Slide 1: Allegro.eu Q3 2023 Results presentation
birthday lottery Allegro.eu Q3 2023 Results presentation 1st allegro days 16 November 2023 | 1
Slide 2: Disclaimer
Disclaimer This presentation (“Presentation”) has been prepared by Allegro.eu, a public limited liability company (société anonyme) incorporated and existing under the laws of the Grand Duchy of Luxembourg, having its registered office at 1, rue Hildegard von Bingen, L – 1282 Luxembourg, Grand Duchy
Slide 3: Agenda
Agenda // Highlights Financial results: Polish Operations International Operations Group Management outlook Q&A | 33
Slide 4: Highlights
Highlights 4
Slide 5: Increasing loyalty, Active Buyers growth and improved monetization drive strong outperformance in Q3
Increasing Allegro shoppers’ loyalty, Active Buyers growth and improved monetization drive strong outperformance in Q3 Q3 2023 Top Line Highlights1 ● GMV in Poland up by 10.5% fuelled by growth in Active Active Buyers GMV per Active Buyer Buyers and their average spend outpacing nominal Group 18.9m
Slide 6: High cash generation despite allegro.cz launch with tight capex control
High cash generation despite allegro.cz launch: exceptional GMV margin accompanied by continued tight capex control Q3 2023 Profitability, Cash-flow and Leverage Highlights1 ● Higher take rate and cost focus delivered an exceptional Adjusted EBITDA 5.86% GMV margin in Poland (+0.87pp QoQ) Group +26.
Slide 7: Management continues to work on the Seven Priorities
Management continues to work on the Seven Priorities Poland CE-51 Framework to report progress Win in Czechia / Slovakia 1 Strong in Poland 2 with our marketplace model across the Growth organization 3 Scale up Allegro Pay Improve Smart! 4 and delivery economics 5 Mall 1P business turnaround Costs 6
Slide 8: No. 1 e-commerce platform in Poland: enhancing the powerful flywheel
No. 1 e-commerce platform in Poland: enhancing the powerful flywheel in Allegro’s key market Strong in Poland PRIORITY 1 ● >660k new Active Buyers added YoY ● >140k merchants, with growing number of in Poland international sellers ● Share of App in visit mix up by 4.5pp YoY Customers Merchants ● Imp
Slide 9: Advertising delivering excellent revenue growth; gradual shift towards monetisation of Allegro Pay
Advertising delivering excellent revenue growth >3.5x ahead of GMV Gradual shift towards monetisation of Allegro Pay Strong in Poland: Advertising PRIORITY 1 Allegro Pay PRIORITY 3 Advertising revenue up by 37.6% YoY, growing >3.5x faster than GMV ● +43% YoY growth in originated loans to PLN 2,015m
Slide 10: Promising early results in traffic and brand awareness of allegro.cz marketplace
Promising early results in traffic and brand awareness of allegro.cz marketplace Winning with our multi-country marketplace model PRIORITY 2 ● Nearly 800k Active Buyers, of which ● >20k shops on the platform >53% newly acquired ● Time-limited promotional terms for local ● >300k Smart! users Customer
Slide 11: Continued focus on costs: efficiency across Smart! and Delivery
Continued focus on costs: efficiency across Smart! and Delivery Smart! PRIORITY 4 Delivery experience PRIORITY 4 FIRST MILE MIDDLE MILE LAST MILE WE|DO InPost courier pick-up Central Hub WE|DO Hub To-door delivery APM & PUDO drop-off Piotrków, PL Ostredek, CZ APM & PUDO delivery On average only +1 w
Slide 12: Continued focus on costs: Mall 1P turnaround and Fit to Grow
Continued focus on costs: Mall 1P turnaround and Fit to Grow Mall 1P turnaround PRIORITY 5 Fit to Grow PRIORITY 6 ● Continued weak demand for the largest, discretionary categories, driven ● “Fit to grow” project delivered its Q3 savings objectives by challenging macro conditions, with continued real
Slide 13: Financial results
Financial results 13
Slide 14: Q3 2023 key results: Polish Operations
Polish Operations Q3 2023 key results: Polish Operations1 GMV Active Buyers2 LTM GMV / Active Buyer3 Take Rate4 Q3 PLN 13,271m +10.5% YoY 14.5m +4.8% YoY PLN 3,699 +7.3% YoY 11.91% +0.85pp YoY 9M PLN 39,094m +11.9% YoY 11.40% +0.61pp YoY Revenue Adjusted EBITDA Adj. EBITDA / GMV margin Cash Conversi
Slide 15: Over 660k Active Buyers added YoY, with continued growth in average spend
