Cettire Limited

Good morning, everyone, and thanks for joining today's first half FY26 results call for Cetire. My name is Sam Wells from NWR, and I'm pleased to have with me from the company today Cetire's founder and Chief Executive Officer, Dean Mintz, as well as Chief Financial Officer, Tim Hume. Both Dean and Tim will spend some time reviewing the ASX results released this morning, including some notable financial and operational highlights. Following their comments, we will have some time for questions at the end of the call. The audience can submit written questions via the Q&A function at the bottom of your Zoom screen, and time permitting, we'll endeavour to get to all questions. We'll aim to have this call wrapped up within 30 minutes, including Q&A. Thank you, and over to you, Dean.

Thanks, Sam. Good morning, everyone, and thank you for joining Ty's interim results briefing for the 2026 financial year. Before we begin, I'd like to remind you of the disclaimer statement in our results presentation. That disclaimer also applies to this investor call. I'm joined today by our CFO, Tim Hume, and together we'll take you through the company's results for the six-month period ending 31 December 2025. Today's results are the outcome of our relentless focus on profitable growth with a clear bias towards profit in what remains a tough luxury market. Gross revenue was $505.7 million and sales revenue was $382.8 million. Both were broadly stable year-on-year. Importantly, excluding the US, sales revenue grew 13% year-on-year to $225 million, which is a testament to our ability to grow our market share in newer markets. We had 613,000 active customers during the period, reflecting a deliberate reduction in paid marketing, combined with softer U.S. demand. Repeat customers continued to represent a growing share of gross revenues, now at 69%. Our bias towards profitability saw an adjusted EBITDA of $8.7 million and a half-on-half improvement of $20.5 million. This result clearly demonstrates the benefit of our agile and flexible business model. Our AOB increased 17% year-on-year to $961, reflecting the continued loyalty of our customers and the path through of our higher U.S. duties in our pricing. We closed the period with $61.4 million in cash and zero financial debt. Against the backdrop of significant headwinds, our team executed exceptionally well. Our steadfast strategy to prioritise profitability, maintain cash and strengthen customer loyalty continued into H1 FY26. This was executed in an environment where demand for luxury goods remained soft. The global personal luxury goods market declined approximately 2% in calendar year 2025 as a result of falling consumer demand globally, ongoing macroeconomic uncertainty and significant changes in US trade policies. In the US specifically, the elimination of the de minimis duty exemption from late August 25 resulted in price increases that further impacted US demand. To address these challenges, we focused on growing market share outside of the US. This resulted in sales revenue ex-US growing by 13%. We also deliberately reduced paid marketing investment and turned our efforts towards enhancing engagement with our existing customers. This drove further growth in gross sales from repeat customers. On the supply side, engagement with brands and inventory holders has never been stronger. We exited H1 FY26 with record available inventory levels, further strengthening our customer value proposition and minimizing supplier concentration. Localization remains a core strategic priority. Our efforts in the half delivered an uplift in sales from emerging markets representing 45% of gross revenue, up from 37% the same time last year. And from a balance sheet perspective, our Capital Light model continued to deliver resilience with closing cash at $61.4 million and no financial debt. Turning to slide six. We finished the six-month period with 613,000 active customers. New customer ads slowed, reflecting softer demand and a decision to lower marketing spend. We prioritize our investment towards quality engagement and conversion over volume. Our average order value increased to $961 with repeat customers spending $1,050 per order on average compared to $811 for new customers. This increase largely reflects the incorporation of higher duties in our pricing. Repeat customers now account for 69% of gross revenues, up from 67%. This trend of increasing loyalty reflects the ongoing attractiveness of our business model to consumers. This loyalty is a key enabler as it helps sustain the business through cycles and underpins the long-term profitable growth. This chart once again reflects the benefits of having a strong cohort of loyal customers and our ability to increase our share of wallet over the long term. Our unit economics over the period strengthened, with both customer acquisition costs and delivered margin improving compared to the preceding six months. Customer acquisition costs declined to $83, reflecting a reduction in paid marketing investment, While this comes at a cost to new customer ads, we believe it is prudent to manage marketing spend in line with achieving a reasonable return on investment. Delivered margin per active customer was $179, delivering a sequential improvement versus H2 FY25 at $148. This reflects our deliberate reduction in promotional activity to prioritize profit. Our localisation strategy continued to diversify our revenue base during the period, with emerging markets' gross revenue increased by 21% year-on-year. These strategic markets now represent around 45% of Satay's gross revenue. Established markets, including the US, UK and Australia, contracted 13%, primarily driven by the challenges impacting the US. The US now represents approximately 41% of gross revenues, with Australia at 6% and UK at 8%. We continue to focus on increasing market share in existing and new markets by focusing on enhancing our capabilities and driving localised initiatives. During the period, we launched our Arabic language capability to capitalise on the momentum we are seeing in the Middle East. We have also successfully launched the Thais flagship store on the JD platform in China and will continue to explore additional routes to market in that region. Our supply chain with hundreds of suppliers continue to grow strongly over the past six months. Engagement levels remain very high as inventory holders and luxury brands seek new routes to market in the challenging demand environment. Pleasingly, we exited the half with record levels of inventory and grew our published stock products by 60% year-on-year. To support our strategy, we continue to invest in our commercial team to support our increased levels of pipeline opportunities that includes luxury brands and third-party inventory holders. I'll now hand over to Timothy.

