PRESS RELEASE

PRESS RELEASE
YOOX S.P.A. REPORTS 2014 FIRST QUARTER RESULTS TO 31 MARCH 2014
ANOTHER QUARTER OF SOUND GROWTH FOR THE GROUP
• Net revenues at Euro 126.5 million, +14.6% (+19.6% at constant exchange rates) compared with 110.4
million in the first quarter of 2013
• EBITDA at Euro 8.1 million, +33.9% compared with 6.0 million in the first quarter of 2013, with a 6.4% margin
up from 5.5% in 2013. EBITDA excluding Incentive plan costs at Euro 9.0 million compared with 8.0 million
of the first quarter of 2013, with margin at 7.1%
• Net Income at Euro 0.9 million, -13.4% compared with 1.1 million in the first quarter of 2013
• Net financial position positive at Euro 14.1 million, compared with 20.5 million at 31 December 2013
• 14.8 million average number of monthly unique visitors, compared with 13.5 million in the first quarter of
2013
• 842 thousand orders, compared with 680 thousand in the first quarter of 2013
• Euro 194 Average Order Value (Euro 201 at constant exchange rates), compared with Euro 211 in the first
quarter of 2013
• 1.1 million active customers, compared with 977 thousand at 31 March 2013
“In the first quarter of 2014, YOOX once again posted sound results, with growth of 20% in net revenues at constant
exchange rates and 34% in EBITDA. We continue investing in technological innovation with particular focus on the
mobile channel, which is growing steadily, month after month, reaching new historical highs,” commented Federico
Marchetti, Founder and CEO of the YOOX Group. “I am particularly pleased with Italy’s performance, which saw a
20% growth with a share of smartphone and tablet sales 19% higher than in the rest of the world, and with China,
where yoox.cn is showing a strong acceleration in revenue growth due to the recent extension of the range of brands
we offer our Chinese customers.”
“In line with our strategy to increasingly focus on the highest potential mono-brand agreements, I am proud to
announce the renewal of the global partnership with Dsquared2 and I look forward to sharing new ambitious
objectives with its formidable creative and management team for another five years.”
Milan, 7 May 2014 - The Board of Directors of YOOX S.p.A. (MTA, STAR: YOOX), the global Internet retailing partner
for leading fashion and design brands, which met today, examined and approved the consolidated interim financial
statements for the three months ended 31 March 2014.
Note: For clarity of information, the percentage changes reported in this press release have been calculated using exact figures. Any differences found in some of the
tables are due to the rounding of values expressed in millions of Euros.
1
THE GROUP’S PERFORMANCE IN THE FIRST QUARTER OF 2014
Key performance indicators
1
2
Monthly unique visitors (millions)
Orders (‘000)
3
AOV (Euro)
4
Active customers (‘000)
1Q 2014
1Q 2013
14.8
842
194
1,135
13.5
680
211
977
In the first quarter of 2014, the Group recorded a monthly average of 14.8 million unique visitors, which translated
into 842 thousand orders, an increase of 23.7% from 680 thousand in the same period of the previous year. The
Average Order Value (AOV) excluding VAT came in at Euro 194 (Euro 201 at constant exchange rates).
The number of active customers also increased to 1.1 million at 31 March 2014, up 16.2% from 977 thousand at 31
March 2013.
Consolidated net revenues
In the first quarter of 2014, YOOX Group posted consolidated net revenues, net of returns and customer discounts,
of Euro 126.5 million, up 14.6% (+19.6% at constant exchange rates) from Euro 110.4 million at 31 March 2013.
Consolidated net revenues by business line
€ million
Multi-brand
Mono-brand
Total YOOX Group
1Q 2014
%
1Q 2013
%
Change
% Change
91.1
72.0%
79.0
71.6%
12.1
+15.3%
35.4 28.0%
126.5 100.0%
31.4
110.4
28.4%
100.0%
4.0
16.1
+12.8%
+14.6%
Multi-brand
The Multi-brand business line, which includes yoox.com, thecorner.com and shoescribe.com, posted consolidated
net revenues of Euro 91.1 million, up 15.3% (+21.2% at constant exchange rates) compared with Euro 79.0 million
in the first quarter of 2013.
