AI assistant
OverActive Media Corp. Management Reports 2025
47787_rns_2025-11-25_10d85d1b-70d0-450f-b959-f95887e271e7.pdf
Management Reports
Open in viewerOpens in your device viewer
OVERACTIVE MEDIA
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
MANAGEMENT'S DISCUSSION AND ANALYSIS
The following has been prepared for the purposes of providing management's discussion and analysis ("MD&A") of the condensed consolidated interim financial position and results of OverActive Media Corp. ("OverActive", "we" or the "Company"). The following information should be read in conjunction with the Company's unaudited condensed consolidated interim financial statements for the three and nine months ended September 30, 2025 and 2024 and the notes to those financial statements, which have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting, as issued by the International Accounting Standards Board ("IASB"); the 2024 Annual MD&A the 2024 Annual Audited Consolidated Financial Statements and notes thereto, which have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the IASB.
This MD&A is dated November 25, 2025, and was prepared with information available at that date. All dollar amounts are stated in thousands of Canadian Dollars and all figures are presented in thousands unless otherwise indicated.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This MD&A contains "forward-looking information" within the meaning of applicable Canadian securities legislation ("forward-looking information"). Such forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statements were made, and readers are advised to consider such forward-looking statements in light of the risks set forth below and as detailed under "Risks and Uncertainties" in this MD&A.
Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking information contained herein is given as of the date of this MD&A and the Company disclaims any obligation to update any forward-looking information, whether as a result of new information, future events or results, except as may be required by applicable securities laws. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
NON-IFRS FINANCIAL MEASURES
This MD&A includes references to Adjusted EBITDA. Adjusted EBITDA is a non-IFRS financial measure and is defined by the Company as net income or loss before income taxes, finance income and costs, depreciation and amortization, decrease in net present value of franchise obligations, foreign exchange gains/losses, assistance payments from Franchise League and government assistance, restructuring and business development costs, impairment charges, and share-based compensation. We believe that adjusted EBITDA is a useful measure of financial performance because it provides an indication of the Company’s ability to capitalize on growth opportunities in a cost-effective manner, finance its ongoing operations and service its financial obligations.
This non-IFRS financial measure is not an earnings or cash flow measure recognized by IFRS and does not have a standardized meaning prescribed by IFRS. Our method of calculating such a financial measure may differ from the methods used by other issuers and, accordingly, our definition of this non-IFRS financial measure may not be comparable to similar measures presented by other issuers. Investors are cautioned that non-IFRS financial measures should not be construed as an alternative to net income determined in accordance with IFRS as indicators of our performance or to cash flows from operating activities as measures of liquidity and cash flows.
BUSINESS OVERVIEW
OverActive Media Corp. (TSXV: OAM) (OTC: OAMCF) (FRA: 0RB) is a premier global esports and entertainment company for today’s generation of fans headquartered in Toronto, Canada, with additional operations in Madrid, Spain, and Berlin, Germany. The Company delivers premium experiences by operating top-tier competitive teams and complementary business units across media, content, and live events.
OverActive operates through two core business segments:
Team Operations
This segment captures revenues and expenses from league share payouts in the Company's various esports pro leagues, performance-based revenue, sticker sales, and tournament prize winnings.
OverActive owns and manages elite competitive teams under two brands:
- Movistar KOI
- League of Legends EMEA Championship (LEC)
- LVP Superliga (Spain)
- LVP Free Fire (Mexico)
- Esports World Cup Partnership Program
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
Movistar KOI is OverActive's flagship brand and is recognized for having one of the largest and most engaged fan bases in the world. The brand consistently ranks at or near the top of viewership leaderboards across its titles. In League of Legends, the world's most watched esport by peak viewership, and other competitive games, Movistar KOI matches are appointment viewing, drawing dedicated audiences and driving cultural relevance.
- Toronto Ultra
- Call of Duty League (CDL)
Business Operations
This segment includes the Company’s commercial activities such as sponsorship and partnership programs, merchandising, original content, and fan experiences. OverActive also operates a digital media agency, an influencer agency, a content production studio, and a live event business. Through strategic partnerships with influencers and content providers, the Company expands the reach and impact of its brands across global digital platforms.
On March 1, 2024, OverActive completed two strategic acquisitions: the full share acquisition of Team Randomk Esports S.L. (Movistar Riders) and the asset purchase of esports properties from Goatch Global S.L. (KOI), (collectively, the “Transactions”). These Transactions significantly strengthened the Company’s position across EMEA and Latin America by adding complementary titles, industry-leading talent, and highly engaged communities.
