Embracer Group AB (publ) (EMBRACB) Earnings Call Transcript & Summary

Hello, and welcome to Embracer's Annual General Meeting 2024. My name is Erik Larsson, Equity Research Analyst at SEB, and I will be the moderator this afternoon. As for the agenda, I will hand over to Kicki Wallje-Lund, Chair of the Board, here in just a second, which will be followed by some presentations and a market updates, including a presentation of the Embracer Games Archive. Finally, we will have a Q&A session before wrapping up the AGM. So with that said, I leave the word over to you, Kicki.

Thank you. Dear shareholders, once again, I would like to welcome you all to Embracer's [Technical Difficulty]. I said it last year, but I would say it again. It means a lot to us, all of us that are representing Embracer to have you all here. I should use this one instead, then we could have skipped all this. Okay, try again. What I did say was that last year, I did say, and I would say it again, that it means a lot to all of us representing Embracer to get the chance to meet with all of you, our shareholders here today, whether it is in real life here in Värmland, in beautiful Värmland, I should say, but -- or if it is online. And why are we here? Well, I have to have it this as well -- well for one, it is to provide you, our shareholders, with an overview of our performance and our plans. But it's also, of course, to make some important decisions. But it's something else too. We are here because we have a fundamental belief in the power of gaming. A fundamental belief that gaming provides unique experiences that unlocks connections, that it expands horizons and that it fuels collective creativity. Well, a lot has happened since we met here a year ago. So if we're looking back at the year, what is it that stands out? Well, first, we have successfully completed our restructuring program, and we have divested Gearbox Entertainment and certain assets of Saber Interactive. It has been hard work in every part of our organization, and it has been painful at times, but the results are clear. We have reduced our CapEx and OpEx. We have improved our cash flow and we have reduced our net debt. We have created a much leaner foundation that we will now continue to build on. Another milestone during this past year is that we announced our intention to transform the group into 3 stand-alone publicly listed companies. Three companies that are all well positioned to deliver profitable growth and value to all stakeholders. This might have been a bit unexpected to some, but in the face of turbulence, new opportunities often arise. So the Board, we are confident that this will help unlock additional value in all 3 companies. And why did we do it? Because we have the foundation -- fundamental belief in the power of gaming. And because we want to ensure that we can continue creating exceptional games that stand to test the time and shape the future of entertainment. It truly has been a transformative year for Embracer Group, but it has not only been a year of big decisions and transformative actions. It has also been a year of continued delivery of -- by all our teams around the world, and that point is important. We continue to deliver fantastic entertainment and experience to gamers and fans around the world every day. Gaming really is superpower entertainment. And with 3.4 billion players throughout the world, the influence of gaming can be seen everywhere. Gaming -- the gamers take top positions in corporations across industries. Gamers start companies that have become invaluable to the global economy and notably, gamers influence even makes large traditional corporations, want to engage with these communities. Over the past few decades, gaming has connected people throughout the world and built inclusive communities, and I will also say very powerful communities that continue to grow. Communities that welcome you -- it's a place for communities that welcome you, it's a place where you can be you is what gamers says. And gaming is engaging. It is truly engaging and accessible to people all over the world. The common misunderstanding is that it's mainly men and boys that play games, but that is not true. It is almost equally as many women nowadays. In contrast to other entertainment activities, which can be and often are consumed while you're doing something else like watching TV, for example, gaming is something that you immerse yourself in. And even if you are not playing or even if you're not engaging directly with gaming on a regular basis, people still take part in the experience by watching the content. The impact of games truly is one of a kind. So is this only for entertainment or only for fun? Well, of course, it's fun, but beyond that, there is also a case for using gaming to address both social and environmental challenges. Gaming's reach just goes beyond the market and even beyond the players. I said it before, but it's worth saying again -- to say it again, we have a fundamental belief in the power of gaming. Having talked about the impacts of gaming, I want to touch briefly on the future of gaming. The 3.4 billion, figure that I just mentioned continues to grow. And today, the size of the video game market is bigger than that of video streaming, music streaming and global box office receipts combined as we have heard many times. Similarly, it is clear that Tabletop Games continue to be popular, addition to the immersive world of video gaming perhaps more so than what some would think a decade ago. Who wants to sit around the table, looking at cardboard paper when there is gaming for real. I mean, like video games. Well, in line with our own conviction, many as it turns out. So the future of gaming is captivating and the horizon is looking bright. Artificial intelligence will, of course, bring even more immersive experienced players and become a useful tool for creators to take their creativity to new levels. As this development continues, players will increasingly demand high-quality, but familiar content. Content that is pushing the boundaries, what gaming experience can and should be. And it is our firm belief that our group's strong IPs combined with the extraordinary talent and expertise of our teams around the world will be key to delivering on these expectations. Gaming is superpower entertainment with an engaged audience and a unique market that continues to grow year-by-year. We know you win gamers' heart through quality and by providing worlds that can help mirror experiences players either had or for a second wish they had. We believe that our 3 new companies are in an excellent position to be leaders in their respective fields, providing the experiences that truly embrace players. So even if we will no longer be Embracer Group, the spirit of our mission will long outlast the former name. We have a fundamental belief in the power of gaming. And with that, I want to declare Embracer's 2024 Annual General Meeting open. Should I continue to use this one? or is this one not working. We have one question before we start, and that is -- so that's good. We have one question before we start, and that is the Board of Directors, they have proposed or we have proposed that this meeting is to be held in English so that everyone will understand what we are saying. And I wonder if we can agree to held the meeting in English?

Yes.

Good, thank you very much. We will also hold a public Q&A session during the presentation later on the business activities in the group. This Q&A session will be only open during the presentation of the business, just so that you know. Now we will now appoint who will act as the Chair of today's Annual General Meeting. And the Nomination Committee has proposed that I'm elected Chair of the meeting, which has also been published in the notice on the 19th of August. Do we have any other proposals? No. Okay. Can we elect me to Chair today's meeting?

Yes.

Thank you for your confidence. Due to amongst other things, including the webcast, there are several unregistered shareholders and guests at the premises and participating remotely. Can we invite these to attend the meeting?

Yes.

Good. I would also like to point out that in addition to the company's representatives and the auditor only shareholders who are here in person, by proxy or cast their vote in advance and are entered in the share register for the meeting, have the right to speak, vote and give proposals at the meeting. During the Q&A, we will, however, allow everyone to be -- that are present to be able to ask questions. Can we agree on that?

Yes.

Thank you. Now on my right-hand side here, I have Ian Gulam. As you all recognize by now, I guess, our Embracer's Chief of Staff and General Counsel, as we'll keep the minutes for the meeting here today. I also would like to inform you which Board members are here today. So in addition to me, we have well, Cecilia Qvist, you can't see, it's too dark, you will see later when we have some pictures. We have Jacob Jonmyren. And we also have Yasmina Brihi and we have Bernt Ingman as well and of course, Lars Wingefors. The company's auditor, PwC, is also present through the company's main responsible auditor, Magnus Svensson Henryson, as you will also meet a bit later. We have the Nomination Committee Chair, Per Fredriksson here, and we also have from the Nomination Committee, Anna Henricsson, Handelsbanken Fonder, we have Magnus Tell, Alecta. And do we have Henrik here as well? There you are, couldn't see because it was too dark. We have Henrik Olsson, CPP, Canadian Pension Fund (sic) [ Canada Pension Plan ] here as well. Okay. We have come to Item #3 on the agenda, that is the preparation and approval of the voting list. So I will now hand over to you, Ian.

Thank you, Kicki. So now it's time to establish the voting list and everyone that has been registered in the share register of the record date as of 11th of September, and has followed the procedures as set out in the notice and notified their participation here at the meeting have been included in a draft voting list that was prepared outside of the door here, when everyone walked in and everyone has been ticked off. So to summarize my old favorite numbers. Today, we have a total of 810,475,305 shares divided into 52,260,204 A shares, and 758,215,101 B shares. This corresponds to 1,280,817,141 votes.

Great. Thank you, Ian. Then we come to Item #4, where we will appoint 1 or 2 persons.

Don't forget to ask them to approve.

Oh sorry. Thank you, Ian. Can we approve the prepared voting list?

Yes.

Thank you. Now we have come to Item #4 on the agenda, where we will appoint 1 or 2 persons to certify the minutes, and do we have any suggestions?

Yes, I propose that...

Okay. Thank you. Are there any more suggestions? Okay. I find that's not the case. Can the Annual General Meeting resolve to appoint one person to certify the minutes?

Yes.

Good. Now Erik, there you are. Then I would like to ask you if you are prepared to undertake the responsibility to verify the minutes.

I would be delighted.

Wonderful. Will you also be available after the meeting to -- great, thank you. Can we resolve to appoint Erik together with the Chairman to certify today's minutes in accordance with the proposal?

Yes.

Great. Thank you very much. We have now come to Item #5 on the agenda, and that is question, whether the meeting has been duly convened. So Ian, could you please explain to us.

Yes, gladly. So in accordance with Articles of Association of the Company, notice must be published no earlier than 6 weeks prior to the meeting and no later than 4 weeks prior to the meeting. So this must be done through publication in the Swedish Official Gazette, in Svenska Dagbladet and on the company's website. All of this occurred as follows: 19th of September, we published the notice on our website. On the 22nd of August, we published the notice in the Official Gazette and the ad convening the notice -- convening the meeting was published the same date, 22nd of August. I said September, right? I mean August.

Does the meeting consider that the meeting has been duly convened?

Yes.

Thank you. Item #6 on the agenda is approval of the same. Proposal for the agenda have been announced in the notice and distributed to the participants at the meeting here today, can we resolve to determine the proposed agenda?

Yes.

Great. Thank you. I find that the agenda has been approved. It is now time for the most exciting part of the AGM, and that is the presentation of the operations within the group. So I would like to ask our CEO, Lars Wingefors, to take the stage.

