First quarter, 1 January –
- Net sales decreased by 57 percent to
SEK 30.6 million (71.6) primarily due to a weak market for VFX projects, which has not yet recovered since the strikes ended in the US last year, in combination with a weak gaming market. - EBITDA amounted to
SEK -22.0 million (-15.0). The loss during the quarter is a result of the significant decrease in sales. - Adjusted EBITDA amounted to
SEK -19.7 million (-12.6). Adjusted EBITDA excludes non-recurring costs ofSEK -2.3 million (-2.4). - EBIT amounted to
SEK -24.7 million (-32.1). - Profit before tax amounted to
SEK -23.9 million (-33.0). - Earnings per share before and after dilution amounted to
-4.28 SEK (-145.98). - Cash and cash equivalents amounted to
SEK 12.3 million (39.6) onMarch 31, 2024 .
Significant events during the first quarter
- Final day of trading for paid subscribed units in the rights issue was on
January 15, 2024 . The record date for conversion wasJanuary 17, 2024 , after which paid subscribed units were converted into shares and war rants of series TO3. - An extraordinary general meeting on
January 30, 2024 decided on a reversed split of shares whereby 100 existing shares will become one new share, 1:100. The Board set the record date for the reversed split toMarch 1, 2024 . The EGM also decided to reduce share capital by38,566,964 SEK to576,488 SEK and the amount will be converted to unrestricted equity conditional upon approval by the Swedish Companies Registration Office or a court. - At the end of
January 2024 ,Goodbye Kansas Studios received an order for production of In-game content for a game project. The order comes from a new, strategic, international customer and the order value amounts to approx.SEK 16 million . The project has started and will span over the first two quarters of 2024. - On
February 16, 2024 ,Goodbye Kansas Group announced that it faced a financing deficit for the first half of 2024 due to an unmaterialized order. - On
March 14, 2024 ,Goodbye Kansas Group and NY VFXWAALA entered into a strategic partnership including an agreement to establish a Joint Venture inIndia . The companies will work in partnership to build up a scalable production hub inIndia to provide cost competitive solutions, as well as supporting revenue growth into new business segments and categories. The Board ofGoodbye Kansas also resolved on aSEK 36.8 million financing package including a rights issue of approximatelySEK 21.8 million , fully covered by subscription and guarantee commitments, and on a directed issue of convertible debentures ofSEK 15 million to NY VFXWAALA. These rights issues have later been approved by extraordinary general meetings onApril 2 andApril 16, 2024 . - On
March 21, 2024 ,Chris Jestico was appointed to Managing Director forGoodbye Kansas Studios . Chris has worked atGoodbye Kansas Studios since 2021 and also has significant experience from leading roles in various global VFX companies internationally, for instance ILM, MPC, DNEG,Framestore as well as production companies such as Warner Bros and New Regency. Chris also has first-hand experience from establishing production partnerships inIndia .
Significant events after the period
- On
April 4, 2024 ,Goodbye Kansas Studios announced an order for production of a cinematic game trailer from a recurring international customer. The order value amounts to approximatelySEK 12 million and production will be ongoing during the coming five months. - On
April 5, 2024 , the Swedish Companies Office (“Bolagsverket”) registered Goodbye Kansas Group AB’s conversion av share capital to unrestricted equity. The company’s equity is thereby restored and an additional general meeting for liquidation purposes is planned to be held. - An extraordinary general meeting (“EGM”) on
April 16, 2024 , decided to alter the Articles of Association by changing the limits for share capital in § 4 and for the number of shares in § 5 in the Articles of Association. The share capital should be more thanSEK 1,940,000 and less thanSEK 7,760,000 and the number of shares should be more than 19,400,000 and less than 77,600,000. The EGM also decided take up a convertible loan with a nominal value ofSEK 15,000,000 through a directed issue of convertible debenture toFuntastik Studios Limited , a subsidiary of NY VFXWAALA. - On
April 23, 2024 , the outcome in the fully guaranteed preferential rights issue inGoodbye Kansas was announced. In total, 8,495,690 shares were subscribed for with support of subscription rights, corresponding to approximately 52.6 percent of the rights issue. 60,622 shares, corresponding to 0.4 percent of the rights issue, were allotted to individuals that have subscribed for shares without support of subscription rights. This means that approximately 47.0 of the rights issue is allotted to underwriting guarantors.Goodbye Kansas thereby raises proceeds of approximatelySEK 21.8 million before deduction of set-off of receivables and transaction costs. Approximately 12.3 percent of the rights issue was subscribed for through set-off of receivables. - On