OverActive’s brands compete and connect at the highest levels of performance and cultural relevance. The Company is focused on building globally recognized, fan-driven media brands that go beyond gameplay through digital storytelling, immersive experiences, and expansion into high-growth markets such as Latin America and China.
Third Quarter 2025 Operations Highlights
- OverActive Media’s Toronto Ultra, renamed as Movistar KOI for the event, finished in 3rd place at the Esports World Cup, earning $200,000 USD.
- OverActive Media’s Movistar KOI placed 2nd in the Summer Split, guaranteeing participation to Worlds 2025 in China.
- OverActive Media’s KOI Fenix placed 2nd in the Spain: Rising Finals in San Jaiver, Murcia, Spain.
- OverActive Media hosted Bell Esports Challenge at Fan Expo at the Metro Toronto Convention Center from August 21st to 24th.
- OverActive Media hosted a Gaming Event and led the audiovisual production of Comic-Con Malaga from September 25th to 28th.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
Significant Announcements Subsequent to Quarter End
- OverActive Media’s Movistar KOI finished 9th-11th place at Worlds 2025 in China.
- OverActive Media secured $2 million in debt financing from entities controlled by members of the Company’s Board of Directors.
- OverActive Media’s Toronto Ultra announced the rebrand of the franchise to Toronto KOI, unifying to one global brand.
- OverActive Media’s Toronto Ultra extended their partnership with Bell Canada through 2027, as the exclusive telecommunication partner.
- OverActive Media was listed on the Börse Frankfurt, creating a euro-denominated access point for European investors.
- OverActive Media’s CFO, Rikesh Shah, will be leaving the Company effective November 30, 2025.
- OverActive Media has appointed Louis Zhang as Executive Vice President, Finance and Interim Chief Financial Officer, effective November 17, 2025.
QUARTERLY HIGHLIGHTS
- Revenue increased to $7,845 for the three-month period ended September 30, 2025, compared to $6,881 for the three-month period ended September 30, 2024.
- Net loss for the three-month period ended September 30, 2025 was $3,801, compared to a net loss of $1,790 for the three-month period ended September 30, 2024.
- Adjusted EBITDA loss for the three-month period ended September 30, 2025 was $1,314, compared to Adjusted EBITDA of $3 for the three-month period ended September 30, 2024.
SELECTED QUARTERLY FINANCIAL INFORMATION
The selected financial information below was derived from the Company’s unaudited condensed consolidated interim financial statements for the three months ended September 30, 2025, and 2024.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
| Three months ended | ||
|---|---|---|
| September 30, 2025 | September 30, 2024 | |
| (In thousands of Canadian dollars, except per share amount, unaudited) | ||
| Revenue | $7,845 | $6,881 |
| Cost of sales | 3,751 | 1,928 |
| Gross profit | 4,094 | 4,953 |
| Operating costs | 5,535 | 5,681 |
| Other expenses (income): | ||
| Depreciation | 562 | 546 |
| Amortization and impairment of intangible assets | 1,173 | 318 |
| Foreign exchange loss | 31 | (70) |
| Decrease in net present value of franchise obligations | - | - |
| Finance income | (3) | (64) |
| Finance cost | 48 | 150 |
| Share-based compensation | 314 | 254 |
| Other income | (4) | (248) |
| Loss before income taxes | (3,562) | (1,614) |
| Income tax expense | 239 | 176 |
| Loss income for the period | (3,801) | (1,790) |
| Other comprehensive income (loss): | ||
| Foreign currency translation | 775 | 1,451 |
| Comprehensive loss for the period | ($3,026) | ($339) |
| Earnings (loss) per share: | ||
| Basic and Diluted | ($0.03) | $0.00 |
| Adjusted EBITDA¹ | ($1,314) | $3 |
¹ Adjusted EBITDA is a non-IFRS measure. Refer to “Non-IFRS Measures” and “Reconciliation of Net Income (Loss) to Adjusted EBITDA”.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
Balance Sheet Summary:
| Total assets | 67,273 | 72,873 |
| --- | --- | --- |
| Total liabilities | 21,105 | 21,271 |
Revenue by segment:
| Team Operations | 1,904 | 3,169 |
| --- | --- | --- |
| Business Operations | 5,941 | 3,712 |
Gross profit by segment:
| Team Operations | 1,466 | 3,040 |
| --- | --- | --- |
| Business Operations | 2,628 | 1,913 |
Income (loss) before income taxes by segment:
| Team Operations | (711) | 181 |
| --- | --- | --- |
| Business Operations | (2,851) | (1,795) |
HIGHLIGHTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025
- Revenue for the nine-month period ended September 30, 2025 increased to $21,209, compared to $17,156 for the nine-month period ended September 30, 2024.