Thank you, Kicki. Pleasure being here. To start, I would like to look at the group and the world map of today. When we were standing here or when I was standing here a year ago, we were more than we are today in terms of headcounts. We are -- but still, we are more than 10,000 people engaged on a daily basis, where of 6,000 developers. And we are having in the pipeline, one of the most interesting and most well-invested pipelines within the industry with 127 projects, and still being developed across the more than 100 studios. And if you look at the map here, we still have many of the industry-leading companies in various fields. Looking in North America starting in the North West with Dark Horse Media, one of the leading comic book publishers in North America and a large producer of content for streaming services. Further South in San Francisco, we have the management of Freemode that holds the rights to Middle-earth and The Lord of the Rings, and a lot of other retro-gaming assets across the globe. Also in San Francisco, we have Crystal Dynamics, one of the leading AAA games developers in the world that are working on several very interesting projects for the future. Also in the north, within the same operating group, we have Eidos-Montréal, one -- also one of the leading AAA games developers in the world. Moving over to Europe, and in Paris, that I now often visit, we have the global leader in board gaming and trading cards games were Tabletop Asmodee with global operations, but headquartered out from Paris. We have in Berlin, the headquarter of DECA, a leading Mobile Games group that are building -- continues to building communities and content for many free-to-play Mobile Games. Also in Germany, we have one of Europe's leading groups within gaming of PLAION, active both in development, distribution and publishing and many other areas. South of Munich, we have the original company of THQ Nordic that I was part of founding 2011, that now became Embracer. THQ Nordic headquarter out of Vienna, but with global operations within PC/Console. And further South, we have the global category leader within brain and puzzle games, Easybrain. And finally, in Sweden, we have Coffee Stain with operations both in Skövde and Stockholm and other cities as well as Amplifier Game Invest. And finally, obviously, the fantastic headquarter in Värmland of Embracer. Now looking at the year, it has been an eventful year. But I think it's worth highlighting that we still have a solid sales and earnings progression. We achieved sales of more than SEK 42 billion in the year, which is a 12% year-over-year growth or 1% organic growth, roughly in line with the industry, with the adjusted earnings of close to 17% or SEK 7 billion in the year. In terms of content, we successfully released 2 very large titles in PC/Consoles, Dead Island 2 and Remnant II. Both that contributed a lot in both, obviously, top line, but also profit within the year, both titles actually have more content coming through over the coming week or weeks. Also, as Kicki mentioned, it's been a very eventful year in terms of restructuring and divestment. So we successfully concluded the restructuring. It has been painful and a lot of tough decisions has been made, but we achieved what we set out to achieve in terms of lowering our OpEx and CapEx. That restructuring did also include the divestments of 2 significant groups of the company, Gearbox and parts of Saber Interactive. We also announced on April 22, what's to come in the future and we are right now working almost 24/7 to execute on the future and the spin-offs of the group, and first out would be Asmodee, the global leading Tabletop Games publisher and distributor, and if you look at that, the numbers on a pro forma basis, they achieved last year sales of SEK 14.6 billion with a profitability of SEK 2.1 billion. Moving over to and when they are successfully listed, we will communicate and identify -- intensify, sorry, the process of the spinoff of what we now call as a working name, Coffee Stain & Friends. That will be a global leader within Indie Games, development and publishing including very successful free-to-play games companies on Mobile with very high recurring margins. And if you look at the numbers within those companies, they had sales of SEK 10.7 billion in the past 12 months with adjusted EBIT of SEK 3.1 billion. And finally, Embracer Group, the listed entity of Embracer Group will become Middle-earth & Friends. And Phil is working on that name to be announced in the future, but it's a creative powerhouse of AAA games development and publishing for PC/Console, as well as the stewards of The Lord of the Rings, Tomb Raider and many, many other items. And looking at those financials, they had net sales of SEK 12.1 billion last 12 months with the adjusted EBIT of SEK 1.5 billion. So that's a brief summary. I will come back later, but I would like to give Muge, our new CFO, the opportunity to take you through the numbers. So please, Muge.

Thank you, Lars. Hello, everyone. I'm very happy to be here today to join today's meeting. Let's take a look at the financial performance for the year ending March 2024. Overall, the financial development was solid in absolute terms. Our net sales grew by 12%, reaching SEK 42.2 billion with an organic growth of 1%. We did see growth in all segments. Growth was primarily driven by the 12-month contribution of previous year acquisitions of Middle-earth Enterprises, Crystal Dynamics, Eidos and Tripwire. On an organic basis, we did see growth primarily from our Tabletop segment as well as Entertainment & Services segment. In the Tabletop segment, the solid performance of trading card game segment performed very strongly. And when it comes to Entertainment & Services, Middle-earth Enterprises did enjoy a more-than-expected performance in the licensing revenue of our beautiful IP, Lord of the Rings. A relatively stable growth performance in our PC/Console segment was supported by a higher contribution of our new releases. The main drivers of the new releases were Dead Island 2 and Remnant II. In the Mobile segment, Easybrain saw positive organic growth while DECA, including CrazyLabs saw a negative organic growth. This was primarily driven by a change in our business model, focusing more on higher profitability and cash flows. On the profit level, adjusted EBIT of SEK 7 billion was within the forecast range and represented 11% growth year-on-year. Profit margins remained stable compared to last year at 17%. Cost savings from the restructuring program, of course, did contribute positively as well as the improved profitability in our Entertainment & Services, due to stronger contribution, like I said, from the licensing revenues, this has been positive as well. This was, however, offset by a softer performance for PC/Console with a higher proportion of amortization of costs due to a lower ROI of some released games. As Lars mentioned earlier, our structuring program, which has run since June 2023 was successfully finalized in March 2024. With the actions taken over the course of the program, we have built a strong foundation for improved profitability, cash flow, but also for future value creation. Turning to the balance sheet. As you can see on these graphs, our balance sheet is actually relatively simple and light. On the left-hand side, we see that we have SEK 11.8 billion of operational assets. This consists primarily of investment in our games pipeline, which totaled SEK 8.6 billion. Of this, SEK 6.2 billion represents cash invested in ongoing games development projects, which when they mature and when those games are released, expect to contribute future profits and cash generation. Net other assets and liabilities of SEK 2 billion are primarily due to the net working capital of SEK 2 billion. Our net working capital represents around 5% of our net sales, which many of you would agree is a very moderate level. Looking at the right side, we have SEK 59 billion (sic) [ SEK 59.3 billion ] in acquisition-related intangible assets, representing goodwill and IP rights. We also have SEK 4.7 billion in net assets held for sale, primarily related to the Gearbox Entertainment. Net other assets and liabilities amounting to SEK 2.7 billion relate primarily to the SEK 2.1 billion of promissory note related to the divestment of Saber. These assets have been financed by equity, by loans and as well as provisions related to earn-outs. Of the SEK 9.6 billion provisions for additional consideration and deferred tax, I shall say, SEK 4.1 billion relates to the deferred net tax liabilities. The remaining SEK 5.5 billion is the provision for additional consideration to be settled in cash or shares depending on the financial and operational targets being set. Moving on to cash. Free cash flow for the period was SEK 1.5 billion, which is a significant improvement in change versus last year, which was slightly negative. Operating cash flow of SEK 9 billion was generated in the year with SEK 6.4 billion being invested in games development. Net working capital decreased slightly generating SEK 113 million. And you would recall, this is also a significant improvement versus last year where we consumed over SEK 2 billion in working capital. And this was driven by the significant efforts in the management of our inventory across the group, especially in our Tabletop segment. As I mentioned earlier, in addition to improving profitability, the actions taken over the course of the restructuring program create a strong foundation and continuing to drive improvements in our cash flow generation. Having a look now at the operational development on the left-hand side, we can see the impacts of the restructuring program including the divestment of Saber. Total headcount decreased by over 4,500 heads around which 3,000 relates to divestment of Saber. The number of internal studios also decreased by 30, again, around which 20 is a result of the divestment of Saber. The number of ongoing projects was also reduced to 141 projects at the end of March 2024. While the number of ongoing projects has reduced, thanks to the detailed review and the ranking process conducted during the restructuring program, the quality of the remaining pipeline has been improved. Finally, as you can see on the right side, we continue to invest in new game development at a similar rate to last year around 1.8x, the investment in completed games. By being more focused in our investment strategy to the updated greenlighting process that Phil is going to describe later, we are laying the foundation to more profitable future growth. Thank you.

Thank you, Muge, that was great to have a deeper review of the numbers. So Karin, our star within sustainability. Please welcome on stage.

Thank you so much, Lars. Hello, everyone. My name is Karin Edner Karlsson. I'm Group Sustainability Manager here at Embracer Group. My role includes coordinating and implementing our sustainability strategy within the group. At Embracer, sustainability is about creating long-term value for our stakeholders and acting in line with our values. Our goal is to create great entertainment, be a great company to work for and to do good for society. Sustainability is important because it reflects our values. It involves managing risks and seizing business opportunities. During the year, we have focused on preparing for reporting according to CSRD and other legal requirements. The group's climate goals were validated and approved by the science-based target initiative, and we established an Advisory Sustainability Council. During the financial year, we launched mandatory annual training for all employees within the group on privacy and anticorruption, and we rolled out an AI policy package across the group. We also continued to make donations from the parent company and support the people affected by the war in Ukraine. I would like to highlight one of our key tools for engaging with employees across the group, our annual employee survey. It's primarily a tool for our management at group and company levels to receive indications of strength and potential for improvement, allowing them to take immediate action and set long-term plans. Secondly, it's a reporting tool that enables us to be transparent to our stakeholders about employee satisfaction and engagement. As you can see, we have experienced a slight decrease from previous years. We assess that the reduction is due to the restructuring program carried out during this year and also the layoffs of employees. I'm pleased to see how important the well-being and development of our employees are to the Board and to the management of Embracer Group, recognizing our great people as key to our success. Thank you so much for listening.

