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G5 Entertainment Q2: Solid margins but gaming metrics looks gloomy - SEB

G5's report was solid on the financials with an EBIT margin 1pp above our expectations (Q2A: 11.7% vs SEBE 10.7%). Sales of SEK 331(vs SEBE SEK 339), corresponded to organic growth of -10% (vs SEBe at -10.4%). What draws our attention is the large decline in some of the gaming metrics with a reported 21% drop in average monthly active users. This does not bode well for the future. We reiterate our mid-point valuation of of SEK 232 per share.

G5's report was solid on the financials with an EBIT margin 1pp above our expectations (Q2A: 11.7% vs SEBE 10.7%). Sales of SEK 331(vs SEBE SEK 339), corresponded to organic growth of -10% (vs SEBe at -10.4%). What draws our attention is the large decline in some of the gaming metrics with a reported 21% drop in average monthly active users. This does not bode well for the future. We reiterate our mid-point valuation of of SEK 232 per share.
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