An anonymous director reports

EAST SIDE GAMES GROUP REPORTS SECOND QUARTER 2023 FINANCIAL RESULTS

East Side Games Group Inc. has released its financial results for the second quarter ended June 30, 2023. All amounts are stated in Canadian dollars on an IFRS (international financial reporting standards) basis unless otherwise indicated.

The company is continuing a strong 2023 with revenue of $21.3-million and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of 11.8 per cent. This brings the first half (H1) of 2023 to $45.6-million revenue and $5.1-million adjusted EBITDA. Q2 saw no new game releases but heavy investment in the company's pipeline of new titles. East Side Games has seven LiveOps titles that generate 95 per cent of the company's revenue, with no one title comprising more than 25 per cent. East Side Games has six titles in active development that are slated for worldwide launch in the next year, as well as several projects with longer-time horizons.

Three months ended June 30, 2023, highlights:

• For the quarter ended June 30, 2023, revenue was $21.3-million.
• Q2 2023 adjusted EBITDA was $2.5-million, a margin of 11.7 per cent -- the third consecutive quarter over $2.5-million.
• Cash for the company at June 30, 2023, was $2.8-million, compared with $5.7-million at Dec. 31, 2022. The decrease was due to the timing of Apple's monthly payments and there is a corresponding increase in accounts receivable. In addition, payables decreased due to the timing of minimum guarantee IP payments.
• Daily active users in Q2 were 273,000. Average revenue per daily active user was 92 cents.
• On Aug. 11, 2022, the company announced its intention to buy back up to 4,076,819 shares under its NCIB (normal course issuer bid). Through June 30, 2023, the company purchased 682,653 shares. The company continues to buy back stock as aggressively as it can under the restrictions for such programs.
• East Side Games would like to thank Birgit Troy and Darcy Taylor for their service on the board. Effective today, Jeremy Pierce and Dr. Russell Ovans will be joining the board as new members.
• East Side Games was named a finalist in the Technology Impact Awards Company of the Year.

Certain information provided in this news release is extracted from the consolidated financial statements and management's discussion and analysis (MD&A) of the company for the three months and six months ended June 30, 2023, and should be read in conjunction with them. It is only in the context of the fulsome information and disclosures contained in the financial statements and MD&A that an investor can properly analyze this information. The financial statements and MD&A can be found under the company's profile on SEDAR and EDGAR.

Webcast and conference call information

The company will hold a conference call to discuss its performance with the investment community at 3 p.m. PT today. Related earnings release materials can be found on East Side Games website.

Conference call details

Toll-free dial-in number:  1-888-886-7786

Local dial-in number:  1-416-764-8658

Conference ID No.:  38030312

A replay will be available by dialling 1-877-674-7070 or 1-416-764-8692 and entering passcode 030312 followed by the pound key.

About East Side Games Group Inc.

East Side Games is a leading free-to-play mobile game group, creating engaging games that produce enduring player loyalty. The company's studio groups entrepreneurial culture is anchored in creativity, execution and growth through licensing of East Side Games' proprietary Game Kit software platform that enables professional game developers to greatly increase the efficiency and effectiveness of game creation in addition to organic growth through a diverse portfolio of original and licensed IP (intellectual property) mobile games that include: The Office: Somehow We Manage, Star Trek: Lower Decks -- The Badgey Directive, Bud Farm Idle Tycoon, Doctor Who: Lost in Time, RuPaul's Drag Race Superstar, Cheech and Chong Bud Farm, and Trailer Park Boys: Grea$y Money.

East Side Games is headquartered in Vancouver, Canada, and its games are available worldwide on the App Store and Google Play.

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