Thank you, Karin. So let's not welcome Chris on stage, but let's welcome Chris Stanton-Jones, online.

Greetings from London. Can you hear me and see me?

Yes, very well.

That's such a relief. Good afternoon, everyone. Yes, I have a short presentation here, looking at the broader games market, its values and performance as well as the players and trends. So a good place to start is the global games market values and year-on-year performance. The graph here looks at past values and future predictions in billions of dollars. And the good news is that the market trend line is showing low but steady growth, taking out, of course, the one-off pandemic peak. For this year, we're looking at about 2% year-on-year growth. And over the whole period, we're looking at over double that about 5% average CAGR. So what are the main influencing factors pushing growth going forward? Well, there are some tailwinds from the economic backdrop, the IMF are predicting a slow, but steady recovery in 2024. PC is the star format at the moment showing very consistent growth, both past and future. And Mobile is also bouncing back from a recent dip, doing particularly well in the emerging markets in the large and growing populations with rising incomes. What about the negative effects of the backdrop? Well, it's mainly on the games companies themselves, well-publicized many job layoffs in the industry as a whole. It's currently rightsizing after several years of high investments and hiring after the pandemic, it's adjusting to the new normal, which involves higher costs, particularly from interest rates. The consumer side, which is normally more resistant to downturns. There's some evidence of -- on the Console hardware side, it's a little bit soft and I think this has been affected by the spending squeeze, which is particularly acute on more expensive items. So let's look at total market trends now. This is one of my favorite slides, and I think Kicki alluded to this as well. The games market compares really well to other entertainment sectors. This is one of my favorite charts. It's the largest entertainment sector, it's bigger than all the others, TV box office, home entertainment and music certainly a far cry from its very niche routes in the early '90s when I joined the games business. We don't have the Hollywood stars or the sector's profile, but we certainly have the market revenues. And there's increasing engagement, there's more players, more than ever before. It's growing every year and this is a really good health barometer of the industry as a whole. There are fewer big games. There's focus on established IPs, many of which are supported by live services and in-game entertainment. The nostalgia-based games are doing really well. And interestingly enough, this is a similar trend to the other entertainment sectors like music and films. There are a few of big new releases now. And the amount of big new releases is varying from quarter-to-quarter. This can vary quite dramatically, meaning that if you're looking at industry figures or company figures, it's making the comparisons for year-on-year sales by quarter or by month more challenging. There are fewer platform exclusives now. Cross-platform releases the standard. And when games are in all formats, there's certainly a little bit more cannibalization between the different formats, and probably PC is benefiting more than some of the other sectors. Okay. So let's look at the players now, who are they? And where are they? And in a nutshell, it's pretty much everywhere and everyone are playing games. Two charts here. The top one shows the engagement per age group, the bottom one gender distribution. And I think we can say we've achieved mainstream popularity in games business. Some data here from Newzoo shows that about 80% of the global population are playing games. I mean this is a huge number compared to the old days. I think we can say that gaming has mass appeal across all age groups, as you can see on the top chart. And what's the average age of the gamer well, a recent study said that it's about 36 years old in the U.S., and this is much older than most people think at most a lot older than how it used to be. Of course, it's not just about playing games. Over half of all games, 56% according to Newzoo, are likely to explore other media related to their favorite games. So this could be -- they could be buying merchandise, watching Twitch, playing a board game or watching a related film. And of course, the big relevance here is that it will certainly benefit companies such as Embracer Group, which have a solid strategy towards transmedia development. Kicki also mentioned the gender of games and how close it is, and I have some data here. The share of females in the bottom chart. You can see its highest high in most groups, but it's generally highest in the older groups, particularly the baby boomers. And if you look at platform as well, if you look at the Mobile sector, for example, it's above 50%. So yes, it's definitely everyone is playing games. And where are they playing? Well, there's an east-west split. Generally, the Mobile gamers, the spend and the users are in the East and for Console and PC, it's the opposite, it's in the West. Okay. Let's have a dive into the PC and Console sectors. What are the trends and breakdowns by platform. Certainly, if you look at where are the gamers in the spend mix in the U.S. and Europe, about 2/3 of the market or the PC and Console market is in the West. And this is relevant, of course, because this is where Embracer companies and presence is the strongest. If we look at PC sector, the PC ownership has increased significantly post-COVID. There are many, many more users with home PCs and laptops. And there are a fewer platform exclusives now. Most games come out on PC, adding to an already strong, very strong catalog and it's growing with the likes of support of publishers like Sony, many of their key first-party titles are on PC now. And PC represents great value for money and the spending squeeze when people are tight for cash. And there's evidence of PC success with Steam, the #1 retailer. They keep breaking their own records with their number of concurrent players. A quick look at Console, the good news is that users are spending more if you compare PS4 owners with PS5 owners, for example, about 26% higher average spend according to Sony in the chart below. Although there is evidence of a slight lag in console upgrading due to the spending squeeze. Sony report that half of their monthly active users are still on PS4. But the positive side, I think, is that software sales generally peak for each console historically 1 to 2 years after the hardware peak. We just passed the hardware peak for most of the consoles now. Secondly, there's better economic conditions coming, and this will affect the more expensive machines, the consoles. But also I think we're going to get a big boost from the launch of GTA VI next year. It's first on Console, there's a big industry event and I think it's really going to drive hardware upgrades, attract lapsed and new players. So bottom line, I think the best is yet to come from the likes of PS5. Okay. Quick word on AI, hot topic, obviously, the industry views are generally positive, I think, in the thought that it's going to save time. It's going to save development costs, and it's going to enhance the overall development process. Who's using it? It's thought to be very widespread, most developers, I think, are using it. But it's early days. It's an experimenting phase, and I think most have not really disclosed details of what they're doing. Timing-wise, I think most analysts are expecting it to start being visible in games from the next year onwards. Of course, it does come with potential risks. Publishers will have to navigate certain challenges there could be a backlash with gamers and artists, could also be copyright infringement, no one really knows. Okay. Lastly, let's just have a look at the Mobile sector. How big is it? Well, it's very big. It's half of the total games market, 49% according to Newzoo. Where is it? It's largely in the Asia/Pacific area, about 60% of the market comes from that area. And of course, that area is growing. It's growing its mobile network infrastructure. It's getting greater smartphone adoption and these are things that are driving it. So growth is expected this year, growth despite the challenges of adapting to changes in the privacy related monetization and user acquisition. It's been driven also by economic -- better economic conditions, continuous strong performance of existing games as well as some recent big hits. So player growth of about 4% is expected in 2024. A big portion of this, as we said, will come from emerging markets. And for the first time ever, on iOS and Android, they're now opening up to other app stores and payment methods. And Epic Games Store, as we speak, is rolling out on iOS and Android, and I think this will be a positive for market. I think you'll start to see a greater variety of games and more ways to play. So that's it, Lars. I'm going to hand back to you.

And hopefully improve margins.

Yes, indeed. Indeed.

Thank you, Chris. Thank you so much. Let's welcome up Phil Rogers.

Thanks, Lars. Actually I'm going move these. I get quite animated. I don't want to knock them off. So especially when I have...

Last time we've checked you are Deputy CEO...

