DGAP-News: SHOP APOTHEKE EUROPE DELIVERED HIGH GROWTH AND BETTER MARGINS IN 2019, ENDING THE YEAR WITH A STRONG Q4.

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SHOP APOTHEKE EUROPE DELIVERED HIGH GROWTH AND BETTER MARGINS IN 2019, ENDING THE YEAR WITH A STRONG Q4.

Sales at EUR 701 million, up 30%, driven by organic growth. Adjusted EBITDA margin at -1.9% in 2019 (-2.2% in 2018), better than guidance (-2.0% to -2.3%). Strong improvement of Q4 adjusted EBITDA margin to -1.0%, up 2% vs. Q4 2018. Outlook for 2020: Grow sales by around 20% and achieve a breakeven adjusted EBITDA margin. SHOP APOTHEKE EUROPE on track to become an e-pharmacy platform with additional digital health services. Temporary surge in orders due to corona situation with high degree of uncertainty going forward.

Venlo/Cologne, 17 March 2020. SHOP APOTHEKE EUROPE N.V. reached its growth and bottom-line targets for 2019: Continental Europe's leading e-pharmacy increased its Group revenues from EUR 540 million in 2018 to EUR 701 million, a rise of 30% with strong organic growth as the main driver. The adjusted EBITDA margin of -1.9% was just above the previous year's level of -2.2%. In 2020 the focus will be on the company's further evolution into an e-pharmacy platform and the start of operations at the new logistics centre.

"We end the 2019 financial year with the positive feeling that we have once again achieved our growth and bottom-line targets and thus delivered against our guidance. Thanks in part to the transfer of all Europa Apotheek customers to shop-apotheke.com, we are well-positioned to disproportionately benefit from the prescription drugs business following the introduction of electronic prescriptions in our German core market," says Stefan Feltens, CEO of SHOP APOTHEKE EUROPE.

Growth in customer numbers and order volumes were once again important drivers for revenue development. The number of active customers across Europe climbed to 4.7 million in 2019, which means that SHOP APOTHEKE EUROPE gained a net of 1.2 million new active customers, an increase of 34%. The number of orders rose significantly in 2019 from 8.7 million to 12.2 million. A consistently high rate of over 81% of orders came from existing customers while the already minimal return rate was further reduced from 0.84% to 0.78%. With 133.9 million visits, the platform was visited significantly more often than in 2018 when it had 93.1 million visits. The average shopping basket size was EUR 66.85, slightly lower than the previous year's EUR 72.44. This is mainly due to the consolidation of subsidiary nu3, which has smaller shopping basket sizes.

Group-level sales increased by 30%, from EUR 540 million in 2018 to EUR 701 million in 2019. Rx sales increased by 12% to EUR 188 million in 2019.

SHOP APOTHEKE EUROPE's gross margin improved from 18.4% the previous year to 19.6% in FY 2019. This is due to a number of favorable factors including higher shares in the sales of OTC as well as beauty and personal care products, the consolidation of nu3 for the full year, and better purchasing conditions. In absolute terms, gross profit rose by 38.7% from
EUR 99.3 million the previous year to EUR 137.7 million in FY 2019. Adjusted EBITDA* improved from -2.2% in 2018 to -1.9% last year. Adjusted EBITDA in Q4 2019 reached -1.0% of sales, a 2% improvement versus Q4 2018.

The "DACH" region (Germany, Austria and Switzerland) generated revenues of EUR 615.4 million, which represents almost 88% of FY 2019 total revenues, and showed an increase of 25.3% (2018: EUR 491 million). Adjusted Segment EBITDA was EUR 13.4 million (2018: EUR 11.3 million).

Revenues for the "International" segment (Belgium, France, Italy, Spain and the Netherlands) rose by 76.1% to EUR 85.6 million (2018: EUR 48.7 million). Adjusted Segment EBITDA fell from EUR -4.5 million in 2018 to EUR -5.8 million in the reporting period. Relative to revenues, the adjusted Segment EBITDA margin improved from -9.2% to -6.8% in 2019. In the fourth quarter 2019, it was decided to exit the unprofitable Spanish operations.

SHOP APOTHEKE EUROPE will continue to steer a clear growth course in the coming years. The strategy is based on the introduction of electronic prescriptions, which should be a catalyst for strong growth in the Rx segment as well as on the company's development from an online retailer into a customer-centric and technology-driven e-pharmacy platform. This includes the establishment of a marketplace for selected partners and the integration of additional digital health services in order to offer SHOP APOTHEKE EUROPE's customers a wide range of health-related products and services.

Stephan Weber, co-founder and CCO of SHOP APOTHEKE EUROPE: "By developing SHOP APOTHEKE EUROPE into a customer-centric e-pharmacy platform we show once more that we are a pioneer in the online pharmacy market, always focusing on customers' needs. The new marketplace offerings will provide benefits to both our customers and to our external partners who will have access to our vast customer base and benefit from our easy-to-use technology platform."

In addition, the product portfolio will be selectively expanded. This includes the introduction of additional private label products in the pharmacy space as well as new products in the established portfolio of nu3, which offers innovative and healthy products (functional foods) for intelligent nutrition. Furthermore, same-day delivery will be expanded to further metropolitan areas.