May 6, 2024 , the outcome in the directed issue of convertible debentures was announced. All 15,000,000 convertible debentures in the directed convertible issue, corresponding to a total nominal amount of15,000,000 SEK , were subscribed for and allotted to the investorFuntastik Studios Limited . Goodbye Kansas appointed Wildeco as the company’s new Certified Advisor.- On
April 5, 2024 , the parent company,Goodbye Kansas Group AB , restored its equity following the Swedish Companies Registration Office’s registration of the conversion of share capital to unrestricted equity. The Board will convene an extraordinary general meeting (“EGM”), a control balance sheet meeting, where the control balance sheet will be presented. See preliminary balance sheet below:
PRELIMINARY BALANCE SHEET, PARENT COMPANY, | 2024-04-30 | 2023-12-31 |
Subscribed but not yet paid share capital | 12,072 | 36,019 |
Fixed assets | 40,088 | 20,072 |
Current receivables | 16,052 | 15,195 |
Cash | 496 | 476 |
Total assets | 68,708 | 71,762 |
Share capital | 2,191 | 139,178 |
Share premium | 476,491 | 458,627 |
Other equity and retained earnings | -443,329 | -580,231 |
Total equity | 35,353 | 17,574 |
Non-current liabilities | 8,022 | 7,283 |
Current liabilities | 25,333 | 46,905 |
Total liabilities | 33,355 | 54,188 |
TOTAL EQUITY AND LIABILITIES | 68,708 | 71,762 |
- On
May 21, 2024 , the outcome was presented for warrants of series TO3, which were alloted in connection to the rights issue inDecember 2023 . In total, 3 850 000 warrants of series TO3 were used to subscribe for 5 500 new shares, corresponding to 0.7 percent of outstanding warrants of series TO3. Gross proceeds amounted toSEK 55 000 before deduction of transaction costs.
CEO comments
Dear shareholder,
During the first quarter we completed a number of structural measures which essentially complete our strategic shift to focus entirely on the studio business with VFX, game trailers, animation and In-Game. An important milestone during the quarter was the announcement of the strategic partnership with NY VFXWAALA from
Creating a sustainable business
Goodbye Kansas’ goal for 2024 is to achieve sales of
We have a strong sales pipeline with several projects which are temporarily paused, projects we believe will begin during the current year, but also new projects. We see a gradual improvement across the board and that demand on the VFX-market is gradually returning even though lead times are relatively long until revenues are generated. We can clearly see that our ability to deliver the highest quality in challenging projects creates possibilities for new business, for instance when new seasons of tv-series are produced.
In the quarter, we appointed our long-time colleague
The Adjusted EBITDA of
Stronger following new strategic partnership
The announcement of the strategic partnership with NY VFXWAALA was an important milestone during the quarter. After the period we visited
If NY VFXWAALA later choose to convert their convertible debentures into shares in
Capital raise strengthens financial position
We have now completed a number of structural measures which mainly complete the strategy shift to fully focus on our studio business which includes VFX, game trailers, animation and In-Game. In these segments, we are able to use our creative abilities and technology, and further build on an attractive and appreciated customer offering, a strong market position and add to our customer list of several world-leading companies.
The slow recovery for market demand and the low sales in the quarter led to the need for another capital raise in order to strengthen our financial situation. In connection with the establishment of our partnership with NY VFXWAALA, we were able to secure a financing package of
As a result of the restructuring process in the autumn of 2023, we were forced to prepare a control balance sheet for the parent company, and in this report we include a preliminary balance sheet as of
We maintain a major focus on costs and following the completed capital raise during the quarter, we have strengthened our endurance. We have previously announced that we will reduce operative costs by
CEO
For more information, please contact:
E-mail: stefan.danieli@goodbyekansas.com
Tel: +46 701 981049
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