Expected operational effects on MTG's esport vertical from the corona virus pandemic, representing 40 percent of 2019 group revenue
Government policies to contain the spread of the corona virus have had a considerable impact on MTG's esports vertical, which is built around large live events with media rights, brand partnerships and many attending fans who purchase tickets and merchandise. As esports is digital by design it has the potential to offset some of the negative impact as MTG and its portfolio companies continue to deliver great entertainment by moving to online competitions and thereby creating new business opportunities.
Revenues in the esports vertical is expected to decline by 35-45 percent in 1H 2020, in comparison to the same period 2019. This is predominantly driven by Own & Operated (O&O) and Esport Services (ESS) events either being cancelled, moved online or postponed from 1H 2020 to the 2H 2020 and 1H 2021.
Q1 2020 esport revenue will decline by approximately 25 percent compared to the same period 2019. Having to operate already committed events with no audience or cancel events at short notice means there are limited possibilities to reduce the cost base in the quarter.
From Q2 2020, ESL and DreamHack are reducing both cost of goods sold and fixed costs. These savings will be at least
Based on the assumption that live events will be allowed starting Q3, MTG expects an improved operational performance in the 2H 2020, supported by rescheduled Master properties and festivals for both ESL and DreamHack.
Expected operational effects on MTG's gaming vertical from the corona virus pandemic, representing 60 percent of 2019 group revenue
In Q1 2020, MTG's gaming vertical has continued to perform well, underpinned by stable Daily Active Users (DAU) and strong development in Average Revenue Per Daily Active User (ARPDAU). This resilience suggests InnoGames and
Impact on the strategic review of the gaming vertical from the corona virus pandemic
Following the announcement of a strategic review of its gaming vertical in
This separation may be implemented either through a sale of the gaming business or through a listing on the Nasdaq First North Growth Market. Inevitably, the coronavirus pandemic has caused some disruption to the review process and the decision on the best route to separation will be taken once markets have stabilized and the company is able to present two strong equity stories.
Financial position and proposal to buy back shares
MTG has a strong financial position with net cash amounting to
MTG's Capital Markets Day (CMD) postponed due to corona virus pandemic
Due to government policies to contain the spread of the corona virus and their impact on travelling, MTG has decided to postpone its CMD to the 9th of
"We are executing on a three phased plan with focus on business continuity, operational efficiency and seizing of new business opportunities in these difficult times, to come out stronger and build on our market leadership in esports. All decisions taken by MTG, ESL and DreamHack, have been taken with the wellbeing of colleagues, fans, teams and customers in mind. This will remain the priority going forward." says President and CEO Jørgen
At this point MTG is not providing market guidance for full year 2020.
This information has been published in accordance with the EU Market Abuse Regulation and/or the Securities Markets Act or the Financial Instruments Trading Act. The information was submitted for publication, through the agency of the contact persons set out below, at
For more information:
Direct: +46 (0) 702-734 879, lars.torstensson (at) mtg.com
Oliver Carrà, Public Relations Director
Direct: +46 (0) 70 464 44 44, oliver.carra (at) mtg.com
Reach us: communications@mtg.com
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MTG (Modern Times Group MTG AB (publ.)) (www.mtg.com) is a strategic and operational investment holding company in esports and gaming entertainment. Born in
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