- Net loss for the nine-month period ended September 30, 2025 was $10,443, compared to a net income for the period of $239 for the nine-month period ended September 30, 2024.
- Adjusted EBITDA loss for the nine-month period ended September 30, 2025 was $4,598, compared to $3,039 for the nine-month period ended September 30, 2024.
The selected financial information below was derived from the Company's unaudited condensed consolidated interim financial statements for the nine months ended September 30, 2025 and 2024.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
| Nine months ended | ||
|---|---|---|
| September 30, 2025 | September 30, 2024 | |
| (In thousands of Canadian dollars, except per share amount, unaudited) | ||
| Revenue | $21,209 | $17,156 |
| Cost of sales | 10,435 | 5,375 |
| Gross profit | 10,774 | 11,781 |
| Operating costs | 15,627 | 17,041 |
| Other expenses (income): | ||
| Depreciation | 1,706 | 1,688 |
| Amortization and impairment of intangible assets | 1,848 | 744 |
| Foreign exchange loss | 313 | 903 |
| Decrease in net present value of franchise obligations | - | (9,838) |
| Finance income | (27) | (222) |
| Finance cost | 182 | 1,603 |
| Share-based compensation | 1,081 | 368 |
| One-time gain | (162) | - |
| Other income | (4) | (411) |
| Loss before income taxes | (9,790) | (95) |
| Income tax expense (recovery) | 653 | (334) |
| Net income (loss) for the period | (10,443) | 239 |
| Other comprehensive loss (gain): | ||
| Foreign currency translation | 3,928 | 1,373 |
| Comprehensive income (loss) for the period | ($6,515) | $1,612 |
| Earnings (loss) per share: | ||
| Basic and Diluted | ($0.08) | $0.01 |
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
| Adjusted EBITDA² | ($4,598) | ($3,039) |
|---|---|---|
| Revenue by segment: | ||
| Team Operations | 4,098 | 7,300 |
| Business Operations | 17,111 | 9,856 |
| Gross profit by segment: | ||
| Team Operations | 3,353 | 6,582 |
| Business Operations | 7,421 | 5,199 |
| Income (loss) before income taxes by segment: | ||
| Team Operations | (3,438) | 7,567 |
| Business Operations | (6,352) | (7,662) |
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
The following table presents a reconciliation of net income (loss) to adjusted EBITDA for the three months ended September 30, 2025, and 2024:
| (In thousands of Canadian dollars) | Three months ended | |
|---|---|---|
| September 30, 2025 | September 30, 2024 | |
| $ | $ | |
| Net loss for the period | (3,801) | (1,790) |
| Income tax expense (recovery) | 239 | 176 |
| Depreciation | 562 | 546 |
| Amortization and impairment of intangible assets | 1,173 | 318 |
| Finance income | (3) | (64) |
| Finance cost | 48 | 150 |
| Foreign exchange loss (gain) | 31 | (70) |
² Adjusted EBITDA is a non-IFRS measure. Refer to “Non-IFRS Measures” and “Reconciliation of Net Income (Loss) to Adjusted EBITDA”.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
| Share-based compensation | 314 | 254 |
|---|---|---|
| Restructuring and business development costs | 123 | 483 |
| Adjusted EBITDA | (1,314) | 3 |
The following table presents a reconciliation of net income (loss) to adjusted EBITDA for the nine months ended September 30, 2025, and 2024:
| Nine months ended | ||
|---|---|---|
| September 30, 2025 | September 30, 2024 | |
| (In thousands of Canadian dollars) | $ | $ |
| Net income (loss) for the period | (10,443) | 239 |
| Income tax expense (recovery) | 653 | (334) |
| Depreciation | 1,706 | 1,688 |
| Amortization and impairment of intangible assets | 1,848 | 744 |
| Decrease in net present value of franchise obligations | - | (9,838) |
| Finance income | (27) | (222) |
| Finance cost | 182 | 1,603 |
| Foreign exchange loss | 313 | 903 |
| Share-based compensation | 1,081 | 368 |
| One-time gain | (162) | - |
| Restructuring and business development costs | 251 | 1,810 |
| Adjusted EBITDA | (4,598) | (3,039) |
RESULTS OF OPERATIONS
Revenues
For the three months ended September 30, 2025, revenues totaled $7,845 as compared to $6,881 for the three months ended September 30, 2024, an increase of $964.
