Astralis A/S : Annual Financial Report 203

Tel.: [phone]	BDO Statsautoriseret revisionsaktieselskab
[e-mail]	Havneholmen 29
www.bdo.dk	DK-1561 København V
	CVR no. 20 22 26 7020222670

ASTRALIS A/S

OTTO BUSSES VEJ 7 2., 2450 KØBENHAVN SV

ANNUAL REPORT

Års

1 JANUARY - 31 DECEMBER 2023

The Annual Report has been presented and adopted at the Company's Annual General Meeting on 9 April 2024

__________________________________

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CVR NO. 40 69 40 72

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CONTENTS
	Page
Company Details
Company Details	3
Group Structure	4
Statement and Report
Management's Statement	5
Independent Auditor's Report	6-8
Management Commentary
Financial Highlights of the Group	9
Management Commentary	10-19
Consolidated and Parent Company Financial Statements 1 January - 31 December
Income Statement	20
Balance Sheet	21-22
Equity	23
Cash Flow Statement	24
Notes	25-32
Accounting Policies	33-37

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BDO Statsautoriseret revisionsaktieselskab, a Danish limited liability company, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

COMPANY DETAILS
Company	Astralis A/S
	Otto Busses Vej 7 2.
	2450 Copenhagen S
	CVR No.:	40 69 40 72 40694072
	Established:	31 July 2019
	Municipality:	Copenhagen
	Financial Year:	1 January - 31 December
Board of Directors	Claus Zibrandtsen, chairman
	Christian Swane Mourier
	Nikolaj Nyholm
	Pernille Nørkær
Executive Board	Nikolaj Nyholm
	Jakob Hansen
Auditor	BDO Statsautoriseret revisionsaktieselskab
	Havneholmen 29
	1561 Copenhagen V

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R

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GROUP STRUCTURE

COMPANY STRUCTURE

Astralis A/S was founded on 31 July 2019 and the legal group was established 14 August 2019 where Astralis A/S acquired Astralis Management ApS and subsidiaries. Astralis Group A/S was renamed Astralis A/S 19 April 2021.

Astralis Group Management ApS was founded 30 October 2018 as RFRSH Teams ApS and renamed Astralis Management ApS 19 April 2021.

Astralis Esport ApS was founded 4 December 2015 as Spirit of Amiga ApS and renamed Astralis CS ApS 19 April 2021.

Origen Esports ApS was founded 30 October 2018 as NewCo Esport ApS and renamed Astralis LoL ApS 19 April 2021.

Astralis Nexus ApS was originally founded as ApS af 29/1-2021, 29 January 2021 and renamed Astralis Nexus ApS 22 April 2021.

Astralis US Inc. was founded 24 August 2021.

BlackBox Media was founded 16 November 2022. Astralis Management ApS holds 55% ownership in BlackBox Media ApS.

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5

MANAGEMENT'S STATEMENT

Today the Board of Directors and Executive Board have discussed and approved the Annual Report of Astralis A/S for the financial year 1 January - 31 December 2023.

The Annual Report is presented in accordance with the Danish Financial Statements Act.

In our opinion the Consolidated Financial Statements and the Annual Financial Statements of the Company give a true and fair view of Group's and the Company's assets, liabilities and financial position at 31 December 2023 and of the results of Group's and the Company's operations and cash flows for the financial year 1 January - 31 December 2023.

The Management Commentary includes in our opinion a fair presentation of the matters dealt with in the Commentary.

We recommend the Annual Report be approved at the Annual General Meeting.

Copenhagen, 12 March 2024

Executive Board
________________________	________________________
Nikolaj Nyholm	Jakob Hansen
Board of Directors
________________________	________________________	________________________
Claus Zibrandtsen	Christian Swane Mourier	Nikolaj Nyholm
Chairman
________________________
Pernille Nørkær

