Redcare Phamacy Unsp/Adr

Yes, thank you very much and good morning to everybody. Also a very warm welcome from my side. Some of you who are joining via webcast probably just saw all commercials. On Rx we are currently running, so we thought this is a nice intro into the day. So let's have a look into the agenda of today. It's the standard agenda. First we start with financial performance, then a strategy update on 2024 and then outlook and guidance. If you look into the financial performance, we would like to start with some highlights. We continue our fast growth at 42%. Even if we exclude Mediservice, we are showing a growth above 20%. So to be more specific, it's 21%. We are also very happy to report strong growth on ERX. As you're all aware of, ERX became mandatory at the beginning of this year. And since then, we have seen really a great adaptation from a doctor's perspective. So more than 80% of the scripts being issued in Germany are already e-scripts. And since the launch of our carding solution on May 6th, we have seen a significant increase also in our ERX business, averaging to a quarterly growth of 37%. At the same time, we are also happy to show that our non-RX business across all countries continues to grow strong at 20%. Our strategy remains also to grow in this area. If we look into the EBITDA, we can show an improvement in Q2 compared to Q1. So we are showing a 2%, 2.7% adjusted EBITDA lifting the year-to-date margin to 2.4%. And as you all know, we started additional marketing activities at the beginning of this year because of the ERX opportunity in Germany. And it works out pretty well from a sales perspective, but we are also very happy to show that we have control of our margins. I think that is an important message. We also would like to send very good news also on the margin perspective. Let's now look into the different segments. The story is pretty much the same like it has been in Q1. We are growing strong in all of our segments. International, a little bit stronger than in the DACH region. On international, we showed 27% of growth, and in DACH, still very good growth of 18.1%. If we go to the next slide, you will see that this is also reflected in the development of our customer file. We are now at 11.6 million active customers, and we added in the last quarter 0.4 million. customers and you can see it's over the last year. I mean quarter after quarter we are adding a steady number of new active customers and this is a very sustainable development here at the same time. Also, our NPS remains very high. You're showing a 69 year for the first half year of 2024 only sliding down to what we saw last year being at 71. Also the AOV. has come up slightly. I mean, probably you would have expected it to be come up a little bit more because of the ERX. But please keep in mind, RX right now is only a small part of our business compared to our core non-RX business. Therefore, you can't see the impact right from the beginning on the AOB in a more significant way. If we go to the next slide, you can see I mean, this is a nice picture. I mean, we are now at 17 million orders in the first half of 2024 and as described in the Q1 meeting of this year, we did the step up at the beginning of the year and now we are simply following the pattern which you can see from the previous years. So always I'm very high in the Q1 and then a little bit slower in Q2. So looks all good and also the 87% from returning customers. Number is still in line with what we have seen in the past, showing that the quality of our customer file continues to be very good. And also shows that overall we are able to process the increased orders also from an operational perspective. So overall, very good picture. And now I would like to hand this over to Jasper.

Thanks a lot, Olaf. Good morning also from my side and I'm very happy to present the numbers of the first six months of the year. This is the customary table as I always present during the quarters. So the first three columns is quarter over quarter and then it is the year to date results from sales up to and including the adjusted EBDA and the bottom line for completers sake the fully loaded EBDA. As the subheader of the slide is already saying, similar to the past quarters, the year-over-year comparisons are somewhat skewed because of May disservice, which has only consolidated since mid-May last year. So next quarter three will be the first apple to apple again. But actually in the next two slides, I will actually try to make as clear as possible what the underlying development is, excluding this impact. So to start at the top of this table, the sales were 420 million in the second quarter of last year, and we increased them to 461 million this year. And after six months last year, 792 million. And we ended this year at precisely 1,121,000,000. And it's an increase of 329 million in six months and a 41.5% growth. As Olaf rightfully said already at the start, roughly half of that is coming from the full consolidation of mani surface, but stripping that one out, there is still remaining 21% organic, fully organic growth of the total group. Then the gross margin and the expenses as percentage of sales are respectively significantly lower and significantly better. I will