Yes. So let's skip to the next slide. So it's great to have an opportunity to talk with you today, our shareholders. I'm not entitled to be given to talk about this passion for games. Firstly, on that passion point, just to call out this amazing backdrop, so we're flicking through a lot of slides, but let's just take a moment here to appreciate this image. It comes from the world of our upcoming game. Kingdom Come: Deliverance II, and it's the fantastic Medieval Kingdom of Bohemia. So what a wonderful backdrop. And to say my goal today is not only to help convey the passion of the people here in the room, the Board and the executive, passion for our company, our goals, our games, of course, but also to convey and represent the passion of our coworkers and teams who are not here because really passion runs throughout this group, and it really is part of our core DNA. So last year was, of course, a challenging time, but it's often said that turbulent times create new opportunities I think you're seeing that now through the earlier sections about how we're approaching those opportunities. I also love the expression that pressure makes diamonds. And this is very much the spirit with which we work with. Over the past year, we've gained valuable insights and knowledge on how we build Embracer stronger for the future and players must be top of mind for this. Now we're fortunate to have very passionate players, players who spend their time and money in our world, in our games, fans who live for our comics, fans who love our merchandising. We're also fortunate to be working with some intellectual properties, which resonate across multiple streams of entertainment. Now intellectual properties or we often call them just IPs, all these have the power to delight, power to amaze, to create smiles, to create laughter, a sense of fun, and of course, a sense of play. And it really sets us up, I believe, in a very unique position. Now for the eagle-eyed amongst you, looking on the big screen, these images are taken from the recent game show in Cologne, Gamescom, where over 300,000 gamers from 100 -- over 100 countries, I believe, landed in Germany, to take part in what is probably the biggest gaming event now in the year -- in the world. Now there's I think better than seeing lines of gamers eagerly waiting, sometimes hours to get your hands on pre-release footage of your game code and to test it and play the game. Well, there actually is something better, and that's when all is said and done and all the playtime is finished, that there's an award. And kudos, the team at our Studio -- Warhorse Studios in Prague for winning the Gamescom 2024 best PC game for Kingdom Come: Deliverance II. So yes, there has been, of course, pressure over this year. But coming through this today, I really feel and believe that we are a company that is committed to build upon its status amongst the leadership in the games industry, and to deliver even better experiences for our players because we're passionate about games. Let's look at PC/Console, just briefly with this one slide. Now you've seen just through Chris, independent consultant with analysis on how the PC/Console gaming world is performing, where it's growing, where it's shifting, and during the year, we've taken the time to review and design how we should be set up to enable great teams to make great games, working within an aligned investment strategy to deliver high-quality hits predictably and profitably. And essentially, there's 3 aspects to this. Firstly, we want our studio teams to be increasingly focused on our own key IPs. Of course, these typically have better unit economics and project economics. But as we think about where the PC/Console gaming market is going, the broader entertainment landscape, focus on our IPs where we believe we've got the longest and best long-term growth. Secondly, to talk to process. Now we have great, creative and production talent within our group. And as we think about the future and perhaps the Middle-earth & Friends in particular, what we're now pushing for is greater collaboration and discipline to improve our ROIs, our returns on investments from higher-quality games, giving gamers what they want and what they expect. Now lower, more focused CapEx investments will positively impact our EBITDAC and free cash flow generation and gradually improve our profit margins. Now the third point here may sound very general and very obvious, but actually talks something really important. It's a sort of DNA, a deep seated drive and ambition to think differently and improve. Again, when we think about Middle-earth & Friends in particular in the road ahead, we must take responsibility to use our PC/Console size and diverse talents in smart ways to develop and scale services across that group. How do we better leverage solutions to common problems across studios and businesses, not reinventing in isolation, building from each studio's success and expertise, and deep collaboration on franchise management for our global IPs. Now it's always hard when you put up a list of intellectual property because we obviously have to miss out on so many. And I think the first few slides, you saw the count was over 100. But I think this is a snapshot really captures the strength of our portfolio, the breadth and the depth from remakes of classic beloved games to new games such as Satisfactory, which just last week hit new highs in terms of player engagement with the game's full release on PC. The care and attention that the team at Coffee Stain put towards player relationships is truly best-in-class. And I know Anton is here somewhere. Anton, yes. He's here, I'm sure he'd love, whether it's in Q&A or afterwards to talk more about their approach to player relationships because again, as we look forward in PC/Console, that relationship between content provider and player is going to be increasingly important. Now on the top, and the center and top right, we see The Lord of the Rings and Tomb Raider. Now Tomb Raider is actually an IP I've been working on or around since you have to count this back since 2007. So it's both scary and exciting and equal measures to think that 17 years already. I fell in love with Tomb Raider and Lara Croft in 1996 on PlayStation 1 days and the chance to provide direction, challenge and resource to our fantastic Tomb Raider studios feels as motivating today as it did back then. The Lord of the Rings is simply one of the biggest IPs in the world, The Lord of the Rings, The Hobbit, both set in Middle-earth became part of the Embracer Group in 2022. And again, if you can imagine it now, I'll put my Middle-earth & Friends hat on and say, such IP is rare and the opportunity now to build within this world being true to the works is something, which resonates massively across your, our shareholders, your studios and your businesses. Last year was a pressure year, but to the point that pressure can create diamonds for both Tomb Raider and The Lord of the Rings, we'd be diligently working with our own creative teams, other creative teams around the world and our passionate fans to lay the foundations and long-term planning for these franchises. On Tomb Raider, our strategic partnership with Amazon across their games and Prime teams is building well. Netflix's animated series, Tomb Raider: The Legend of Lara Croft, releases in early October. For The Lord of the Rings, as previously announced, we've entered into a new collaborative long-term partnership with Warner Bros., and New Line Cinema for upcoming film projects as well with Amazon Games, again, to create an expansive MMO or massively multiplayer online game all set in Middle-earth. Now in addition to these major partnerships with our updated greenlight process, we're actively testing and prototyping multiple new game concepts exploring a wide range of immersive and authentic gameplay or within the Middle-earth world, an honest and tactical approach to well-building and authentic storytelling is at the heart of all these efforts, again, true to the works. And we believe that engaging deeply and early with the community is essential to creating experiences that truly resonate. So in closing, what's left to say? Well, hopefully, you can sense some passion. What's left to say is that Embracer really is one of the leading groups, a successful entrepreneurs, creative talents and world-class IPs. As other speakers have said, we've got fantastic people, a great number of hidden gems and amazing games from across the group, and we aim to demonstrate the growing earnings power of this combination now over time. And so to close, we're going to have a quick show reel of some upcoming titles. [Presentation]

Wow, and thank you, Phil. I would like to take the moment to show you just a few slides, something I'm also very passionate about, I'm passionate about games, passion for fans and something that are part of the ecosystem that the shareholders might not be aware of that we are shareholders of. And it's 4 companies to start part of the group is Limited Run Games led by the founder, Josh Fairhurst based in North Carolina and they are a global leader in its field. They set the gold standard how to physically publish and distribute editions direct to gamers across the world. And we are very excited about the future, but they are already contributing a lot to the success of the group and the synergies within Embracer. Moving to Game Outlet, very close to my heart. This was the company I was part funding 1994, still based here in Karlstad. Nowadays, they are not the mail order company, they are many things, but foremost, they are a provider of retro-gaming hardware and accessories across Europe. To DPI led by the Founder and CEO, Angela, are one of the industry leaders to provide merchandise either directly to the consumer on publishers, we provide websites for publishers and IP holders, but also they are a significant provider of items for collector editions, those amazing collector's editions that you all have bought in here, haven't you? To the fantastic team at PLAION that are providing retro consoles to fans across the world. They started off with THEC64 Mini, now 6 years ago, and it's been a great success for us and for them, and they sold more than 780,000 consoles. And we are all super excited about the release of The Spectrum and Atari 7800+ coming this Christmas. So if you don't know what to buy for a Christmas gift, click online or visit a local game shop. So talking about retro consoles. We have something else within Embracer that are close, not only to my heart, but to a lot of us, including many shareholders, and it's the Embracer Games Archive. And we will have an opportunity to watch a very short video about the Archive. [Presentation]

I'm always -- I always become really glad when we're sitting Games Archive. And I forgot to mention that the Archive also has been contributing to the development of the retro game consoles. So just a few words from my side before we move over to, I believe, a Q&A session to shareholders and to all of you. It's been a long journey. It's been 31 years for me in games and it's been 8 years as a listed company, close to 8 years. And that has been a journey on its own, telling you. We set out as THQ Nordic in November 2016. We started the journey of allocating more capital to making more games, start making some small acquisition, and then 2018, we started making some larger acquisition, bringing leading entrepreneurs such as Klemens at PLAION or Anton of Coffee Stain on board under the roof of Embracer Group. We try to learn, not master, we try to learn the capital markets, and it's a beast. But we successfully have been able to raise $3.5 billion, roughly over 7 raisings, and we have been doing more than 100 acquisitions over the past 7 years. And I told you the other day that we should learn even more from this. Obviously, we are learning every day and been learning a lot, but from those 100 acquisitions, we have had many successes luckily. But we also had processes or acquisitions that has not been performing or failed or many acquisitions that we haven't been able to wait to complete. Now thinking about the divestments we had to do the past year. But we will bring all those learnings into the future and I think we have a lot to take from this journey into the future. The past year has been difficult, sometimes more difficult than you can imagine that you publicly could read. There is a lot of drama in media, but sometimes, there is some truth. Sometimes, there is less truth to that. But one difficult thing I learned, I always promised not to borrow money, not at least of scale and then the banks calling me 2021, hey you can borrow any amount, 0.75% interest rate, no security, okay. Then we took on a lot of debt and then the war came, this was December '21. The war came in February. We were to close the transaction of that debt in March. And then since then, it's been a process, also learning lenders and banks who are your friends, and who are not your friends. And when you're acting together, it could be some rough discussion sometimes. But luckily, the ones that don't want to be our friends, they left. And we have the refinancing, we have been repaying the debt. We've been refinancing in Asmodee and in RemainCo. And today, I feel we are on a solid financial basis to go into the future. Obviously, with everything else going on in terms of improving cash flow, focusing and strategy how to do all this. And I'm looking into the pipeline, and obviously, I would love to tell you about the pipeline, and I'm sure Phil would love it as well on stage, but we need to talk to gamers first. And we need to let the developers and the publisher and the team around the world talk to gamers when the things are ready. But I'm super excited. And for example, I was really glad that we were able to conclude a divestment process last week with Saber Interactive, and we were able to actually keep 4A Games within the group. It's a fantastic studio that has 2 very important games. It's just a very good example that I can't wait to tell you or I will not tell you, but someone will tell you in the future. In the daily life of the CEO, Group CEO, there is a lot of different topics. And I've been spending a lot of time working on Asmodee and the spin-off, spending lots of time in Paris, but also with everyone involved in that process. And like telling you we are -- it's going according to plan. We are very close, I feel. And we have many different work streams and I'm very determined to get this going as soon as possible. And it's in line with what we have been communicating before, still open whether that would happen in the end of this calendar year in December, whether it would happen in February or March. But we are working as hard as we can, promising you. I'm still standing here. I still believe in the vision we set out to provide a home and support for entrepreneurs and creators and to have them working together in an ecosystem. And a lot of that will survive these spin-offs. Collaborations, for example, between Middle-earth and other verticals will still be there, and they might even be stronger at the time of spin-offs. So finally, I would like to thank you all team members, all in this room, but all across the world for your efforts. We are really a team, and we've been working hard together making some difficult decisions, but also hopefully, enjoying doing the daily job. And I just would like to thank you all very much. And I would like to thank all shareholders that are still in the room and still patient with the journey. I know some of you came in as shareholders in the peak of 2021. We are still working hard to deliver back on that entry point. But we are confident -- I'm very confident and I'm long term in all the 3 spin-off companies as a shareholder. And I believe we will be able to create a lot of shareholder value in the coming decade. So thank you so much.

All right. Let's begin the Q&A. Thanks for very good presentations. I noted you said something there on your closing remarks about banks. I just want to clarify, I only work with equities. I work at a bank.

SEB is a friend.

Okay. Sounds good. I have a bunch of questions myself. I'm going to ask the audience for questions as well. And then everyone on the webcast can ask questions. But I thought I'd start with you, David, CEO of the Games Archive. So first of all, why is there an archive for all these games?