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6

INDEPENDENT AUDITOR'S REPORT
To the Shareholder of Astralis A/S
Opinion	Konk
We have audited the Consolidated Financial Statements and the Annual Financial Statements of the
Company of Astralis A/S for the financial year 1 January - 31 December 2023, which comprise income
statement, Balance Sheet, statement of changes in equity, notes and a summary of significant
accounting policies for both the Group and the Parent Company, as well as consolidated statement of
cash flows for the Group. The Consolidated Financial Statements and the Annual Financial Statements
of the Company are prepared in accordance with the Danish Financial Statements Act.
In our opinion, the Consolidated Financial Statements and the Annual Financial Statements of the
Company give a true and fair view of the assets, liabilities and financial position of the Group or the
Company at 31 December 2023 and of the results of the Group and the Parent Company's operations as
well as the consolidated cash flows of the Group for the financial year 1 January - 31 December 2023
in accordance with the Danish Financial Statements Act.
Basis for Opinion	Grun
We conducted our audit in accordance with International Standards on Auditing (ISAs) and the
additional requirements applicable in Denmark. Our responsibilities under those standards and
requirements are further described in the "Auditor's Responsibilities for the Audit of the Consolidated
Financial Statements and the Annual Financial Statements of the Company" section of our report. We
are independent of the Group in accordance with the International Ethics Standards Board for
Accountants' International Code of Ethics for Professional Accountants (including International
Independence Standards) (IESBA Code), together with the ethical requirements that are relevant to
our audit of the financial statements in Denmark, and we have fulfilled our other ethical
responsibilities in accordance with these requirements and the IESBA Code. We believe that the evi-
dence we have obtained is sufficient and appropriate to provide a basis for our conclusion.
Management's Responsibilities for the Consolidated Financial Statements and the Annual Financial
Statements of the Company
Management is responsible for the preparation of Consolidated Financial Statements and the Annual
Financial Statements of the Company that give a true and fair view in accordance with the Danish Fi-
nancial Statements Act and for such Internal control as Management determines is necessary to enable
the preparation of Consolidated Financial Statements and the Annual Financial Statements of the
Company that are free from material misstatement, whether due to fraud or error.
In preparing the Consolidated Financial Statements and the Annual Financial Statements of the Com-
pany, Management is responsible for assessing the Group's and the Parent Company's ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting in preparing the Consolidated Financial Statements and the Annual
Financial Statements of the Company unless Management either intends to liquidate the Group or the
Company or to cease operations, or has no realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Consolidated Financial Statements and the Parent
Company Financial Statements
Our objectives are to obtain reasonable assurance about whether the Consolidated Financial State-
ments and the Annual Financial Statements of the Company as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor's report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs and the additional requirements applicable in Denmark will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these Consolidated Financial State-
ments and the Annual Financial Statements of the Company.

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INDEPENDENT AUDITOR'S REPORT

As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the Consolidated Financial Statements and the Annual Financial Statements of the Company, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's and the Parent Company's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.
• Conclude on the appropriateness of Management's use of the going concern basis of accounting in preparing the Consolidated Financial Statements and the Annual Financial Statements of the Com- pany and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's and the Parent Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the Consolidated Fi- nancial Statements and the Annual Financial Statements of the Company or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group and the Parent Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and contents of the Consolidated Financial State- ments and the Annual Financial Statements of the Company, including the disclosures, and whether the Consolidated Financial Statements and the Annual Financial Statements of the Com- pany represent the underlying transactions and events in a manner that gives a true and fair view.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the Consolidated Financial Statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Statement on Management Commentary

Management is responsible for Management Commentary.

Our opinion on the Consolidated Financial Statements and the Annual Financial Statements of the Company does not cover Management Commentary, and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Consolidated Financial Statements and the Annual Financial Statements of the Company, our responsibility is to read Management Commentary and, in doing so, consider whether Management Commentary is materially inconsistent with the Consolidated Financial Statements and the Annual Financial Statements of the Company or our knowledge obtained during the audit, or otherwise appears to be materially misstated.

Moreover, it is our responsibility to consider whether Management Commentary provides the information required under the Danish Financial Statements Act.

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INDEPENDENT AUDITOR'S REPORT

Based on the work we have performed, we conclude that Management Commentary is in accordance with the Consolidated Financial Statements and the Annual Financial Statements of the Company and has been prepared in accordance with the requirements of the Danish Financial Statements Act. We did not identify any material misstatement of Management Commentary.

Copenhagen, 12 March 2024		12-03-202
BDO Statsautoriseret revisionsaktieselskab	202226
CVR no. 20 22 26 70
BDO Statsautoriseret revisionsaktieselskab	202226
Kim Mücke	Troels Stenholm	Revisio
State Authorised Public Accountant	State Authorised Public Accountant
MNE no. mne10944	MNE no. mne47806
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					9
FINANCIAL HIGHLIGHTS OF THE GROUP
	2023	2022	2021	2020	2019*
	DKK '000	DKK '000	DKK '000	DKK '000	DKK '000
Income statement
Net revenue	72.310	87.548	75.004	51.504	48.633
Operating profit/loss before	146.752	2.582	-7.875	-14.518	-22.685
depreciation and amortisation (EBITDA)..
Financial income and expenses, net	-324	-103	-2.169	-3.212	5.679
Profit/loss for the year before tax	137.032	-9.668	-35.195	-53.221	-34.643
Balance sheet
Total assets	231.346	99.329	126.707	164.110	229.360
Equity	199.495	73.927	83.230	113.931	166.906
Cash flows
Cash flows from operating activities	-16.536	2.900	-19.425	-33.274	-15.050
Cash flows from investing activities	14.494	-6.624	-1.800	1.767	-31.387
Cash flows from financing activities	-387	-9.298	-7.914	-4.894	130.846
Total cash flows	-2.429	-13.022	-29.139	-36.401	84.409
Investment in property, plant and	-283	-1.633	-6.681	-1.104	0
equipment
Average number of full-time	60	77	63	36	19
employees
Key ratios
Operating margin	190,0	-10,9	-46,9	-103,3	-71,2
Equity ratio	86,7	74,3	65,7	69,4	72,8

