Please send your questions to [email protected] We will aim to answer as many questions as possible at the end of this presentation The Funcom Group Funcom N.V. and subsidiaries 2015 First Quarter Presentation The Funcom Group Funcom N.V. and subsidiaries Disclaimer – forward looking statements This presentation contains forward-looking statements that involve risks and uncertainties. All statements other than statements of historical facts are forward-looking. You should not place undue reliance on these forward-looking statements for many reasons. These forward-looking statements reflect current views with respect to future events and are by their nature subject to significant risk and uncertainties because they relate to events and depend on circumstances that will occur in future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward- looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot assure you that our future results, level of activity or performance will meet these expectations. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. Unless we are required by law to update these statements, we will not necessarily update any of these statements after the date of this presentation, either to conform them to actual results or to changes in our expectations. Please send questions to [email protected] Agenda 1. Key highlights 1Q 2015 2. Key financials 3. Project status • Large scale MMO’s • MMO’s in development 4. Summary and Outlook Please send questions to [email protected] Highlights • Q1 FY15 revenues were USD 2,772k, a decrease of USD 144k compared to Q4 FY14 • The Live Games – Anarchy Online, Age of Conan and The Secret Word – were the major contributors to the revenues • The EBIT improved from USD -439k in Q4 FY14 to USD -269k in Q1 FY15 mainly due to the realignment of expenses with the declining revenues • LEGO Minifigures Online (LMO) will switch to a buy-to-play model this summer • The cash position is USD 2,452k in Q1 FY15 compared to USD 3,705k in Q4 FY14 • Restructuring going to plan. The impact of these costs savings will continue to materialize in Q2 FY15 • Quarterly operating costs are down USD 1,100k YoY and down USD 802k from Q4 FY14. • Rui Casais has been appointed CEO as of the 13th of May Please send questions to [email protected] Agenda 1. Key highlights 1Q 2015 2. Key financials 3. Project status • Large scale MMO’s • MMO’s in development 4. Summary and Outlook Please send questions to [email protected] Key Financial Summary – Q1 FY15 Notes Q1FY15 Q1 FY14 in K USD < Main sources of revenues are The Revenues 2,772 3,836 Secret World and Age of Conan EBITDA 487 451 < Year on Year decrease in revenues due to ageing of the Live EBIT (269) (72) Games EAT (144) (659) Please send questions to [email protected] Key Financial Summary, 1Q 2015 - Revenue Quarterly Revenues (TUSD) 3,500 3,190 2,939 2,772 3,000 2,651 2,500 2,000 1,500 1,000 500 0 2Q 2014 3Q 2014 4Q 2014 1Q 2015 Please send questions to [email protected] Key Financial Summary, 1Q 2015 – Operating costs Quarterly Operating costs (TUSD) Notes 6000 < Alignment of the 5000 operating costs with 3,674 3,119 the declining revenues 4000 3,087 2,285 3000 < Favorable foreign currency exchanges on 2000 the costs of European operations in 1Q FY15 1000 compared to FY14 0 2Q 2014 3Q 2014 4Q 2014 1Q 2015 Please send questions to [email protected] Agenda 1. Key highlights 1Q 2015 2. Key financials 3. Project status • Large scale MMO’s • MMO’s in development 4. Summary and Outlook Please send questions to [email protected] Funcom’s Live Games and IPs Launch: 1999 & 2006 Launch: July 2001 Launch: May 2008 Launch: July 2012 Please send questions to [email protected] Live Games : The Secret World • Four main activities were done in Q1 • Released Valentine Bag for both FY15 solo and group use • Launched the new Enhanced Player Experience, which improved game sales and signups • Released the Fall of Tokyo mission pack • Ran a Golden Bag Weekend event, resulting in increased point sales • These activities proved to be successful leading to results being in line with internal forecasts Please send questions to [email protected] Other Live Games : Age of Conan and Anarchy Online • The Age of Conan team released new content and systems in Q1 FY15 that were well received, such as a new Achievement System and a “Hoard of the War Bringer” bag • The Anarchy Online team focused mostly on content and features that are to come out in the future but still ran a Valentine’s Day Event and released a Social Lottery Bag. Please send questions to [email protected] LEGO® Minifigures Online • Significant modifications to the game to remove payment prompts in support of the upcoming switch to a buy-to-play business model, allowing us to create a more compelling and fun experience. • Created new Minifigures and content elements • Refinements to gameplay experience based on comprehensive user behavior data collection • Conducted an iOS Beta to collect feedback and stability/performance data which received generally positive feedback. • Continued to work with both LEGO and Apple to secure App approval for LMO on iOS • Announced releases for Mac, Linux, iOS tablets and select Android tablets later this summer Please send questions to [email protected] LEGO Minifigures Online – B2P Transition • During this initial run on PC, Funcom has gathered valuable feedback, data and metrics, allowing the company to carefully review the performance of each component of the game, including the business model and its impact on player satisfaction. • Monetizing the game has proven challenging, and the company attributes this to the business model’s impact on gameplay and player progression, as well as the play patterns and the purchasing power of its target audience. • Funcom believes conversion to a buy-to-play model will allow the company to present a more fun and engaging gaming experience that will resonate better with the target audience, making it a more commercially viable proposition. • LEGO Minifigures Online will be launched as a buy-to-play game during the 2015 summer, and will be available on PC, Mac, Linux and select iOS and Android tablets. • The launch will also introduce significant enhancements to the game in terms of content and gameplay to make it a more engaging experience and to make it a better fit with the buy-to-play business model. This includes the introduction of a stronger narrative that spans across the game and leads the player through the various worlds. • For more information, please see the buy-to-play FAQ available on Funcom.com. Please send questions to [email protected] Other Projects • The Longest Journey iOS: Localization in 5 languages to be released during Q2 • Dreamfall Chapters Episode 2, developed by Red Thread Games on license from Funcom, was released during Q1 • Continued with exploring and prototyping concepts for possible new projects during Q1 Please send questions to [email protected] Agenda 1. Key highlights 1Q 2015 2. Key financials 3. Project status • Large scale MMO’s • MMO’s in development 4. Summary and Outlook Please send questions to [email protected] Summary and Outlook • LEGO Minifigures Online game announced switch of business model to B2P and a full launch in Summer 2015 • At the end of Q1 FY15, the Company expects to have the capacity to fund its operation for the following 12 months • The Company expects revenues from games in Q2 FY15 to be in line with Q1 FY15, with a small downward trend for the Live games • The restructuring announced at the end of Q3 FY14 is going to plan and the impact of these costs savings will continue to materialize in Q2 FY15. Additional structural cost analysis is in progress • As previously reported in the 2014 Annual Report, the Company continues to look at all means of financing the business, including but not limited to restructuring the debt Please send questions to [email protected] Thank You The Funcom Group Funcom N.V. and subsidiaries.