Good question. For the past 50 years, the video game industry has grown too very big. Today, it's huge, even bigger than film and movies. And unlike the other big industries, there hasn't been anyone who's taken on the mission to preserve physical video games. And this is something that we believe is very important. It needs to be done. Just like any other culture forum, I think it will always be important to be able to look back and see how the culture has evolved over time. People love video games, and they want to look back and see where it all came from. And with our unique archive that we are building, we can give great possibilities for people to explore this further.

And how has it been received so far?

It's been received very good and very positive, both from -- within the video game community and also outside of it. And yes, so it's been very well received.

It sounds on you like this archive can serve a broader purpose than just storing games?

Yes. We just don't want the games to look nice in our shelf and Archive is not only for the Embracer Group. It's for all who wants to get access to the games. And we really want Archive to be a helpful resource that can promote and support the video game culture and the video game industry. And this can be done in several ways. We have had a close collaboration with the National Library here in Sweden, and also close collaboration with universities, researchers, schools and teachers. And last year, we showed the retro consoles from Plaion. And a guy from Plaion, Ben was visiting us like 2 years ago or something. And he had to try the comparability for the Atari 2600. So he brought a prototype to our archive, and we have like 400 Atari games. So he tried 1 each in a time to see the compatibility, and that was very helpful to them to make the console a success. And we also help book publishers with creating books about gaming history and so on. And actually, next week, a university going to be visiting us and give classes in gaming history in the archive. So I'm really looking forward to that next week.

Wow, cool. Yes. What's your dream vision for Archive?

First of all, I want to Archive to be as extensive as possible of all the games. It's already a fantastic place and I love being there, but this is just the beginning, and it's a longer road ahead of us. But I have this like dream vision. Most of us know about this Vault Archive in Norway, the Seed Archive in Norway and where they store all the seeds in the world. I want to Archive to be like a similar landmark so that people know about the important work that we do there. And people around the world know that in Kosta, Sweden, there is an archive for all the video games. And that's -- yes, it's a good thing.

Sounds good. And for everyone here physically, I believe we have a showcase.

Yes. After this, we have a small exhibition of some items from the Archive with some of the great IPs that are under Embracer, not all of them, but some of them. So please come a look and also play some Giana Sisters on the Commodore 64. Yes.

If I move over to this side, just starting with this past fiscal year, it's been a lot of focus on short-term stuff, restructuring, divestments, now more recently spin-offs. How do you look back on it just simply put, if I ask maybe all 3 of you?

I think we look back with care and -- but we really try to look forward. I mean, I think to the learnings point, I think certainly on the games industry side, there's been a constant change sometimes, then a need to sort of reset and rethink. Personally, I think it's one of the most positive things about the games industry is the confidence and can do. It takes on to try new tech, to try new business models, try new markets, new genres. It really does push boundaries and -- but with that, sometimes you have these periods of reflection and correction. And I think that's what the industry has gone through, and that's what we've gone through. And now we learn and we move forward. And I think with our -- as I say, with the people, with the IPs, with the strategies now set, I think, great times for the future. So we look forward.

Humbling, a humbling year.

A few words, but then it says a lot. And you, Muge, do you have anything to add?

Well, very consistent with Phil and Lars looking back and connecting the dots, things we've gone through, I find it very consistent with the move we are about to undertake, taking us a more solid base, a lot more consciousness. Everything we have left behind us gives a lot of exciting, favorable actually future outlook.

Okay. And then just a follow-up to you specifically, you're new in your role as Group CFO coming from Asmodee initially. Has it been a big transition for you going from Asmodee to a company like Embracer?

I shall say, since the change of control, the welcome overall has always been very warm. I have said it several times, I didn't feel like being treated like a subsidiary, but by a valuable colleague, by all my colleagues, [ forces ] at Embracer. I think I had the privilege to be a part of this family for now many years. I had the chance to actively participate in our restructuring program, serve as the Deputy CFO. So having had the chance to get familiar with some businesses, work with colleagues, having had the chance to work closely with Johan. So I think I'm very grateful with everything I was exposed to. So, so far, I'm just very happy with the process.

Great. And in terms of a special year like this, I assume it's a difficult balance when you as a company must, on the one hand, address costs. But at the same time, you still have a lot of developers that need to focus on developing good games. And Phil, I thought I'd ask you how you navigate that balance because you play a key role in Embracer's restructuring, but you're also leading Crystal Dynamics, so?

Yes, I think -- I mean, it's all down to the teams, even reflecting -- getting ready for these short notes today, thinking about the path with Kingdom Come: Deliverance II, the team, how they've kept their focus and can come out at the right times and showcase the world. So I think that's across the group. There's a lot of teams that have just kept their focus. They believe in what they want to try and do. They believe in the broader vision. So I think step by step and team by team, but that's how we've kind of approached it, humbly and organically and just try to do the right thing.

And we also have Anton here on stage from Coffee Stain.

Yes, he is on there.

Yes, it sounds like it works. What's been your role in this restructuring or transformation?

Yes. So my role is changing a lot. It's a very interesting year for me coming from building Coffee Stain to where we are today, now trying to make sense of this new structure. And yes, there's a lot of things going on. I think we are quite early like still. It's what -- it's taking on some speed now and yes, it's been interesting. Like this whole restructuring phase. I was part of the process where we went through all these games. It's been very eye opening for me as well to even get more insights into all the other things that are going on in Embracer. And I think that I was very focused on Coffee Stain. I'm still very focused on Coffee Stain, but it's also so many other good things in Embracer. And I think it's a little bit of a shame that -- yes, I think we will see more of that in the future, and I'm actually -- it's been very nice experience for me so far. So also now, obviously, like just getting to know everyone else, it's a great group, a lot of great developers, great people. So yes, it feels good.

Great. And I noted your shirt earlier, Kingdom Come...

Yes. I can see it.

It looks really good. And I thought if we call that an upcoming success, I thought I had to ask you about the recent success is Satisfactory?

Yes. It's crazy. I must just say I'm so happy the team has done such an amazing effort. It's crazy. Satisfactory is one of those games. I'm typically always skeptical about everything, unlike very harsh. And I think when we worked on Satisfactory in the start, I was a little bit skeptical. But like over time, like the team just showed how great of a game it is. And I think last week launch was just a crazy testament to that, like seeing like over 200,000 concurrent players. We had like 185,000, I think, on Steam and then at the same time, a lot on Epic. That's a crazy amount. So it's a huge love for the game. And also, obviously, that gives me a lot of confidence that we can keep delivering on Satisfactory. But it's also like I think a good proof of whatever we're doing in Coffee Stain, it's actually working very well, like working closely with the community, having this like very open and being very transparent, like no tricks, very like open-minded. I think that's the way of the future. And yes, super happy about it.

So that's the secret sauce, just transparency and...

Yes, it may sounds easy, but I think it's -- actually boils down to a lot of that. And like how -- I mean, so much has changed, if you like, look at things even when we started the Coffee Stain with like marketing with like how social media has grown to like this -- like players talk with each other, like it's so important to kind of have the trust in the players. So I think this is one of the challenges, which a lot of the like older and bigger companies maybe have to kind of go through and adapt to that new landscape where it's very -- you have to kind of be with the community in a different way than, I think, in the past.

And I was going to ask you what's next, but I guess that's console.

So what's next? Yes, we obviously have a lot of things going on. As you saw here in the video, we're looking forward to launching Satisfactory on consoles. And there's -- after that, we're probably going to do looking into DLC and more content. But I think that goes for all our products. So you will see more. We have some stuff in our pipeline as well. But -- and then across the whole Coffee Stain and Friends group, there are plenty of cool things coming. So yes, much to look forward to.

Stay tuned. Do we have any questions from the physical audience? Just raise your hand. I believe there's a mic. Yes. Do we have a mic? Raise your hand again, maybe.

Thank you today for your presentations. My name is Mark Johnson, and I represent the Folksam Group. I have a question about cash compensation to senior executives. And I wonder if Lars or the Chairman can comment on the link, if there is any to performance in regarding sustainability.

Thank you, Mark. It's a relevant question. And I think it's important in general to have incentives that are linked to the important KPIs of the business and not only financial. Obviously, this is a difficult science and sustainability, even though there is many KPIs, you don't want to suboptimize incentives. But the reality is today that we don't have any cash incentives or share incentive plans to any executive that are linked to the sustainability or ESG matters, even though it's our ambition. So Ian, I'm looking at you here because you are the expert on incentive program.

Yes. So in short, as Lars alluded to, today, we don't have any share based or variable remuneration, cash based either for senior executive and thus, no KPIs whatsoever because there are no incentives. So...

It's easy answer.

The short answer. In future when we do, there will, of course, be sustainability, other relevant KPIs for our business, so?

Okay. Any other question? Yes, one up here.

My name is Johannes Wingborg, and I represent Länsförsäkringar Fondförvaltning here at the AGM. I have a question regarding the Board's shareholding. Some of the Board members have a very large shareholding. At the same time, a couple of board members who stand for reelection, do not own any shares when I look at the material for the AGM. So I just wanted to ask if this has been a discussion regarding this in the -- and yes, what's your view on that?

I could answer from my view. I think perhaps, Per, if could give some color from the Nomination Committee because basically, it's also a question for him and the Nomination Committee. But in general, I mean, obviously, in favor that I'm in the same boat with people and people have incentives and that they are shareholders. Now even more important is that you have the right Board members that are committed and engaged to the business. And the reality is that not everyone are millionaires or billionaires. And so I don't think I should force anyone to buy things or shares, people. I think, in general, the pay in Swedish boards are very low. And they have a lot of responsibility and they spend a lot many hours every year. So in general, it's not a very well-paid job. So that's something I would like to bring back to the institutions, perhaps if they were better paid, they could have more reasons to buy shares. That was a very long answer.

