Capital Markets Day 2019 Z AL A N D O . T H E S T AR T I N G P O I N T F O R F AS H I O N F E B R U A R Y 2 8 , 2 0 1 9
HIGHLIGHTS AND BUSINESS UPDATE
HIGHLIGHTS AND LOWLIGHTS Q4/18 HIGHLIGHTS LOWLIGHTS +25% -5.0% Strong growth at upper end of Continuing trend of decreasing target corridor basket economics Average basket size Revenue growth -1.5pp +31% Significant traffic increase Higher discounting level Gross margin yoy Site visits +1.3m Strongest quarterly increase in 5 years Active customers €118m Solid margin >7% Adj. EBIT 3
RECORD-BREAKING BLACK FRIDAY PROVES SCAL ABI LITY OF OUR OPERATIONS AND SYSTEM S Cohort quality comparable to More than 23,000,000 site visits rest of year Our customers ordered More than 60% GMV growth ~ 2,000,000 times compared to Black Friday 2017 Our operations and systems were tested to Acquired 220,000 new customers the maximum : >4,200 orders per minute 4
PLATFORM TRANSITION FURTHER UNFOLDING, DELIVERING IM PORTANT PROOF POINTS ZFS COVERAGE OF PARTNER PROGRAM ITEMS # of items shipped with ZFS 25% of PP More than 25% of Partner Program items are now fulfilled by Zalando Fulfillment Solutions (ZFS) Partner Program customer proposition approaching wholesale: NPS now on par with wholesale NPS Strong push in internationalization: Share of Partner Program outside Germany above 40% Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 5
INTRODUCTION OF A M INIM UM ORDER VALUE AS FIRST STEP TOWARDS DE-AVER AGIN G THE CUSTOM ER EXPERIENCE MOV is an important element to de-average Positive impact on unit economics customer experience Introduction in Italy in November Move from a “one -size-fits- all“ offering • Profit to a differentiated customer experience Basket size contribution 1 Orders MOV allows us to continue to offer merchandise • -8% > +10% +6% customers are looking for at all price points Maintain leading convenience proposition with • lowest fee in market Before After MOV MOV Profit contribution per order before marketing costs 6 (1)
FINANCIAL UPDATE Q4/2018
AS PLATFORM TRANSITION UNFOLDS, GM V WILL BE KEY GROWTH M ETRIC GMV to revenue bridge Q4/18 Impact Comment • Net 1 B2C merchandise value incl. VAT GMV growth Q4/18 +25.7% • Only commission is booked as revenue Increasing Partner Program share - • Only in revenue: ZFS, ZMS, Plus, etc. B2B and other B2C revenue + • Point of order (GMV) vs. customer receipt (revenue) Revenue recognition +/- • IFRS standards Revenue growth Q4/18 +24.6% 8 After returns and cancellations, dynamically reported (1)
STRONG GROWTH FINISH TO THE YEAR FASHION STORE – DACH (Q4) REVENUE: GROUP (FY) GROUP (Q4) Fashion Store GMV: GMV: Offprice +21.1% +25.7% 764 Other 2 634 5,388 1 1,662 1 (in €m and %) 4,489 1 1,334 1 Q4/17 Q4/18 FASHION STORE – REST OF EUROPE (Q4) 4,968 1,539 4,151 1,231 776 596 498 150 345 110 443 131 345 88 FY/17 FY/18 Q4/17 Q4/18 Q4/17 Q4/18 FY18 (FY/17) contains - €522m ( - €352m) reconciliation of internal revenues. Q4/18 (Q4/17): - €160m ( - €95.6m) (1) 9 All other segments including private label offering zLabels and various emerging businesses (2)
STRONGEST ABSOLUTE GROWTH IN ACTIVE CUSTOM ERS SINCE Q2/13 ACTIVE CUSTOMERS AVERAGE ORDERS PER ACTIVE CUSTOMER 4.4 3.9 (in #m) (LTM in #) Placed 34m orders (+32%) Q4/17 Q4/18 26.4 AVERAGE BASKET SIZE AFTER RETURNS 1 23.1 60.6 57.2 (LTM in €) Q4/17 Q4/18 GMV PER ACTIVE CUSTOMER 2 (LTM in €) 251 237 Q4/17 Q4/18 Q4/17 Q4/18 Defined as GMV divided by the number of orders. (1) 10 Defined as GMV divided by the number of active customers (2)
STABLE Q4 EBIT AT 7% M ARGIN DESPITE INVESTM ENTS FASHION STORE – DACH (Q4) ADJ. EBIT: GROUP (FY) 1 GROUP (Q4) 1 Fashion Store 12.9% 9.3% Offprice 82 71 4.8% 3.2% 8.4% 7.1% Other (in €m 215 2 and %) 118 2 Q4/17 Q4/18 112 2 173 2 FASHION STORE – REST OF EUROPE (Q4) 214 162 111 122 6.6% 5.1% 40 40 35 28 11 2 - 4 -25 -26 -11 Q4/17 Q4/18 FY/17 FY/18 Q4/17 Q4/18 Excluding equity-settled share- based payment expense (“SBC”), restructuring costs and non -operating one- time effects of €54.2m in FY/18 (FY/17: €27.5m), (1) Q4/18: €15.1m (Q4/17: €10.3m) 11 FY/18 (FY17) contains €0.7m ( - €0.0m) reconciliation of internal adj. EBIT. Q4/18 (Q4/17): - €0.1m (€0.0m) (2)
