure on the EBITDA margins, and that's because the payback times are longer than a quarter. That means that we don't get all the money back immediately in the same quarter as we expense for it, and then it puts a pressure short-term on the profitability. Of course, we have a lot of strong models for predicting the future earnings from that investment, and we do it because we see that we will get back the money and with a margin. Over time, this is great news, and we're gonna have growing revenues and even higher profit margins over time. That's kind of the entire idea here. Short-term, this is what you should expect. Given that we see in Q1 we can continue to invest a lot of money in user acquisition, we expect the margins to be under pressure for a bit more. In our usual product mix picture, on the right-hand side here, we have our Live Ops games and our other catalog games as well, coming in roughly as expected, a bit softer in Q4. We can see the run rate here is about SEK 100 million on a yearly basis at a high profitability as always. Yeah. Then on the left side, we have kind of where it's more movement, where we wanna create growth. We have the new games development, where we're working on this game wrapper. We're gonna have a more modular approach, where we build a really interesting world with decoration and narrative and so on, but have a pluggable system for different core mechanics. We're gonna test multiple core mechanics during the fall with this new game. Then on the growth side, as we see here, we have the Q3 revenues to compare to. We had SEK 46 million in the growth side of the business in Q3. Given the kind of seasonality we see, usually it's about 10% down in Q4 because people play less and CPMs are lower and so on. Let's say like SEK 40-ish million would be the expected everything the same, but we still end up with SEK 62 million. This is highly correlated, of course, with our increased investments in UA. Yeah, great to see the growth side growing so quickly. That's what we're always aiming for. Yeah, a quick reminder of where do we see the growth coming from at MAG. One is to expand our portfolio. This is both developing new games in-house, like we did with Tile Mansion, and also, of course, M&A. It's an interesting time right now looking at potential acquisition possibilities. Prices go down in the market, of course. We're always out there and talking to studios. We also work on improving the lifetime values for the live games. We have this super loyal audience, as you said, like 70% + play more than a year. It's a lot of value to be created with just improving the game for our existing player base. Yeah. UA, of course, where this quarter stands out at high levels, and we're in place where we want to be really. Yeah. Yeah, summarizing, this is the feeling we have. It's really full speed ahead now. User acquisition at levels we haven't seen in years, and also being able through that to accelerate our evergreen games. There's a lot of excitement inside the company now about everything that's going on, and also in the new game side, like a new approach to building games, and we have some really exciting stuff in the works. Yeah, a very exciting time at MAG, and we look forward to what Q1 and the new financial year will bring. We're gonna look at some questions now if we have something coming on live in the stream. As always, we'll also look at Twitter throughout the day and answer any questions that come in from that channel as well. Let's see if we have anything right now in our live stream. Okay, the first one. Great to see that UA spend is so strong. Why is it working so well for MAG? I tried to reason a little bit about that in the CEO word in the report as well. I think it's always this combination of we are making better and better products, how well our products are performing compared to the competition is one thing. Then we have the kind of the UA activity internally, which how good are we at managing our campaigns? How efficient are our ad creatives, so the messaging around the games. Then we also have this big other moving part, which is what's the competition up to? How much are they investing? Which eyeballs are they trying to reach compared to who we're trying to reach. We have a sense that it's kind of at least on our where we're acting, it's kinda more oxygen in the system. We have easier to invest more while keeping good return levels. We feel that it's a really good time for us, and it's hard to understand exactly why. We're always trying to impact what we can from the inside, but it's definitely loosened up more than we hoped for. Mm-hmm. When the window is open, we really wanna go for it. Okay. The next one maybe is for you, Magnus. Yeah. Can you talk a bit about the USD impact and how much of the sales% increase goes through to the bottom line? I guess that's in a way two questions, but also connected. The USD impact, of course, we have a lot of our income in USD. A