Coffee Stain (COFFEE) investor relations material

Executive summary

• Q4 net sales reached SEK 260 million, up 20% year-over-year, with organic growth at 40% in constant currency, driven by core IPs and Teardown Multiplayer release.

• Full-year net sales were SEK 961 million, down 12% year-over-year mainly due to FX headwinds and lower mobile/Roblox contributions; organic growth nearly flat at -1%.

• Cash EBIT for Q4 was SEK 81 million (31% margin); full-year Cash EBIT was SEK 333 million (35% margin), with 90% conversion to free cash flow.

• The group maintains a robust cash position of SEK 620 million at year-end, supporting future investments and proposed shareholder returns.

• Board proposes returning SEK 300 million to shareholders, including a SEK 0.68 per share dividend and a SEK 150 million share repurchase program, subject to approval.

Financial highlights

• Q4 net sales increased 20% year-over-year, driven by strong recurring revenue from key titles, successful launches, and a publisher sale.

• Q4 Cash EBIT margin was 31%, impacted by higher operating costs, especially from Fellowship and product mix.

• Full-year net sales declined by SEK 128 million, with SEK 117 million attributed to USD/SEK FX movements.

• Cash EBIT for the year decreased by SEK 151 million, primarily due to lower net sales and increased third-party development costs.

• LTM Cash EBIT/Free Cash Flow conversion was 90%.

Outlook and guidance

• Focus remains on core IPs and proven games with long lifecycles, with upcoming releases including Deep Rock Galactic: Rogue Core, Teardown multiplayer for console, Satisfactory 1.2 update, and Valheim for PlayStation 5 and Switch 2.

• Continued investment in established franchises and select new IPs, with 80% of resources allocated to core titles and leaner operations post-Malmö closure.

• Cost reduction initiatives underway, targeting third-party and consultant expenses as porting projects conclude.

• Board intends to return SEK 300 million to shareholders by AGM 2027 and initiate a SEK 150 million share repurchase program, subject to approval.