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    WEW   DE000A2N4H07

WESTWING GROUP AG

(WEW)
  Report
Delayed Quote. Delayed Xetra - 11/26 11:35:07 am
25.8 EUR   +6.35%
11/24WESTWING : Gets a Buy rating from Berenberg
MD
11/17WESTWING : Upgraded to Buy by Jefferies
MD
11/12WESTWING : Baader Bank maintains a Buy rating
MD
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Westwing : Half-year report H1|2021

08/12/2021 | 02:11am EST

H A L F - Y E A R R E P O R T

2021

WESTWING AT A GL ANCE

Q 2 2021 H I G H L I G H T S

  • Revenue at EUR 131.7m with 18.6 % growth
  • Contribution margin at 29.0 % (Q2 2020: 28.7 %)
  • Adjusted EBITDA margin of 8.1 % (Q2 2020: 13.2 %) - decrease driven by growth investments into technology, Westwing Collection and marketing
  • Strong cash balance of EUR 122.1m as of June 30, 2021

K E Y F I G U R E S ( U N A U D I T E D )

Change

Change

H1 2021

H1 2020

Q2 2021

Q2 2020

Results of operations

Revenue (in EUR m)

270.1

178.6

51.2 %

131.7

111.1

18.6 %

Adjusted EBITDA (in EUR m)

30.3

13.5

16.8

10.7

14.7

- 4.0

Adjusted EBITDA margin (in % of revenue)

11.2 %

7.6 %

3.7pp

8.1 %

13.2 %

- 5.1pp

Financial position

Free cash flow (in EUR m)

20.5

16.3

4.2

6.8

22.7

- 15.9

Cash and cash equivalents (in EUR m, as of reporting date)

122.1

86.2

35.9

Other performance indicators

Westwing Collection share (in %)

32 %

23 %

9pp

32 %

22 %

10pp

GMV (in EUR m)

302

214

41.3 %

139

128

7.9 %

Number of orders (in k)

2,290

1,727

32.6 %

1,022

1,051

- 2.8 %

Average basket size (in EUR)

132

124

6.6 %

135

122

11.0 %

Active customers (in k)

1,730

1,178

46.9 %

Average orders per active customer

in the preceding 12 months

2.7

2.6

2.2 %

Average GMV per active customer

in the preceding 12 months (in EUR)

341

325

4.9 %

Mobile visit share (in %)

79 %

78 %

1pp

80 %

79 %

1pp

Other

Full-time equivalent employees (as of reporting date)

1,853

1,382

34.1 %

1

REPORT ON ECONOMIC POSITION

1 .1 FINANCIAL PERFORMANCE OF THE GROUP 1

The condensed income statement for the second quarter of 2021 shows revenue of EUR 131.7m with a growth of 18.6 % compared to the same quarter of the previous year (Q2 2020: EUR 111.1m). GMV grew at 7.9 % year-over-year. While the number of orders slightly decreased by 2.8 % to 1.0m (Q2 2020: 1.1m), the average basket size increased by 11.0 % to EUR 135 (Q2 2020: EUR 122). The number of active customers who made at least one order in the last twelve months was up by 46.9 % to 1.7m (Q2 2020: 1.2m). Customer loyalty remained very strong with 81 % of orders coming from repeat customers.

Both segments showed good revenue growth in the second quarter 2021. The DACH segment grew by 25.0 % and the International segment grew by 11.1 % compared to the second quarter of 2020.

Corresponding to the lower growth in revenue, driven by investments into technology, Westwing Collection and marketing, the Adjusted EBITDA margin decreased by 5.1 percentage points to 8.1 % in the second quarter of 2021 (Q2 2020: 13.2 %).

Unchanged to the previous quarters most of our employees in administrative functions worked from home and all warehouse workers and photo studio employees followed strict health procedures due to COVID-19 during the second quarter of 2021. In June 2021, Westwing started to offer vaccination of its employees at all sites.

