Verkkokauppa.com - Challenging quarter
Verkkokauppa.com’s Q1 topline topped, but EBIT fell short of our expectations as well as consensus estimates. Volumes suffered from a weak demand stemming from lower consumer trust.
• Group result: Q1 revenue declined by 6.9% y/y to EUR 124.8m (EUR 120.1m/120.1m Evli/cons.) driven by the soft performance of the consumer segment. A challenging environment led the market to fierce price competition which can be seen in a drop in margins. Sales mix had also a negative impact on gross margin. Gross margin decreased from the comparison period to 15.4% (Q1’21: 16.2%). Lower gross margin, poor scalability through low volumes, and higher transportation costs had a negative impact on profitability, adj. EBIT totaling EUR 0.9m (EUR 2.1m/2.9m Evli/cons.), reflecting an adj. EBIT margin of 0.7%.
• Online sales represented 63% (Q1’21: 64%) of total sales while the main categories were 87.6% (Q1’21: 89.5%) of total sales.
• Consumer segment: Consumer segment suffered from a soft market environment mainly driven by consumer electronics, and the segment declined clearly from the comparison period. Consumer segment represented 68% of total sales (Q1’21: 72%). However, evolving categories saw a 10.2% y/y growth during Q1, driven by sports, kid’s supplies, bags & traveling, and toys.
• B2B segment: B2B performed well and grew by 12% y/y, representing 26% of total sales (Q1’21: 22%).
• Exports segment: end of Russia exports had a negative impact (-30.5% y/y) on exports that represented only 5% of total sales.
• FY’22 guidance (revised on March 23rd): net sales between EUR 530-590m and EBIT between EUR 12-19m.
• Online sales represented 63% (Q1’21: 64%) of total sales while the main categories were 87.6% (Q1’21: 89.5%) of total sales.
• Consumer segment: Consumer segment suffered from a soft market environment mainly driven by consumer electronics, and the segment declined clearly from the comparison period. Consumer segment represented 68% of total sales (Q1’21: 72%). However, evolving categories saw a 10.2% y/y growth during Q1, driven by sports, kid’s supplies, bags & traveling, and toys.
• B2B segment: B2B performed well and grew by 12% y/y, representing 26% of total sales (Q1’21: 22%).
• Exports segment: end of Russia exports had a negative impact (-30.5% y/y) on exports that represented only 5% of total sales.
• FY’22 guidance (revised on March 23rd): net sales between EUR 530-590m and EBIT between EUR 12-19m.