14.08.2018
Delticom AG DE0005146807
DGAP-News: Delticom AG: Delticom publishes Semi-Annual Report 2018
DGAP-News: Delticom AG / Key word(s): Half Year Results
Delticom AG: Delticom publishes Semi-Annual Report 2018
14.08.2018 / 20:18
The issuer is solely responsible for the content of this announcement.
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Delticom publishes Semi-Annual Report 2018
Hanover, 14 August 2018 - Delticom (German Securities Code (WKN) 514680,
ISIN DE0005146807, stock market symbol DEX), Europe's leading online
retailer of tyres and automotive accessories as well as efood specialist and
expert in the field of efficient warehouse logistics, has published its
report for the first half year of 2018. In the first six months of the
current financial year, the company recognized revenues of EUR 291 million,
a decrease of 2.2 % (H1 17: EUR 297 million). EBITDA came in at EUR 6.8
million (H1 17: EUR 5 million, +37 %). EBIT increased in the reporting
period by 138 % to EUR 3.2 million (H1 17: EUR 1.3 million).
Business in the first six months
Market environment. The domestic tyre trade was unable to benefit from
rising sales figures in the first half of the year. Continuing cold
temperatures in the first three months of the current year had caused many
drivers to delay the conversion of the vehicle to summer tyres. Accordingly,
the summer tyre business only started this year after the Easter holidays at
the beginning of April. Despite the catch-up effect in the second quarter,
market experts forecast a 5.4 % decline in sales of summer tyres for the
first half of 2018. According to estimates by the German Rubber Industry
Association (WdK) and the manufacturers' association ETRMA, a total of 2.4 %
fewer replacement car tyres were sold to consumers in the first half of the
year.
Revenues. In H1 18 the Group recognized revenues of EUR 291 million, a
decrease of 2.2 % after EUR 297 million in the prior-year period. During the
first quarter of the current fiscal year, Delticom generated revenues of EUR
111 million (Q1 17: EUR 127 million, -12.6 %). The first three months of the
current year were marked by winterly weather conditions in Germany. Only
after the Easter holidays at the beginning of April did the summer tyre
business gain momentum in many places. In the corresponding quarter of the
previous year, mild temperatures from mid-March had ushered in the
changeover season at an early stage. In Q2 18, the Group generated sales of
EUR 180 million, an increase of 5.5 % (Q2 17: EUR 170 million). This meant
that we were unable to fully make up for the decline in sales in the first
quarter. In the second quarter, the company managed sales in its core
business in line with its profitability targets. Due to the delayed start to
the season, the summer tyre business was stronger in June than in the same
month of the previous year. Some of the orders received at the end of June
were delivered in July and therefore sales were only realized at the
beginning of H2 18.
Customers. The following customer numbers are the customer numbers in our
core business - the online trade with tyres and car spare parts in Europe.
During the first six months of 2018, a total of 506 thousand existing
customers (H1 17: 538 thousand, -5.9 %) made repeated purchases of tyres and
spare parts in one of the Delticom Group's online shops. The decline in the
number of repeat buyers was mainly attributable to our core business - the
replacement tyre business with private end customers. In our estimation,
this development is based on the one hand on the strong business development
in H1 17 and the associated base effect. On the other hand, the trend
towards all-season tyres also has a short-term effect on repurchase rates.
Anyone who has bought all-season tyres will not need new tyres within the
next 2-4 years, depending on their individual driving behaviour. However, we
believe that the increasing demand for all-season tyres will shorten the
replacement cycle so that we can welcome customers back in one of our online
shops more quickly.
In H1 18 the company was able to acquire a total of 601 thousand new
customers (H1 17: 599 thousand, +0.4 %) via our tyre and car parts shops in
Europe. Since the company was founded, almost 13 million customers have made
purchases in our online shops. In half-year terms, the number of active
buyers (new customers and repeat customers - the latter are counted only
once, regardless of the number of purchases made in H1 18 is 2.6 % below the
same period last year and with that similar to sales.
Gross margin. The cost of goods sold (COGS) is the largest expense item; it
considers the purchase price of sold products (mainly tyres). Group COGS
decreased by 3.1 % from EUR 235 million in H1 17 to EUR 228 million in H1
18. The gross margin decreased in the reporting period from 21.7 % in H1 17
to 21 %. In the first six months of the current year the company structured
the prices in its online shops in line with its profitability targets.
Personnel expenses. In the reporting period, Delticom employed an average of
185 staff members (H1 17: 156). Personnel expenses amounted to EUR 6.1
million (H1 17: EUR 5.2 million, +15.8 %). Broadening our business
activities has resulted in further new hirings over the past 12 months in
order to drive forward the pace of development in individual areas.
