BIKE24 doubles sales in localized markets during Q1 2023 – ongoing subdued consumer sentiment in the DACH region

BIKE24 doubles sales in localized markets during Q1 2023 – ongoing subdued consumer sentiment in the DACH region

• Number of active customers increases by more than 16 percent to 971 thousand
• Group sales in the first quarter at EUR 55.3 million (-10.5 percent compared to Q1 2022), adjusted EBITDA at EUR -2.6 million (Q1 2022: EUR 3.8 million) 
• Growth in the localized markets of Spain, France and Italy remains strong, with average sales up 109 percent
• Growth and improved margins expected from second quarter onward
• Full-year guidance confirmed: Sales growth of 0 to 10 percent and positive adjusted EBITDA margin of 0 to 3.5 percent

Dresden, May 3, 2023. BIKE24 has started into a challenging first half of 2023 as expected. In a persistently uncertain economic environment, the e-commerce platform for everything around cycling recorded a 10.5 percent decline in revenues in the first quarter to EUR 55.3 million, compared to EUR 61.8 million in the previous year. Among other things, overcapacities in inventories and associated promotional activities in the market had a negative impact on margins. At the same time, the company remains on a clear growth path in its localized markets of Spain, France and Italy with an average increase in sales of 109 percent compared to the same period of the previous year. For the full year 2023, management confirms the guidance with sales growth between 0 and 10 percent and an adjusted EBITDA margin of 0 to 3.5 percent.

"As expected by us and other industry experts, we have started into a challenging first half of 2023. In addition to the cautious consumer sentiment, we are also feeling the effects that spring is taking longer to arrive this year," reports Andrés Martin-Birner, co-founder and CEO of BIKE24. "However, we can already see that the overall situation is slowly improving, and we expect to return to our growth path in the second quarter of this year. The cycling trend is intact throughout Europe and we expect it will continue to evolve as the sustainable mobility revolution progresses."

BIKE24 recorded unbroken strong growth in Spain, France and Italy. Sales in these countries more than doubled compared to the same quarter of the previous year, growing by an average of 109 percent to EUR 8.7 million. Meanwhile, the ramp-up of the new logistics site in Barcelona to supply the Southern European markets is progressing according to plan.

The company divides its international markets into three segments: Localized markets Spain, France and Italy accounted for 16 percent of sales, other European markets for 15 percent and the rest of the world for 5 percent.

Further localizations successfully completed

As part of its internationalization strategy, BIKE24 successfully launched localized online shops in the Netherlands, Belgium, and Luxembourg in February 2023. These markets with a cycling-savvy population now offer the bike platform even more potential for further growth.

Subdued consumer sentiment impacts overall sales and earnings

In the first three months of 2023, BIKE24 generated sales of EUR 55.3 million. The decline of 10.5 percent compared to the same period of the previous year (Q1 2022: EUR 61.8 million) is mainly due to the subdued consumer sentiment. The DACH region remained the largest market with a 64 percent share of sales or EUR 35.2 million (Q1 2022: EUR 40.4 million). The number of active customers again developed positively for BIKE24. As of March 31, 2023, it increased by 16 percent year-on-year to 971 thousand customers.

Earnings before interest, taxes, depreciation and amortization (EBITDA) decreased by EUR 6.8 million to EUR -3.6 million in the first quarter of 2023 (Q1 2022: EUR 3.2 million). Adjusted for non-recurring expenses of EUR 1.0 million, adjusted EBITDA amounted to EUR -2.6 million compared to EUR 3.8 million in the prior-year period. The adjusted EBITDA margin was -4.7 percent. The non-recurring expenses resulted mainly from the costs for the extension of the syndicated loan agreement and for a planned IT system implementation.

"In a market environment characterized by depressed consumer sentiment, we succeeded in reducing old inventories and improving our liquidity management. At the same time, we have added attractive new merchandise to our range and are now ideally equipped for the upcoming cycling season," explains Timm Armbrust, CFO of BIKE24. "With our steadily growing customer base and offers tailored to individual markets, we are in pole position to benefit overproportionately from the expected recovery of the sector."

Guidance for the full year 2023 confirmed

Despite the ongoing challenges, the company is confident that the existing overcapacities in the cycling market will normalize in the second half of 2023, enabling a positive effect on margins. The company's guidance of sales growth between 0 and 10 percent and a positive adjusted EBITDA margin of 0 to 3.5 percent remains unchanged.

BIKE24's Q1 2023 earnings call will take place today at 12pm CEST. The presentation will be available from 10am on the IR website. Please register for the webcast under the following link:

https://montegaconnect.de/event/75pnbx1cmo02obivltv4bqwj7s69gfd8
 

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