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Starbreeze posts pre-tax profits of $2.9 million despite no new releases

Dead By Daylight rights sale “dramatically boosts profitability” as Overkill's The Walking Dead release finally draws closer

Starbreeze has released its latest financial results and for once they make for pleasant reading, including pre-tax profits of SEK 26.2 million ($2.9 million) for the second quarter, plus "all-time high" sales during those three months.

The Swedish publisher has suffered a turbulent few years, with several quarters of pre-tax losses and profit declines, plus the struggles of Raid: World War II and delays to Overkill's The Walking Dead. The firm has even resorted to share sales to secure more finance as it pushes forward.

However, in its first-half results for 2018, the firm reports net sales of SEK 233.6 million ($26.5 million) - up 30% year-on-year from SEK 180 million ($19.7 million) - and profit before tax of SEK 19.8 million ($2.17 million ) - a significant turnaround from the SEK 73 million ($8 million) pre-tax lost reported last year.

For the second quarter of its financial year, Starbreeze reports net sales of SEK 123.5 million ($13.5 million) - up from SEK 122.7 million ($13.4 million) in the same period last year, and an "all-time high" according to CEO Bo Andersson Klint. Meanwhile, pre-tax profits for the quarter came in at SEK 26.2 million ($2.9 million), up from a SEK 16.7 million ($1.83 million) loss last year.

The key drivers continue to be Payday and Dead By Daylight, generating SEK 56.3 million ($6.17 million) and SEK 133.5 million ($14.6 million) respectively over the first half. While the former saw decline from the SEK 75.5 million ($8.27 million) seen in H1 2017, the latter was actually up 54% year-on-year from SEK 86.7 million ($9.5 million).

Notably, Starbreeze reports that the sale of Dead by Daylight to developer Behaviour Interactive earlier this year has actually benefitted the firm greatly.

"Even though we did not release any new products during the quarter, we matched our sales record set in Q2 2017, when we had two major game releases," said Klint.

"Starbreeze has dramatically boosted profitability since the agreement to sell back the publishing rights to Dead by Daylight. Compared to last year, we have improved EBITDA by SEK 55.1 million, largely due to the Dead by Daylight deal."

Overkill's The Walking Dead, a title Starbreeze has bet heavily on, is still on course for release in November 2018, with 505 Games announcing today that the console version will be released in February 2019.