Other operating expenses. Other operating expenses amounted to EUR 64
million
(H1 17: EUR 64.2 million, -0,2 %). Among the other operating expenses,
transportation costs is the largest line item. Transportation costs
decreased from EUR 28.1 million by 11.8 % to EUR 24.8 million. In addition
to the correction made in H1 18 of too high transportation costs for the
previous years 2016 and 2017, the year-on-year decline in transport costs is
partly due to the decline in unit sales and a higher share of drop-ship
business in revenues. In addition, the country mix in sales and the
year-on-year increase in business with commercial customers, in which
deliveries are partly bundled or shipped on pallets, contributed to a
decline in transportation costs. Due to the delayed start to the summer
season, business in June was stronger than in the same month of the previous
year. For orders received in June with delivery in July, the transport costs
have shifted accordingly into the service month and thus into H2 18.
Marketing. Marketing expenses in H1 18 amounted to EUR 13.1 million, after
EUR 12 million the previous year (+9.2 %). In addition to the pure online
shops, the company now also increasingly sells its products via online
marketplaces in Germany and abroad. In addition, the company spent more on
advertising in the reporting period in order to draw greater attention to
its online shops in a difficult market environment. H1 18 marketing spent
with 4.5 % of revenues was higher than last year's 4 %.
EBITDA. Earnings before interest, taxes, depreciation and amortization
(EBITDA) for the reporting period came in at EUR 6.8 million (H1 17: EUR 5
million, +37 %). This equates to an EBITDA margin of 2.3 % (H1 17: 1.7 %).
Depreciation. Depreciation remained with EUR 3.6 million nearly unchanged
compared to the previous year (H1 17: EUR 3.6 million, -0.5 %).
EBIT. Earnings before interest and taxes (EBIT) increased in the reporting
period by 138 % to EUR 3.2 million (H1 17: EUR 1.3 million). This translates
into an EBIT margin of 1.1 % (EBIT in percent of revenues, H1 17: 0.5 %).
Income taxes. In the first six months the expenditure for income taxes
totalled EUR 1 million (H1 17: EUR 0.4 million). This equates to a tax rate
of 32.5 % (H1 17: 31.7 %).
Net income. Consolidated net income in the first half of the year totalled
EUR 2 million after EUR 0.8 million in H1 17. This corresponds to earnings
per share (EPS) of EUR 0.16 (H1 17: EUR 0.06).
Inventories. Among the current assets, inventories is the biggest line item.
Since the beginning of the year their value grew by EUR 14 million or 17.5 %
to EUR 93.8 million (31.12.2017: EUR 79.8 million). Inventories on the
reporting date were EUR 3.2 million higher compared to the previous year's
balance sheet date (30.06.2017: EUR 90.6 million). This is partly due to the
delayed start of the season and the associated decline in sales in H1 18. On
the other hand, the company started winter stockpiling earlier than last
year.
Receivables. Trade receivables usually follow the seasons, but reporting
date effects are often unavoidable. At the end of the second quarter,
receivables amounted to EUR 43 million (31.12.2017: EUR 39.3 million,
30.06.2017: EUR 45.2 million).
Payables. The accounts payable decreased in the reporting period from an
opening balance of EUR 114.4 million by EUR 26.3 million to EUR 88.1
million. By closing date comparison trade payables were EUR 19.3 million
lower (30.06.2017: EUR 107.3 million). In a difficult market environment,
Delticom redeemed trade payables due for payment at the end of the first
half of the year before the balance sheet date.
Liquidity. Liquidity as of 30.06.2018 totalled EUR 4 million (31.12.2017:
EUR 3.9 million, 30.06.2017: EUR 3 million).
In the reporting period, Delticom used existing credit lines for the
intra-year financing of the working capital. On 30.06.2018, the company's
net cash position (liquidity less liabilities from current accounts)
amounted to EUR -51.6 million (31.12.2017: EUR -4.4 million, 30.06.2017: EUR
-29.3 million). This significant change compared with year-end 2017 as well
as H1 17 is exclusively based on the reporting date effect as described
within the cash flow from ordinary business activities. In July and August,
the use of credit lines was almost at the previous year's level. We expect
short-term debt at the end of the year to be similarly low as in fiscal year
2017.
Cash flow. Due to the significant reduction in trade payables and the
associated development in working capital, cash flow from operating
activities for H1 18 amounted to EUR -41.3 million (H1 17: EUR -12.4
million). While last year the company paid the majority of the trade
payables as of the reporting date 30.06.2017 in the first week of July, this
year the existing credit lines were used in view of the current market
situation to settle the liabilities before the balance sheet date. The
company pursues active liquidity management and accepts intrayearly
corresponding reporting date effects like in H1 18 for strategic reasons.
In the reporting period Delticom invested EUR 2.2 million into property,
plant and equipment (H1 17: EUR 1.8 million). On the one hand, this concerns
investments into warehouse equipment. On the other hand, the company
acquired a plot of land including buildings for a purchase price of EUR 1
million in order to build a production facility for ultra-modern logistics
machinery. Further EUR 1 million were invested in intangible assets (H1 17:
EUR 1.2 million).