I can add some comments actually. I'm Chair of the Nomination Committee. As you can see or maybe you've read and you will learn from our proposal, we've had these kind of discussions. And of course, we can't, as a Nomination Committee, put any demand on the Boards of Directors, but we can make expectations and as you will learn from the proposal we will make.

All right. Any other questions?

Yes. My name is [ Ole Hultberg ]. I'm a shareholder. And I have a question regarding the IPs. IPs has been mentioned numerous times, specifically Phil here in his presentation. And the IPs are, of course, I think we can agree a platform for developing the games in multichannels and on different platforms. Now how in the restructuring will the IPs be utilized and shared as historically, within Embracer, this has been a synergy effect that we can address to develop more games and more merchandise and different things. Thank you.

Yes. I can certainly start with that. I mean I think that -- even taking away the restructuring, there was sharing and collaboration between groups. I talked to some of the expertise and how we use that. There's expertise in creating remasters, there's expertise in merchandising, as you correctly referenced. So I think -- I think certain IPs have been done in ways that are great examples. And I think from great examples, then we're driving better economics and results, and that will create a sort of halo effect and will naturally create that barriers to reduce down further. So I'm quite optimistic about that. And I think -- the other aspect is, as I've alluded today, I mean, Lord of the Rings in particular, is on the world's biggest IPs. And there, we have to really think beyond silos or historics. We have to bring teams together to create multiple year plans. And then once you've established what it is, how do we do it internally, externally. And this will really I think, play to the point you're making. And I'm really passionate about that, but also as we talk about that in the business today, I can feel the feedback is really positive. That's what for an IP of that size and shape and potential, that's what teams want to do. So I think we're beginning to move faster and further into that collaboration and really realize these synergies. And as the breadth shows in -- from Retro to Merchandise to all these specialist areas, limited run, they're experts in their domain. And so I'm really optimistic.

Just to give some color on that. One thing it's important to remember that we have been -- we own or control 900 IPs. Some of them are the greatest in the world. Some are very niche and not so well known globally. We have been lowering our CapEx from -- in dollars, about $800 million a year to about $400 million to $450 million. And obviously, we have less capital to invest into all of those IPs. So I think going forward, obviously, we will focus more on owned and controlled IPs in the investments we are doing. But I also believe we will give access to external companies to work on a number of IPs, including gaming companies to provide future beloved products. It's something more on long-term planning to utilize the IPs we own in the balance sheet. Right now, we're very focusing on executing what we have on the plate. But I think it could create a lot of value for both gamers and shareholders on the long term, thinking that way.

All right. Yes, I see a hand here.

Erik Sprinchorn, representing TIN Fonder. A question on AI, which is a topic that I've sensed some hesitation in previous meetings and so far. But now we've heard that you've created -- formed a policy on -- with respect to employees. And I've heard Kicki, I think, talk about tools being perhaps very valuable. So I mean, I get a sense that you are slowly, but surely, getting your arms around this topic and maybe you can share some sort of general findings on potentials and risks. And is the organization embracing these -- sorry about that, but these tools or what's your current view on AI and how it will be helpful for productivity, creativity or not?

So it's a bit of a sensitive topic, and I think it's a bit of an unknown topic. I've been spending a lot of time with the leading AI companies in the world the past month, trying to deeply understand how this is impacting our group and the industry and the wider society, because if you're not deep into it, you could imagine that you push a bottom and then outcome a new Tomb Raider game. I'm happy to learn in the way that, that is not true. And if that ever happens, it's decades or centuries away. So it's more of a tool to complement the current work streams. I think that's one thing I realize is. Well, it develops fast, but it's not a magic tool to create games without any humans in between. Phil, perhaps you can process it for us.

I mean I think it's really exciting for us, let's say, AI, and it's great that -- I mean I actually went to a conference early this spring where the first day was dedicated to excitement. And then the second day was handed over to lawyers and it was -- and oh, be careful. So I think as a business, how we navigate that is common with many businesses. I wouldn't call it cautious necessarily, but I'd call it pragmatic. I think we're trying to identify and our teams, I mean this one of the advantage of being somewhat distributed, there's lots of individual pushes to find solutions to solve -- to work faster or be more creative, and now we're trying to pull those together, so we can we can learn and redeploy, looking through a very pragmatic lens. And I think from my own personal, I did a deep dive a month or 2 ago about community management with AI. And I remember GDC attending some sessions and listening. I actually thought to myself how hard can it be? But then when you really read into the white papers that are coming, I think that was sort of a Microsoft team, and you realize the challenges that go deep into community management and how you take profanities out of communities and make communities safe -- safe places for people to be. Some of the notes that Kicki talked to earlier, there are now AI tools and technologies that are really winning there. It's probably when you think about AI, it's probably not the sort of absolute cutting edge that you might imagine, but it's making communities safer. It's -- you think, why can't we just filter out profanity. Well, if people are being profound, swearing and whatnot in symbols, it's very hard for filters to do that. So you do need some element of machine learning and whatnot to provide those tools to make those communities safe. So it's a small aspect of 1 aspect of our overall ecosystem, how we have safe and productive forums for our games. I think that's an example of where we do read in, and we do learn and apply quite quickly.

One thing, also like, I think this industry, we have some of the best programmers in the world, which are super excited about AI generally. So like I think all our teams are looking into like these tools and -- so I mean, I think that's something to keep in mind. I think the games industry are going to benefit a lot from this. And everyone is now looking for like the next big thing. It's going to take some time. Tools are going to get much better. It's going to increase efficiency, ultimately, like better products, I think, from us and maybe faster, but it's with like all this technologies, it's like it takes a little bit of time to get them into practice.

All right. Any other questions? I don't think I see any hands. All right. I'll take some questions from the web here. Actually, the first one here is not really a question, but it's worth mentioning. It's someone regarding the games archive asking it to put some games online. So you can play them, and the person seems willing to pay for it. So it's a business idea. But another question here. Have you decided where 4A Games will sit within the Embracer structure?

Yes. So it would be part of the future Middle-earth & Friends structure.

All right. And then a second question here from the chat, regarding the release date of Kingdom Come, which is on the same date as a game called Civilization, which might be a bit competing perhaps, how do you tackle that? Or do you tackle it. Do you change the date?

We're looking at it. We're mindful of it, but I think we're confident on our plan. But yes, I think it's a constant thing that we do when we look at release dates is what else is coming out, when are other events taking place. So it's more day-to-day for us, and we'll do the best thing for the game.

Yes. Sounds good. I think we'll have to wrap up the Q&A here thinking about time. So I'll ask you a final question. I know it's a lot of focus on spinoffs. So I'm curious on the feedback you've gotten from external stakeholders, not meaning investors because I know there are different views there, but from industry partners, what has been the response in general, I would say.

No, I think they're very supportive. I think what we hear, and they want us to succeed. I think the spin-off process we're going through is one important thing to get us where we need to be. We need to be able to utilize our balance sheet. We need to be able to tap into the capital market. And if we do that, we will create better games and become more successful. So we are a public company with public shareholders, and we need to optimize for that to create operational success. So people are very supportive from that perspective.

All right. I think we'll wrap the Q&A there. So thank you very much.

Thank you.

Thank you.

Okay. Thank you, Lars and team. Now we have come to the even more exciting part of the Annual General Meeting. And that's now #8 on the agenda, presenting of accounting documents. The annual report for the financial year has been published on the company's website on June 20 and has also been available the company's offices and is available here today as well. Do we have any questions about the -- so far regarding the material that's been available? No, I can see that. So I would like now to ask our company's main responsible auditor, Magnus Svensson Henryson at PwC, to present the auditor's report. Welcome Magnus.

