Slide 1: Verkkokauppa.com Q2 2018 - Today's Storefront
Verkkokauppa.com Q2 2018 10.8.2018, Panu Porkka, CEO TODAY´S STOREFRONT RETAIL IS GOING ONLINE. COME ALONG. Questions during or after the presentation - investors@verkkokauppa.com
Slide 2: Agenda
Agenda • Q2/2018 • 2018 outlook • Market development and trends • Key takeaways • Q&A
Slide 3: Verkkokauppa.com Q2 2018
Verkkokauppa.com Q2 2018 Q2 revenue €102m (+3.2%) EBITDA* €0.7m (-73%) Market share gains in most categories** Q2 dividend €0.046 (previous Q €0.045) *) Comparable EBITDA **) Source: GfK
Slide 4: Q2 2018 Income Statement
Verkkokauppa.com Q2 2018 Income Statement Q2 2018 Q2 2017 Ch % Revenue, € million 102.2 99.1 +3.2% Gross profit 14.6 14.4 +1.8% Gross Margin 14.3% 14.5% Personal expenses -7.3 -6.0 +22% Other opex -6.7 -5.8 +15% EBITDA 0.6 2.6 -73% EBITDA margin 0.3% 2.6% Operating profit (EBIT) 0.4 2.3 -83% Net pro
Slide 5: Q2 2018 sales drivers
Verkkokauppa.com Q2 2018 sales drivers • Retails continues going online • Finnish economy returning to growth, GDP +2.9% 2018* • Tough CE market** in Q2/2018 (Market +2.2%) • Market share gains in almost all categories • Raisio megastore opened March 8 60.6 80.0 80.1 99.0 102.2 mEUR mEUR mEUR mEUR m
Slide 6: 30/6/2018 Balance Sheet
Verkkokauppa.com 30/6/2018 Balance Sheet • Inventory 53.6 (47.7) million euros on 30/6/2018, change +12% • Cash flow from operating activities -25.3 (-14.2) million euros • Investments 1-6/2018 was 0.8 (1.0) millions euros • Equity ratio 40.0% (44.8%) • Cash 21.3 (21.9) million euros, no interest be
Slide 7: Highlights in Q2 2018
Highlights in Q2 2018 • Dude Island Festival • Outlet auctions • Q2 Sale week • 100 day opening of Raisio • Raisio Monday Carnivals – also on tuesdays
Slide 8: H1/2018
Verkkokauppa.com H1/2018 H1 2018 H1 2017 Ch % Revenue, € million 204.7 199.0 +2.9% Gross profit 31.0 28.2 +10% Gross Margin 15.1% 14.2% Personal expenses -14.4 -12.1 +19% Other opex -13.6 -11.0 +23% EBITDA 3.1 5.1 -39% EBITDA margin 1.5% 2.6% Operating profit (EBIT) 2.4 4.5 -45% ”Higher revenue grow
Slide 9: 2018 outlook
Verkkokauppa.com 2018 outlook 2018 guidance revenue between €460m - €500m (2017 €432m) and comparable EBITDA €11 - €14m (2017 €13 m). Medium-term targets of net sales growth of 10-20% per year, growing EBITDA and EBITDA margin of 3-5%. Policy of paying out growing, quarterly dividend.
Slide 10: Growth drivers for H2/2018
Growth drivers for H2/2018 • Positive outlook on Finnish economy • Increasing market shares in existing categories • Improvement of brand marketing • Fourth megastore in Raisio • Improvement of omnichannel experience
Slide 11: Verkkokauppa.com's targets and categories
Verkkokauppa.com´s targets and categories Continuous and systematic expansion into new categories that are fully suitable for low-cost online model and efficient logistics. • Medium-term target of 10-20% revenue growth and EBITDA margin of 3-5% is split between 26 main categories with some being mor
Slide 12: Verkkokauppa.com's gross margin and fixed costs
Verkkokauppa.com´s gross margin and fixed costs 20% 15% 2,6 % 4,7 % 2,5 % 2,0 % 3,0 % 10% 16,0 % 13,8 % 14,5 % 13,2 % 14,4 % 11,3 % 11,9 % 11,2 % 11,3 % 11,4 % 5% 0% Verk.com Q1 2017 (Sales Verk.com Q2 2017 (Sales Verk.com Q3 2017 Verk.com Q4 2017 (Sales Verk.com 2017 (sales +16 +20 %) +24 %) (Sales
Slide 13: Business model with lower fixed costs
Verkkokauppa.com´s business model with lower fixed costs 35,0 % 30,0 % 30,3 % 27,5 % 25,0 % 25,9 % 25,0 % 20,0 % 20,9 % 20,6 % 20,6 % 18,9 % 15,0 % 14,6 % 14,3 % 14,4 % 10,0 % 11,4 % 5,0 % 0,0 % Retail in Finland (w/o Verk.com Q2 2018 (sales Verk.com 2017 (sales Gigantti 2017/2018 (sales Power Finla
Slide 14: Global online share forecast 2015-2021
Global online share forecast 2015-2021* E-commerce share of total global retail sales from 2015 to 2021 20% 18% 17,5 % 2016 Retail e-commerce shares: Finland 10%, 15,5 % 16% UK 17%, USA 14%, Germany 14% 14% (source: CRR) 13,7 % Verkkokauppa.com aims 11,9 % to take large part of 12% retail (~€40b) go
Slide 15: Mobile users are growing
Mobile users are growing Yes, i have bought online using mobile device in the last 60% 50% 40% 30% 50% 51% 46% 20% 38% 31% 10% 21% 0% 15-24 years 25-34 years 35-44 years 45-54 years 55-65 years 66-75 years ”40 % of Finnish have used mobile device for online shopping during the last three months. ” S
Slide 16: Web visits last 12 months (desktop and mobile)
Web visits last 12 months (desktop and mobile)
Slide 17: Key takeaways
Key takeaways • Revenue (+3,2%) inline with company´s expectations • Market share growth in a tough market situation • Raisio megastore contributing in sales growth • Growth in H2 significantly higher than H1 • New management team complete in August RETAIL IS GOING ONLINE. COME ALONG.
Slide 18: Philips Hue advertisement
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Slide 19: Thank you and Q&A
Thank you and Q&A Upcoming events: • Q3/2018, Friday 26 October 2018 Links: • Investors site - www.verkinvest.com • Company Releases mailing list - www.joinverk.com • Company Investor Webcasts - www.verklive.com Contacts: • Panu Porkka, CEO panu.porkka@verkkokauppa.com • Jussi Tallgren, CFO, jussi.t
Slide 20: Disclaimer
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