The acquisition of Gearbox and Asmodee put Embracer negatively on their financial outcome

business news The acquisition of Gearbox and Asmodee put Embracer negatively on their financial outcome

Embracer Group released their financial results for the financial year. If the group goes to another dimension in terms of turnover, the many losses associated with the redemptions it has made will have to be further accounted for.

the The group is grouped many stories about him increase publisher takeovers more or less important and studios in recent years. The band was recently released its financial results throughout the year, and the impact of these acquisitions is more widely felt.

Record losses for the Embracer Group

Financial results for the financial year from April 2021 to March 2022 are compiled for the Embracer Group. A few weeks ago, Embracer acquired Square-Enix Montreal, Eidos Montreal and Crystal Dynamics from Square Enix, to about $ 300 million. In recent years, Asmodee has already been acquired by the group (December 2021, for 3 billion euros), Gearbox Software (February 2021, for 1.3 billion euros) or even more Koch Media (in 2018, for € 121 million). Publishers of video games, board games, movies, etc., Embracer is diversifying its media to diversify its revenue sources. But with all these redemptions, the the group is no longer positive !

In fact, the group’s balance sheet shows us that in this fiscal year, the Surgical costs went up for Embracer. With 2.27 billion euros in spending, the group has one annual loss of 408.66 million euros. So the Embracer is “in the red”, with an overall negative result, but less worrying because it’s for them a year of transition first of all. Above all, the group did not intend to quit in such a good way because Lars Wingefors, CEO of the group, explains:

Nothing is said that there is no need to make even more claims to improve. However, we continue to pursue selected additional M&A opportunities to support our long -term growth ambitions.

Lars Wingefors, CEO of Embracer Group

The acquisition of Gearbox and Asmodee put Embracer negatively on their financial outcome

All results on the financial balance sheet of Embracer Group are expressed in Swedish Krona (1 SEK = 0.09558 EUR).

The increase in net operating expenses compared to last year was explained largely by the addition of Gearbox Entertainment and Easybrain in April 2021, CrazyLabs in September 2021 and Asmodee in March 2022. acquired companies Asmodee, Dark Horse and Perfect World. Net operating costs were further affected by SEK 50 million in humanitarian aid and employee support due to the war in Ukraine. Organically, net operating expenses were influenced by the increase in headcount to support the growth of the games portfolio and further strengthen the group’s capabilities.

Financial statement of Embracer Group between April 2021 and March 2022

The acquisition of Gearbox and Asmodee put Embracer negatively on their financial outcome

The acquisition of Square Enix’s studio has yet to be felt

As explained on the balance sheet, the The acquisition of Square’s studios has never affected the financial balance in the Embracer Group. In fact, the redemption was announced just a few weeks ago, after the end of the financial year on March 31. In addition, this type of redemption takes time and does not happen when it is announced. This is why the acquisition of Gearbox, announced in February 2021counted in the fiscal year this year, between April 2021 and March 2022. In the introduction to the financial statement of Embracer Group, Lars Wingefors accepts these claims and plans for the future:

In the second quarter of 20221, we further strengthened our development capabilities and our licensing portfolio by entering into an agreement to acquire Crystal Dynamics, Eidos Montreal and Square Enix Montreal, including Tomb Raider, Deus Ex, Thief, Legacy of Kain and other licenses. The announcement received an enthusiastic and positive reception. We see huge potential, not only in sequels, but also in remakes, remasters, spin-offs and cross-media projects across the group. We believe the transaction will be completed during July – September.

So we have to wait for review next year to get an idea of ​​the impact of the latest findings.

The acquisition of Gearbox and Asmodee put Embracer negatively on their financial outcome

A turnover of more than a billion, a first for Embracer

Embrace still had a smile. In effect, despite record losses who will no doubt count in the future, the group has reason to rejoice. First, he entered the major leagues by recording for for the first time in its history with a turnover exceeding the symbolic bar of one billion : 1.6 billion euros (17 billion Swedish crowns) for the financial year April 2021 – March 2022. 89% increase compared to last year’s turnover.

Financial year Turnover in euros Euro operating costs Operating profit in the euro Net income in euros
April 2021 – March 2022 1.6 billion 2.27 billion – 353.8 million – 408.6 million
April 2020 – March 2021 859.5 million 983.5 million + 45.4 million + 27.3 million
The acquisition of Gearbox and Asmodee put Embracer negatively on their financial outcome

Of all the publishers who are part of the Embracer group, and all the licenses they hold, some have done better than others this year. After remarkable (and somewhat unexpected) success at Valheim in the last financial year, we should not have expected to do even better or even better this year. but some titles like Hot Wheels Unleashed have found their place in the market this year, and other games from older catalogs like Wreckfest or Metro Exodus are going well. Above all, the The release of Tiny Tina’s Wonderlands was a hit, beyond expectations. It should be noted, however, that for now, it is Take-Two that will affect the revenue of this title, before Gearbox regains the rights for some time.

But, and maybe you didn’t expect it, it is Neither Gearbox nor Koch Media don’t have the most revenue for Embracer. The publisher who brings in the most money is a free publisher in the game! she it is in fact Easybrain, publisher of simple puzzle games on mobiles like sudokus, find the difference games, pixel-art games … This publisher has already counted a billion downloads for its applications on iOS and Android. And this fiscal year alone, he recorded 304 million euros in turnover.

Publisher, subsidiary of Embracer Group Turnover in the euro April 2021 – March 2022 Turnover in the euro April 2020 – March 2021 Evolution between 2021 and 2022 Number of studios within the publisher (current) Number of employees within the publisher (current)
easybrain 304 million 1 271
Koch Media Publishing 237 million 198 million + 20% 13 2,274
Gearbox fun 184 million 4 961
THQ Nordic 164 million 170 million – 4% 21 988
Saber Interactive 161 million 113 million + 43% 24 2,671
DECA Games 159 million 20 million + 697% 10 814
Coffee stains 62 million 112 million – 44% 7 123
Asmodeus 54 million 22 2,346
The acquisition of Gearbox and Asmodee put Embracer negatively on their financial outcome

Source: Embracer Group – Q4 and Full Year report: April 2021 – March 2022

Following the recent release of Evil Dead: The Game and Songs of Conquest, the next big title in the Embracer Group catalog is the obvious Saints Row, the much-anticipated reboot of the popular saga, set for Aug. 23 at PC, PS5, PS4, Xbox Series and Xbox One.

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