In the reporting period, Delticom recorded a cash flow from financing
activities amounting to EUR 44.6 million, thereof the dividend payout for
the last financial year of EUR 1.2 million and the repayment of long-term
loans of EUR 0.8 million. The cash outflow was offset by inflows from
financial liabilities of EUR 46.7 million which are mainly of short-term
nature.
Outlook.
Despite a late start to the season, Delticom succeeded in increasing Group
profitability in the first six months of the current year in a difficult
market environment compared to the same period last year. For the second
half of the year, we plan to further fine-tune the balance between sales
growth and profitability and to drive forward the market establishment of
our start-ups in the corporate portfolio.
Today, more than 4 billion people worldwide are already using the Internet.
In addition to increasing user numbers, the time people stay online is also
increasing. The average Internet user now spends about six hours a day with
Internet-enabled devices and services.
As Europe's leading online retailer of tyres and automotive accessories as
well as efood specialist and expert in the field of efficient warehousing
logistics, Delticom will benefit from the growing E-Commerce trend in the
coming months. We expect a positive sales trend in the second half of the
year. This year, too, the winter business in the fourth quarter will be
decisive for the business development in the 2018 fiscal year as a whole.
Due to the investments made into the warehouse infrastructure and the
expansion of our storage capacity, we are well equipped for the upcoming
winter season.
We continue to expect the Delticom Group's revenues to increase to EUR 690
million in the current fiscal year. For the Group, we continue to plan
EBITDA for the full year at around EUR 14 million.
Note to these half-year financial statements 2018
The Annual General Meeting of 8 May 2018 appointed KPMG AG
Wirtschaftsprüfungsgesellschaft, Prinzenstraße 23, 30159 Hanover, Germany,
as auditor of the annual financial statements and consolidated financial
statements for the 2018 financial year and as auditor for a review of the
condensed financial statements and interim management report for the first
half of 2018. In the previous years, PricewaterhouseCoopers GmbH was
appointed for this purpose. At the time of publication of this report for
the first half of 2018, two topics had not yet been finally clarified:
Deferred tax assets and transport costs for the financial years 2016 to
2018. Further explanations can be found in the section Significant events
after the reporting date on page 12f. of the Semi-Annual Report 2018.
The report for the first six months 2018 stands ready for download within
the "Investor Relations" section of the website www.delti.com.
Company profile:
Delticom AG is an E-Commerce company operating primarily in Europe and the
USA. It specialises in the design and operation of online shops,
Internet-based customer acquisition, internet marketing, developing partner
networks and complex, highly efficient product picking and distribution
logistics.
Delticom AG is the leading online distributor of tyres and automotive
accessories. Our product range also includes the online second-hand vehicle
trade and efood. Delticom has extensive experience in creating shops for the
international market and in trans-national E-Commerce. In addition to
design, Delticom also provides product descriptions and a comprehensive
customer service programme in your national language. Establishing efficient
warehousing and logistics processes is utilised not only in selling tyres,
used vehicles and online grocery shopping, but is also offered to third
parties as an additional service.
Since its establishment in Hanover, Germany in 1999, the company has accrued
exceptional expertise in designing efficient, fully integrated internal
ordering and logistics processes. The company owns its own warehouses,
including a fully automated small item warehouse.
In 2017, Delticom AG generated sales in excess of EUR 667.7 million. The
E-Commerce specialist operates in 74 countries with over 460 online shops
and online distribution platforms, serving over 12.8 million customers. The
range of tyres offered to retail and commercial customers includes over 100
brands and more than 25,000 models of sedans, motorbikes, trucks, utility
vehicles, buses and complete wheel sets. Customers are also able to have the
ordered products sent to one of the around 42,000 service partners of
Delticom AG around the world.
Our range also encompasses over 500,000 automotive parts and accessories,
including motor oils, snow chains and batteries. Entry into the business of
online used car selling has rounded off the automotive offering. In this
sense, Delticom AG has developed from a classic online retailer to an online
solutions provider. Delticom AG also now offers a comprehensive range of
around 20,000 different food items.
The shares of Delticom AG have been listed in the Prime Standard of the
German Stock Exchange since October 2006 (ISIN DE0005146807).
On the Internet at: www.delti.com
Contact:
Delticom AG Investor Relations
Melanie Gereke
Brühlstraße 11
30169 Hannover
Tel.: +49 (0)511-936 34-8903
Fax: +49 (0)89-208081147
e-mail: [email protected]
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14.08.2018 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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Language: English
Company: Delticom AG
Brühlstraße 11
30169 Hannover
Germany
Phone: +49 (0)511 93634 8000
Fax: +49 (0)511 33611 655
E-mail: [email protected]
Internet: www.delti.com
ISIN: DE0005146807
WKN: 514680
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated
Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover,
Munich, Stuttgart, Tradegate Exchange
End of News DGAP News Service
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714341 14.08.2018
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