Stillfront Group (SF) Q4 2024 earnings summary

Executive summary

• Q4 2024 net revenue was 1,660 MSEK, a 5% organic decline year-over-year, but adjusted EBITDAC rose 12% to 410 MSEK with a 25% margin, driven by cost reductions and efficiency improvements.

• Free cash flow for 2024 reached 1,050 MSEK, with Q4 free cash flow up 170% year-over-year to 342 MSEK.

• Organizational restructuring consolidated studios, reduced management layers, and focused on 10 key game franchises across three business areas: Europe, North America, and MENA/APAC.

• A non-cash goodwill impairment of 6,867 MSEK resulted in a net loss of 7,278 MSEK for the quarter.

• Cost optimization and efficiency initiatives yielded annualized savings and improved cash flow margins.

Financial highlights

• Gross profit margin improved to 79% in Q4 2024, with adjusted EBITDAC margin at 25%.

• Free cash flow in Q4 was 342 MSEK, and for the full year exceeded 1 BSEK.

• Leverage ratio at year-end was 1.84x, with cash position of 957 MSEK and undrawn credit facilities of 1,224 MSEK.

• Investments in product development were SEK 138 million (8.3% of net revenues) in Q4.

• EBITDA was 479 MSEK; adjusted EBITDA was 548 MSEK, margin 33%.

Outlook and guidance

• Expect negative organic growth in Q1 and Q2 2025, with improvement and a target of positive organic growth in H2 2025.

• Annual run-rate savings of SEK 200-250 million expected by end of Q4 2025 from operational efficiencies.

• Continued focus on cost control, product investment in key franchises, and operational efficiency to support margin and cash flow.

• North America remains a turnaround case, with new leadership and ongoing restructuring.