explain that on the next slides. So let's go to the adjusted EBDA margin, 2.7% in Q2, bringing the year to date to 2.4% versus last year's 2.8%. And multiplying this margin with the significantly increased sales is leading to the adjusted DBDA in absolute terms. This stood after six months last year at a positive 22 million, and it increased this year with 5 million to a positive 27 million. And then finally, as you can also see at the bottom line, actually our fully loaded EBDA did not increase with 5 million, but with 10 million because we have significantly fewer adjustments this year than we had last year, because last year there came an end to adjustments related to the acquisitions in 2021. And with that, we go to the gross margin slides. I would like to start at the middle of the slides, the two bars there in the center of the page. They show the declined gross margin that we just saw in the table from 26.5% last year to 23.4% now. However, to the right of the slides, to have apples and apples, so excluding the mixed impact of media service this and last year, you can actually see that the gross profit margin was roughly stable, 28.1 versus 20%. And under the hood of this 28%, a lot of interesting things are happening, of course. But in a summary to mention a couple of those developments, we achieved a continuous improvement of our purchasing conditions. We have several other positive impacts like more platform sales and own brands and very good mix in our baskets. and it also enabled us to continue having very sharp prices for our customers and also including more Rx sales. Finally, the two bars on the right, Q1 and Q2, actually there could be seasonality there, they're the same, but this is just to show you what the normalized going forward margin is more or less including major services. So stable gross margin that was and now we go to all the cost as a percentage of sales. So the SG&A as a percentage of sales. Also here to the middle, we see the improvement in the middle two bars of 2.7 percentage points as we also saw in the table. We are benefiting there from the inclusion of mainly surface. If you go to the apple and apple, we have to go to the right and you see it's more or less the same versus last year. slightly increased with some 20 basis points. Actually, a number that we are really happy with at the moment that we were able to achieve that. I mean, like in the whole economy, also outside our company, we have seen increases of minimum wage rates, general increases of wage rates, general inflation, but we really achieved significant efficiencies which have virtually is the same as last year. And besides offsetting the impacts that I talked already about, we also, of course, did this in Q1 and Q2, more marketing for RX, but with the scale and all the efficiencies that we achieved, we were able to keep this stable. A different slide than normally. Actually, I take the opportunity for a longer-term perspective here. It's the past 10 quarters on a row, our growth and our margin development. So let's start at the bottom of the page. With today's released numbers, we recorded the eighth consecutive quarter of a positive adjusted EBDA margin. But actually, it's also good to realize that the two EBDA margins to the left were also the result of our deliberate decisions back then to balance best growth and margins at that period. Because at the end, in the second half of 2021, and then what you see on the graph, the start of 2022, we deliberately decided actually to invest more to enter on the sweet spots of our marketing propositions. So the bars there are showing the EVDA margins. If you would have shown the EVDA in euros, it would have gone up, as we have seen in the table. But actually, now having discussed the lower part, the key reason for showing this graph is actually the combination of the margins below and the upper graph lines which represent our growth. The black line might perhaps appear at first sight to be a rather dull, rather horizontal line, but actually I find it a spectacular one because it is showing that for 10 consecutive quarters in a row we are achieving for our non-Rx business, which was last year around 1.5 billion growth of double digits between 15 and 25%. And by the way, we could have gone back more than 10 quarters, then you would have seen the same. We have virtually always been growing double digits there. So the black line showing continuous growth of our non-Rx business. And then the red line, that is our X business in Germany, And of course, we see there from quarter one to quarter two, an increase from 7% to 37% in the last quarter, which was the average of the quarter. So the key of this slide is actually that our focus, if you can go back on slide, please, still. So our focus on fast growth is not giving us, and has never given us any reason to not focus Phamacy Unsp & Adr Before. Phamacy Unsp Before. Phamacy Unsp Before. Phamacy Unsp Before. Phamacy Unsp Before. Phamacy Unsp Before. Phamacy Unsp and the very favourable working capital development is mainly the seasonal pattern where we end the year, a calendar year, generally at an elevated working capital needs position. And with that, to the 31 million of cash at the end. Jules, back to you. Thank you very much.