lot of the in-app purchases are done in the U.S., but not all, so maybe half. Obviously, the ads are generally a USD-based market themselves, so we have a lot of sort of what we see is a lot of US D. That does impact there. We also have costs in USD, the marketing. Overall, generally speaking, a stronger USD helps us net. Mm Rule of thumb. To the question, how much of the sales percent goes to the bottom line? It's of course the UA effect we have to think about, but other than that, most will go down to the bottom line. Low contribution, a lot of the costs are fixed. Yeah. Simply speaking. Yeah, like both the Swedish currency and the British one, we have an office in Brighton. Both currencies are doing not so great right now, and that's. It's good for us in that sense. Mm. Are hyper-casual games more recession-proof than, say, strategy mobile games? I think we're not making hyper-casual games, but I think I know how to read this question, which is, are casual games more recession-proof than strategy mobile games? I think the answer is yes, in the sense that, we have a bigger chunk of our revenues coming in from advertising, and this programmatic advertising environment seem to be able to take a lot of big changes and just fill up demand. We saw that when COVID hit. Mm. After just a couple of weeks, everything was back to normal. Mm-hmm. We haven't seen pressure on CPMs compared to the last year, for example. Also, strategy games or very deep kind of core games, as we talk about in the industry, often rely more on few very high spenders, whereas we have a fairly high percentage of people that pay slightly less. I'd guess we're more recession-proof, and then we'll see if we're fully recession-proof or not. So far, so good for us this year, definitely. Probably good to have ads in the mix and not be highly dependent on these kind of super payers. Mm. What are next steps for Tile Mansion? Tile Mansion, we expanded from U.S. only to a number of English-speaking geographies. We still do a lot of optimization in that game. We see KPIs improving all the time, so we don't think we have the perfect product yet. But it's already really strong, so we can invest in user acquisition and grow the revenues. We see that perform well now. But we're still continuing to optimize it on the U.S. market, which is the most important one. We will add more localization and go to more markets over time. I am not super certain about the timetable, but I assume the next couple of months, we're gonna expand to more countries. We're very happy with what we've seen so far, and exciting stuff. As of today, do you see UA increasing again or actually decreasing more? I mean, what we see is like the pace we had going from Q4, which was SEK 43 million, that pace we've definitely kept so far in Q1. We're halfway in, so we'll see what happens if we can expand even further. What we do is always to operate and looking at our prediction models and make sure we will get the profitability we require from the spend. It continues to look good, so no changes so far into Q1. Mm-hmm. This is similar, I guess. Do you continue to use a maximum of 180 days payback for user acquisition? This is a question that came in from Twitter, so we'll answer this on Twitter as well. We always use 180 days as our kind of mark. This is what we're aiming for because we think if we have less than 180 days, there's probably room for spending more. The aim of this 180 is not. It's not a magical number of days. It's just we see that we wanna optimize for the maximum absolute profit, and usually we end up around 180 to achieve that. What we see now is we can expand even further, quite a lot further in terms of money that's working for us. Right now, I'd say we're about 80%-90% payback in 180 days. We're not super far from that 180-day mark. This is normal always, not only this quarter. We go a bit around that mark. Right now we're slightly further than 180 days, but definitely on top of things in terms of getting good profit margin back from the spend. Is ARPDAU in Tile Mansion currently higher or lower than the $0.20 you see for Wordzee? It's quite a bit higher than $0.20. What's the% of revenues coming from IAP ads in Tile Mansion? Tile Mansion is built on the same framework as Word Mansion. If you play that game, you've noticed that it's super efficient in having you look at a lot of rewarded videos. It's the same in Tile Mansion. We have a lot of revenues coming in from ads. The vast majority is advertising, even though we have a healthy conversion to payers as well. Mm-hmm. It's a really interesting product from that perspective, but majority is ads. I think that's it. I think that's it. We've seen that there are more questions on Twitter today, so that's really exciting. Good to see a lot of interest for the report. We will go back to our computers and start- Mm. typing and answer everything we can on Twitter as best as we can. Thank you so much for watching. Thank you.