Meanwhile accustomed to the situation, we continued to run our business and operations smoothly, despite some disruptions in the global supply chains, especially from China and India. Because of increasing demand and limited supply for shipments from Asia, we also see container rates surging. While we can pass on most of the cost increases to our product prices, we still expect a negative short-term impact on our contribution margins. We continue to constantly monitor the situation in order to react fast to challenges caused by COVID-19.

Overall, we continue to see strong results and we continue to focus on profitable growth going forward.

1 Figures in this section are presented on an adjusted basis, i.e. excluding (i) share-based compensation (in Fulfilment expenses, Marketing expenses as well as in General and administrative expenses) and (ii) expenses for a tax claim provision against a divested entity regarding previous years and (iii) income/expenses for the restructuring of the French business. We calculate "Adjusted EBITDA" by adjusting EBITDA for these items.

3

WESTWING GROUP AG HALF-YEAR REPORT 2021

C O N D E N S E D F I R S T H A L F 2021 C O N S O L I D AT E D I N C O M E S TAT E M E N T O N A DJ U S T E D B A S I S 2 ( U N A U D I T E D )

EUR m

H1 2021

In % of

H1 2020

In % of

revenue

revenue

Revenue

270.1

100.0 %

178.6

100.0 %

Cost of sales

- 134.8

- 49.9 %

- 93.1

- 52.1 %

Gross profit

135.3

50.1 %

85.5

47.9 %

Fulfilment expenses

- 53.8

- 19.9 %

- 37.3

- 20.9 %

Contribution profit

81.5

30.2 %

48.2

27.0 %

Marketing expenses

- 22.8

- 8.5 %

- 12.4

- 6.9 %

General and administrative expenses

- 35.0

- 13.0 %

- 27.1

- 15.2 %

Other operating expenses

- 0.9

- 0.3 %

- 1.3

- 0.7 %

Other operating income

1.6

0.6 %

1.0

0.6 %

Depreciation, amortization and impairments

6.0

2.2 %

5.0

2.8 %

Adjusted EBITDA

30.3

11.2 %

13.5

7.6 %

C O N D E N S E D S E C O N D Q UA R T E R 2021 C O N S O L I D AT E D I N C O M E S TAT E M E N T O N A DJ U S T E D B A S I S 2 (U N AU D I T E D )

EUR m

In % of

In % of

Q2 2021

Q2 2020

revenue

revenue

Revenue

131.7

100.0 %

111.1

100.0 %

Cost of sales

- 66.5

- 50.5 %

- 57.1

- 51.4 %

Gross profit

65.2

49.5 %

54.0

48.6 %

Fulfilment expenses

- 27.0

- 20.5 %

- 22.1

- 19.9 %

Contribution profit

38.2

29.0 %

31.8

28.7 %

Marketing expenses

- 12.6

- 9.6 %

- 5.9

- 5.4 %

General and administrative expenses

- 18.5

- 14.0 %

- 13.7

- 12.3 %

Other operating expenses

- 0.6

- 0.5 %

- 0.6

- 0.6 %

Other operating income

1.2

0.9 %

0.5

0.5 %

Depreciation, amortization and impairments

3.0

2.3 %

2.6

2.3 %

Adjusted EBITDA

10.7

8.1 %

14.7

13.2 %

Revenue

Our revenue increased by 18.6 % from EUR 111.1m in the previous-year period to EUR 131.7m in the second quarter of 2021.

In the first half of 2021, revenue amounted to EUR 270.1m, an increase by EUR 91.5m or 51.2 % compared to the same period of the previous year (H1 2020: EUR 178.6m).

2 Figures are presented on an adjusted basis, i.e. excluding (i) share-based compensation (in Fulfilment expenses, Marketing expenses as well as in General and administrative expenses) and (ii) expenses for a tax claim provision against a divested entity regarding previous years and (iii) income/expenses for the restructuring of the French business. We calculate "Adjusted EBITDA" by adjusting EBITDA for these items.