Team Operations revenue decreased by $1,265 to $1,904 for the three months ended September 30, 2025, as compared to $3,169 for the same period in 2024. The decrease reflects a shift in payment structure from a higher annual minimum guarantee in 2024 to a lower base guarantee supplemented by milestone-based incentives in 2025. As a result, monthly recognized revenue is lower in the current period, with the potential
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
for higher recognition in the final quarter of the year upon achievement of targeted incentives. Further, prize money declined year-over-year due to the discontinuation of the Toronto Defiant team.
Business Operations revenue increased by $2,229 to $5,941 for the three months ended September 30, 2025, as compared to $3,712 for the same period in 2024. The increase is primarily due to the successful execution of a Gaming Project and the audiovisual production of Comic-Con Malaga, during the period. This was further supported by the strong performance of the European Agencies business, in addition to the signing of North America's first deal.
For the nine months ended September 30, 2025, revenues totaled $21,209 compared with $17,156 for the same period in 2024, representing an increase of $4,053.
Team Operations revenue decreased by $3,202 to $4,098 for the nine months ended September 30, 2025, as compared to $7,300 for the same period in 2024. The decrease is attributable to the shift in payment structure from a higher annual minimum guarantee in 2024 to a lower base guarantee supplemented by milestone-based incentives in 2025. As a result, monthly recognized revenue is lower in the current period, with the potential for higher recognition in the last quarter of the year upon achievement of targeted incentives. Further, with the elimination of the Counter-Strike (CS) roster, the Company lost the opportunity to sell digital goods, Stickers. Lastly, Toronto Ultra underperformed compared to their 2024 season, in addition to the elimination of the Toronto Defiant.
Business Operations revenue increased by $7,255 to $17,111 for the nine months ended September 30, 2025, as compared to $9,856 for the same period in 2024. The increase was primarily driven by the successful delivery of four major events—Major 1, LEC on the Road, the Call of Duty Championship Weekend and Comic-Con Malaga—compared with one major event (Major 3) in the prior year. Additional contributions came from the strong performance of the Agencies business, as well as modest year-over-year growth in Partnerships and Merchandising.
Gross profit
For the three months ended September 30, 2025, the Company reported gross profit of $4,094 compared to $4,953 for the same period in 2024, a decrease of $859. The decline reflects a shift in revenue mix, with higher top-line contributions from Events and Agencies, which carry lower margin activities in the current period.
For the nine months ended September 30, 2025, the Company reported gross profit of $10,774, compared to $11,781 for the same period in 2024, a decrease of $1,007. The decrease is primarily driven by the cessation of Counter-Strike related revenues, which historically carried a significantly lower cost of sales. This was partially offset by the growth in lower margin segments, specifically Events and Agencies.
Operating costs
For the three months ended September 30, 2025, operating costs totaled $5,535 compared to $5,681 for the three months ended September 30, 2024, representing a decrease of $146. The decrease is attributable to the reduction in team operation expenses, roster-specific restructuring costs and business development costs related to the acquisitions. However, this was partially offset by an increase in Roster and Team Payroll as the Company incurred higher costs year over year.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
For the nine months ended September 30, 2025, operating costs totaled $15,627 compared to $17,041 for the nine months ended September 30, 2024, representing a decrease of $1,414. While Corporate Payroll as well as Roster and Team Payroll increased to support the Company’s expanding operations this was more than offset by the one-time elimination of restructuring and business development costs, resulting in overall cost reduction year to date.
Adjusted EBITDA
For the three months ended September 30, 2025, Adjusted EBITDA loss totaled $1,314 compared to adjusted EBITDA of $3 for the three months ended September 30, 2024, representing a decrease of $1,317. The year-over-year change was driven by an increase in Cost of Sales, specifically related to the Events and Agencies business. This was partially offset by savings in operating expenses, primarily attributable to Team Operations.
For the nine months ended September 30, 2025, Adjusted EBITDA loss totaled $4,598 compared to $3,039 for the nine months ended September 30, 2024, representing an increase in loss of $1,560. While restructuring and business development costs decreased significantly year to date, these items are added back in calculating Adjusted EBITDA. As a result, increased Cost of Sales, specifically related to the Agencies and Events business, plus Corporate and Team Payroll to support the Company’s expanding operations were the main factors in the loss year over year.
