Westwing continued to grow in Q2 2024 while delivering on its 3-step plan to unlock the Company’s full value potential

Westwing continued to grow in Q2 2024 while delivering on its 3-step plan to unlock the Company’s full value potential

 

• In Q2 2024, GMV grew by 5% and revenue by 4% year-over-year.
• Adjusted EBITDA amounted to EUR 4 million at 3.7% adjusted EBITDA margin (-0.7pp year-over-year) with improved contribution margin and continued investments into brand awareness.
• The Westwing Collection share increased by 7 percentage points year-over-year to 53% of Group GMV in Q2 2024.
• Westwing made good progress on its 3-step plan to unlock the Company's full value potential and announced further measures to reduce complexity and strengthen its premium brand positioning.
• Westwing confirms the financial guidance for 2024 with revenue of EUR 415 million to EUR 445 million at -3% to +4% year-over-year growth and an adjusted EBITDA of EUR 14 million to EUR 24 million (+3% to +5% adjusted EBITDA margin).

 

Munich, 8 August 2024 // Westwing Group SE (“Westwing” or “the Company”), Europe‘s #1 in Beautiful Living e-commerce, announces its results for the second quarter of 2024.

Westwing continued to grow in a challenging market, with Q2 2024 Gross Merchandise Volume (GMV) up 5% and revenue up 4% year-over-year. Revenue amounted to EUR 106 million. Growth was driven by a significant increase in average spend per order of 11% year-over-year to EUR 198 in Q2 2024 (Q2 2023: EUR 178) as well as a 2% growth in active customers compared to the previous year’s second quarter.

With regards to profitability, Westwing reported EUR 4 million adjusted EBITDA in Q2 2024 (Q2 2023: EUR 4 million), corresponding to an adjusted EBITDA margin of 3.7% (Q2 2023: 4.4%). The result was driven by continued expansion of the high margin Westwing Collection, efficiency gains in fulfilment, and sustained investments into brand awareness. The strategically important Westwing Collection reached an all-time high of 53% share of overall Group GMV in Q2 2024, an increase of 7 percentage points compared to previous year’s second quarter. The benefits thereof were partially offset by pressure on 3rd party market prices and higher container costs. Overall, the contribution margin increased by 2 percentage points year-over-year to 31%. 

Westwing’s net working capital increased by EUR 8 million quarter-over-quarter driven by payment-related timing effects from Q1 and seasonal inventory increase but remained negative at EUR -11 million at the end of the quarter. Q2 2024 free cash flow amounted to EUR -7 million and net cash stood at EUR 72 million at the end of the quarter (end of Q2 2023: EUR 69 million).

Westwing is making good progress on its 3-step plan to unlock the Company’s full value potential. The focus continues to lie on complexity reduction, premium brand positioning, OneWestwing commercial model, and Westwing Collection share increase.

• The migration from a proprietary technology ecosystem to a mostly Software-as-a-Service (SaaS) based platform reached important milestones. The new platform was successfully launched in Portugal and the Netherlands. The former also marked the first market expansion for Westwing since 2014. The platform comes with a new, more premium web design, tailor-made for design lovers.

• Equally serving the goals of complexity reduction, premium brand positioning and OneWestwing commercial model, the switch to a mostly global product assortment and the related reorganisations are making good progress. Both were completed for Italy and Spain in the second quarter and will now be rolled out to Central and Eastern Europe. On top, premiumisation of the product assortment will accelerate on a global level, with products phasing out that are less premium and less profitable. While topline impact will be negative, the measures will reduce costs and strengthen the positioning of the Company. The expected overall topline impact remains in line with the previously communicated range of a low to mid single-digit percentage of 2024 full year Group revenue, with the main impact in the second half of the year.

Westwing also continues to make progress on sustainability. In the second quarter of 2024, the Company increased the share of Westwing Collection products featuring a WE CARE label to 60% and grew the share of EU Westwing Collection suppliers that have been evaluated on social aspects to 82%. Westwing continues to work towards achieving its carbon reduction targets, which were validated by the Science Based Targets initiative (SBTi).

Dr Andreas Hoerning, CEO of Westwing, commented: "I am very proud of the progress we are making on our 3-step plan to unlock Westwing’s full value potential. Not only did we complete the centralisation of our Italian and Spanish businesses, but we also expanded to Portugal as our first new country in 10 years. It is also the first country to run on our predominantly SaaS-based technology platform that comes with a new, gorgeous web design. This brings us another step closer to becoming Europe’s leading premium one-stop destination in Home & Living."

 

Outlook 2024

Despite a successful first half of 2024 with 5% GMV growth, the outlook for the rest of the year remains cautious. Besides low consumer spending, management expects negative topline impact from the announced complexity reduction and premiumisation measures in the second half of 2024. Westwing confirms its guidance for the full year 2024 as published in March 2024. Revenue is expected to be between EUR 415 million and EUR 445 million with a year-over-year growth rate of -3% to +4%. Adjusted EBITDA is expected to be between EUR 14 million and EUR 24 million at an adjusted EBITDA margin in the range of +3% to +5%.

 

Webcast and Conference Call
Westwing's Q2 2024 earnings call will be broadcasted via live stream on 8 August 2024, starting at 10:00 AM (CEST) on the Company's investor relations website https://ir.westwing.com. The recording of the live stream will be available on the same site.

 

For more information, please visit the Westwing Investor Relations website: https://ir.westwing.com

 

Key performance indicators H1 2024 H1 2023 Change Q2 2024 Q2 2023 Change Westwing Collection share (in %) 52% 46% +6pp 53% 46% +7pp GMV (in EUR m) 239 227 +5% 114 109 +5% Number of orders (in k) 1,254 1,308 -4% 578 614 -6% Average basket size (in EUR) 191 173 +10% 198 178 +11% Active customers LTM (in k) 1,282 1,252 +2% 1,282 1,252 +2% Average orders per active customer LTM 2.2 2.3 -5% 2.2 2.3 -5% Average GMV per active customer LTM (in EUR) 385 376 +2% 385 376 +2% Mobile visit share (in %) 81% 79% +2pp 81% 78% +3pp

 

About Westwing

Westwing, Europe’s #1 in Beautiful Living e-commerce, is now present in 12 European countries and has achieved a GMV (Gross Merchandise Volume) of EUR 481 million in 2023. As Europe’s premium one-stop destination for Design Lovers we offer a unique brand experience with a carefully curated assortment of our Westwing Collection and 3rd party design brands. The integrated platform combines Shop, Club-Sales, (offline) Stores, the B2B Service (Westwing Business) and our Westwing Design Service. Our team consists of more than 1,700 professionals working together on our shared purpose to “Excite people to create homes that unlock the full beauty of life”. Founded in 2011, Westwing is headquartered in Munich and went public on the Frankfurt Stock Exchange in October 2018.

 

Disclaimer

Certain statements in this communication may constitute forward-looking statements. These statements are based on assumptions that are believed to be reasonable at the time they are made, and are subject to significant risks and uncertainties. You should not rely on these forward-looking statements as predictions of future events and we undertake no obligation to update or revise these statements. Our actual results may differ materially and adversely from any forward-looking statements discussed in these statements due to a number of factors. These include, without limitation, risks from macroeconomic developments, external fraud, inefficient processes at fulfilment centres, inaccurate personnel and capacity forecasts for fulfilment centres, hazardous materials/production conditions with regard to private labels, insufficient innovation capabilities, inadequate data security, insufficient market knowledge, strike risks and changes in competition levels.

 

Contact
Westwing Group SE
Investor Relations
E-Mail: ir@westwing.de