Maximum Entertainment (MAXENT) Q4 2024 earnings summary

Executive summary

• Q4 2024 net sales were €25.5M, down 26% year-over-year, reflecting fewer blockbuster releases and the sale of part of the Merge catalog.

• Adjusted EBITDA for Q4 was €3.7M (14% margin), with full-year adjusted EBITDA at €6.8M (8% margin).

• Strategic restructuring led to a 48% reduction in headcount, annualized savings of €1.9M, and divestment of non-core assets.

• Focus shifted to core IPs and fast-return publishing projects, with notable launches and updates in Q4.

Financial highlights

• Gross margin for Q4 was 31%, down from 34% in Q4 2023, due to higher royalty costs and a shift in publishing strategy.

• Adjusted EBIT for Q4 was -€0.3M, with reported EBIT at -€4.5M, impacted by €13.2M goodwill impairment and €1.2M game impairments.

• Cash flow from operations in Q4 was €7.9M, with year-end cash at €6.1M.

• Total borrowings increased to €44.1M, with net debt after earn-outs at €48.7M.

Outlook and guidance

• 2025 expected to benefit from major industry releases and new hardware, with a promising lineup including Maximum Football, Bye Sweet Carole, and Smalland DLCs.

• Continued focus on cost control, cash generation, and leveraging the back catalog.