Thank you, Kicki. Honored shareholders, ladies and gentlemen, as mentioned, my name is Magnus Svensson Henryson, and I'm representing PwC as the auditor in charge for the audit of Embracer Group AB. You shareholders engaged us to perform audit work in order for us to express an opinion on the financial statements and the management performed by the directors. The purpose of that opinion is to further support and trust for the financial reporting and the management. Our audit has been performed throughout the year. And we had extensive communication with management on matters relating to business operations and the financial reporting throughout that year. We have reported our work to the Audit and Sustainability Committee on 5 occasions. And we've met with the full board on 3 occasions during the year. Our participation in those meetings allow the directors to ask us questions on matters relating to the audit, the financial reporting and other areas, and that opportunity has been used. We believe that the collaboration between us as auditors and the management and the directors have worked very well. As you may remember, this is our first year as Embracer's auditors, and that means that we spend a considerable amount of time to understand your business. We have also done work to understand what was done in last year's audit performed by EY, and we did perform additional work as we must do around last year's closing balance sheet. In addition, we have evaluated significant business processes, systems and controls for the financial reporting. We spent time getting to know your people responsible for the financial reporting, both centrally here in Karlstad and locally around the world. Changing audit firms requires hard work, not only for us as auditors and I'm not sure that's of importance to you. But what is important, it also requires a lot of work for Embracer's people. And I speak now for the entire global audit team when I say that we have received great support from Embracer's staff, and we appreciate all the efforts made. Based on what we learned during this start-up phase, we've made a plan to audit the business of the major entities within the group. Our global team consists of local teams in various territories and a central team in Karlstad and Stockholm, supported by subject matter experts on various areas such as tax, IT, sustainability, valuation, accounting and other areas. Our view is that Embracer overall has robust processes for the financial reporting and that the business performance is presented transparently. These qualities are built on the expectations that have been communicated by the directors and management and on the commitment and competence of Embracer's employees. An audit are based on concept of materiality and risk and those are our tools to focus our limited efforts on areas that are most significant. The audit report sets out 4 such areas that we have judged to be of greatest importance in our audit, and I thought I should mention a few words on each of those areas. First of all, revenue recognition. The diverse nature of Embracer's business, and we've heard that today, of course, the diverse nature requires various business revenue streams that have inherent different characteristics depending on the type of business, products and how they are distributed. Embracer is part to agreements with publishers, platforms and other counterparties that may influence how revenues are recognized. We have tested the reporting of revenues that is consistent with Embracer's accounting principles by evaluating systems and controls and testing selected key controls. And we have also tested samples of transactions against supporting documents and payments. And we've done so for all operative groups of Embracer. We assessed that revenues are reported correctly in accordance with Embracer's accounting policies and that those accounting policies are consistent or compliant with IFRS. The second area is goodwill and other items related to business acquisitions. As mentioned before here today, Embracer has acquired many businesses in recent years, and that has led to the recognition of goodwill and other assets and liabilities, with significant amounts, I should add. Goodwill assets have indefinite useful life for accounting purposes and they are held at cost without amortization, instead carrying amounts of individual assets are tested for impairment annually. Those impairment tests require estimates of future cash flows and other inputs that are inherently subjective. We have tested a sample of historic purchase price allocations against supporting documentation. We have examined a sample of the impairment test, the most significant ones. And we have evaluated those significant assumptions made that I just mentioned. We also tested the recognition of goodwill from assets sold or reclassified to assets held for sale. We assessed that goodwill and other intangible assets identifying business combinations have been measured correctly in accordance with the accounting principles of Embracer and that those accounting principles are compliant with IFRS. The third area is divestment of subsidiaries, and we heard that Embracer has divested Saber Interactive and significant parts of Gearbox. These are very complex transactions, not the least because they are very sizable businesses. We have read the share purchase agreements and other documents and discussed the transactions with management to evaluate the presentation in the financial statements. And we have traced agreed purchase prices to payment transactions and the carrying amounts of sold assets and liabilities to the accounting records. We assessed that the divestment have been presented in accordance with IFRS. And then the fourth and final area is restructuring program. We have obtained an understanding of the program, and we have tested significant activities under the program, including impairment test of development costs and other assets. Our work also included tracing divestments and termination of contracts to accounting records, payments and agreements. We assess that the activities under the restructuring program have been presented in accordance with IFRS. Before, during and in connection with the completion of our audit, we evaluate our own independence. Any service beyond the statutory audit have been evaluated separately by ourselves and by Embracer before accepting. Embracer has a strict policy for non-audit services provided by its auditor. We meet all requirements on independence set out by regulators in Sweden and overseas, and we have reported that to the Audit and Sustainability Committee in connection with the issuance of our auditor report. I have now come to the conclusions of our audit. They can be read from our auditor's report that's included in the annual report. We recommend that the Annual General Meeting adopts the income statement and the balance sheet for the parent company and the group that the profit be appropriated in accordance with the proposal in the statutory administration report, and that the directors and the Managing Director are discharged from liability for the financial year. Thank you.

Thank you very much, Magnus. I'm wondering, do we -- anyone having any questions to Magnus? No. Okay. I then find that the annual report and consolidated accounts as well as the auditor's report have been presented. Thank you, Magnus. As we heard the auditor support that the Annual General Meeting approves the presented income statement and balance sheet as well as the consolidated income statement and consolidated balance sheet. Can the Annual General Meeting approve the presented income statements and the balance sheet?

Yes.

Thank you. The Board of Directors' proposal regarding the allocation of the company's result is included in the annual report and as well been included in the notice for this meeting. The Board proposes that no dividend shall be paid for the financial year '23, '24 and the Board proposed that the funds available to the Annual General Meeting of approximately SEK 54.7 billion shall be carried forward. Does anyone want to comment on the Board's proposal. As we have heard, the auditor also support that the Annual General Meeting resolves to allocate the company's profits in accordance with the Board's proposal. Can the Annual General Meeting resolve that the approved results is allocated in accordance with the Board's proposal, which was also endorsed by the auditor.

Yes.

Thank you. We have previously heard also that the auditors support discharge from liability. And I would like -- also like to inform the Annual General Meeting that the Board members and the CEO may not participate in the resolutions concerning each of themselves. Can the Annual General Meeting in accordance with the auditor's endorsement approve discharge from liability to the directors of the Board and the Managing Director for the past financial year.

Yes.

Thank you. Considering the votes provided in advance...

Yes. Considering the votes provided in advance and present here today. The decision has been passed with sufficient -- majority.

Yes. Okay. Great. Now we have come to point 10 to 12. And this is where we should determine the number of Board of Directors and auditors, fees to the Board of Directors and the auditors and also the election of the Board of Directors and auditors. And this proposal has also been available since the 19th of August on the company's website in the notice and also available here today. But before we will present the Board -- will go through all that, I would like to present the Board's work of the year. And we will -- I would like to have some slides here. We have -- this year has been a busy year for the Board to say the least. And as you probably -- or at least you have heard several times now, that the most challenging -- this has been the most challenging period in the history of the company, and I would like just to take you through the process that we have -- that has taken us to where we are today from a Board perspective. We have had -- of course, the most focused -- the most important thing for us to focus on what to make sure that Embracer becomes a leaner, stronger, more focused and self-sufficient company. So if we look at the process that we have had, that we worked through, we have had a very thorough process. And most focus, I would say, has been on the restructuring program. We actually were, of course, spending a lot of time to explore different options to maximize value for Embracer. And you -- that all that work resulted in the proposal to transform Embracer into three stand-alone publicly listed company. And we -- as you may remember, we announced that on the 22nd of April. And we have had, during this period of time, we have had 54 record meetings in the Board. And we have an annual calendar, Board calendar where we have specified what we should do during our ordinary meetings through the year. And those -- there we can see what we must do during the year. But this year, it's been an extraordinary year, I would say, because we have -- as you can see here, these are all the ordinary meetings we have had, but we have also had a number of extra meetings. Now in the middle here or actually in September last year, we had a new -- we had several new Board members that joined the Board, and I would say they got a real kickstart because -- to actually become involved and catch up in the middle of all this was quite an achievement, I would say. So if we add the extra board meetings that we had physical or on Teams. We had 21 physical meetings or via Teams during the year. Most of them, as you may see here is that most of them actually relate to the restructuring program. And we followed up on each 1 of all activities to make sure that we really -- that we make the progress we needed to do in order to deliver what we had promised. We also had a number of per capsulam meetings during the year. Actually, you can see the small orange dots here. That's the per capsulam meetings that we did have. And we also had 8 Audit Committee, Audit and Sustainability Committee meetings and 5 Remuneration Committee. So all in all, this actually resulted in 54 meetings through the year. Now you can say that as you probably already figured out that the focus that we had was, first of all, as I already said, on the comprehensive restructuring program, we also spend a lot of time on the structured divestment processes. For example, as you see here, Saber and Gearbox, as we have mentioned several times today. And also that meant that we terminated all our operations in Russia. So we spent a lot of time on that as well. And of course, last but not least, we spend a lot of time to the proposal to split the company into 3 new companies. Then if we talk about the reporting and the business performance, we -- I would say that we do not just sit there and wait for information. We are quite -- we know what kind of information we would like to get from management. And if we look at the reporting and the -- that we get from mainly, of course, from our CFO, it's a long list of reports. And apart from all the business performance and the reports that we get from the CFO, we also have the CEO reports that we get from the different operative groups in the company, which I find extremely interesting to read because there, we can follow up and we can read how the businesses are progressing if they compare to budget, what they're doing and on new things and the pipeline of games and all that. So that's very exciting. If we look at -- when we talk about the ordinary course of business going forward now. As you know, we have like 3 train standing, waiting to take off. And they're all on track, as you can see. And the first 1 out will be, as Lars mentioned, Asmodee, and it's extremely interesting to see how that business is now forming and take part. It's another thing as well. I would say, if you -- if you think about all the energy and the passion, we talked a lot about passion here today, the energy and the passion that the Board puts into our work throughout the year. So here comes the ultimate test now for it. What -- why do you think we put in so much energy and passion into our board work, because we have a fundamental belief in the power of gaming, of course. Any questions on the board work. right? Thank you. We had 54 meetings this year, but we had 86 the year before. So we're going in the right direction. So now I would like to ask the Chair of our Nomination Committee, Per Fredriksson, to present the proposal for all these items that we will -- that I mentioned before. And then I would like us to vote on all of them in 1 piece after Per has presented.

