Interim report 2 - 1 January - 30 June 2023 - New Value-Adding Partnership Agreements and Successful Integration of Wargraphs S.A.S.

Adjusted EBITDA increased by 160 percent compared to Q1 2023.

Summary quarter 2 - 1 APRIL 2023 – 30 JUNE 2023

• Net sales amounted to SEK 63.7 million (SEK 70.8 million).
• In the quarter, the company had costs linked to the acquisition of Wargraphs corresponding to SEK 5.4 million.
• Adjusted EBITDA amounted to SEK 7 million (SEK 8.9 million). *
• EBITDA amounted to SEK 1.6 million (SEK 8.9 million).
• Operating profit amounted to SEK 0.1 million (SEK 7.7 million).
• Profit before tax amounted to -4.5 MSEK (7 MSEK).
• Cash flow from current operations before changes in working capital amounted to SEK 0.1 million (SEK 11 million).
• Earnings per share during the quarter amounted to SEK -0.2 (SEK 0.3)

Summary 6 months - 1 JANUARY 2023 – 30 JUNE 2023

• Net sales amounted to SEK 119.3 million (SEK 138.2 million)
• In the period, the company had costs linked to the acquisition of Wargraph corresponding to SEK 5.4 million.
• Adjusted EBITDA amounted to SEK 9.7 million (SEK 17.3 million). *
• EBITDA amounted to SEK 4.3 million (SEK 17.3 million).
• Operating profit amounted to SEK 1.3 million (SEK 15.2 million).
• Profit before tax amounted to -4 MSEK (13.9 MSEK).
• Cash flow from current operations before changes in working capital amounted to SEK 2.7 million (SEK 19.1 million).
• Earnings per share during the period amounted to SEK -0.2 (SEK 0.6)

 * Adjusted EBITDA consists of operating profit before depreciation and amortization and adjusted for non-recurring costs.

Comment from the CEO

New Value-Adding Partnership Agreements and Successful Integration of Wargraphs S.A.S.

Adjusted EBITDA increased by 160 percent compared to Q1 2023.

With the acquisition of Wargraphs S.A.S., consolidated from June 1, we have onboarded a leading game service provider and developer of gaming applications that diversify our product range and drive revenues and profitability from day one. The revenues are primarily attributed to advertising sales through the leading game application, Porofessor, with approximately 800,000 daily users, and websites. The integration has proceeded as planned, and the bolstered operations show improved operational KPIs consistent with our expectations, even if the advertising market is currently challenging.

The founder of Wargraphs is now part of the M.O.B.A. team, contributing numerous ideas for new products and enhancements of the existing product portfolio, many of which have already been realized. As a further example of operational synergies, I wish to highlight that, in collaboration with the founder, subsidiary CriticalClick is actively developing the Porofessor app, which will lead to new extensive and global product launches in the future.

Challenging Comparative Quarter

Revenues for the quarter are at a satisfactory level, even if they represent a decline compared to the revenues from the same quarter last year, which was extraordinarily high – our best Q2 ever. Since then, the market situation has been volatile. However, revenues increased by 14% compared to Q1 2023, a combination of organic growth plus the one-month contribution by Wargraphs. The company's adjusted EBITDA (excluding transaction costs of 5.4 MSEK) increased between quarters, from 2.6 MSEK in Q1 to 7.0 MSEK in this quarter, representing a 160 percent increase. One of the quarter's highlights is a 20% traffic increase to our owned and operated websites.

The Market

Regarding the advertising market, we reiterate the analysis we made in the previous quarterly report: The global economic climate has negatively impacted the digital advertising market, while inflation and interest rates have led to increased costs and tighter margins. Long term, we are not concerned about the digital advertising market within gaming. Still, individual quarters may be adversely affected by the uncertain macroeconomic environment. We note that the gaming industry remains highly attractive, targeting a demographic that advertisers often find hard to reach. Previous experiences indicate that when the market recovers, it does so rapidly.

Several factors suggest our competitiveness and long-term growth remain unthreatened:

• The acquisition of Wargraphs has diversified our portfolio, making M.O.B.A. more competitive through increased differentiation and market penetration.

• In the coming quarters, Wargraphs will be fully consolidated, significantly strengthening both our revenues and profitability, and paving the way for additional organic and acquisition-based investments.

• Our assessment that all assets possess strong long-term growth potential remains unchanged.

Improved Agreements and Increased Investments

Our ability to engage the best partners and secure favorable deals is crucial to our success strategy. During the quarter, we made efforts to review and enhance several collaboration agreements. The most important new collaboration this quarter is the advertising agreement with Raptive. Announced in July, this will enhance our client offerings, leveraging Raptive's strong market position and ad technology. Furthermore, the agreement offers significantly improved terms, which in the long run will lead to increased profitability. This allows M.O.B.A. to transfer additional community websites to these enhanced terms over time as other contracts expire, solidifying our position as the leading consolidator within gaming communities.

