‘Lord Of The Rings’ IP Performing “Well Ahead Of Plan” For New Owner Embracer Group

deadline.com:

Lord of the Rings IP is performing “well ahead of business plan” for new owner Embracer Group, which grew sales by 50% last quarter while layoffs and division closures were being announced.

The Sweden-headquartered video game giant unveiled its first quarterly results today since revealing layoffs and a “painful” restructure, and the near-$400M acquisition of Lord of the Rings owner Middle-earth Enterprises was placed front and center of the financials.

Embracer’s Entertainment & Services segment grew 70% organically with a 15% adjusted EBIT margin for the three months to 1 July 2023, according to the group, which said this was “primarily explained by a strong contribution from Middle-earth Enterprises, driven by strong licensing revenue for The Lord of the Rings.” Embracer said the performance is “well ahead of the business plan” developed at the time of acquisition a year ago from the Saul Zaentz Company, citing the success of trading card game The Lord of the Rings: Tales of Middle-earth, PC/Console survival-crafting game The Lord of the Rings: Return to Moria and “many other exciting new products that will grow the IP further.” Overall, the group grew turnover by nearly 47% to 10.45B Swedish Krona ($960M) across the quarter, with adjusted EBIT up to nearly 1.7B SEK and EBIT margin of 4%. “We now have increased confidence regarding earnings this year and we are on track to deliver on the restructuring program announced in June, with a series of initial actions now taken,” said CEO Lars Wingefors. “Even though it’s a challenging time for everyone impacted, I am confident we will emerge a stronger company.” The group said “good progress” is being made with the restructuring program including meeting various adjusted