DGAP-News: windeln.de SE

- Q3 revenues of EUR 52.9 million (9M: EUR 159.4 million); increase of 15.8% over the same period of last year (9M: +15.8%)

- China (Q3 revenue +27.8% compared to previous year) and other European countries (+23.6%) continue to drive growth

- Adjusted EBIT margin in Q3 improved to -10.3% compared to Q3 2016 (-14.5%) and Q2 2017 (-10.5%); -11.6% in nine-month period in 2017 compared to -14.1% in 2016

- Change of liquidity position EUR -11.3 million in Q3 due to inventory built up for local warehouse in China, Bebitus integration and acquisition related Earn Out payment

- Integration of Bebitus successfully completed on October 1, 2017

Munich, November 14, 2017: windeln.de SE, one of the leading
online retailers for baby and toddler products in Europe and to customers in China, posted revenues of EUR 52.9 million in the third quarter of 2017. This represents an increase of 15.8% compared to the same period of the previous year (Q3 2016: EUR 45.7 million). Based on the adjusted EBIT margin, the Group improved its profitability from -14.5% (Q3 2016) to -10.3% in the third quarter of the current year. The adjusted EBIT margin for the first three quarters of 2017 was -11.6% (9M 2016: -14.1%).

China and other European countries as growth drivers, continuation of profitability orientation in the German-speaking region (DACH)

EUR 26.8 million were generated in the third quarter of 2017 in China, an increase of 27.8% compared to the same period of the previous year (Q3 2016: EUR 20.9 million). Overall, the China business continues to contribute around half of Group revenues.

Sales in other European countries amounted to EUR 16.3 million in the third quarter. Compared to the same quarter of the previous year, this represents an increase of 23.6% (Q3 2016: EUR 13.2 million). The growing online penetration continues to be a key driver of this development in European markets. Constant revenues compared to the second quarter of 2017 were due, among other factors, to the seasonally lower revenues during the summer months.

In the DACH region, revenues decreased by -14.7% in the third quarter of 2017 compared to the same period of the previous year and amounted to EUR 9.9 million, thus accounting for 18.6% of Group revenues (Q3 2016: EUR 11.5 million). The reason for this development is the focus on profitable sales, an objective that the company has been pursuing since the first quarter of 2017. This is primarily characterized by a clear margin orientation and a lower total volume of marketing expenditure. The implementation of this strategy is also reflected in the increased repurchase rate of 83% for the Group in Q3 2017 (Q2 2017: 76%). In addition, sales in Switzerland were lower than in the second quarter following the closure of the Swiss office in order to reduce selling and administrative expenses.

"We consistently continued to pursue our strategy in the third quarter. More specifically, that means we completed integrating our Spanish subsidiary Bebitus into the Group as planned on October 1, 2017. At the same time, we continued to drive profitability in the German-speaking markets. Our goal is to return to the growth path in the DACH region without neglecting profitability," commented Alexander Brand, founder and member of the Management Board of windeln.de.

Improvement in adjusted EBIT margin

The adjusted EBIT margin improved to -10.3% in the third quarter of the current year after -14.5% in the same period of the previous year (-16.6% including discontinued Shopping Clubs segment) and -10.5% in the second quarter 2017. The EBIT margin for the period January to September 2017 was -11.6% (9M 2016: -14.1% and -15.7% including discontinued Shopping Clubs segment).

The respective expenses for marketing and fulfillment were reduced in both absolute and relative terms (in relation to revenues). The operating contribution margin (the difference between gross profit and expenses for marketing and fulfillment) as an important indicator for steering the company was at 4.8% in the nine-month period of 2017 or approximately 2.2 percentage points above the previous year's level (9M 2016: 2.6%). The operating contribution margin was slightly lower in the third quarter compared to the second quarter of 2017. This was due to a lower gross profit margin, which mainly resulted from a rising foreign share and the related product mix.

Other selling, general and administrative expenses improved slightly in relation to Group revenues and reached 16.4% after nine months compared to 16.6% in the same period of the previous year. This cost block also developed positively compared to the previous quarter. Additional measures aimed at improving operational efficiency are still being implemented.

"We are making further progress on a major project to improve our cost base - the relocation of our central warehouse from Germany to Poland. This is to take place over the course of the first half of 2018," explained Jürgen Vedie, COO and member of the Management Board of windeln.de.

Local warehouse in China and integration preparation Bebitus increase net working capital

As of September 30, 2017, net working capital stood at EUR 9.5 million after EUR 4.3 million as of June 30, 2017. The increase is attributable to two significant factors. On the one hand, the company has built up stock at its local warehouse in China, which is supplied in a time-consuming way by sea; on the other hand, buffer stock was built up prior to integrating Bebitus. Cash and cash equivalents (including time deposits and restricted cash) amounted to EUR 31 million as of the reporting date, September 30, 2017. This position was EUR 11.3 million lower than at the end of the second quarter to a large extent as a result of the increase in net working capital and cash Earn Out payment to the founders of Bebitus in the amount of EUR 1.7 million.

"The steps to improve our cost and margin position taken so far are showing some effect already when looking at the adjusted EBIT in 2017 in comparison to the previous year. We expect further substantial effects to come in 2018." said CFO and Management Board member Dr. Nikolaus Weinberger.

Select key figures for the first nine months of 2017 and the third quarter of 2017 (excluding the discontinued Shopping Clubs segment)

Corporate Communications

Judith Buchholz
Phone: +49 (89) 41 61 71 52 65
email: investor.relations@windeln.de

About windeln.de

windeln.de is one of the leading online retailers for baby and toddler products in Europe. The windeln.de shops are tailored to the needs of our customers in 10 European countries: Germany, Austria, Switzerland, Czech Republic, Poland, Slovakia, Spain, Portugal, France and Italy. The company also operates a successful e-commerce business with products for babies and toddlers for customers in China. The broad product portfolio includes everything from diapers, baby food, children's furniture, toys, clothes and strollers to children's car seats. windeln.de was founded in October 2010 and currently has more than 400 employees in Germany and abroad. The company has been listed in the Prime Standard of the Frankfurt Stock Exchange since May 6, 2015. For more information, go to http://corporate.windeln.de.

Our shops: www.windeln.de, www.nakiki.de, www.windeln.ch, www.kindertraum.ch, www.toys.ch, www.pannolini.it, www.feedo.cz, www.feedo.sk, www.feedo.pl, www.bebitus.es, www.bebitus.pt, www.bebitus.fr, www.windeln.com.cn, windelnde.tmall.hk