Redcare Phamacy Unsp/Adr

Good morning to everybody joining today's call. I'm very happy that I can present the quarter one numbers of shopper particular Europe to you this morning. And I'm here today together with Monica Ambrosi from Investor Relations. I quickly wrap the moment here. I will keep it short. Phamacy Unsp & Adr Phamacy Unsp & Adr We achieved a 22% total sales growth. It's the post-corona period. We are showing that we have been growing double digit pre-corona during Corona and after Corona. And this quarter one was in total 22% higher than last year. So our company grew by one fifth in total size. And we did so with an adjusted EBITDA margin, which was significantly up. And certainly in the next slides, I will explain to you more about that development. To start with the first bullet, double digit growth, pre-Corona, during Corona, after Corona, in our two segments and even in all our seven countries. Non-RX and RX were both almost growing at the same pace. Double digit total 22 as I said already and non-RX 23%. The total performance was driven by a continuous growth of our active customer base, that means keeping our existing customers loyal, increasing their frequency and at the same time also welcoming a significant amount of new customers. Our total base of customers that are active, so placed a purchase over the past 12 months, increased in just one quarter, this quarter one, from 9.3 to end at 9.7. And we had, again, a quarter with a very high customer satisfaction score. We carefully tracked this on a daily base, and again, total shop uptake was at the net promoter score north of 70. Second bullet, peculiar for this quarter, Efficiency gains significantly compared to the same quarter last year, and also compared to the last recent quarter, quarter 4 last year. The adjusted EBITDA margin this year was a positive 2.4%, which is 380 basis points up from the same quarter last year. As a result, our operating cash flow was a positive 44 million, and please don't do that times 4, of in total 37 million, and for example last year Q1 the working capital inflow in Q1 was also 30 million. But as we will see later, this operating cash flow also included an EBITDA of 9 million, so an EBITDA cash-in of around 7 to 8 million. And while achieving more customers, happy customers and significantly improved financial results. Bullet number four, we are also really happy with some external increased acknowledgement we are getting for our sustainability efforts. Later more on that, but to keep it short for now, it's always flattering if an external renowned institution, in this case MSCI, is increasing our rating, our ESG rating from a double A to a triple A. That's the highest possible score according to MSCI and it brings us in the global benchmark in the top four. There are a couple of things we can mention which we also achieved in quarter one. I'll point out one and that was our intention to start a strategic partnership with Galenica and to create together a leading online pharmacy in Switzerland. Also more on that later. On this slide, the sales. As I said already, total growth 22, non-ORX 23, so both well north of 20%, achieving a total of 372 million of sales. The DAG segment increased by 23%. Our international business consisting of the Netherlands, Belgium, France, and Italy increased by 19%, and that was still 13%

Thank you Jasper. So let's take a look at our customer key performance indicators for the quarter, which either improved or remained at very strong levels in quarter one. Starting with the active customer base, as Jasper already mentioned, we had an increase of 0.4 million in the active customer base from quarter four to quarter one. which was an increase of 1.4 million over the prior year's quarter. So we now boast 9.7 million active customers. And this was an increase seen across all of our markets. This several hundred thousand increase in active customers every quarter has been a feature over the past four quarters, a consistent increase. And this continuous increase in active customers wouldn't be possible if our customers were not happy and returning customers, which is why we really focus very much on delivering strong, excellent service. And we see this again from a very high net promoter score over the first quarter of 71. So happy customers. And then finally, we can just take a look at the average shop and basket value for the first quarter of the year. We also saw a slight increase compared to last year from around at 57 euro to around at 58 euro in this quarter. So we've been talking about customer satisfaction. It certainly builds customer loyalty. And as a result of this, the strong sales growth that we reported was very much driven by a high rate of returning customers, which in the first quarter was at a high 84% among the highest it has been in the past. So these are not new customers, these are returning customers. Then if we speak about our number of orders, we can see that the strong momentum which started in 2022 continued in the first quarter of the year, where our logistics facility very efficiently and seamlessly processed over 7 million orders in the first quarter of the year. And again, if we look back over the last four years, every first quarter we have seen an increase in orders of around 1 million. So this is a very strong underlying increase. What makes the performance even more solid, as Jasper has already mentioned about corona, This is not demand as a consequence of corona. This is demand after corona. And even with a bit of seasonality, it reflects a strong structural increase. Over to you.

