Interim report – 9M 2022/23

Company announcement no. 13 2022/23
Allerød, 8 February 2023

Interim report – 9M 2022/23

(1 April – 31 December 2022)

Profitability improved and free cash flow doubled

• Driven by a record high number of customers, Matas generated a total revenue of DKK 1,396 million in Q3 2022/23 corresponding to a year-on-year increase of 1.3% from DKK 1,378 million in Q3 2021/22. Underlying sales grew 1.2% in the quarter.

• Gross margin was 44.5% in the quarter which is in line with the long-term trend.
• EBITDA before special items came to DKK 296 million in Q3 2022/23 compared to DKK 284 million last year, and the EBITDA margin before special items was 21.2% in the quarter against 20.6% last year.
• Profit for the period amounted to DKK 147 million after tax which is in line with Q3 2021/22.
• Customer satisfaction maintained the high level reached in Q2 with a Net Promotor Score of 75 on matas.dk and 73 in stores.
• Matas.dk strengthened its position as the second most frequently used web shop across all retail categories according to the Danish Chamber of Commerce’s E-commerce Analysis for 2022.
• On 31 January 2023, Matas launched its web shops matas.no and matas.se.
• A tender for Matas Logistics Center was sent out on 1 February 2023.
• Matas maintains its guidance for the financial year 2022/23, but now expects to reach the upper end of the guided range for EBITDA margin before special items between 17% and 18%.

Gregers Wedell-Wedellsborg, CEO of Matas A/S:

“The Christmas season was bright and shining in Matas. We served a record number ofcustomers, maintained our high customer satisfaction, and finished the quarter with 16% growth in online sales. The numbers confirm our growth strategy even in achallenging retail environment.

Profitability improved, despite rising facility costs, as a result of growth from our housebrands and our pick-in-store initiative, which ensures delivery to customerswithin one hour and lowers fulfilment costs.On the back of good Q3 results, we expect to reach the upper end of our guided EBITDA margin before special items for the financial year 2022/23.

To gain foothold in international markets, we have now opened our award-winningweb shop in Sweden and Norway. Thereby, we give access to our unique beautyand wellbeing assortment to both Swedish and Norwegian consumers, 20% of whom alreadyknow Matas from visits and holidays in Denmark.”

Key figures and ratios

	2022/23 Q3	2021/22 Q3	2022/23 9M	2021/22 9M
Key figures (DKKm)
Revenue	1,396.2	1,378.4	3,438.9	3,373.6
Gross profit	620.9	613.7	1,529.9	1,497.7
EBITDA before special items	295.9	283.5	647.4	634.8
Profit for the period after tax	147.3	146.7	263.1	237.2
Free cash flow	382.4	186.1	541.2	266.8
Ratios
Revenue growth	1.3%	5.0%	1.9%	5.7%
Underlying like-for-like revenue growth	1.2%	2.8%	1.8%	3.4%
Gross margin	44.5%	44.5%	44.5%	44.4%
EBITDA margin before special items	21.2%	20.6%	18.8%	18.8%
Net interest-bearing debt/ EBITDA before special items			1.5	2.1

Q32022/23 highlights

• Matas generated a total revenue of DKK 1,396 million in Q3 2022/23 corresponding to a year-on-year increase of 1.3% from DKK 1,378 million in Q3 2021/22 (1.2% revenue increase announced in the trading update). Underlying sales increased by 1.2%.
• Online sales grew by 15.5% and physical stores reported sales down by 3.4% compared to Q3 last year.
• Footfall was strong, and the number of transactions increased by 2.3% to 6.8 million, while the average basket size fell by 0.8% to DKK 203 per transaction.
• Gross profit for Q3 2022/23 amounted to DKK 621 million, up from DKK 614 million in Q3 2021/22. The gross margin was 44.5%, up from 43.0% in Q3 2021/22, when adjusting for the DKK 20 million from the Club Matas VAT case last year.
• Other external costs amounted to DKK 105 million in Q3 2022/23, up from DKK 98 million in Q3 2021/22. The increase in other external costs by DKK 7 million was primarily driven by an increase in facility and freight costs compared to Q3 2021/22.
• EBITDA before special items came to DKK 296 million resulting in an EBITDA margin before special items of 21.2%.
• The total amortization, depreciation and impairment charges were down by DKK 13 million to DKK 95 million in Q3 2022/23.
• Profit for the period amounted to DKK 147 million after tax which is in line with Q3 2021/22.
• Free cash flow was an inflow of DKK 382 million, compared with an inflow of DKK 186 million the year before.
  
  

9M 2022/23 highlights

• Retail revenue was up by 2.0% to DKK 3,365 million. Mass Beauty grew by 4.9%, Health and Wellbeing grew 2.7% while High-End Beauty was in line with last year.
• Total revenue was up by 1.9% in 9M 2022/23 driven by online growth of 9.3%, while wholesale sales grew 1.1% and physical stores declined by 0.5%.
• Footfall was strong, and the number of transactions increased by 4.3% to 17.7 million, while the average basket size fell by 2.2% to DKK 191 per transaction.
• Gross profit for 9M 2022/23 amounted to DKK 1,530 million compared to DKK 1,498 million in 9M 2021/22. The gross margin was 44.5%, up from 43.8%, when adjusting for special items.
• Other external costs amounted to DKK 269 million in 9M 2022/23, up from DKK 236 million in 9M 2021/22. The higher other external costs were driven by a DKK 12 million increase in energy costs and costs attributable to the online growth in 9M 2022/23.
• EBITDA before special items amounted to DKK 647 million in 9M 2022/23 compared to DKK 635 million in 9M 2021/22. The EBITDA margin before special items was 18.8% which is in line with last year.
• Cash generated from operations was an inflow of DKK 757 million in 9M 2022/23 against an inflow of DKK 537 million in 9M 2021/22.
• Free cash flow was an inflow of DKK 541 million, compared with an inflow of DKK 267 million in 9M 2021/22.

Video conference
Matas will host a video conference for investors and analysts on Wednesday, 8 February at 10:00 a.m. CET. The video conference and the presentation can be accessed from Matas’ investor website: https://investor.matas.dk.

Video conference access numbers for investors and analysts:

DK: +45 78 76 84 90

UK: +44 203 769 6819

US: +1 646 787 0157

PIN for all countries: 915912

Link to webcast: https://streams.eventcdn.net/matas/q3-interimreport/

Contacts
Gregers Wedell-Wedellsborg
CEO, phone +45 48 16 55 55

Per Johannesen Madsen
CFO, phone +45 48 16 55 55

Klaus Fridorf
Head of Communication, phone +45 61 20 19 97

Frederikke Linde
Head of Investor Relations, phone +45 60 62 60 87

Forward-looking statements
This interim report contains statements relating to the future, including statements regarding Matas Group’s future operating results, financial position, cash flows, business strategy and future targets. Such statements are based on Management’s reasonable expectations and forecasts at the time of release of this report. Forward-looking statements are subject to risks and uncertainties and a number of other factors, many of which are beyond Matas Group’s control. This may have the effect that actual results may differ significantly from the expectations expressed in the report. Without being exhaustive, such factors include general economic and commercial factors, including market and competitive conditions, supplier issues and financial and regulatory issues as well as any effects of healthcare measures that are not specifically mentioned above.

Attachment

• Matas_Q3_2022-23_UK_FINAL

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