Polish Operations Over 660k Active Buyers added YoY, with continued growth in average spend from rising buyer engagement Active Buyers (period end) LTM GMV / Active Buyer (period end) m PLN m 4.8% 7.3% 1.8% 1.1% 0.4% 1.4% 1.9% 2.3% 1.0% 1.9% 13.8 14.1 14.2 14.3 14.5 3,582 3,664 3,699 3,449 3,515 Q3
Slide 16: GMV in Poland up by 10.5% as transaction growth accelerates further
Polish Operations GMV in Poland up by 10.5% as transaction growth accelerates further, with highest growth in high frequency categories GMV1 PLN bn ● LTM2 GMV of PLN 53.5bn, up by 12.4% YoY and advancing by PLN 21.4% 14.0% 14.0% 11.3% 10.5% 1.3bn QoQ ● Growth in July and August in line with Q2, whil
Slide 17: Revenue growth led by marketplace, advertising and other
Polish Operations Revenue growth led by marketplace, advertising and other Revenue Bridge Take Rate2 PLN m % 19.3% 37.6% 4.5% -15.3% 171.3% 19.9% Q3’23 Take Rate up by 0.85pp YoY, mainly from July 2023 changes to co-financing 253.6 53.7 1.9 31.7 1,951.5 and rate cards 1,627.3 -16.8 11.91 11.05 10.91
Slide 18: Adjusted EBITDA up by 32.4% YoY, driven by higher GMV, take rate and advertising
Polish Operations Adjusted EBITDA up by 32.4% YoY, driven by higher GMV, take rate and advertising contribution, with continued focus on SG&A efficiency ● Marketplace revenue reflecting GMV growth at higher YoY Adjusted EBITDA bridge in Q3 20231 take rates PLN m ● Continued growth in contribution of
Slide 19: Capex spend down by over 50% YoY while cash conversion reached 90%
Polish Operations Capex spend down by over 50% YoY with focus on ROI metric and asset utilization, while cash conversion reached 90% in Q3 Capital expenditures1 by type -50.9% PLN m 163.3 Other 87.0 ● Delivery Experience and IT projects limited in 2023 with focus on 80.1 utilization 14.8 ● New offic
Slide 20: Q3 2023 key results: International Operations
International Operations Q3 2023 key results: International Operations1 (Mall Segment and Allegro International Segment) GMV Active Buyers3 LTM GMV / Active Buyer5 Take Rate6 Q3 PLN 799m -10.7% YoY 4.5m +5.1% YoY2 PLN 842.1 -10.3% YoY2 9.92% -1.97pp YoY 9M PLN 2,342 -5.8% YoY2 11.03% N/A8 Revenue Ad
Slide 21: Allegro.cz GMV growing >3.4x QoQ, partially mitigating legacy Mall segment GMV declines
International Operations Allegro.cz GMV growing >3.4x QoQ, partially mitigating legacy Mall segment GMV declines GMV bridge in Q3 2023 PLN m ● Czech retail in real decline for 6 quarters (approx. -29.2% -14.3% -29.9% -10.7% -4.5% YoY in Q31), with consumer discretionary under most pressure 894.9 194
Slide 22: Mall loss reduced while Allegro invests to start the allegro.cz marketplace flywheel
International Operations Mall loss reduced while Allegro invests to start the allegro.cz marketplace flywheel Adjusted EBITDA bridge in Q3 20231 ● Reduced YoY Adjusted EBITDA loss PLN m of the Mall Segment to PLN 44.3m due to focus on gross margin, rationalised marketing and lower overheads 16.1 ● a
Slide 23: Q3 2023 key results: Consolidated Group
Group Consolidated Q3 2023 key results: Consolidated Group1 GMV Adjusted EBITDA Take rate Q3 PLN 14,067m +9.0% YoY PLN 676.9m +26.0% YoY 11.87% +0.80pp YoY 9M PLN 41,433m +13.1% YoY PLN 1,788.2m +20.5% YoY 11.39% +0.60pp YoY Revenue Adj. EBITDA / GMV margin Cash Conversion2 Q3 PLN 2,432m +4.8% YoY 4
Slide 24: Continued rapid deleveraging in Q3 to 2.17x
Group Consolidated Continued rapid deleveraging in Q3 to 2.17x due to rising LTM EBITDA and lower capex PLN m (unaudited) 30.09.2022 31.12.2022 30.06.2023 30.09.2023 ● Sequential step down in leverage thanks to exceptional EBITDA growth in Q3’2023 and significantly lower YoY LTM1 Adjusted EBITDA Pol
Slide 25: Management outlook
Management outlook 25
Slide 26: Q4 2023 outlook
Q4 2023 outlook Polish Operations International Operations3 Group consolidated Q3’23 Q3’23 Q3’23 Q3’23E Actual Q4’23E Q3’23E Actual Q4’23E Q3’23E Actual Q4’23E GMV 10-11% 10.5% 9-11% 10-12% 10.7% 10-14% 8-9% 9.0% 7-9% YoY YoY YoY YoY YoY YoY YoY YoY YoY growth growth growth decline decline decline g
Slide 27: Q&A
Q&A 27
Slide 28: Thank you.
alleoro Thank you.
Slide 29: Appendix: Expanded group structure explained
Appendix: Expanded group structure explained Consolidated Group: ALLEGRO.EU Polish Operations International Operations Reportable Allegro segment Allegro Ceneo Other Mall International Legal Allegro sp. z o.o. Ceneo.pl sp. z o.o. Allegro Treasury S.à r.l. Mall Group a.s. allegro.cz operations (excl.