4

WESTWING GROUP AG HALF-YEAR REPORT 2021

Contribution Margin

Our gross margin increased slightly from 48.6 % in the second quarter of the previous year to 49.5 % in the second quarter of 2021. With 20.5 % our fulfilment cost ratio remained around the previous year's level (Q2 2020: 19.9 %).

As a result, our contribution margin only slightly changed from 28.7 % in the previous-year period to 29.0 % in the second quarter of 2021. For the first six months of 2021, the contribution margin was 30.2 %, while it amounted to 27.0 % in the first half of 2020.

Compared to the second quarter of 2020 our Westwing Collection share improved by 10 percentage points to 32 %, caused by an expanded product portfolio with a higher share of furniture and overall better availability.

Marketing Expenses

Based on our approach to invest into the current market momentum, marketing expenses increased to EUR 12.6m (9.6 % of revenue) in the second quarter of 2021 compared to EUR 5.9m or 5.4 % of revenue in the previous-year period.

In the first half of 2021 marketing expenses amounted to EUR 22.8m or 8.5 % of revenue, while they were at EUR 12.4m or 6.9 % of revenue in the same period 2020.

General and Administrative Expenses

In percent of revenue, general and administrative expenses were slightly up by 1.7 percentage points to 14.0 % in the second quarter of 2021 compared to the same period of the previous year (Q2 2020: 12.3 % of revenue). This development is primarily driven by higher investments into personnel. In absolute terms, general and administrative expenses increased by EUR 4.8m to EUR 18.5m in the second quarter of 2021 (Q2 2020: EUR 13.7m). Westwing will continue to invest into long-term growth, especially into technology and our Westwing Collection team to expand the Westwing Collection into more product categories with higher-margin products.

In the first half of 2021 general and administration expenses were EUR 35.0m (H1 2020: EUR 27.1m), corresponding to 13.0 %

of revenue (H1 2020: 15.2 %).

Adjusted EBITDA

The Group's Adjusted EBITDA decreased by EUR 4.0m to EUR 10.7m compared to the previous-year period (Q2 2020: EUR 14.7m) given our increased investments in technology, Westwing Collection and marketing as discussed above. Our Adjusted EBITDA margin decreased by 5.1 percentage points accordingly, from 13.2 % in the second quarter of 2020 to 8.1 % in the same period of 2021.

Next to share-based compensation expenses, Westwing adjusted its EBITDA for a non-operating tax claim for previous years from a divested entity amounting to EUR 1.0m in the second quarter of 2021. Due to its non-recurring nature, related expenses are excluded from our Adjusted EBITDA.

Adjusted EBITDA for the first six months of the year increased toEUR 30.3m (H1 2020: EUR 13.5m) which corresponds to an

Adjusted EBITDA margin of 11.2 % (H1 2020: 7.6 %).

5

WESTWING GROUP AG HALF-YEAR REPORT 2021

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Westwing Group AG published this content on 12 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 12 August 2021 06:10:03 UTC.


ę Publicnow 2021
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Sales 2021 529 M 598 M 598 M
Net income 2021 16,4 M 18,5 M 18,5 M
Net cash 2021 100 M 113 M 113 M
P/E ratio 2021 33,1x
Yield 2021 -
Capitalization 524 M 593 M 592 M
EV / Sales 2021 0,80x
EV / Sales 2022 0,66x
Nbr of Employees 2 105
Free-Float 61,3%
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Last Close Price 25,80 €
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Spread / Average Target 72,1%
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Stefan Smalla Chief Executive Officer
Sebastian Sńuberlich Chief Financial Officer
Christoph Barchewitz Chairman-Supervisory Board
Antonella Mei-Pochtler Deputy Chairman-Supervisory Board
Michael Hoffmann Member-Supervisory Board
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