This performance reflects a strong growth in the number of orders and a lower AOV mainly due to the depreciation of
the main foreign currencies against the Euro.
Overall, at 31 March 2014, the Multi-brand business line accounted for 72.0% of the Group’s consolidated net
revenues.
Mono-brand
The Mono-brand business line includes the design, set-up and management of the online stores of some of the
leading global fashion and luxury brands.
This business line posted consolidated net revenues of Euro 35.4 million, up 12.8% (+15.8% at constant exchange
5
rates) from Euro 31.4 million at 31 March 2013, while gross merchandise value grew by 22.9% (+27.2% at
constant exchange rates).
1
Key performance indicators refer to yoox.com, thecorner.com, shoescribe.com and the other mono-brand online stores “Powered by YOOX Group”. Key performance
indicators related to the joint venture with Kering are excluded.
Monthly unique visitor is defined as a visitor who opened at least one browser session to visit the online store over the month. The figure reported is calculated as the
average of monthly unique visitors for the reporting period. Source: SiteCatalyst for yoox.com; Google Analytics for thecorner.com, shoescribe.com and the mono-brand
online stores "Powered by YOOX Group".
3
Average Order Value, or AOV, indicates the average value of all orders placed, excluding VAT.
4
Active customer is defined as a customer who placed at least one order during the 12 preceding months.
2
2
On 20 March 2014, the Missoni Home line was added to missoni.com in all the countries in which the online store is
active.
Overall, at 31 March 2014, the Mono-brand business line accounted for 28.0% of the Group’s consolidated net
revenues with 37 online stores.
Consolidated net revenues by geographical area
1Q 2014
%
1Q 2013
%
Change %
current FX
Change %
constant FX
Italy
20.0
15.8%
16.7
15.1%
+19.7%
+19.7%
Europe (excluding Italy)
62.2
49.2%
54.0
48.9%
+15.2%
+20.4%
North America
24.9
19.7%
22.9
20.8%
+8.5%
+12.5%
Japan
10.7
8.5%
9.7
8.8%
+10.3%
+27.5%
Other Countries
6.6
5.2%
5.3
4.8%
+24.0%
+27.1%
Not country related
2.2
1.7%
1.8
1.6%
+22.1%
+22.1%
126.5
100.0%
110.4
100.0%
+14.6%
+19.6%
€ million
Total YOOX Group
In the first quarter of 2014, the Group recorded growth in all of its key markets.
An excellent performance was recorded in Italy, up 19.7% compared with the first quarter of 2013, with turnover
amounting to Euro 20.0 million. This result was fuelled by the rising contribution to sales of smartphones and tablets
- 19% higher than in the rest of the world - and customers’ growing trust in the YOOX brand.
In order to fully capitalise on the mobile channel’s potential - particularly significant in the domestic market - the Group
is developing a new native application and a new mobile site for yoox.com, which will be launched globally before the
start of the 2014 Christmas Campaign.
The Rest of Europe saw a growth of 15.2% in comparison to the first quarter of 2013 despite the sharp depreciation
in the Ruble / Euro exchange rate (+20.4% at constant exchange rates). UK posted exceptional results, underpinning
the growing awareness of the Group in the country.
North America posted net revenues of Euro 24.9 million, up 8.5% (+12.5% at constant exchange rates). This
performance reflects both the smaller Mono-brand business perimeter and the greater contribution of the Fall/Winter
collection - marked by promotions in the first quarter of the year - due to the exceptionally cold weather that delayed
the start of Spring/Summer sales. This last effect, despite negatively impacting AOV in the quarter, favoured the
achievement of the best Fall/Winter collection sell-through in the last five years.
Japan also recorded a positive performance, with net revenues up by 10.3% at current exchange rates and by 27.5%
at constant exchange rates compared with the first three months of 2013.
