Fragbite Group (FRAG) Status Update summary

Q3 financial and operational highlights

• Group turnover for Q3 was SEK 52 million, down from SEK 61 million, mainly due to postponed IP releases and the sale of hyper-casual games in 2023.

• Positive EBITDA of SEK 2.2 million for Q3, with year-to-date adjusted EBITDA at SEK 6.2 million, reflecting cost reductions and operational improvements.

• Gross margin improved to 37% in Q3 (from 32% last year) and 46% year-to-date (from 35%).

• Rights issue raised SEK 61 million before costs, and a cost reduction program is expected to save SEK 11 million annually.

• Cash position at end of Q3 was SEK 5.7 million, with additional SEK 3.6 million from warrants and SEK 5 million convertible loan raised in October.

Business area developments

• Gaming remains the largest segment, with Playdigious achieving strong downloads for Loop Hero and preparing major IP launches for 2025.

• Esports operations saw record audience and sponsor retention at the Swedish Cup finals, with continued profitability and growth expected.

• FunRock signed two work-for-hire deals, leveraging existing IPs for hybrid revenue models and ongoing negotiations for further expansion.

Web3 and Koban ecosystem updates

• Dynamic NFTs launched in Panzerdogs, and Kumo NFT collection generated SEK 0.8 million in Q3, selling out quickly and trending on major marketplaces.

• Kumo is expanding into physical products via a licensing deal with Mighty Mojo Toys, JCorp, and Metafy, targeting major retailers and integrating NFC chips for digital-physical utility.

• The first Kumo products, featuring NFC-enabled collectibles and blockchain tie-ins, will launch in Q1 2025, with marketing starting before Christmas 2024.

• Development of a gaming protocol to enable interoperability and B2B services, with node sales planned ahead of the Koban public token launch.

• Node sales are expected to provide significant revenue and are being finalized with partners, with a multi-chain protocol vision beyond Sui.