Net income (loss) after income taxes
For the three months ended September 30, 2025, net loss after income taxes totaled $3,801, compared to net loss after income taxes of $1,790 for the same period in 2024. The net loss is primarily attributable to lower gross profit due to lower margin activities, in addition to an increase in the amortization and impairment of intangible assets during the period. During the three months ending September 30, 2025, the Company’s Valorant Champions Tour (“VCT”) participation agreement was terminated. Despite the termination, the Company remains entitled to receive certain revenues under the agreement until December 2025. The contract asset, which was initially recognized (as an intangible asset) at a fair value of $1,265 as part of the 2024 purchase price allocation, has been reassessed as at September 30, 2025, resulting in an impairment of approximately $823.
For the nine months ended September 30, 2025, net loss after income taxes totaled $10,443, compared to a net income after income taxes of $239, for the nine months ended September 30, 2024. The major source of the net loss is the elimination of the gain in the net present value of franchise payables of $9,838 resulting from the agreement with the Call of Duty League.
LIQUIDITY AND CAPITAL RESOURCES
Capital management
As of September 30, 2025, the Company had a working capital deficit of $216 and used $1,943 of cash in operating activities for the nine months then ended. Subsequent to quarter-end, on October 22, 2025, the
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
Company secured gross proceeds of $2,000 through two short-term secured promissory note and warrant agreements with entities controlled by members of the Board of Directors. The financing strengthens near-term liquidity and provides additional flexibility to fund working capital requirements while management continues to pursue longer-term capital solutions. Based on the Company's current growth trajectory, management expects that additional funding will be required by the end of the fourth quarter of the current fiscal year to support working capital needs and to fund expansion across its influencer agency business, live events, and new product initiatives such as ActiveVoices. These conditions indicate the existence of a material uncertainty that casts substantial doubt on the Company's ability to continue as a going concern.
The Company expects to maintain financial flexibility by exploring a range of financing options over the next twelve months, including the potential establishment of operating lines of credit, equity or debt financings, and other available funding sources. Management reasonably expects these sources of liquidity will be available to satisfy both short-term and long-term obligations.
While the Company continues to work toward generating positive cash flows from operations, it will seek to remedy any working capital requirements through one or more of the funding measures noted above. In connection with this, the Company announced on November 11, 2025, that it was listed on the Börse Frankfurt, creating a euro-denominated access point for European investors. Management has a track record of successfully raising capital to fund operations, growth initiatives, and acquisitions, and believes it can do so again if required.
The Company's objective in managing capital is to ensure sufficient liquidity to operate effectively, preserve capital, and deliver competitive returns on invested capital.
The Company's liquidity and capital resources as at September 30, 2025, and December 31, 2024 were as follows:
| September 30, 2025 | December 31, 2024 | |
|---|---|---|
| (In thousands of Canadian dollars) | $ | $ |
| Cash and cash equivalents | 2,366 | 6,849 |
| Total current assets | 11,883 | 18,675 |
| Total current liabilities | 12,099 | 12,113 |
| Working capital³ | (216) | 6,562 |
| Total assets | 67,273 | 72,873 |
| Total liabilities | 21,105 | 21,271 |
³ Working capital is a non-IFRS measure and defined as “Current assets less current liabilities.”
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
Cash flows
| | September 30, 2025 | September 30, 2024 |
| --- | --- | --- |
| (In thousands of Canadian dollars) | $ | $ |
| Cash flow used in operating activities | (1,943) | (7,085) |
| Cash flow used in financing activities | (1,952) | (1,723) |
| Cash flow from (used) in investing activities | 46 | 4,229 |
| Decrease in cash and cash equivalents | (3,849) | (4,579) |
| Cash and cash equivalents, beginning of period | 6,849 | 13,933 |
| Effect of exchange rate changes on cash and cash equivalents | (634) | (493) |
| Cash and cash equivalents, end of period | 2,366 | 8,861 |
RISK MANAGEMENT
In the normal course of business, the Company is exposed to a number of risks that can affect its operating performance. These risks and the actions taken to manage them are discussed below.
Foreign currency risk:
The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. The Company does not use derivative instruments to reduce its exposure to foreign currency risk.
For the nine months ended September 30, 2025, the Company recognized a foreign exchange loss of $313 (nine months ended September 30, 2024 - loss of $903) primarily due to the depreciation of the Canadian dollar relative to the U.S. dollar.
