Hello everyone. It's working.

Sorry for a small hiccup at the beginning. Hello everyone, it's very nice to see you all again.

I'm Piotr Bajraszewski, Director of Finance and Business Development. With me there we have Przemek Marszał, our CEO.

I would like to make a short summary of our strategy that we shared recently. What we do is we create unique and easily understandable games with a message and strong gameplay that wide groups of players will love to play, games that are and will be market relevant, the games that are and will become hits.

This is 11 bit studios. Q1 was a pretty calm quarter for us with the console release of Death Hole being the biggest event.

It was a quarter of intense development of the two big upcoming DLCs that will be released this year. Also, we were preparing to announcement of Crop that we announced at the beginning of April with very good results.

Now moving on to financial results and operational summary. In last quarter we generated nearly 20 million PLN of revenue, 13% more than last year.

Depreciation and amortization was high in first quarter, mainly due to the depreciation of Frostpunk 2, DLC of Frostpunk 2, The Alters, and Death Hole. We had 8.6 million PLN of external services cost, out of which 3.6 were royalties.

We had also staff cost of 4 million PLN, the operating loss was 5.5 million PLN. Still, EBITDA was 5.9 million PLN, significantly higher than first quarter last year, and net loss of 2.8 million PLN, also significantly less than last year.

The biggest revenue in first quarter was generated by the new title from the external development team, Death Hole. That is a very good result for us, very huge success, which was generated in a big part by Game Pass deal.

Frostpunk 2 and The Alters had weaker quarter, however we believe in those titles in the future and their future performance, especially since we have the upcoming DLCs. As we declared at the end of last quarter, we want to share the dev team sizes at the end of each quarter.

At the moment we have two strong teams working on new content for The Alters and Frostpunk 2, and already 27 people working on Frostpunk 1886, and stable increase of the team sizes of P12, P13, and first time P14. Regarding the internal development, we have two upcoming DLCs coming to Frostpunk 2.

One of them is already announced to June. Also we have advanced works on Frostpunk 1886.

We just had an event where amongst other things we presented a little bit more about the Frostpunk 1886. We presented also the first screenshot of the Frostpunk 1886, first in-game target quality screenshot that was very well received.

We are also working on P13, which is a new game in new genre in the Frostpunk universe that we announced recently. Regarding The Alters, we have first paid DLC coming in the upcoming months.

External development, we launched Death Hole. As I already mentioned, it had very good financial results in the previous quarter, very good reception of 94% of positive reviews.

Also due to the Game Pass, this is the project that already broke even. We are also aiming toward the early access of Moonlighter 2 with full release planned in the second half of this year.

As I mentioned already, Crop that was announced with a very strong performance, phenomenal performance actually, the best we ever had regarding the number of wishlists accumulated in such a short period since announcement. We have signed a new project.

However, on that, details to be confirmed. As we do not share information about the project when we sign them, but when we announce them.

Prospects for 2026, we are investing in the next wave. We made an extensive presentation regarding that last month, just a short summary: that the DLC, Breach of Trust, coming for Frostpunk 2 coming in June 2026, which was already playtested and had a very good reception because it's wrapping around the core narrative of the game and it's adding a feature that players enjoy.

Also the third DLC for Frostpunk 2 planned somewhere at the end of this year. The Alters DLC expanding story and gameplay settings systems, also very big DLC which will be released at the end of the second quarter or beginning of the third quarter, still to be decided.

We have unannounced projects, key internal projects that are moving forward from pre-production to full production. Regarding the external development, Moonlighter 2, new full release with new platforms, which is very crucial, as we already highlighted, the Switch for Moonlighter 2 is very, very important.

Of course, constantly we are scouting and evaluating potential games for publishing. How it looks on a timeline: in 2026 we have Moonlighter 2, once again Frostpunk 2 DLCs, The Alters DLCs.

Then in 2027 and '28, we have Crop and unannounced ExDev projects and Frostpunk 1886. Then 2028-2029, P13 in Frostpunk universe, P15, the reimagination of This War of Mine.

Then 2029-2030, Project P12, new IP based on This War of Mine in the This War of Mine universe. And 2030-2031, new P14 from new IP which will be a new IP.

Thank you very much. That's all, and let's move to Q&A.

Let me stop sharing the presentation. Feel free to ask questions in the comments.

We have already some questions that we received prior to the presentation, we'll go through them as well. I can start with the question that we got from Grzegorz Balcerski in the comments: "What was the share of Game Pass payment in Death Hole sales in the quarter?"

Sadly, we're starting with a question that I cannot answer right away because in general with Game Pass, due to the agreement limitations, we can never share exact amounts that we are getting from Microsoft. Sadly, I cannot answer that question.

Moving to the questions that we received prior to the presentation. There was a question regarding the revenue because we showed the four games that earned the most in the first quarter, but there was a pretty big other.

Someone asked about the revenue coming from The Thaumaturge and This War of Mine in the first quarter. The answer for that, how big was the revenue coming from The Thaumaturge in first quarter was around 700,000 złoty, PLN.

