In broad terms, we believe the report aligns with our expectations. The cost reduction program is becoming increasingly evident in the P&L, with Opex down by 12% q/q. Questopia drove growth in the quarter and continues to perform well, albeit on a small scale. Cash flow from operations amounted to SEK1.8m, positively impacted by working capital movements of SEK1.6m. The company’s cash position at the end of the quarter was SEK8.8m, bolstered by the SEK7.8m rights issue conducted during the quarter.

Although it is encouraging to see that Questopia is performing solidly, recent quarters have been relatively uneventful as all eyes are on the upcoming launch of Fishing Tour. With each passing quarter, we move closer to the full launch of the game, which is expected to be fully launched in Q4. It is also evident that for Sozap to achieve profitability, the game must be successful. Given that the cost base is already slim, sales must increase for the company to achieve positive cash flow.

Following the Q2 figures, we have made limited revisions to our sales estimates, increasing 2024e sales by 1% while leaving 2025e–2026e unchanged. In terms of costs, we have also made minor adjustments, resulting in small changes to our EBITDA and EBIT estimates. We leave our valuation unchanged. Our base case stands at SEK3.5 and fair value range is SEK0.5-8.