HIGHER DISCOUNTING LEVEL, BUT LOWER PRESSURE ON FULFILLM ENT COSTS COSTS AND MARGINS 1 (in % of revenue) F Y Q 4 Delta 2017 2018 Delta 2017 2018 C O S T O F S A L E S (56.2%) (57.6%) 1.4pp (54.8%) (56.3%) 1.5pp Higher discounting, in line with market G R O S S P R O F I T 43.8% 42.4% (1.4pp) 45.2% 43.7% (1.5pp) Lower order split and F U L F I L L M E N T C O S T S (25.9%) (27.7%) 1.8pp (24.9%) (25.4%) 0.5pp return rate Marketing M A R K E T I N G C O S T S (7.9%) (7.2%) (0.7pp) (7.0%) (7.4%) 0.4pp investment as planned A D M I N I S T R A T I V E (5.3%) (4.4%) (0.9pp) (4.8%) (3.7%) (1.1pp) E X P E N S E S & O T H E R A D J . E B I T 4.8% 3.2% (1.6pp) 8.4% 7.1% (1.3pp) 12 Excluding equity-settled share- based payment expense (“SBC”), restructuring costs and non -operating one-time effects (1)
WORKING CAPIT AL AND CAPEX IN LINE WITH GUIDANCE CAPITAL EXPENDITURE 1 NET WORKING CAPITAL (END OF Q4) (in % of annualized revenue) Intangibles PP&E (in €m) (€62.4 m) (€84.3 m) 278 244 19% 109 22% 14% 68 12% -1.4 -1.6 Q4/17 Q4/18 FY/17 FY/18 Q4/17 Q4/18 13 Excluding payments for acquisitions of €7.1m in FY/18 (FY/17: €34.9m). Q4/18: €1.8m (Q4/17: €1.5m) (1)
OUTLOOK
IN 2018, WE M ADE STRONG PROGRESS WITH OUR PLATFORM TRANSITION WHILE CAPTURING IM PORTANT LEARNINGS ACHIEVEMENTS LEARNINGS >3bn site visits We are operating in a challenging environment Significantly increased scale >110m orders >26m active customers >10% PP GMV share Customer behavior and Partner Program Platform transition unfolding >25% ZFS share 1 with strong impact on basket economics >60% ZMS growth Added beauty We need to actively manage platform transition New growth opportunities Entered new markets Roll-out Zalando Plus 15 in % of partner program outbound items (1)
WE WILL CONTINUE ON OUR PLATFORM TRANSITION GMV GROWTH IN 20-25% RANGE; REVENUE GROWTH AT THE LOW END OF THE 20 – 25% RANGE ADJ. EBIT 1 : € 175 – 225M SLIGHTLY NEGATIVE WORKING CAPITAL + AROUND €300M CAPEX 2 Excluding equity-settled share- based payment expense (“SBC”) of ~€65m for FY/19E (1) 16 Excludes M&A transactions (2)
C O N T I N U E D S T R O N G L I Q U I D I T Y P O S I T I ON (in €m) (109) 7 1,015 (20) 995 234 897 Investing CF 2 Q3/18 Operating CF Other Q4/18 Short-term Cash & cash Liquidity 1 changes 3 Liquidity 1 investments equivalents Q4/18 Free cash flow: €125m Both Q3/18 and Q4/18 liquidity include investments into short-term deposits with maturity of more than 3 and less than 12 months of - €20m, respectively. (1) Includes investments in fixed and intangible assets and payments for acquisitions and change in restricted cash (+€1.0m) (2) 18 Includes financing cash flow (- €8.6m) and effect of exchange rate on cash and cash equivalents (+€1.6m). (3)
ISSUED SHARE CAPIT AL SHARE INFORMATION (AS OF DEC 31, 2018) Type of Shares Ordinary bearer shares with no-par value ( Stückaktien ) Stock Exchange Frankfurt Stock Exchange Market Segment Regulated Market ( Prime Standard ) Index Listings MDAX Total Number of Shares Outstanding 250,649,759 Issued Share Capital €250,649,759 STOCK OPTION PROGRAMS (AS OF DEC 31, 2018) EMPLOYEE INCENTIVE PLANS (AS OF DEC 31, 2018) Weighted average exercise Weighted average exercise Program # Options outstanding Program # Options outstanding price (EUR) price (EUR) SOP 2011 1 1,346,400 5.65 EIP 3,470,790 36.07 SOP 2013 1 9,445,771 15.37 VSOP 2017 870,000 42.24 SOP 2014 1 4,119,559 20.15 VSOP 2018 750,000 47.44 LTI 2018 5,250,000 47.44 Total 5,090,790 38.80 Total 20,161,730 24.05 19 Share settled. (1)
Recommend
More recommend
