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#G5 Entertainment: September starts in positive fashion

newlogo September has started in the same fashion as August had ended: daily revenues generated by mobile games for iPhone in the USA have on average increased by another 1% compared to our last channel check one week ago (data provided by www.thinkgaming.com). The gradual increase of the daily revenues generated ever since the beginning of December continues untiringly. Since the beginning of 2014, daily revenues generated by mobile games for iPhone in the USA have now on average increased by around 42%.

thinkgamingWhile the mobile gaming market just grows and grows, G5 Entertainment manages improve the rankingsĀ  for its most important game, Secret Society, this week. At the time of writing of this article, Secret Society is ranked #24 top grossing iPad game in the US. Encouragingly, the game is today also ranked #18 in Germany, #27 in UK and #24 in France (amongst others). On top, there could be first signs that another of G5’s F2P-games is “waking up” in terms of monetization. Following an update earlier this week, “Letters from Nowhere: A Hidden Object Mystery” is today #34 top grossing iPad game in Spain, and probably more importantly #48 in Korea. Rankings in the big markets are still lagging at this point but the trend is positive with #249 in Germany and #312 in the all important US market. It remains to be seen if Letters from Nowhere will be able to improve its revenue generation or maybe even approach Secret Society levels. A second serious revenue stream for G5 would be very welcome.

Elsewhere, we are eagerly awaiting the new free-to-play games which G5 management has promised for H2. Ideally, we would like to see at least 1-2 of them to be launched by October so that they can start to build a first audience into the holiday season. F2P games tend to be slow-starters in terms of monetization as people first download the game and play for free for while until they are hooked and convinced to pay for more content. Given the steady growth of the underlying market, combined with the upcoming release of new F2P-games, we are optimistic that G5 will be able to increase its revenues in H2 versus H1. For Q3 and Q4, we are now assuming a sequential revenue increase of 4% and 6% respectively, which leads to a FY 2014 revenue estimate of SEK 167m. This implies a y-o-y increase of 67% and must be seen as very impressive.

Nordic Investor

Follow the latest buzz around G5 Entertainment at www.buzztrader.se. G5 Entertainment is part of the Nordic Investor BuzzTrader portfolio.

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