How big was the revenue of This War of Mine in the first quarter, it was around 1.2 million PLN. Also, there was a question regarding the last year still, the fourth quarter, and the revenue coming from The Thaumaturge in fourth quarter of the last year, it was again around 800,000 PLN.

Now we'll move also to the questions that we have from the audience because the live questions. "When can we expect to reach the breakeven point for the production of the game The Alters?"

As we do not share the revenue predictions, I cannot pin the exact date. However, we haven't met it.

We don't have breakeven yet, but we see and think it will happen at some point. Sorry for the evasive question, but yeah, for sure the launch of the DLC and the big bit that's coming with it will be an important factor here.

Sorry, I'm reading the next question from Niewdzięczny. "Hypothetically, would 11 bit studios as a major shareholder benefit from Fool's Theory's success in the market with their ongoing projects, even though there is no ongoing mutual project between 11 bit and Fool's Theory?"

Yes, we have 40% of shares in Fool's Theory, which if you are following our reports in the last year and first quarter gave us we had a loss resulted from owning those shares. If the results of the Fool's Theory would be positive, it will also be calculated in our results.

"Are there any plans to expand on bundle sales in between bigger promo actions on Steam? 11 bit already have reasonable portfolio to compose interesting bundles, minus 40-60% discount with their own games, especially the older ones.

At the moment, there are only 10-15% bundle with low efficiency between Steam sales." That's a more complicated question, but in general, we do a lot of bundles.

We do a lot of promos outside of Steam, inside of Steam. Historically, we were one of the first to do the big bundle, as you mentioned, the 50-60% discount of our portfolio for our portfolio, that was a huge success back in the day, where we sold more than 1 million SKUs in a week.

Of course, we know that mechanic, and we use it when we think it's profitable. The problem, very technical answer, but the problem is that now you cannot get the visibility for the bundles itself, but of course, we are testing that constantly and increasing, decreasing discounts, and checking all of that.

That's the part of our ongoing business strategy and something that we are doing actively, along with other Humble Bundles and other deals that we are doing. "Have you already in Q1 recognized all the payment for Death Hole in Game Pass?"

Yes, almost everything. Almost everything.

"When P15 TWoM remake production will start? Isn't the target for 2028 too ambitious, considering no developers working on the title right now?"

I'm not sure if you want to answer that, Przemysław. I can answer that we shared that the steam will start working at the beginning of third quarter.

Sorry, Piotr.

Okay.

I'm thinking about something...

No worries. We are getting questions from all over from...

You mean which question, sorry?

When the production of TWoM remake will start. We shared that it will be the beginning of the third quarter.

Yeah. It's going in that direction, guys, as we shared a month ago.

We started the design process. We are working on the project, etc., etc.

We are looking for some people, but the core team that will start is already prepared for that. As we are waiting for the DLCs to end, we are working on DLC for Frostpunk 2, of course, and for The Alters, and those are huge teams that are working there.

That needs to happen, then we can start working on the P15.

Yes. Also, I would like to mention that it's not 2028, it's 2028/2029, which is actually a significant difference.

"What was the volume of Frostpunk 2 sold in Q1? What was the volume of The Alters sold in Q1?"

That's not something that I can share right away. In the next reports, for the half-year report, we will share the specific data regarding the volumes of copies sold.

We'll think about splitting it into quarters to be more clear regarding the sales. However, as I said, it was a calm quarter, majority of the revenue that we generated with those titles came from the revenue of copies sold.

Long story short, you can make calculations based on the revenue. "Were you already approached by any third party with a question whether you will be interested in selling your stake in Fool's Theory?"

That's something that we are not commenting on. "What's the reason of loss from Fool's?

Aren't they operating in work-for-hire regime? Shouldn't they generate some margin on their work?"

That's also a longer and complicated question because it's between Fool's Theory and the agreement they have.

I think what you need to understand is that's the independent company, with the independent management board for the whole company. Of course, we are in talks and there are a lot of discussions, as always, but they have the plan, they have the idea where to grow the company.

When we'll be ready, for example, to talk with you guys and share a bit more on what's the direction for Fool's, it's interesting for me that for today it's so interesting topic. I think next time we can, for next Q, we can prepare a section for the Fool's Theory and agree with guys we will share this, this, this, and you will guys get that information.

Count on it that we will do it then. As for now, as I said, it's independent company.

We know, of course, where they are going. We have the stakes in them, we believe in the Fool's Theory.

They are working with CDPR right now, but the work is really good from what we heard. Next time we'll be ready to share you more.

Mm-hmm. Mmm.

The next question: "Are there plans to acquire stakes in the other studios in the near future?" I think we shared that a year ago, already a year ago.

That's not the time we are looking for another studios right now. We have a lot of projects.

You see that. The money is needed for what we plan to do, and as for now, that's not something we want to grow or expand.

There are different areas we want to expand. It's not a topic where we are actively looking for it.

There are always talks about when companies come with projects, when we sign a deals, there's always an open discussion around that, but it's not as an element that we are currently pursuing. As you saw, I'd like to highlight that, Piotr already told you that, we sign another project for the publishing department, for our ExDev.

I'm really happy about that. What you probably also might have seen in the presentation, what Piotr said, is for the next year, this mean we will have multiple ExDev launches.