The results recorded by Other countries were also outstanding, with growth of 24.0% at current exchange rates and
27.1% at constant exchange rates driven by China, growing strongly in the first quarter of 2014. This performance
benefitted from the introduction on yoox.cn of a new logistics set-up, complementary to that locally available, which
since mid-February 2014 allows Chinese customers to access not only the local offering available in the Shanghai
logistics centre, but also the global range of brands based in Italy. This enabled the Group to extend its offer in a
market experiencing sharp growth in online demand while at the same time limiting investments in local inventories.
5
Retail value of sales of all the mono-brand online stores, net of returns and customer discounts. Set-up, design and maintenance fees for the mono-brand online stores
accounted in “Not country related” are excluded.
3
EBITDA Pre Corporate Costs
In the first quarter of 2014, EBITDA Pre Corporate Costs came in at Euro 17.7 million, up 13.5% compared with
Euro 15.6 million at 31 March 2013. The EBITDA margin was 14.0%, broadly in line with the 14.1% of the first quarter
of 2013, despite the strong depreciation of the main foreign currencies which the Group operates in.
Multi-brand
€ million
EBITDA Pre Corporate Costs
% of business line net revenues
% change
Mono-brand
Group Total
1Q 2014
1Q 2013
1Q 2014
1Q 2013
1Q 2014
1Q 2013
10.9
12.0%
13.3%
9.6
12.2%
6.8
19.1%
13.8%
6.0
19.0%
17.7
14.0%
13.5%
15.6
14.1%
EBITDA Pre Corporate Costs in the Multi-brand business line came in at Euro 10.9 million up from Euro 9.6
million in the first quarter of 2013, with a margin of 12.0% substantially in line with 12.2% in 2013. This result is mainly
attributable to the operating leverage on fulfillment costs and the greater efficiency of sales and marketing
investments, which almost fully offset the unfavourable impact of exchange rates.
EBITDA Pre Corporate Costs in the Mono-brand business line stood at Euro 6.8 million, a rise of 13.8% on the
Euro 6.0 million in the first quarter of 2013, with a margin of 19.1% broadly in line with the 19.0% of the previous year.
This result is due to the improvement in the gross margin, which benefited from the positive contribution of the joint
venture with Kering, and the effectiveness of the dynamic and profit-driven management strategy of the mono-brand
portfolio.
EBITDA
In the first quarter of 2014, EBITDA stood at Euro 8.1 million, a 33.9% increase compared with Euro 6.0 million in
the same period of the previous year. The EBITDA margin, up to 6.4% from 5.5% in the first quarter of 2013, mainly
benefitted from a lower incidence of general & administrative expenses on net revenues which more than offset the
unfavourable exchange rate effect. EBITDA excluding Incentive Plan Costs amounted to Euro 9.0 million, with a
margin on net revenues of 7.1%.
Net Income
Consolidated net income came in at Euro 0.9 million in the first quarter of 2014, compared with Euro 1.1 million in
the same period of the previous year. This result was primarily affected by higher depreciation and amortisation
related to investments in technological innovation and higher financial charges relating to unrealised exchange rate
losses and interest expenses.
Taking out non-cash costs relating to existing incentive plans and the related tax effect, Net income Excluding
Incentive Plan Costs came in at Euro 1.6 million.
Net working capital
In the first quarter of 2014, net working capital came in at Euro 33.8 million, compared with Euro 28.3 million at 31
December 2013. This performance reflects a greater reduction in non-trade payables (mainly related to taxes) than
the decrease in trade working capital which contributed Euro 2.9 million to the generation of operating cash flow.
Net working capital as a percentage of revenues improved: 7.2% in the first quarter of 2014 in comparison to 7.8% in
the same period of 2013, the best result ever achieved in the first quarter of the year.
4
Investments
In the first three months of 2014, the Group continued to invest in the innovation and consolidation of its global
techno-logistics platform: capital expenditure amounted to Euro 9.4 million compared with Euro 9.5 million in the
first quarter of 2013, with a percentage of net revenues at 7.4%, down from 8.6% in the same period of the
previous year.