Okay. I will go through item 10 to 12 then. I beg for your attention for another 6 minutes and 54 seconds or something like that. The Nomination Committee in respect of the Annual General Meeting 2024, has been comprised of myself, appointed by Lars Wingefors AB; Ola Åhman appointed by Savvy Gaming Group; Anna Henricsson, appointed by Handelsbanken Fonder; Henrik Olsson appointed by Canada Pension Plan Investment Board and Magnus Tell appointed by Alecta. The chairman of the board, Kicki Wallje Lund has been an adjunct to the Nomination Committee. Our work is described in the AGM documentation. Well, we have held 8 recorded meetings, all in good spirit and I would say, including passionate discussion to add to the theme of the AGM maybe. In respect of this AGM 2024, the Nomination Committee has unanimously resolved to submit the following proposals. Item 10 then, proposal for candidates for the post of Chair and other directors of the Board. The Nomination Committee proposes that the Board shall consist of 7 directors, without Deputy Director that Yasmina Brihi, Bernt Ingman, Jacob Jonmyren, Cecilia Qvist, Kicki Wallje Lund and Lars Wingefors shall be re-elected and that Brian Ward shall be elected as new Board member. That Kicki Wallje Lund is re-elected as Chair of the Board. Information on all proposed Board members is available on the company's website, as you might know. Reasoned statement regarding the proposed Board. In preparing its proposal for the Board, the Nomination Committee has focused on maintaining its composition and competencies paying particular attention to the transformation of the company into three standalone publicly listed entities. Furthermore taking into account the Board's ability to supporting the company's strategic position and development, international operations, governance and financial controls. The Nomination Committee has applied rule 4.1 of the Swedish Code of Corporate Governance the "Code" as diversity policy, entailing that the Board of Directors shall, with regards to the company's business, phase of development and other relevant circumstances, have an appropriate composition of Board members elected by the general meeting that collectively display diversity and breadth in respect of skills, experience and background, and to strive for an equal gender distribution. 43% of the proposed Board members are women. In addition, the Nomination Committee has assessed the independence of the Board members. The Nomination Committees proposal regarding the composition of the Board meets the requirements of independence as stipulated in the Code. In preparing its proposal, the Nomination Committee has considered that a majority of the proposed directors are to be regarded as independent in relation to the Company and the executive management and that at least 2 of the Board members who are independent of the Company and the executive management shall also be independent in relation to the Company's major shareholders. Furthermore no more than one elected member of the board may be a member of the executive management of the company or a subsidiary, in accordance with rule 4.3 of the Code. With respect to the temporary current and anticipated extra workload of the Board associated with the transformation of the company into 3 standalone publicly listed entities, the Nomination Committee would like to underline the importance of video game experience, industrial knowledge and active ownership added by Brian Ward's candidacy. David Gardner and Cecilia Driving are thanked for their contributions within the Board of Directors. Well, that concludes item 10. Item 11, proposal for fees and other remuneration. The Nomination Committee proposes that remuneration of the Board, excluding remuneration for committee work, shall be increased to an aggregate of SEK 7.5 million. The remuneration to the Chairman of the Board shall amount to SEK 2.2 million. The remuneration to each other member of the Board, not employed by the company shall amount to SEK 700,000. Moreover, given the additional board work required with regards to the intention to transform into 3 stand-alone publicly listed entities, additional Board remuneration is warranted until the listings have been completed. Thus, the Nomination Committee proposes an additional fee of SEK 200,000 to the Chairman and SEK 150,000 to Board members who are not employed by the company. This is called the Transformation fee. And now back to the question before. The Board members are expected to use at least the part of the compensation that corresponds to the increased board remuneration and the Transformation fee after any tax that burdens such part of the remuneration and Transformation fee has been paid, to acquire shares in the company. The Nomination Committee recommends that the acquisition of the shares should be carried out as soon as possible after receipt of the remuneration from the company. In addition, the Nomination Committee proposes that remuneration for work in the Audit committee shall remain unchanged and be paid with SEK 275,000 to the chairman of the Audit committee and SEK 175,000 to every other member of the Audit committee. Remuneration for work in the Remuneration committee shall remain unchanged and be paid with SEK 150,000 to the chairman of the Remuneration committee and SEK 100,000 to every other member of the Remuneration committee. Reasoning regarding Board fees. In the process of setting and proposing the Board fees, the Nomination Committee has conducted a thorough benchmark of Board remuneration levels based on Swedish and international peers, and has also sounded with former, present as well as potential new board candidates in this effort. With respect to the temporary current and anticipated extra workload of the Board associated with the transformation of the company into three standalone publicly listed entities, the Nomination Committee considers it reasonable to propose the Transformation fee on top of the ordinary remuneration up until the completion of the company's transformation. That concludes item 11. Item 12, proposal for election and remuneration of company auditor. The Nomination Committee proposes that the registered audit company is appointed as auditor until the end of the next general meeting. Further, the Nomination Committee proposes, in accordance with the audit and sustainability committee’s recommendation, re-election of the registered audit company Öhrlings PricewaterhouseCoopers as auditor in the company for the period until the end of the next annual general meeting. PwC has informed that authorized public accountant Magnus Svensson Henryson shall remain the main responsible auditor. Remuneration for the auditor should be paid in accordance with approved invoices. And that concludes Item 12.

That was fast.

That was 06:54, maybe, I don't know.

Okay. Do we have any questions on the proposal? Okay. Now, Per do you want to invite Brian.

Yes, why not. Please, Brian, if you could make just a short presentation.

Thank you very much, Per. Thank you, Kicki, and thank you very much for the invitation to say a few words. I am slightly disappointed having been born and raised in Northern Canada that this meeting is not taking place in the middle of January, in a climate I'd be more familiar with. But, thank you, nonetheless. And congratulations to the company on its operational results, process improvements, the results of its restructuring and divestment programs. I know firsthand how difficult those decisions and communications can be. And particularly, congratulations to the company on setting the foundation and road map for a stronger future, which we believe will unlock shareholder value, is an easier investment story. And I think also will provide additional motivation clarity and excitement to the employees of the broader group and then 3 units within it. Just briefly about my background, although I started my career as a lawyer, I've now been in this industry 28 years, having started at a very small studio owned by Electronic Arts in Vancouver in 1996. Since that time, I've had the privilege of leading 2 of the largest M&A transactions in our industry's history, many other mergers and acquisitions, integrations, restructurings and divestitures as well as a number of process improvements that enabled and drove some substantial organic growth. At that small studio in Vancouver, which was 100 people when I joined in 4 years, we grew that studio to 800 people, quadrupled revenue and contributed 43% of the top line to Electronic Arts among a studio group of 13. After a couple of years at Microsoft and joining Activision, I had the opportunity to lead Worldwide Studios there. And during that period of time, we were very fortunate to also quadruple revenue, I think, over a 5-year period, triple the size of the studio organization, posted the industry's leading margins and overtook Electronic Arts as the #1 pure-play publisher. I now lead as group CEO, Savvy Games, which is a completely different type of entity and quite an unusual startup. We are now only 2.5 years old, but we are 3,800 employees in 22 countries and doing about $4 billion a year in top line revenue. I am very excited about this opportunity to serve. I am grateful for your support. I think this is an exciting juncture and point of inflection for Embracer Group. We have extreme confidence in Lars and the leadership and management team. I hope my experience over the last 28 years, facing a lot -- facing and managing through a lot of the issues, challenges and opportunities that Embracer team will now be facing over the next couple of years. I hope my experience will be of value and will exceed expectations, and I look forward very much to working with Kicki, Lars, the other members of the Board and the broader Embracer employee group.

Thank you very much, Brian. I can't say welcome yet because we haven't made a decision yet. You have to wait. Now that we have heard the proposals for Item 10 to 12, I will ask the meeting to -- that we can approve all these items together. But before we proceed to voting, are there any other proposals for Item 10 to 12? Can the meeting resolve in accordance with the proposal?

Yes.

Thank you. So now, Brian, I can say a warm welcome to our -- becoming our new Board member. And Brian, there is one thing I can promise you. It will never be boring. Okay. I also would like to inform the meeting who our Audit and Sustainability Committee and Remuneration Committee will be composed. The Audit and Sustainability Committee, it will be Bernt Ingman will be the share of the Committee and Jacob Jonmyren and myself will be a part of that Committee as well. We have the Remuneration Committee. And Yasmina Brihi will be the Chair of that Committee and it will be Jacob Jonmyren and Cecilia Qvist that will also be the members of the Committee. Now even if we -- if Cecilia Driving and David Gardner, couldn't make it here today, I would like to take this opportunity to express our great thanks for all the contributions and engagement in the Board throughout the years. Now the Board has, after a recommendation from the Remuneration Committee proposed that the Annual General Meeting approves the remuneration report. And the proposal has been included in the notice for the meeting and has also been available on the company's website prior to the meeting and has also been distributed here today. So therefore, I do not intend to go through this in detail. And in this context, I would like to point out that the auditor's statement regarding guidelines for remuneration for senior executives are available here today and has been available at the company's website. In addition, the current guidelines are kept unchanged and will unless adjusted in the future remain in force until 2026. Do we have any questions regarding the report? Okay. Can the Annual General Meeting resolve in accordance with the proposal?

Yes.

Thank you. Number 14, the Board of Directors has proposed that the Annual General Meeting shall resolve on authorization for the Board of Directors to issue B shares, convertibles and/or warrants. This proposal has also been made available in the same manner as noted for item 13, and I do not intend to go through this in detail either. It can be noted that the authorization may comprise a maximum of 10% of the total number of shares in the company per day when the authorization is first used, i.e., based on the number of shares today, that is how many, Ian.

134,994,486.

Good. Thank you. Are there any questions regarding this proposal? No. Can the Annual General Meeting resolve in accordance with the proposal?

Yes.

Great. Thank you. Can we -- considering the votes provided in advance, can we note that the resolution is passed with sufficient majority of 2/3 of the votes cast at present -- at present at the meeting. Okay. Thank you. Number 15, the Board of Directors has proposed that the Annual General Meeting shall resolve on authorization for the Board of Directors to repurchase own B shares. Same procedure here as under Item #14 and I do not intend to go through this in detail either. It can be noted that the authorization may be made up to a maximum number of B shares that the company is holding of own shares corresponds to no more than 1/10 of all shares in the company. In other words, the same number of shares as noted for the authorization to issue shares.

I want to say it again. Okay.

Yes. You did say here that you...

[ 134,994,486 ].

Okay. Great. Are there any questions regarding the proposal? No. Can the Annual General meeting resolve in accordance with the proposal?

Yes.

And considering the votes...

Yes. We can note that it's passed with sufficient majority.

Thank you. #16. The Board of Directors has proposed that Annual General Meeting shall resolve on authorization for the Board of Directors to transfer own shares. Same procedure as for the previous item for the final time today. Are there any questions regarding the proposal? No. Can the Annual General meeting resolve in accordance with the proposal?

Yes.

Thank you very much. Considering the votes.

One final time, passed with sufficient majority.

Good. Thank you. Okay. Well, dear shareholders, with this meeting now, we can put '23 and '24 behind us. And I would like to take the opportunity to thank Lars and his team for all the hard work and energy and all the passion, God's sake, that you always put into the business. And then, of course, I would also like to thank you all here today for participating in our General -- Annual General Meeting. And I hope to see you all here next year again in sunny Karlstad. And as we have no other questions reported, I hereby declare the meeting closed. Thank you very much.