Yeah, happy to. So thank you, Monica. Very clear to me. And here are then the key financials in the P&L, in the customary formats in the table. So let's start with column two and three, quarter one last year and this year. So our sales increased from 305 to 372, an increase of 67%. 1.1% up. The gross profit margin, and later a bit more on that, increased by 1.1 percentage points. And he's selling at distribution, so all our expenses as a percentage of sales increased by even double that amount, by 2.5 percentage points, reflective of scale and efficiency. At the same time, our administrative expenses also were stable at 2.9% of sales compared to 3.8 percentage points. In euros, from minus 4 to plus 9 is an increase of 13 million. And just for reference sake, also the fully loaded EBITDA, which was also a positive 5 million in the most recent quarter. The columns to the right that you're seeing here Though it is an apple and an orange, because at Shop Apotheke, as with most retailers, there is seasonality in the quarters. But still, quarter four, where we also achieved for the second quarter in a row a positive adjusted EBITDA. If you compare those numbers, you see at the top that our sales were significantly higher from 328, as Monica just explained, to a new record of more than 7 million orders. Our gross profit margin, quarter over quarter, was roughly comparable, slightly down 0.1%. But you see that actually half of the year-over-year increase that we achieved in efficiency and skill Phamacy Unsp & Adr The gross profit, an increase year-over-year, and to the right of this slide, roughly comparable to the past quarter. The year-over-year improvement of the gross profit margin is mainly in the first bucket, which is the product margin that we're having. And the product margin is really reflective of all the optimizations we continuously try to do in having the most relevant assortment, new assortment, showing the customers the assortment Phamacy Unsp & Adr Marketing was a big driver of the, if you compare it mathematically, year-over-year improvement of the selling distribution as a percentage of sales. But also the operating labour was something that made us really happy as Total Shop Apothecary. Let me start at the start. So in total a significant better S&D as a percentage of sales. But please keep in mind that quarter one 2022, so a year ago, was still a relatively marketing heavy quarter to us. We were still recovering from some low points we had in 2021 in Q3 and Q4. So also in Q1 last year, that was still the case. But you're really seeing that last year, Q3, Q4, this year Q1, we internally say the machine is running. Our model is working and we have significantly more effective marketing across all our countries, all our seven countries. Phamacy Unsp & Adr At a very high quality level, we are delivering our goods faster to our customers. At the same time, of course, we have also had wage inflation also in the operations, but still seeing the overall efficiency gains that we have been able to achieve here in this facility, the total operational labor costs were significantly better than last year, 0.6%. Again, repeating not only a year-over-year improvement, And with that we go to the cash. And we increased our cash balances by in total 32 million over the past quarter. So we increased from 180 to 212 million. The first two blocks is to Some 7 million from the, let's say, EBITDA, our operating results, very favourable largely from seasonality movements in our working capital, and then our investments and financing expenses in total leading to the end-bands. And then before we go to the second part of our presentation, also in the financial results, I would like to re-emphasise what I said by the MSCI rating in ESG. So a couple of comments here. First of all, October last year, 2022, we were three years ahead of plan, able to reduce our scope one and scope two CO2 emissions by more than 80%. So three years ahead of our planning. And it was not a reduction by 80%, but actually by 88%. And at the same time, a bit later, we as a company committed ourselves to the very important reduction in scope 3 by 2040 to try to be net zero there. But ESG is not the same as only a judgment whether we are a sustainable company. ESG in the definition of MSCI actually also focuses on how well is the company prepared for any risk related to the three areas of ESG. And the total of that led to an increase of last year already from Phamacy Unsp & Adr As much as we have always been about the opportunity, the huge opportunity, the once in a lifetime opportunity of ERX in Germany. There's a great market opportunity there and we think we are very well prepared. A lot has happened the past years. We are totally ready. Many players in the ecosystem are ready. We are receiving e-scripts every day. from the government that things would be mandatory as of the 1st of January 2022. But there is new momentum in it. It's clear, for example, also in the conference of April 25 that the German Minister of Health, Mr Lauterbach, expressed that it is really on his agenda to also adopt the laws to make it possible to have really ERX as the standard in 2024. Still, that needs to be published. So on timelines, I cannot give you any more concreteness than you had before this meeting. I can only tell you what we see from our perspective. So we see the number of e-scripts last time we talked to you, there was on March when we released the full year numbers, it was 1.3 million. That increased to 1.7 million electronic prescriptions redeemed in total Germany. The average is around 7,500 to 8,000 per day, some fluctuations there. and we still expect as shop apotheker that it is very likely that there will be a lot more concreteness perhaps including even what we are anticipating a significant increase in the last half or at the start of 2024. We as shop apotheker are ready and I think our customers are also ready for a future in Germany with e-prescriptions. Now to something completely different that is We announced our strategic partnership where we would combine Phamacy Unsp & Adr Phamacy Unsp for Pharmacy in Switzerland. In the base, you can see that Kalenica is very strong with the Mediservice daughter in what is named in jargon specialty pharmacy. Kalenica is saying we are very strong in, let's say, being an e-commerce pharmacy and combining those two will lead to better products, better services, and according to us, best B2C proposition We are awaiting the regular competitive authorities approval. That timeline is unchanged compared to what we announced on March 30. We still expect the transaction to be able to be closed before the end of the first half of the year. On the next one, please some characteristics on the transaction. So what is basically happening in one transaction is that it may and at the same time Shop Apotheke is achieving in this Mediservice a 51% share and Galenica a 49% share. And it's of course clear that the current Mediservice business with annual sales of around 450 million euros is significantly larger than our current Swiss business. increase of our share capital. In addition to the 6%, Galenica indicated to us their wish to actually also reflect their strategic commitment to shop apotheke even more and wanted to acquire an additional 2% shares in shop apotheke, resulting in the end situation of having an 8% share in shop apotheke post transaction. And we, of course, were very happy with this commitment that was expressed by Galenica. All waiting for the approval, and then it's the intention to execute things. As I just explained, having a very strong B2C proposition in Switzerland, working together with two specialized partners, Kalenica and Shop Appeteker, and having welcomed another very much wanted investor in Shop Appeteker with 8%. The last slide. when we closed the transaction. It's a repetition also of what we disclosed on March 30 for those that didn't join the call. According to IFRS, that's the accounting of business combinations, we as shop apothekers It will be for half a year in our numbers and then of course next year for the full year a bit repeating what I just said current business of Mediservice so what's going to be on top of the shop upper taker numbers is on an annual base around 450 million of Swiss francs one on one with the euro around 450 million of euros and the business is operating at an Iberda, which is close to a free cash flow percentage of sales between 2% and 3% of sales. In addition, the last bullet, if the transaction closes, and we expect that it will happen in the coming weeks, for the 2% share in Shop Appeteker, we will receive a one-off cash-in of 29 million euros. It's about time I give it back to you.