*Astralis A/S was founded on 31 July 2019 and only constituted a legal group from 14 August 2019 where Astralis A/S acquired Astralis Management ApS and subsidiaries. To provide meaningful comparison figures for 2019 these are based on consolidated financial statements for the underlying operating sub-group; Astralis Management ApS and subsidiaries for the financial period 1 January 2019

- 31 December 2019.

The ratios stated in the list of key figures and ratios have been calculated as follows:

Operating margin:	Operating profit/loss x 100
		Net revenue
Equity ratio:	Equity(ex. minorities), at year-endx 100
	Total	assets, at year-	end

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10

MANAGEMENT COMMENTARY

LETTER TO SHAREHOLDERS

In 2023, we consolidated our business further by selling off the majority of our LEC franchise rights in League of Legends, resulting in an EBITDA of DKK 146.8 million for the year. The value increase of the rights re-affirms our ongoing investment and consolidation strategy around key assets, and even though it comes in DKK 3.2 million below latest guidance, given the circumstances and investment in the Counter-Strike team, the result is overall satisfactory.

The main contributors to the result, beside the sale of LEC Franchise rights, are a stabilization of the value of our Commercial Partnerships and League Revenues as well as further growth in thes B2B and B2C business in and around our gaming centre, Astralis Nexus.

During the year, we invested significantly in our Counter-Strike teams and division. On the team side we added two high-profile players, both amongst the best in the world. We also welcomed a new Sports Director with the goal of securing long-term competitive success across our teams. The goal continues to be a permanent presence in the top of the world rankings.

Despite the lack of top results, we continued to see a strengthening of our brand with a growing digital audience and media presence. We launched our own broadcast channel, Astralis Watch, which despite a limited budget has already shown promising viewership numbers and an extremely engaged audience. This confirms our strategy of creating a global gaming brand and media, independent of short-term team results.

In a year of varied competitive success, the Astralis brand continued to strengthen within existing and new audiences. The fanbase continued the positive development measured in the number of followers on our digital channels, and compared to 2022, we registered a positive development in the total number of followers across all channels, providing a wider commercial platform for existing and potential commercial partners.

Following a strategic review announced in March 2023, it was decided to delist from NASDAQ First North Growth Markets in August 2023. Despite the strong financial performance, the share price had dropped significantly since the listing in 2019 and the liquidity of the Company's share was very limited, providing little value for both the Company and its shareholders. Furthermore, the delisting will save the Company approximately DKK +2m in annual direct costs and an estimated addition of DKK +1m in annual indirect cost savings. The Company delisted on 25 October 2023.

Leagues and Franchise Rights

In October 2023, we announced a transfer of our Franchise rights in the League of Legends European Championship (LEC) at a total agreed valuation of DKK 194 million to a newly created French subsidiary AK-Game SAS. Subsequently, Karmine Corp SAS acquired 66,67 % of the shares in AK-Game SAS for DKK 129 million.

The sale is completed in tranches from 2023-2025, and Astralis will retain a capital interest in AK- Game SAS of 33,33 % when all tranches are received. The Agreement contains provisions for Astralis to trigger additional share transfers, up to ceding 100% of the shares to Karmine Corp SAS by 2031 at the latest.

The net gain before tax from the sale in 2023 was DKK 153.6 million with aggregated cash flow effect from 2023-to 2025 of DKK 112 million.

Brand, Media, and Partnerships

The Astralis brand continues to grow, not just in gaming and esports, but also within the general youth culture, especially in Denmark. Even compared to a strong 2022, with high engagement and viewership, we managed to retain and even increase the number of followers across our digital channels.

Our diverse and expanding media portfolio provides a strong commercial platform for existing and potential commercial partners. Across teams and Astralis Nexus, we extended key partnership agreements and entered eight new, significant partnership agreements in 2023.

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