In mid-February 2014, the Group introduced on yoox.cn a new logistics set-up, complementary to that already
locally available, which allows Chinese customers to access not only the local offering available in the Shanghai
logistics centre, but also the global range of brands based in Italy. This enabled the Group to extend its offer in a
market experiencing sharp growth in online demand while at the same time limiting investments in local inventories.
Investment in technological innovation continued, particularly for the mobile channel, which is growing steadily,
month after month, reaching new historical highs. A new native application for iOS and Android operating systems
and a new mobile site for yoox.com are being developed and will be released globally before the start of the 2014
Christmas Campaign. In the first months of 2014, new mobile sites were also launched for some of the Group’s
mono-brand online stores.
In addition, in March 2014, the Hong Kong dollar was introduced to the Group’s platform, bringing to seven the
number of currencies available to make payments.
In order to maximise the customer retention rate and increase purchase frequency, new technological solutions are
being implemented on yoox.com in order to strengthen its CRM potential.
Finally, a new management system for search engine marketing campaigns was adopted for yoox.com and a few of
the Group’s other online stores, with the aim of introducing higher process automation and reducing the acquisition
costs for new customers thanks to a more effective allocation of the marketing budget.
Net financial position
At 31 March 2014, the Group’s net financial position was positive at Euro 14.1 million, compared with Euro 20.5
million at 31 December 2013. This cash absorption is largely attributable to capital expenditure of Euro 9.4 million,
mainly for technological innovation.
SIGNIFICANT EVENTS AFTER 31 MARCH 2014
Mono-brand online stores
On 6 May 2014, ahead of the original expiry date, Dsquared2 S.p.A. and YOOX S.p.A. renewed the partnership
agreement to manage the dsquared2.com online store “Powered by YOOX” in Europe, the US, Japan and China
for a further 5 years, until 30 April 2019.
The Brunello Cucinelli and Balenciaga online stores were extended to the Chinese market in the months of April
and May 2014, respectively.
INCENTIVE PLANS
Exercise of stock options
In the first quarter of 2014, a total of 465,660 ordinary shares were issued following the exercise of a total of 8,955
options relating to existing Stock Option Plans.
After 31 March 2014, a total of 34,424 ordinary shares were issued following the exercise of 662 options relating to
existing Stock Option Plans. As a result of the above, the new share capital issued by YOOX S.p.A. at today’s date is
6
equal to Euro 587,074.80 divided into 58,707,480 ordinary shares with no indication of nominal value.
6
In the process of being registered in the Business Register.
5
2009 - 2014 Incentive Plan
In the first quarter of 2014, 4,829 treasury shares relating to the 2009 - 2014 Incentive Plan were allocated. As a
result of the above, the number of treasury shares held at today’s date is 51,935.
BUSINESS OUTLOOK
In light of the proven effectiveness of the YOOX business model worldwide and the positive outlook for the online
retail market, it is reasonable to expect that the YOOX Group will continue to see growth in sales and profits in 2014.
All of the Group’s key markets and both business lines are expected to positively contribute to this growth.
Investments in innovation and consolidation of YOOX’s global techno-logistics platform will continue: in particular, the
Group plans to further strengthen its mobile offer and release cross-channel features that will enhance its proposition
to mono-brand partners, allowing them to provide their customers with a fully integrated and seamless experience
between their physical stores and the virtual ones “Powered by YOOX”.
Lastly, internal initiatives to improve efficiency and ensure tight cost control will continue.
***
Pursuant to Article 154-bis, paragraph 2 of the Italian Consolidated Law on Finance, Francesco Guidotti, the Director
responsible for preparing the financial statements, certifies that the accounting information contained in this press
release corresponds to documentary records and to accounting books and ledger entries.
