D-MARKET Elektronik Hizmetler ve Ticaret AS · NASDAQ:HEPS
D-MARKET Elektronik Hizmetler ve Ticaret AS — D-Market Electronic Services & Trading (Hepsiburada) — Q3 2023 Earnings Presentation
38 slides from D-MARKET Elektronik Hizmetler ve Ticaret AS's earnings presentation, Dec 5, 2023
Slide 1: Q3 2023 Results Presentation
Q3 2023 Results Presentation December 5, 2023
Slide 2: Disclaimer
Disclaimer Restatement of Financial Information Pursuant to the International Accounting Standard 29, Financial Reporting in Hyperinflationary Economies (“IAS 29”), the financial statements of entities whose functional currency is that of a hyperinflationary economy must be adjusted for the effects
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation, the conference call webcast, press release and related communications include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended and the S
Slide 4: Business Update
hepsiburada Business Update
Slide 5: Q3 2023 Highlights: Robust Performance
Q3 2023 Highlights: Robust Performance IAS 29- Unadjusted GMV Growth 126.2% YoY 45.1% YoY Total Orders 27.0M 55.1% YoY inflation-adjusted(1) IAS 29- Unadjusted Gross Contribution 11.6% +1.8pp YoY NPS(4) 71 Strong NPS as a % GMV(2) IAS 29- Unadjusted 2.7% +6.9pp YoY HB Premium Program 2.0M +10 points
Slide 6: Q3 2023 Guidance: Exceeded While Shooting for Positive Full Year EBITDA
Q3 2023 Guidance: Exceeded while Shooting for Positive Full Year EBITDA Guidance Actual IAS 29-Unadjusted GMV Growth ~110% 126.2% IAS 29-Unadjusted excluding EBITDA as a 0.5% to 1.0% one-off (1) 2.2% % of GMV On track towards our full year positive EBITDA(2) guidance in 2023 (1): Excluding the settl
Slide 7: Hepsiburada: Trust Brand of E-Commerce
Hepsiburada: Trust Brand of E-Commerce (LTM) Active Customers(1) Q3’22 Q3’23 11.8M 12.0M 182K YoY Total Orders(2) Q3’22 Q3’23 17.4M 27.0M 55% YoY (Order) Frequency(3) NPS: NPS Q3’22 Q3’23 71 71 5.4 8.6 59% YoY NOTE: Growth figures are between Q3 2023 and Q3 2022 unless otherwise indicated. The year-
Slide 8: Digitizing E-Commerce: Growing Together with Our Merchants
Digitizing E-Commerce: Growing Together with our Merchants Number of SKUs(1) Q3’22 Q3’23 Enhanced Merchant Experience 145.0M 210.6M 45% YoY Self-campaign management and coupon creation through merchant app (LTM) Active Merchants(2) Q3’22 Q3’23 94.3K 101.1K Automated inclusion to “Next day delivery”
Slide 9: Strategic Update: Progressing On Our Priorities
Strategic Update: Progressing On Our Priorities Win with customer loyalty and optimize marketing and advertising spend Clear differentiation with affordability & lending solutions as well as high-quality service levels on our platform and superior delivery services Pursue profitability through focus
Slide 10: Hepsiburada Premium: Compelling Proposition Leading to Customer Loyalty
Hepsiburada Premium: Compelling Proposition Leading to Customer Loyalty HB Premium Program 2.0 million Building Loyalty Hepsiburada Premium Members(1) 1.4x Driving Retention the monthly order frequency after joining the program(2) 81 Strong Customer Hepsiburada Premium Satisfaction NPS(3) (1): As of
Slide 11: Differentiation Through Financial Services: Hepsipay Digital Wallet
Differentiation Through Financial Services: Hepsipay Digital Wallet Continues to Expand In Scope Hepsipay Prepaid Card Top-up to Wallet Enabler for (*) spending top-up to wallet loans Starter for digital wallet proposition at instore points 708K 3% cash back Top-up to wallet with loans Hepsipay card
Slide 12: Differentiation Through Financial Services: Diverse Affordability Solutions