We continue to invest in our organization and are in the process of several key recruitments focused on supporting the sales function and operational work. We look forward to welcoming these individuals, one of whom will be joining the executive team, in the near future.

Offer to Content Creators Strengthened by Agreement with MediaCube

Post-reporting period, M.O.B.A. entered into an agreement with MediaCube to boost UFG's future revenues. MediaCube, having developed a system named MCPAY, brings more features, increased direct sales, and an effective management service function. Starting September 1, 2023, MediaCube will assist with operational activities based on our requirements. The goal is to provide the best technical solutions for content creators and a dedicated sales team. We believe this will attract new content creators and reduce churn within UFG. Primarily, the agreement anticipates increased revenues and cost savings in the existing structure.

M.O.B.A. is the Leading Consolidator of Gaming Communities

Since its inception in 2018 and stock market listing in 2019, M.O.B.A. has experienced an annual growth of 70% and has always been profitable with strong cash flows. We continue to work towards solidifying our position in line with our growth strategy:

• M.O.B.A. is the leading consolidator within gaming communities, a relatively untapped market in the gaming industry.

• M.O.B.A. invests in games with a long history and a large player/fan base, yielding a positive network effect and strong SEO.

• M.O.B.A.'s goal is to grow both organically and through acquisitions, aiming to exponentially increase revenues with traffic volume.

I would like to take this opportunity to thank the group's employees, management, board, and all shareholders for making this growth journey possible!

CEO, Björn Mannerqvist, August 23 2023

Significant events during the period 1 April 2023 – 30 June 2023, in brief

• On May 11, M.O.B.A. Network AB announced the successful placement of a senior secured bond loan with a volume of 25 million euros within a framework of 60 million euros, with a maturity of 3 years. The Bonds will carry floating rate interest of EURIBOR 3m plus 10,00 per cent per annum and were issued at par.
• The company completed the acquisition of Wargaphs S.A.S. on May 30. Wargraphs is a leading game service provider and game application developer that provides players with vital statistics and data for popular games such as League of Legends, Teamfight Tactics, and Legends of Runeterra. Wargraphs is a digital publisher with revenue primarily attributable to the sale of advertisements via its websites and its world-leading gaming application Porofessor, which has approximately 800,000 daily users. The company has been consolidated from June 1, 2023.
• The company, after acquiring Wargraphs on May 30, 2023, has been able to verify the cash position which has been built up from December 1, 2022, to May 31, 2023. The company took over the company from December 1, 2022, but the company will be consolidated into the results from June 1, 2023. The cash position in Wargraphs amounts to 3.3 MEUR, compared to the previously estimated 2.0-2.5 MEUR communicated via press releases and the investor presentation for the bond. This means that the net debt of M.O.B.A. is lower than expected, which will also positively affect the acquisition analysis.
• The company held the Annual General Meeting on June 20, 2023. The AGM resolved to adopt the income statement and balance sheet and the consolidated income statement and consolidated balance sheet. The AGM resolved to discharge all individuals who had served as Board members or CEO from liability for the administration of the company. The AGM resolved in favour of re-election of the board members Henrik Henriksson, Maria A. Grimaldi, Jonas Bertilsson och Manfred Gottschlich and Chairman of the Board Fredrik Burvall.
• The company published the bond prospectus and applied for admission to trading of bonds at Nasdaq Stockholm on June 30.

Significant events after the period 1 April 2023 – 30 June 2023

• The company signed a new ad agreement with US-based Raptive, which operates a global ad network and already manages the ad inventory for the community websites run by M.O.B.A.’s subsidiary Magic Find. The agreement gives M.O.B.A. the opportunity to transfer more community websites to the same improved terms over time as other contracts expire. The agreement significantly improves terms and will lead to increased earnings for M.O.B.A.
• The company announced a strategic partnership with Mediacube Worldwide aimed at further enhancing the revenue opportunities for Union for Gamers (UFG), the Youtube network owned and operated by M.O.B.A. Network. Through this partnership, M.O.B.A. Network will fortify its role within gaming communities and content creators, leveraging the outstanding expertise of Mediacube in content creator services and management of Youtube networks (MCN). Mediacube, a pioneering force in the Multi-Channel Network (MCN) realm, has taken significant steps towards optimizing income generation for content creators through its innovative service, MCPay. The collaboration will commence on September 1st and will involve Mediacube assisting in the operational aspects of Union for Gamers as per M.O.B.A. Network’s specifications. This change is geared towards delivering optimal technical solutions for content creators, including a dedicated sales team. M.O.B.A. Network anticipates that this change will attract new content creators and reduce churn within UFG. The collaboration is projected to lead to increased revenue while simultaneously generating cost savings within the existing structure.

Webcast

M.O.B.A. Network presents a webcast in regards to Interim report 2 2023, the webcast will be published on M.O.B.A’s website at 09.00 den 23 August 2023. Watch the webcast through the follwoing link: ​​https://wearemoba.com/investor-relations/investor-information/presentations/

This disclosure contains information that M.O.B.A Network AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 23-08-2023 07:30 CET.