G5 and Fortinova new holdings in November
G5 was added as a new holding this month. This is a game developer that focuses on women 35+ and that has a strength in match-3 games and hidden objects.
We see several profit drivers in the coming years:
- the development of own games will result in game releases that can will contribute meaningfully in a few years’ time
- the proportion of in-house developed games versus licensed continues to grow, making a positive contribution to the gross margin
- the fee at Microsoft Store was reduced during the third quarter
- the in-house developed G5 Store continues to grow with a higher gross margin
Unlike many other game developers that focus on acquisitions, G5 invests in game development, marketing and buybacks of its own shares. Organically, G5 outperformed multiple competitors in Q3 and we believe there are good chances for higher organic growth going forward. In the short term, we also note that currency movements have so far been favourable as G5 is the biggest winner of the larger gaming companies from a stronger dollar against the krona.
During the month, SBB placed a bid for Amasten, which was then a holding in the fund. Interest in rental apartments continues to be high, and this month the fund invested in Fortinova on that theme. Fortinova has an unused balance sheet and conservatively valued properties.