***
6
CONFERENCE CALL
A conference call will take place today, Wednesday 7 May 2014, at 18:00 (CET), during which the YOOX Group’s
management will present the 2014 first-quarter results. If you wish to take part in the conference call, please call one
of the following numbers:
•
•
•
•
from Italy: +39 02 805 88 11
from the UK: +44 121 281 8003
from the US (toll-free number): 1 855 265 6959
from the US (local number): +1 718 705 8794
The presentation may be downloaded before the start of the conference call from the Investor Relations section of the
YOOX Group website at http://www.yooxgroup.com/en/investor_relation/press_releases/presentations_2014.asp.
A recording of the conference call will be available from Wednesday 7 May 2014, after the call, until Wednesday 21
May 2014 on the following numbers:
•
•
•
from Italy: +39 02 724 95
from the UK: +44 121 281 8005
from the US (local number): +1 718 705 8797
Access code: 815#
YOOX Group - Media and Investor Relations contacts
Image Building
Simona Raffaelli, Emanuela Borromeo
T +39 02 89011300
[email protected]
Silvia Scagnelli
Investor Relations & Financial Communications Director
T +39 02 83112811
[email protected]
YOOX Group
YOOX Group is the global Internet retailing partner for leading fashion & design brands. It has established itself amongst the
market leaders with the multi-brand online stores yoox.com, thecorner.com and shoescribe.com, as well as with numerous monobrand online stores, all of which are "Powered by YOOX Group." The Group is also a partner of Kering, with which it has created a
joint venture dedicated to the management of the mono-brand online stores of several of the Kering Group's luxury brands. The
Group has offices and operations in Europe, the United States, Japan, China and Hong Kong and delivers to more than 100
countries worldwide. Listed on the Milan stock exchange, the Group posted consolidated net revenues of Euro 456 million in 2013.
For further information: www.yooxgroup.com.
7
ANNEX 1 - YOOX GROUP RECLASSIFIED CONSOLIDATED INCOME STATEMENT
1Q 2014
€ million
1Q 2013
Variazione
Consolidated net revenues
126.5
110.4
14.6%
Cost of goods sold
(84.1)
(73.1)
15.0%
42.4
37.3
13.9%
Gross Profit 7
% of consolidated net revenues
33.5%
33.7%
Fulfillment costs
(11.1)
(10.0)
11.6%
Sales and marketing costs
(13.6)
(11.7)
16.2%
EBITDA Pre Corporate Costs 8
17.7
15.6
13.5%
% of consolidated net revenues
14.0%
14.1%
General & administrative expenses
(9.1)
(9.1)
-0.3%
Other income and expenses
(0.5)
(0.5)
17.2%
33.9%
EBITDA 9
8.1
6.0
% of consolidated net revenues
6.4%
5.5%
Depreciation and amortisation
(5.7)
(4.2)
-
-
-
2.4
1.9
26.6%
% of consolidated net revenues
1.9%
1.7%
Income/Loss from investment in associates
(0.2)
(0.3)
-19.0%
-73.7%
Non-recurring items
Operating profit
Financial income
37.2%
0.2
0.8
(0.9)
(0.7)
19.8%
1.5
1.7
-11.5%
% of consolidated net revenues
1.2%
1.5%
Taxes
(0.5)
(0.6)
-8.0%
0.9
1.1
-13.4%
0.7%
1.0%
Financial expenses
Profit before tax
Consolidated net income
% of consolidated net revenues
EBITDA Excluding Incentive Plan Costs 10
9.0
8.0
12.1%
% of consolidated net revenues
Net Income Excluding Incentive Plan Costs 11
7.1%
1.6
7.3%
2.6
-37.5%
% of consolidated net revenues
1.3%
2.3%
7
Gross profit is earnings before fulfillment costs, sales and marketing costs, general and administrative expenses, other operating income and expenses, depreciation
and amortisation, non-recurring expenses, income/loss from investment in associates, financial income and expenses and income taxes. Since gross profit is not
recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be standard, and the measurement
criterion adopted by the Group might not be consistent with that adopted by other groups. Accordingly, the resulting figures may not be comparable.