The summary quantitative data about the Company's material exposure to currency risk is as follows:
| USD | September 30, 2025 | December 31, 2024 |
|---|---|---|
| Cash | $ 185 | $ 269 |
| Receivables | 2,693 | 4,586 |
| Payables | (1,297) | (981) |
| Net consolidated statement of financial position exposure | $ 1,581 | $ 3,874 |
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
| EUR | September 30, 2025 | December 31, 2024 | ||
|---|---|---|---|---|
| Cash | € | 917 | € | 1,961 |
| Receivables | 3,072 | 2,852 | ||
| Payables | (3,010) | (3,850) | ||
| Net consolidated statement of financial position exposure | € | 979 | € | 963 |
Credit risk:
Credit risk refers to the risk that a counterparty will default on its contractual obligations, resulting in financial loss to the Company. The Company does not provide any guarantees which would expose the Company to credit risk.
The credit risk on cash is limited because the counterparties are banks with high credit ratings assigned by international credit-rating agencies. Trade receivables consist of customers spread across diverse industries. For the nine months ended September 30, 2025, four major customers each representing more than 10% of consolidated revenues, in aggregate make up 37% of trade receivables as at September 30, 2025 (42% of trade receivables as at December 31, 2024). Ongoing credit evaluation is performed on the financial condition of trade receivables. The Company has not recognized an allowance for doubtful accounts in 2025 or 2024 based on its ongoing evaluation of the credit risk for uncollected receivables.
At September 30, 2025, the aging of trade receivables that were not impaired were as follows:
| September 30, 2025 | December 31, 2024 | |||
|---|---|---|---|---|
| Neither past due nor impaired | $ | 4,840 | $ | 9,356 |
| Past due 1-30 days | 1,797 | 150 | ||
| Past due 31-90 days | 700 | 11 | ||
| Past due > 90 days | 816 | 409 | ||
| $ | 8,153 | $ | 9,926 |
Management believes that the unimpaired amounts that are past due by more than 30 days are still collectible in full, based on the credit worthiness of these customers and evaluation of customer credit risk.
Liquidity risk:
Liquidity risk refers to the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. The Company's ability to generate positive cash flows from operations and to raise future capital is subject to uncertainty and the inability to generate positive cash flows from operations and raise such capital may have an adverse impact
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
on the Company’s ability to meet obligations and continue as a going concern. Refer to Note 2(a)(iii) of the condensed consolidated interim financial statements for the three and nine months ended September 30, 2025.
The Company manages liquidity risk by maintaining adequate cash balances and by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.
The following table provides details of the Company's remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The table includes the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay as of September 30, 2025.
| Carrying amount | Contractual cash flows | Less than 1 year | 1 to 2 years | > 2 years | |
|---|---|---|---|---|---|
| Trade payable and accrued liabilities | $ 7,382 | $ 7,382 | $ 7,382 | $ - | $ - |
| Lease liabilities | 2,752 | 2,899 | 1,225 | 536 | 1,138 |
| Long-term debt | 489 | 641 | 299 | 174 | 168 |
| $ 10,623 | $ 10,922 | $ 8,906 | $ 710 | $ 1,306 |
OFF BALANCE SHEET ARRANGEMENTS
The Company has not entered into any off-Balance Sheet arrangements.
DIVIDEND POLICY
The Company’s current policy is to retain future earnings to finance its growth. Any future determination to pay dividends will be made at the discretion of the Company’s Board of Directors and will depend on the Company’s financial condition, results of operations, capital requirements and other such factors as the Board of Directors may deem relevant.
RELATED PARTY TRANSACTIONS
a) Key management personnel:
The remuneration of directors and other members identified as key management personnel during the 9 months ended September 30, 2025, and 2024 was as follows:
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
| September 30, 2025 | September 30, 2024 | |
|---|---|---|
| Salaries, pension and other short-term employee benefits | $ 1,248 | $ 1,331 |
| Share-based compensation | 438 | 13 |
| $ 1,686 | $ 1,344 |
Key management personnel comprise the Company's directors and executive officers.
b) Harlo Capital
In 2024, the Company made a payment of $782 to Harlo Capital in relation to its construction in progress asset related to the arena initiative. Harlo Capital is an investment firm jointly held in part by Kimel family board members of OverActive Media Corp. As such, Harlo Capital is considered a related party to OverActive Media Corp. The transaction was conducted in the normal course of business and was recorded at book value. No such transaction was made during the nine-month period ended September 30, 2025.