Thanks, Dean, and good morning, everybody. Sales revenue was $382.8 million, down 3% on the prior year. This reflects the impact of US tariff changes and softer demand in the region. Excluding the US, sales revenue grew by 13% to $225 million, Gross revenue was $505.7 million, while refund rates remained relatively stable. Delivered margin at 14% of sales was impacted by higher US duties costs being absorbed into our fulfillment cost base. This was partially offset by a decrease in overall promotional activity. The duties impact was more fulsome in the second quarter due to the end of the de minimis exemption in the US from September onwards. Importantly, however, delivered margin percent improved compared with the second half of fiscal year 25. Paid acquisition expenses were 4.2% of sales revenue and brand investment was modest at $1.9 million. This reflected our deliberate strategy to prioritise profitability. Adjusted EBITDA was $8.7 million, delivering an EBITDA margin of 2.3%. Pleasingly, our focus on driving profit delivered a half-on-half adjusted EBITDA turnaround of $20.5 million. Moving on to the balance sheet. Closing cash was $61 million, and we continue to have zero financial debt. The increase in cash since June was supported by operating profits combined with favourable working capital dynamics. The year-on-year increase in contract liabilities is reflective of lengthier delivery times that we saw in the period leading up to the end balance date. This has resulted in a deferral of revenue recognition until the subsequent period. We continue to invest in our technology platform to develop capability and reinforce our competitive advantage. This resulted in capitalised investments as a proportion of sales revenue being 2.2%. The other key call-out relates to the receivables. As a reminder, we have receivables relating to credits for VAT paid on purchases in Europe. To be more specific, these are statutory receivables that are due and payable. They could be paid at any time. However, we're subject to the timeline of the government to pay out these amounts. The government has been slow to pay and out of caution, we have conservatively reclassed an additional portion of this receivable to non-current. Short-term challenges in luxury are expected to persist, albeit there are some signs of improvement. Importantly, the long-term fundamentals of the sector remain robust. The most recent study on luxury by Bain Altagamma estimates the personal luxury goods market for the 25 calendar year declined by 2%. They cited macroeconomic headwinds, trade disruption, shifting customer preferences and a deteriorating value proposition as the reasons for the slowdown. On the positive side, the research is forecasting 3-5% growth in the 2026 calendar year. Moving now to the outlook, in the short term there continues to be uncertainty within the global luxury personal goods market, with performance varying significantly across geographies. In the current quarter, Satire is cycling a period of aggressive promotional activity and some pull forward of US demand that occurred ahead of the Liberation Day tariffs being implemented in early April 2025. Promotional activity peaked in March 2025, whereas in the current year, Sataya has meaningfully reduced its level and frequency of promotion. In light of the above, the Q3 comparator from last year has made the current quarter a lot more challenging from a growth perspective. And it's against this backdrop that our quarter-to-day gross revenues have decreased by 13% versus the prior corresponding period. The US policy and macroeconomic environment remain dynamic and will continue to influence our sales activity in that market. However, the company expects to achieve a significantly improved growth profile in the fourth quarter of fiscal year 26. I will now hand you back to Dane to conclude.