Differentiation Through Financial Services : Diverse Affordability Solutions Affordability Solutions BNPL Affordability Solutions GMV Penetration(1) (%) 5.6% Convenience and speed in limit inquiry BNPL+ Shopping loan First and Only in Turkish e- Q3’22 Q4’22 Q1’23 Q2’23 Q3’23 commerce Through Non-car
Slide 13: Differentiation Through Last-Mile Delivery Service: A Closer Look at the KPIs
Differentiation Through Last-Mile Delivery Service: A Closer Look at the KPIs TPVFast as a and GMV(2) Service Through HepsiJet % of Reliable TPV asHJ a -%% of GMV Total (2) Delivered(3) Parcels HJ - % Next Day Delivery(1) 67% 66% 67% HepsiJet NPS(2) 86.2 84% in Q3’23 83% 82% Q3’22 Q2’23 Q3’23 HJ XL-
Slide 14: Pursuing Profitability: Achieved Through Key Strengths and Cost Management
Pursuing Profitability: Achieved Through Key Strengths and Cost Management IAS 29-Unadjusted EBITDA as a % of GMV 2.7% Building Blocks for Profitability 2.0% Key strengths and action points 1.2% 2.2% 1.5% Optimization of Opex and Gross Increase share of 0.0% marketing and Contribution non-electronic
Slide 15: Moving Off-Platform with Services: HepsiJet Is Expanding Its External Customer Base
Moving Off-Platform with Services: HepsiJet is Expanding Its External Customer Base Hepsijet serves third parties HJ - % Volume of External Customers(1) Market Leader in +8.4pp 24.8% NPS 16.4% 15 XL Q3’22 Q3’23 (1): Share of volume from other retailers’ operations delivered by HepsiJet within HepsiJ
Slide 16: Moving Off-Platform with Services: Fast and Reliable Payment Experience
Moving Off-Platform with Services: Fast and Reliable Payment Experience Off-Platform with Various Payment Options Pay with Hepsipay at Check-out One-click check-out at integrated merchants: “Pay with Hepsipay” Use prepaid card for both online and instore payments Top-up to wallet with loans and spen
Slide 17: Hepsiburada: Legendary 11.11
Another Legendary November! Hepsiburada: Legendary 11.11 Order was 2x that of the monthly average of the prior months of 2023 500M visits; 30M pieces sold through the platform Around 46% of GMV came through installment sales Q3 2023 Results 17
Slide 18: Q4 2023 Outlook and FY 2023E
Q4 2023 Outlook and FY 2023E: Continued Growth and Profitability Q4 2023 Guidance FY 2023E GMV(1) YoY Growth 93% to 95% around 100% EBITDA(1) as a % of GMV 0.5% to 1.0% around 1.5% +3.6pp YoY (1): Figures are based on IAS 29-Unadjusted EBITDA and IAS 29-Unadjusted GMV figures. Q3 2023 Results 18
Slide 19: Financial Performance
hepsiburada Financial Performance
Slide 20: Q3 2023 Financial Highlights: Continued Uptrend Across All Key Metrics
Q3 2023 Financial Highlights: Continued Uptrend Across All Key Metrics IAS 29-Unadjusted IAS 29-Unadjusted IAS 29-Unadjusted IAS 29-Unadjusted GMV Revenue Gross Contribution(1) EBITDA TRY 24.3Bn TRY 7.6Bn 11.6% of GMV 2.7% of GMV 2.2% of GMV excluding (2) one-off 126% YoY 137% YoY +1.8 pp YoY +6.9 p
Slide 21: GMV Performance: Robust Growth
GMV Performance: Robust Growth Solid Operational KPIs.. …resulting in strong GMV growth Number of Orders GMV 1P GMV GMV Non-Electronics GMV (million) 55% (TRY Billion) (TRY Billion) Electronics GMV 3P GMV 18% 27.0 excl. digital products +45% 17.4 25.7 25.7 34.5% 40.8% Q3’22 Q3’23 17.7 17.7 31.8% Q3’
Slide 22: Revenue and Gross Contribution Margin
Revenue and Gross Contribution Margin: Solid Revenue Growth Coupled with Margin Improvement Revenue Breakdown and Bridge Gross Contribution Performance Revenue Gross Contribution Margin (TRY Million) IAS 29-Unadjusted Gross Contribution Margin Gross Contribution Margin +52.0% 11.6% 8,057 391 275 10.