c) Shareholder loans
On March 1, 2024, the Company acquired Team Randomk Esports S.L. (operating as "Movistar Riders"). The Company inherited Movistar Riders' existing debt, which includes three shareholder loans with certain members of the Board totaling $163 (EUR 112) and measured at an effective interest rate of 11.64%. $46 principal payments were made during the nine-month period ended September 30, 2025 (September 30, 2024 - $45).
d) Promissory Note and Warrants:
After quarter end, the Company entered into two secured promissory note and warrant agreements with entities controlled by Michael Kimel and Sheldon Pollack, who are members of the Company's Board of Directors. Further details are provided in Note 14 – Subsequent Events in the unaudited financial statements.
e) Departure of CFO
Subsequent to quarter end, the Company entered into a settlement agreement with former Chief Financial Officer, Rikesh Shah. Further details are provided in Note 14 – Subsequent Events in the unaudited financial statements.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
SEASONALITY
The Company's financial results generally vary from quarter to quarter as a result of changes in general economic conditions and seasonal fluctuations, among other things, in each of the reportable segments. The majority of the Company's revenue in the Team Operations segment is expected to be related to our franchises receiving a share of the revenue from the associated leagues, which is typically recognized by the Company subsequent to the completion of the season and as amounts can become reasonably estimated or guaranteed by the Franchise Leagues typically in the third and fourth fiscal quarters. Prize money is less predictable, and the timing of such revenues would be related to the timing of tournaments and success of teams, typically in the second and third fiscal quarters. However, revenues related to sponsorships and partnerships, and merchandise are more evenly earned and recognized through the year. Revenues related to live events and ticket admission sales are earned as those events are delivered.
STOCK-BASED COMPENSATION
The purpose of the Company's Omnibus Equity Incentive Plan (the "Plan") is to assist the Company in attracting, retaining key employees, officers, directors, and consultants who will contribute to the Company's long-term success by providing them incentives that align their interests with those of the shareholders of the Company. The Plan is administered by the Board and is authorized to issue stock option units, restricted stock units ("RSU"), deferred stock units ("DSU") and performance share unit ("PSU"). The total number of common shares reserved for issuance pursuant to awards granted under the Plan and all other security-based compensation outstanding under the legacy Stock Option Plan shall not exceed 10% of the issued and outstanding common shares from time to time.
The following reconciles the number of RSUs outstanding as of September 30, 2025, and December 31, 2024:
| September 30, 2025 | December 31, 2024 | |
|---|---|---|
| Beginning balance | 4,183 | 4,342 |
| Granted | - | 2,400 |
| Exercised | (1,327) | (400) |
| Forfeited | (275) | (2,159) |
| Ending balance | 2,581 | 4,183 |
For the three and nine months ended September 30, 2025, the Company recorded share-based compensation of $68 and $346, respectively (for the three and nine months ended September 30, 2024 – $17 and recovery of $22 respectively) related to its RSUs.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
The following reconciles the number of DSUs outstanding as of September 30, 2025 and December 31, 2024:
| September 30, 2025 | December 31, 2024 | |
|---|---|---|
| Beginning balance | 1,210 | 560 |
| Granted | - | 650 |
| Exercised | (80) | - |
| Forfeited | (77) | - |
| Ending balance | 1,053 | 1,210 |
For the three and nine months ended September 30, 2025, the Company recorded share-based compensation of $31 and $90, respectively (for the three and nine months ended September 30, 2024 – $16 and $48 respectively) related to its DSUs.
The following reconciles the number of share-based awards available for grant under the Plan as of September 30, 2025, and December 31, 2024:
| September 30, 2025 | December 31, 2024 | |
|---|---|---|
| Options available for grant, beginning of the period | 5,693 | 369 |
| Granted | - | - |
| Forfeited | 385 | 3,874 |
| Increase due to shares issued in acquisitions | - | 4,500 |
| 6,278 | 8,743 | |
| Other share-based awards granted during the period: | ||
| RSUs | - | (2,400) |
| DSUs | - | (650) |
| Share-based awards available for grant, end of the period | 6,278 | 5,693 |
Options generally expire ten years following the grant date.
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
A summary of the status of the options outstanding as at September 30, 2025 is presented below:
| September 30, 2025 | ||
|---|---|---|
| Number of options | Weighted average exercise price | |
| Beginning of period, options outstanding | 820 | $ 2.11 |
| Granted | - | - |
| Exercised | - | - |
| Exchanged to RSUs | - | - |
| Forfeited | (33) | 0.22 |
| Balance, end of period | 787 | $ 2.19 |
| Exercisable, end of period | 776 | $ 2.22 |
For the three and nine months ended September 30, 2025, the Company recorded share-based compensation (recovery) of $nil and $1 respectively (three and nine months ended September 30, 2024 - $4 and recovery of $306 respectively).
