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Third party research

G5 Entertainment: Weaker sales, strong cash flow - ABG

G5 Entertainment

This is a third party research report and does not necessarily reflect our views or values

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Sales -6%, adj. EBIT -11% vs. FactSet consensus in Q3
We expect consensus to lower EBIT estimates by 2-4% on '25e-'26e
Highlights positive momentum m-o-m in October, share trades at 4x EBIT '24e


Q3 details

Sales SEK 270m (-6% vs ABGSCe 286m and -6% vs cons 287m), adj. EBIT SEK 23m (-11% vs ABGSCe 26m and -11% vs cons 26m), net profit SEK 24m (-3% vs ABGSCe 25m and 2% vs cons 24m), organic growth -14% y-o-y. Negative growth trend continues, but EBIT margin increased y-o-y (8% vs. 7% Q3'23) supported by a higher gross margin (69% vs. 68% Q3'23) driven by high growth in G5 Store (27% y-o-y, organically) and free cash flow was also strong at SEK 57m leading to a YTD free cash flow of SEK 158m, compared to SEK 78m YTD EBIT. Encouragingly, management highlighted that it has seen a significant m-o-m increase of sales in October, for the first time since 2020. It also said that it is progressing with its goal of releasing one new game globally this year.
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Inderes’ Disclaimer can be found here. Detailed information about each share actively monitored by Inderes is available on the company-specific pages on Inderes’ website. © Inderes Oyj. All rights reserved.