Slide 1: Solid performance in a highly price-driven market in Q4
Verkkokauppa.com Oyj – Financial Statements Review 2023 Solid performance in a highly price-driven market in Q4 8 February 2024 | Panu Porkka, CEO | Verkkokauppa.com Oyj
Slide 2: Q4 & FY 2023 results
Q4 & FY 2023 results › Market development › Q4 & FY 2023 performance › 2023 highlights › Strategy update › Market outlook and guidance › Key takeaways 2 2/7/2024
Slide 3: Market development
Market development i : ac
Slide 4: Consumer confidence continued to weaken in December 2023
Consumer confidence continued to weaken in December 2023 • According to Statistics Finland, consumer confidence Consumer confidence indicator continued to weaken, and was at -13.3 in December 01/2020 - 12/2023 (Nov. -12.4, Oct. -12.6). Inflation was 3.6% (3.3% in Nov.) 6 4 • The time was still regar
Slide 5: Q4 & FY 2023 performance
Q4 & FY 2023 performance
Slide 6: Market share gains in a declining market Q4/2023 development
Market share gains in a declining market Q4/2023 development Group revenue declined by -2.8% YoY and was 2022 2023 EUR 150.6 million Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Customer segments › Sales for both Consumer and B2B customer Revenue, 154.9 segments in euros were on par with the 150.6 EUR million 137.8 prev
Slide 7: Gross margin impacted by price driven market
Gross margin impacted by price driven market 2022 2023 Q4/2023 development Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Gross profit totaled EUR 23.1 million and 15.3% 16.6% 16.7% 15.9% of revenue 15.4% 15.4% 14.6% 15.3% 14.1% Gross profit and › Gross margin was positively impacted by a margin, EUR million 21.9 23.1 goo
Slide 8: Well executed profitability program offset the impact of inflation
Well executed profitability program offset the impact of inflation Q4/2023 development EUR million Q4/2023 Q4/2022 Change 2023 2022 Change › Personnel costs declined by -10.5% as result of the change negotiations and Revenue 150.6 154.9 -2.8% 502.9 543.1 -7.4% the successful adaptation of personnel
Slide 9: Well executed inventory management – down by -16%
Well executed inventory management – down by -16% Balance sheet and cash flow on 31 December 2023 2022 2023 › Inventory in a healthy level, declined by - 16% and EUR 12 million YoY, and totaled Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 EUR 62.7 million. Inventories, › Investments during January-December EUR million 9
Slide 10: FY 2023 Financial performance - year of a profit improvement actions
FY 2023 Financial performance - year of a profit improvement actions Revenue Gross profit Comparable EBIT Operating Cash flow EUR 502.9 million EUR 80.9 million EUR 6.1 million EUR 20.3 million -7.4% vs. 2022 (2022: EUR 80.6 million) (2022: EUR 3.5 million) (2022: EUR 1.5 million) Gross margin 16.1%
Slide 11: 2023 operative highlights
2023 operative highlights 1. We focused on securing profitability and managed well to adapt our business on lower demand, to increase flexibility and as a result to improve cost efficiency 2. We optimized assortment and streamlined delivery flows by utilizing automation and technologies 3. We exceed
Slide 12: Highlights of our sustainability work in 2023
Highlights of our sustainability work in 2023 We launched a trade-in service, which promotes circular economy We multiplied the assortment available of used products We sell products that customer actually need and kept the product return rate low: 0.7% We invested in diversity by establishing a div
Slide 13: We achieved targeted savings and operational efficiency with the profitability improvement program
We achieved targeted savings and operational efficiency with the profitability improvement program Profitability improvement program: 2023: We achieved our targets capture full potential of core business Quarterly timing of improvements Operational performance & Commercial excellence During 2023, co
Slide 14: Online store renewal is delivering commercial results and improved efficiency
Customer experience Online store renewal is delivering commercial results and improved efficiency • Verkkokauppa.com's new online store strengthens its customer-focused strategy and enhances scalability across various product categories. • The updated online platform provides a more user-friendly sh
Slide 15: Over 78 000 credit account customers with thousands of instant trade-in transactions
New customer services Over 78 000 credit account customers with thousands of instant trade-in transactions Total number of opened “Tili” credit accounts Our new services; customer credit account +144% together with trade-in service are creating the 78 000 foundation for the new norm of owning 32 000