For the three and nine months ended September 30, 2025, the Company recorded share-based compensation of $215 and $646 (three and nine months ended September 30, 2024 - $217 and $648 respectively), related to earnout shares.
Unrecognized stock-based compensation expense as of September 30, 2025 relating to stock option plans was $291 (September 30, 2024 - $110). The unrecognized portion will be recognized to net income over the remainder of their respective vesting periods.
OUTSTANDING SHARE DATA
The Company is authorized to issue an unlimited number of common shares and preferred shares, issuable in series. As at November 25, 2025, and December 31, 2024, there were no preferred shares issued and outstanding.
A summary of the Company's shares issued and outstanding is as follows:
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
| Number of common shares | Total amount net of issuance | |
|---|---|---|
| December 31, 2023 | 80,308 | $ 133,638 |
| Shares issued in acquisitions | 45,000 | 15,245 |
| Stock options exercised | 28 | – |
| RSUs vested and exercised | 400 | – |
| Shares repurchased | (200) | – |
| December 31, 2024 | 125,536 | $ 148,883 |
| RSUs and DSUs vested and exercised | 1,187 | – |
| November 25, 2025 | 126,723 | $ 148,883 |
CRITICAL ESTIMATES AND JUDGEMENTS
The preparation of financial statements in accordance with IFRS requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and notes to the consolidated financial statements. These estimates are based on management's best knowledge of current events and actions the Company may undertake in the future. Actual results could differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis.
Refer to the 2024 annual MD&A and the 2024 annual audited consolidated financial statements and notes thereto for a discussion of the accounting policies and estimates that are critical to the understanding of the business operations and results of operations.
RISKS AND UNCERTAINTIES
Due to the nature of the Company's business, the legal and economic climate in which it operates and its present stage of development, the Company may be subject to significant risks. The Company's future development and operating results may be very different from those expected as at the date of this MD&A. Readers should carefully consider all such risks. In addition to those risks discussed under "Risk Management", risk factors relating to the Company include, but are not limited to, the following:
- The Company has a limited long-term operating history;
- The Company's future revenues are uncertain;
- The Company has historical losses and negative operating cash flows;
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
- The Company cannot be certain that additional financing will be available on reasonable terms when required, or at all;
- The Company has grown and plans to continue to grow at a very rapid pace;
- The Company’s business is substantially dependent on the continued popularity and/or competitive success of exports;
- The Company’s reliance on publishers, leagues, sponsors and corporate partners;
- Risks associated with brand development and reputation;
- Dependence on key personnel;
- Risks associated with league and tournament participation;
- The Company’s business model and use of technology;
- The Company’s intellectual property may be subject to misappropriation;
- League rules and regulations may have a negative effect on the Company;
- The Company’s business is highly competitive and competition presents an ongoing threat to the success of its business;
- The Company’s exports decisions may have material negative effects on its business and results of operations;
- Injuries to, and illness of, players on the Company’s exports teams could hinder its success;
- Risks associated with potential future acquisitions;
- International expansion and operations in foreign markets expose the Company to risks associated with international sales and operations;
- Risks relating to conflicts of interest and general business regulation, including privacy laws;
- The Company cannot guarantee absolute protection against cyberattacks or other breaches of network or IT systems;
- The Company cannot guarantee that it will be able to successfully develop its proposed entertainment facility in Toronto;
- If research analysts do not publish research about the Company’s business or if they issue unfavourable commentary or downgrade the Company’s Shares, the Company’s stock price and trading volume could decline;
- The Company does not intend to pay dividends for the foreseeable future;
- The market price of the Company securities may decline due to the large number of outstanding common shares eligible for future sale;
OverActive Media Corp.
Management Discussion and Analysis
For the three and nine months ended September 30, 2025, and 2024
- The Company may issue additional equity securities, or engage in other transactions that could dilute its book value or affect the priority of the Company Shares, which may adversely affect the market price of the Company’s Shares;
- The Company may invest or spend in ways with which investors may not agree or in ways which may not yield a return;
- Tax risks and uncertainties facing the Company;
- Investors may have Canadian and non-Canadian income tax consequences related to holding the Company’s Shares;
- The Company cannot be certain of the longevity or the success of the various esports leagues in which the Company owns franchises; and
- General risks and uncertainties arising out of adverse economic changes.