You already saw that, and, yeah, when we will be ready, we'll share you more information about that, but we are happy about there is the ongoing process there, and ExDev is doing the next projects, etc., etc. We are constantly seeing new stuff.

Yeah. Another curveball question from Piotr, thank you very much for that, but I already see that you even put the smiley face at the end, you know that the answer because the question is: "Which universe can we expect to see during Summer Game Fest: Frostpunk, The Alters, This War of Mine, or a new one?"

I had to ask for sure, and you know that I have to answer that we cannot share that. As I explained recently, we have to be vague sometimes regarding what we are doing next regarding our marketing bits because it's important for us not to burn what exactly we are planning next because it can hurt our marketing strategy and actual visibility that such a bit will have.

Sadly, I cannot say anything more here, the same as Łukasz recently couldn't say anymore in his statement. Sorry because I'm Mógłbyś przeczytać pytania te?

Sorry, because we have also those questions that we got from before the and I want to see Okay, I see that some of those questions are the same that you passed it here. There was a question about volumes of sales of Frostpunk 2 and The Alters.

That's something that I said that will be shared for a half year, not a quarter, because it's much more extensive report. Then the next question is: "How is the progress of work on the DLCs, I guess for Frostpunk 2 and The Alters?"

It's going very well. Both of them were already playtested publicly and internally at the studio, and the reception is very good so far.

I think we can say we don't expect any delays with what is currently planned, what you saw with the timeline that Piotr shared, we don't see any problems with any delays with those projects, with those DLCs. We do not and

we feel pretty safe with the technical state of the Frostpunk 2 second DLC, which was the issue with the first DLC. The next question is sorry, it's in Polish, let me translate it: "At what level the DLC will help with the organic sales of the of the titles?

How we want to make it happen?" Basically, the DLCs always improve the sales of the base game.

We we plan to reach out to streamers, we plan to have the marketing campaign wrapped up around those DLCs with a good reception. It's always a high additional boost of the sales of the main game, and also people coming back to the game.

That's one thing. Also long-term, I mean long-term, very long-term, for years, the DLCs are increasing the average revenue per user that we get from those games, which is very important because, as for example, from This War of Mine, we are selling our games for years.

"What was the percentage of revenue of" Sorry, trying to translate the question at the same time. "What was in first quarter, what was the revenue share split between the external and internal titles?"

It was around 50% each, 50/40, something like that. The Death Hole and Moonlighter 2 was was mainly the the the biggest chunk of the of the of the publishing revenue coming the revenue coming from the publishing.

That was okay, all the questions. We have still a moment, let's see what were the questions asked here.

Sorry, I will start at the bottom because I start reading the questions up. "How are the guys at Carbonara?

Aren't they overwhelmed with such a positive feedback they have received after the Crop reveal trailer? Does anything change in their development pipeline after the reveal trailer?"

Not exactly. They are good.

They are happy, they are excited, but they are not rookies. They just moving forward with with the game.

We believed in the game, the the the the Rufus of the ExDev director believed in the game from from from start and believed that it has a very high potential regarding the market appeal, and the only thing, it proved that it was he was right. It was not a shock for us, but just

With showing those screens, we already and those materials, the videos, we already can see what people react to, how they imagine the game. That's a cool discussion we now can have with Carbonara guys.

Of course, they are very positive, etc. Now we can discuss and what fantasies we shared, how the people see that, and that's a really important moment as always for any project it is, to have that conversation and the imagination of players what this game will be.

We already have some comments on that, some thoughts around that. We are currently discussing with the team, etc., etc.

The question from Niewdzięczny: "Will there be military army aspects introduced in the upcoming Frostpunk 2 DLC as per the recent screenshot drops on YouTube and X?" That's a lot kind of loaded question because all we share on YouTube and X is, of course, the materials from the game.

If you saw that on those screenshots, it's true and it will happen. Military and army aspects are in the game, but there won't be, I don't know, World War of automatons happening and some big military battles, anything like that.

There will be some aspects, but exactly per the recent screenshots that we shared. "Considering plans of P12, P15 development, what scale of CapEx increase we should expect in 2026 and 2027 versus current PLN 10 million quarterly level?"

In general, we don't foresee any significant changes in our monthly spendings. It's more of a matter of allocation between products.

As we plan to make all the games internally, we do not foresee any huge increases in CapEx. "Have you already recouped the production cost of The Alters?"

No, not yet. Had to ask.

I think that's it. Yes.

I think that's it. We'll be probably ending.

As you guys I think saw in the in the in the results, it's like just the next month after the yearly conference. Everything is going as planned.

Piotr showed you the numbers, showed you the updates on the on the project. We are happy with where where the games are progressing, DLCs are progressing, the ExDev signings, etc., etc., etc.

It's us like it's just a month passed away,

but

we are happy about what what what we did during that month. I think that's that that's the that's the thing what you should know right now.

Yes.

Thank you, guys. Have a great day.

Thanks, Piotr. See you next time.

If you will have any questions, just drop an email to Monika, to our IR, and we'll gladly answer you, meet you guys. To next time.

Bye. Thank you very much.