Secoo Holding Limited

Welcome to SECO's Q1 2025 results presentation and business update. Before I hand over to your host today, please be advised there will be an opportunity to ask questions at the end of the presentation. In order to do so, please use the raise hand function on your screen or for those signing in, hit star nine on your keypad. I now have pleasure handing over to Clarence Nahan, SECO's head of investor relations. Please go ahead, Clarence, the floor to you.

Thank you very much. Good morning to you all, and thank you very much for joining us on our quarterly call. During this presentation with our CEO Max Mari and our CFO Lorenzo Mazzini, we will discuss the financial performance for the first three months of this year. We will also provide you with a detailed update on our business and the trends we anticipate going forward. So the key message we want to pass on today is that we are now in a position to confirm a clear rebound in our business. In fact, both our revenues and our gross profit margin for the quarter came above the guidance we had provided to the market back in March. And most of our P&L KPIs continue to put us in the very top decile of our sector. CLIA continued to progress, now contributing 13% of our revenues. And our EBITDA also showed a strong rebound quarter on quarter, now back above the 20% margin. We also want to take this opportunity to address some of the questions we received from investors during our latest roadshows. On US tariffs first. As you know, the US is still a relatively small part of our business at around 14% during the first quarter. We have already confirmed with most of our largest clients in the area that we will pass through any tariff impact onto them, which they have agreed to and demonstrate our strong pricing power. We actually expect this region to grow in 2025 and can confirm that our budget is already mostly covered by contracted orders. On the outlook as well, where for the moment there is no change to our stance, we want to define it as cautiously positive. All our KPI confirm a positive trend and we are back to delivering quarterly performance in line with our historical levels, confirmed by the guidance we provided this morning to investors of 50 million euros in revenues for the next quarter. With this, I will leave the floor to Lorenzo to take us through our financial results in greater detail.

Thank you, Clarence, and good morning to all. Let me provide you with the key highlights of our Q1-25 financial KPIs. Starting with our net sales, we closed the quarter in line with Q1-24. But more importantly, we recorded a 7% growth versus the fourth quarter of last year. This growth was true across almost all geographies and verticals. Software revenues also increased respect to Q4, now contributing 13% of our total sales. As per the gross profit margin, a strong performance in the quarter has put us far above the 50% guidance. This is in part due to the growing contribution of software sales. Another important KPI is the rebound in adjusted EBITDA margin at 20%. Paolo Davide Farah- driven by our operating leverage effect with OPEX actually stable respect to Q4 24 and Q1 24. Finally, please note that our adjusted net income, as usual, is a less relevant metric as at this time of the year, taxes are calculated with theoretical tax rates and interest incomes do not include gains over derivatives on the financing facilities due to the hedge accounting. Moving on to our revenue breakdown, I would like to point out two important items. First, our software sales are now reaching a 13% contribution in Q1 2025, the highest level since our launch of the software business. Second, thanks to the recovery in demand following the end of the stocking, we enjoyed a double digit growth in almost all the countries versus the same period of last year. This is true with only one exception, that is Germany, where we still see a delay in the recovery of demand. Now let's pass commenting our adjusted eBTDA performance. Our profitability margin is back at 20%. The gap with respect to Q1-24 is explained only by the difference in gross profit margin. This demonstrates that the 37 million of revenues we book in Q1 created an inflection point in our EBITDA margin. And therefore, going forward, the more we increase our sales, the more profitability we can generate thanks to our operating leverage. On adjustments to EBTDA, these quotes are almost all represented by the stock option actuarial value. Finally, touching upon our net financial position, it continues to be fully under control with the leverage below two times EBTDA. The increase in the quarter respect to 2024 year end can be primarily explained by the increase in trade receivable due to many factors. One of these is a reduction in the use of non-recourse factoring. An important point that I would like to point out in the closing of this quarter is the level of net working capital. In one year, we were able to reduce net working capital by 20 million. Thank you very much for your attention and I pass through the speech to Max again.