Slide 23: EBITDA Performance: Higher Gross Contribution and Efficient Spending
EBITDA Performance: Improvement Through Higher Gross Contribution and Efficient Spending EBITDA as a % of GMV Bridge EBITDA as a % of GMV Shipping and Payroll and Q3’22 Q4’22 Q1’23 Q2’23 Q3’23 EBITDA Gross Advertising packaging outsource Other EBITDA % of GMV contribution exp. exp. staff exp. OPEX(1
Slide 24: Free Cash Flow: Strong Cash Generation on Robust Growth
Free Cash Flow: Strong Cash Generation on Robust Growth Free Cash Flow(1) Cash Flow From Operating Activities TRY million TRY million First 9 (2,211) 1,042 First 9 (1,295) 1,781 months months 2,007 2,241 535 713 875 346 80 -205 -540 -760 -2,883 -3,092 Q1’22 Q2’22 Q3’22 Q1’23 Q2’23 Q3’23 Q1’22 Q2’22
Slide 25: Q3 2023: Key Takeaways
Q3 2023: Key Takeaways IAS 29-Unadjusted basis 1 EBITDA as a % of GMV at 2.7%, exceeding guidance for Q3 2023 2 GMV growth at ~126%, exceeding guidance for Q3 2023 1.8pp improvement in Gross Contribution and 6.9pp rise in EBITDA as 3 a % of GMV Positive cash flow from operations, resulting in substa
Slide 26: Q&A
hepsiburada Q&A
Slide 27: Appendix
Appendix Consolidated Financial Statements Presentation of Financial and Other Information
Slide 28: Summary Financials
Summary Financials (unaudited) (unaudited) (unaudited) (unaudited) TRY million Q3’23 Q3’22 YoY 9M’23 9M’22 YoY Revenue 8,057.4 5,300.1 52.0% 21,596.7 15,786.0 36.8% Gross Contribution 2,415.0 1,478.6 63.3% 6,505.3 2,953.2 120.3% Gross Contribution margin(1) 9.4% 8.4% 1.0pp 9.4% 5.7% 3.7pp Operating
Slide 29: Operating Expenses
Operating Expenses Operating Expenses as a % of GMV Advertising Shipping and Packaging G&A(1) Total OPEX -2.3pp excluding excluding -5.1pp -1.2pp one-off one-off Impact(2) Impact(2) 14.2% -3.9pp -1.1pp 7.8% 11.8% 3.3% -0.1pp 5.4% 3.1% 3.0% excluding 9.5% 2.7% one-off 8.5% 2.3% Impact(2) 9.1% 2.0% 4.
Slide 30: Consolidated Statements of Comprehensive Loss
Consolidated Statements of Comprehensive Loss Consolidated Statements of Comprehensive Loss (Amounts expressed in thousands of Turkish lira (TRY) in terms of the purchasing power of the TRY at 30 September 2023 unless otherwise indicated.) Nine Months Ended Three Months Ended unaudited unaudited una
Slide 31: Consolidated Balance Sheets
Consolidated Balance Sheets Consolidated Balance Sheets (Amounts expressed in thousands of Turkish lira (TRY) in terms of the purchasing power of the TRY at 30 September 2023 unless otherwise indicated.) unaudited unaudited Assets: 30 September 2023 31 December 2022 Cash and cash equivalents 5,714,0
Slide 32: Consolidated Statements of Cash Flows
Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows (Amounts expressed in thousands of Turkish lira (TRY) in terms of the purchasing power of the TRY at 30 September 2023 unless otherwise indicated.) (unaudited) (unaudited) 1 January – 30 September 2023 1 January – 30 Septemb
Slide 33: Non-IFRS Metrics Reconciliation (I/V)
Non-IFRS Metrics Reconciliation (I/V) EBITDA (TRY million) Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Net income/ (loss) for the period (191.1) (923.1) 654.5 (3,527.2) Taxation on income - - - - Financial income 503.6 728.1 2,524.4 2,558.7 Financial expenses
Slide 34: Non-IFRS Metrics Reconciliation (II/V)
Non-IFRS Metrics Reconciliation (II/V) IAS 29-Unadjusted EBITDA (TRY million) Three months ended September 30, Reversal of IAS 29 Reversal of IAS 29 IAS 29 Unadjusted IAS 29 Unadjusted 2023 Adjustment 2023 2022 Adjustment 2022 Net income/(loss) for the period (191.1) (350.3) 159.2 (923.1) (507.3) (4
Slide 35: Non-IFRS Metrics Reconciliation (III/V)
Non-IFRS Metrics Reconciliation (III/V) IAS 29-Unadjusted EBITDA (TRY million) Nine months ended September 30, Reversal of IAS 29 Reversal of IAS 29 2023 IAS 29 Unadjusted 2022 IAS 29 Unadjusted Adjustment Adjustment 2023 2022 Net income/(loss) for the period 654.5 (405.9) 1,060.4 (3,527.2) (2,656.2
Slide 36: Non-IFRS Metrics Reconciliation (IV/V)
Non-IFRS Metrics Reconciliation (IV/V) REVENUE (TRY million) Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Revenue 8,057.4 5,300.1 21,596.7 15,786.0 Reversal of IAS 29 adjustment 450.0 2,094.1 3,709.7 7,190.5 IAS 29-Unadjusted Revenue 7,607.4 3,206.0 17,887.0 8
Slide 37: Non-IFRS Metrics Reconciliation (V/V)
Non-IFRS Metrics Reconciliation (V/V) Free Cash Flow (TRY million) Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 Net cash provided by /(used in) operating activities 2,240.6 874.8 1,780.7 (1,295.1) Capital expenditures (244.8) (340.2) (751.0) (916.5) Proceeds f
Slide 38: Certain Definitions
Certain Definitions We provide a number of key operating performance indicators used by our management and often used by competitors in our industry. We define certain terms used in this presentation as follows: GMV as gross merchandise value which refers to the total value of orders/products sold
D-Market Electronic Services & Trading (Hepsiburada) — Q3 2023 Earnings Presentation on 6ix