Verkkokauppa.com - Challenging environment continued
Verkkokauppa.com’s Q2 EBIT fell short of our expectations. Simultaneously, the company lowered its FY’22 guidance, which was driven by weak consumer trust, impaired consumer purchasing power, and increased operative costs.
- Group result: Q2 net sales decreased by 3.7% y/y to EUR 125.7m (EUR 123.7/122.9m Evli/cons.) driven by soft development of consumer and export segments. Price competition increased, resulting in a softer gross margin. Through lower net sales, increased fixed costs, and softer gross margin, the company’s EBIT fell below that of the comparison period to EUR -0.9m (EUR 2.4/2.1m Evli/cons.) implying an EBIT margin of -0.7% (Q1’21: 3.9%). EPS amounted to EUR -0.02 (EUR 0.03/0.03 Evli/cons.).
- Online sales: weaker sales development was seen through all sales channels and online sales represented 63% (Q1’21: 61%) of total sales.
- Category sales split: core categories represented 82% of total sales while evolving categories saw a y/y increase of 5% representing 18% of total sales.
- Consumer segment: The main driver for the soft development of the consumer segment was weak demand in core categories and the delayed summer season. Meanwhile, the sales of evolving categories increased by 4.8% y/y. The segment represented 68% of total sales (Q2’21: 72%).
- B2B segment continued its trend of strong development and corporate sales grew by 12.6% y/y. B2B segment represented 26% of total group sales (Q2’21: 22%).
- Export segment: with the withdrawal of Russian markets, export sales declined y/y and represented 6% of total sales
- FY’22 guidance lowered: last night the company lowered its FY’22 guidance, now expecting revenue to land between EUR 530-570m (prev. 530-590m) and EBIT to amount to EUR 8-14m (prev. 12-19m). According to the new guidance, the company’s topline will face a y/y decrease of 1-8% while EBIT is expected to clearly decline, by 31-61%.