Slide 16: Monthly over 20 000 fast delivery
The fastest deliveries We’re extremely satisfied of customer demand for fast deliveries Fastest deliveries in Finland creating a new norm of buying • In 2023, we tripled the amount of fast deliveries compared to 2022 • Growth was fueled by the scaling of one- Monthly hour delivery throughout the yea
Slide 17: Updated Strategy 2024-2028
Updated Strategy 2024 - 2028 — " Verkkokauppa com, i
Slide 18: We will accelerate online transition leading to profitable growth
OUR STRATEGY FOR 2024-2028 18 We will accelerate online transition leading to profitable growth 1 FASTEST FULFILMENT • Blazing delivery speed a new norm of buying • The most effortless shopping experience • Automated product flows and intralogistics 2 CURATED ASSORTMENT • First one to introduce late
Slide 19: We will make fast deliveries the new norm in Finland
We will make fast deliveries the new norm in Finland 19 2023 1 hour deliveries available 2025 1 hour deliveries in four 2028 1 hour deliveries across Finland in 24/7 in capital region major cities in Finland largest cities using cost effective covering >10% of FI covering >40% of micro fulfilment ce
Slide 20: New business models will enable steady growth and improved EBIT
20 New business models will enable steady growth and improved EBIT Retail as a media Product life cycle services Additional new markets We will leverage our extensive Subscription models compliment In addition to existing international customer base and 1st party customer traditional unit purchase m
Slide 21: Long-term financial targets, by the end of 2028
Long-term financial targets, by the end of 2028 Top line growth (CAGR) of GROWTH more than 5%, outgrowing the market + PROFITABILITY EBIT margin above 5% + Fixed costs below 10% of COST-EFFICIENCY revenue + Target to pay out 60-80% of APPEALING annual net profit in quarterly DIVIDEND PAYOUT growing
Slide 22: Market outlook and guidance
Market outlook and guidance
Slide 23: Market outlook and short-term expectations
Market outlook and short-term expectations › There is ongoing uncertainty about the future outlook concerning intensified geopolitical conflicts in the world › Due to the weak economy, the labor market situation is expected to deteriorate in 2024, which will have an impact on consumer confidence › T
Slide 24: Financial guidance for 2024
Financial guidance for 2024 Verkkokauppa.com expects revenue for 2024 to remain at the 2023 level and comparable EBIT to increase from 2023. In 2023, revenue was EUR 502.9 million and comparable EBIT EUR 6.1 million. 24 2/7/2024
Slide 25: Key takeaways
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Slide 26: Key takeaways from 2023
Key takeaways from 2023 › Consumer confidence was low during the quarter and sank towards the end of year › We achieved targeted savings and › Consumer market in home electronics operational efficiency with the profit declined, however, we performed well improvement program and increased market shar
Slide 27: Thank you
Verkkokauppa PROBABLY ALWAYS CHEAPER Com Thank you
Slide 28: More information
More information Upcoming Financial Investor Relations Links events contacts Visit our Investors website www.verkinvest.com The Financial Statements for 2023 during the Marja Mäkinen week starting on 26 February (week 9) in 2024 Head of Investor Relations & Annual general meeting is planned to b
Slide 29: @verkkokauppa.com_sijoittajille
@verkkokauppa.com_sijoittajille Follow Verkkokauppa.com NEW Instagram account for our current and new shareholders! Please note, posts are in Finnish, targeted for our over 21,000 Finnish shareholders. 29 2/7/2024
Slide 30: This document is not an invitation to subscribe for or purchase any securities
This document is not an invitation to subscribe for or purchase any securities or make any investment decisions in respect of the Company or its securities. This document is not for publication or distribution, directly or indirectly, in or into Australia, Canada, the Hong Kong special administrativ
Slide 31: Appendix
Appendix > Quarterly Key Figures
Slide 32: Quarterly Key Figures
Quarterly Key Figures 2023 2022 Q1-Q4 Q1-Q4 Q1 Q2 Q3 Q4 2023 Q1 Q2 Q3 Q4 2022 Revenue, eur million 122.0 112.8 117.4 150.6 502.9 124.8 125.7 137.8 154.9 543.1 Gross profit, eur million 20.2 18.8 18.7 23.1 80.9 19.3 19.4 20.1 21.9 80.6 Gross margin-% 16.6% 16.7% 15.9% 15.3% 16.1% 15.4% 15.4% 14.6% 14
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