The Management Board of SHOP APOTHEKE EUROPE forecasts organically driven growth of around 20% for 2020. Management also expects to achieve a breakeven adjusted EBITDA margin for the first time in 2020. Effects of the developing Coronavirus outbreak are not reflected in the guidance for 2020. Stefan Feltens, CEO of SHOP APOTHEKE EUROPE comments: "Safeguarding the health of our employees and serving the needs of our customers in the best way possible are our main focus in these challenging weeks. At this time, we are not experiencing any major supply chain or operational issues. This might change depending on the further development of the outbreak, which means we operate in an environment characterized by a high level of uncertainty."

* Segment EBITDA: defined as earnings before interest, taxes, depreciation and amortization.

** Special effects from stock option plans as well as one-off expenses related to the exit from the Spanish market and the new logistics centre.
 

SEGMENT INFORMATION - NON ADJUSTED AND ADJUSTED.

2019 DACH International Total     EUR 1,000 EUR 1,000 EUR 1,000   Revenue 615,424 85,587 701,010   Cost of sales - 499,112 - 64,217 - 563,329   Adjusted cost of sales - 499,112 - 63,997 - 563,109   Gross profit 116,311 21,370 137,682   Adjusted gross profit 116,311 21,590 137,902   % of revenue 18.9 % 25.2 % 19.7 %   Other income 647 89 736   Adjusted other income 64 89 153   Selling & distribution - 103,247 - 27,511 - 130,758   Adjusted S&D - 103,025 - 27,511 - 130,536   Segment EBITDA 13,711 - 6,052 7,659   Adjusted segment EBITDA 13,350 - 5,832 7,519   Administrative expenses     - 26,241   Adjusted AE     - 21,091   EBITDA     - 18,582   Adjusted EBITDA     - 13,572   Depreciation     - 14,864   Adjusted depreciation     - 14,607   EBIT     - 33,445   Adjusted EBIT     - 28,179   Net finance cost and income tax     - 2,824             Net loss     - 36,270   Adjusted net loss     - 31,003     2018 DACH International Total   EUR 1,000 EUR 1,000 EUR 1,000 Revenue 491,078 48,632 539,710 Cost of sales - 403,328 - 37,064 - 440,392 Gross profit 87,750 11,568 99,318 % of revenue 17.9 % 23.8 % 18.4 % Other income 156 40 196 Selling & distribution - 78,082 - 16,287 - 94,369 Adjusted S&D - 76,605 - 16,132 - 92,736 Segment EBITDA 9,825 - 4,680 5,145 Adjusted segment EBITDA 11,301 - 4,524 6,777 Administrative expenses     - 20,704 Adjusted AE     - 18,530 EBITDA     - 15,559 Adjusted EBITDA     - 11,753 Depreciation     - 13,171 EBIT     - 28,730 Adjusted EBIT     - 24,924 Net finance cost and income tax     - 4,879         Net loss     - 33,609 Adjusted net loss     - 29,803  

 

CONSOLIDATED STATEMENT OF PROFIT AND LOSS.

  Period ended
31. 12. 2019 Period ended
31. 12. 2018   EUR 1,000 EUR 1,000       Revenue 701,010 539,710 Cost of sales - 563,329 - 440,392 Gross profit 137,682 99,318       Other income 736 196 Selling and distribution - 143,392 - 105,564 Administrative expenses - 28,470 - 22,679 Operating result - 33,445 - 28,730       Finance income 1,333 24 Finance expenses - 10,171 - 5,983 Share of profit of associates and joint ventures 104 97 Result before tax - 42,180 - 34,591       Income tax 5,910 982 Result after tax - 36,270 - 33,609       Attributable to:     Owners of the company - 36,270 - 33,609  

ABOUT SHOP APOTHEKE EUROPE.

SHOP APOTHEKE EUROPE is one of the leading and the fastest-growing online pharmacies in Continental Europe. With the acquisition of Europa Apotheek Venlo in November 2017, SHOP APOTHEKE EUROPE significantly extended its European market leadership. The product range for the whole family in the OTC, beauty and personal care products as well as prescription drugs segments is supplemented by high quality natural food and health products, low carb products and sports nutrition following the acquisition of nu3 GmbH in July 2018.

SHOP APOTHEKE EUROPE already operates online pharmacies in Germany, Austria, France, Belgium, Italy, the Netherlands and Switzerland. SHOP APOTHEKE EUROPE delivers a broad range of more than 100,000 original products to over 4.7 million active customers fast and at attractive prices. In addition, SHOP APOTHEKE EUROPE provides comprehensive pharmaceutical consulting services.

SHOP APOTHEKE EUROPE N.V. has been listed on the regulated market of the Frankfurt Stock Exchange (Prime Standard) since 13 October 2016 and is part of the SDAX index since 24 September 2018.

In addition to being traded on the Frankfurt stock exchange, SHOP APOTHEKE EUROPE'S convertible bonds (ISIN: DE000A19Y072) are also tradeable on the Dutch Euronext stock exchange, which operates the stock exchanges in Paris, Amsterdam, Brussels and Lisbon.

PRESS CONTACTS.

Trade and popular media:
Sven Schirmer
Tel: +49 221 99 53 44 31
Email: presse@shop-apotheke.com

Financial media:
Bettina Fries
Tel: +49 211 75 80 779
Email: presse@shop-apotheke.com

Investor relations:
Carmen Herkenrath
Tel.: +31 77 850 6109
Email: carmen.herkenrath@shop-apotheke.com

Thomas Schnorrenberg
Tel.: +49 151 465 31317
Email: presse@shop-apotheke.com