8
EBITDA Pre Corporate Costs (or Operating Profit by business line) is defined as earnings before general and administrative expenses, other income and expenses,
depreciation and amortisation, non-recurring expenses, income/loss from investment in associates, financial income and expenses and income taxes. Since EBITDA
Pre Corporate Costs is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be
standard, and the measurement criterion adopted by the Group might not be consistent with that used by other groups. Accordingly, the resulting figures may not be
comparable. EBITDA Pre Corporate Costs corresponds to the operating profit by business line reported in the Group's consolidated interim financial statements.
9
EBITDA is earnings before depreciation and amortisation, non-recurring expenses, income/loss from investment in associates, financial income and expenses and
income taxes. Since EBITDA is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be
standard. Group management uses EBITDA to monitor and measure the Group’s performance. The management believes that EBITDA is an important indicator of
operating performance in that it is not affected by the various criteria used to calculate taxes, the amount and characteristics of invested capital and the related
amortisation and depreciation methods. The criterion used by the Group to calculate EBITDA might not be consistent with that adopted by other groups. Accordingly, the
resulting figures may not be comparable between groups.
10
EBITDA Excluding Incentive Plan Costs is defined as EBITDA before the costs associated with Stock Option Plans and Company Incentive Plans, as described in the
Group's interim consolidated financial statements.
11
Net income Excluding Incentive Plans Costs is defined as the consolidated Net income of the period before the non-cash costs associated with Stock Option Plans
and Company Incentive Plans and their related tax effects.
8
ANNEX 2 - YOOX GROUP RECLASSIFIED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
€ million
Net working capital
12
Non-current assets
Non-current liabilities (excluding financial liabilities)
Net invested capital
13
Shareholders' equity
Net debt / (net financial position)
14
Total sources of financing
31 March 2014
31December 2013
Variazione %
33.8
28.3
19.4%
75.3
71.2
5.7%
(0.3)
(0.4)
-19.6%
108.8
99.2
9.7%
122.9
119.7
2.7%
(14.1)
(20.5)
-31.3%
108.8
99.2
9.7%
ANNEX 3 - YOOX GROUP RECLASSIFIED CONSOLIDATED STATEMENT OF CASH FLOWS
31 March 2014
31 March 2013
Variazione %
Cash flow from (used in) operating activities
1.6
8.8
-81.5%
Cash flow from (used in) investing activities
(10.6)
(11.0)
-3.6%
Sub-Total
(9.0)
(2.2)
>100%
Cash flow from (used in) financing activities
(5.1)
(3.0)
72.1%
(14.1)
(5.2)
>100%
€ million
Total Cash Flow for the period
12
Net working capital is current assets, net of current liabilities, with the exception of cash and cash equivalents, bank loans and borrowings and other financial
payables falling due within one year and financial assets and liabilities included under other current assets and liabilities. Net working capital is not recognised as an
accounting measure under Italian GAAP or the IFRS endorsed by the European Union. The measurement criterion adopted by the Company might not be consistent
with that adopted by other groups. Accordingly, the balance obtained by the Company may not be comparable with the figures obtained by other groups.
13
Net invested capital is the sum of net working capital, non-current assets and non-current liabilities net of non-current financial liabilities. Net invested capital is not
recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union. The measurement criterion adopted by the Company might not
be consistent with that adopted by other groups. Accordingly, the balance obtained by the Company may not be comparable with the figures obtained by other groups.
14
Net debt (or net financial position) is the sum of cash and cash equivalents, other current financial assets, net of bank loans and borrowings and other financial
payables falling due within one year, other current financial liabilities and non-current financial liabilities. Net debt (or net financial position) is not recognised as an
accounting measure under Italian GAAP or the IFRS endorsed by the European Union. The measurement criterion adopted by the Company might not be consistent
with that adopted by other groups. Accordingly, the balance obtained by the Company may not be comparable with the figures obtained by other groups. Other current
financial assets are not governed in detail in CESR's definition of net debt (or net financial position): the Group considers it appropriate to supplement this definition by
including receivables from acquirers and logistics operators that have been requested to collect cash on delivery under “other current financial assets”.
9

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