So now we are in the strategy session, so I would like to give an update. If we can go to the next slide to me. The header is already saying everything. That's the story. This is just the beginning of a new digital era. I mean, since generations, especially chronically ill patients, when it comes down to script business, they always had, let's say, a non-digital journey with their pharmacy whenever they were looking for pharmacy services. And now with CartLink, it's the first time that the Rx process becomes fully digital. And we have received really great feedback from both existing customers, but also new customers. And now it's really about us. It's about RedCare with all of the, let's say the value that this company presents, that is the people, the technology, the customer, the customers we already have. It's about us now to develop products and services to make use of this digital era. CardLink to us is just the beginning and we are really looking forward entering into this digital era. If we can go to the next slide, I think we also need to look into the redemption options. I mean, this slide somehow you are familiar with, but we added, as you can see on the right hand side, we added a fifth channel. So because since June of this year, customers can also redeem their scripts via the apps of the insurance companies. So now we have five ways how you can redeem key scripts. What does this mean for Redcar customers? For Redcar customers, they can still place their orders directly with us. Directly with us means they can use our app with a calling solution and then place the order in our app, but they can also use a paper printout if they get a paper printout from the doctor or if they request a paper printout and then they can use our own channels like our web or our app where we have the scan functionality in that channel. And that is how they can do the shopping with us. And at the same time, they now have additional channels like the Gematik app or the insurance app. So they can also find us in those apps because by law, we are also listed in those channels. The barriers to entry are different for the different redemption options. So if you look into the EGK plug-in, so a solution for brick-and-mortar and the card-link solution. Here you can simply use the German healthcare card without a PIN. For the other channels like Ematic app and insurance app, you need either a digital ID or the EGK card plus a PIN. And we all know the distribution of digital IDs and also EGK plus PIN remains very low in Germany. So overall, a lot of options for our customers. If we go to the next slide, we would like to one more time explain how simply CardLink works. It is really as simple as paying by card. You simply open up our app, click on the CardLink button, and then you have to receive the SMS code, present the card, the smartphone is reading the card, and then all of the orders will show up in the basket. Phamacy Unsp & Adr Phamacy Unsp&Adr Our major value proposition and therefore to us it's important that we have a very competitive product in the market and I would like to point out some of the highlights of our product. So first of all, 24 seven so sounds so easy, but what we have actually actually experienced is that a lot of customers are placing their order either on Saturday or on Sunday. So we saw the same kind of pattern in the non Rx business. Phamacy Unsp & Adr if you are a chronically ill patient and you receive a script from the doctor and show up in the pharmacy. In a lot of cases, the product is not available. So you show up and then the pharmacist tells you, sorry, right now it's not available. In our app, you can simply attach the card, use the scan functionality, and then we show you in real time if the product is available and if the product is not available, how long it does take us. It takes us to organize the product and then when we can send the product to you. So it's a real-time, fully digital information and that adds a huge value, especially if you're a chronically ill patient. Next thing is the preferred medicine choice. I mean, the way it works in the German system is a doctor prescribing a product or an ingredient and then based on the contract your payer or your insurance company has set up there is might be a portfolio approach or portfolio availability so that means the payer is reimbursing maybe three different products if we talk about a generic product so then they offer from three different brands the choice and what you can do as a customer in our app you can select on your own so that means you're in control You're empowered and you can decide which brand you want to choose. And you can do this in real time. And then you also get the information if there's a change in co-payment or not. So in total, we are really using the advantages of having a fully digital journey compared to having a not digital journey. And the last thing I would like to point out is we are always talking about scan functionality at NFC. I mean, NFC has been around for quite a long time, but what we really have established here is that this product is not just an NFC scan functionality. I mean, it has an approval from Gematik. It also has an approval in terms of data security from the BSI and the BFDE. So, I mean, this is not just a scan functionality. It follows the highest standards in terms of data security, which are So overall, it's really a great product and it's a major step forward, especially for chronically ill patients. If we go to the next slide, let's talk a little bit about the future potential. And I think what we should do is just to stay with the facts. What we can see here is, I mean, we just want to remind you of that. We are talking about a 55 billion market. So the RX market in Germany is a 55 billion market. And we have increased our market share since January from 0.27% to 0.45% by the end of June. So if you consider that June number as our run rate and calculate a 12-month sales level out of that, we would end up on 250 million euros. compared to the 151 of 2023. So with the achievement on the market share, we already have a significant higher share in sales level than we had prior to the launch of the Carling solution. If you add one percentage point of the market, that would lead to an additional 550 million in sales, and that shows you how significant this opportunity is and what just one percentage point market share can move in terms of sales level. On a more strategic level, of course, I think it's fair to say that we cannot predict the future. Now, we certainly have to do the job to educate the customers, to communicate about the solution, and to initiate change of behavior. And we have done this in the past. When we talk about the non-RX business, we have done this very successfully. And now it's our job to also do this for the ERX. But again, This journey only started a couple of weeks ago, so we have to see going into the future what is going to happen. And by having said this, I think we should move on in the agenda. And next one is outlook and guidance. And I would like to hand this over again to Jasper. Yeah, thanks again.