EQS-News: GLOBAL FASHION GROUP REPORTS Q3 2022 RESULTS

Christoph Barchewitz and Patrick Schmidt, Co-CEOs of GFG, said:

GFG has achieved NMV growth and a stable Adj. EBITDA margin despite a challenging market and trade environment for our industry. Given our presence in growth markets, we are experienced at adapting to macro issues and volatility. We have increased our focus on improving efficiency and managing our costs, while strengthening our platform proposition and assortment to continue inspiring our customers. With over 800 million consumers projected to spend around 230 billion on fashion and lifestyle products in GFGs markets this year, we remain confident in the significant opportunity ahead.

Outlook

GFGs outlook is impacted by the macroeconomic backdrop dampening consumer spend and elevated levels of uncertainty over the Groups peak trading period. In ANZ, consumer demand trended downwards through the quarter and we expect this alongside elevated levels of promotional activity to continue into Q4. To reflect the change in demand environment, the Group is actively managing its cost base and maintains its focus on finishing the year strongly and efficiently.

Business Review

In Q3, GFG delivered NMV of 399.0 million, up by 1.7% yoy despite the challenging market conditions. The Group adapted to the subdued levels of demand with a focus on inventory levels and actions on costs to preserve profitability. The Group has 11.9 million Active Customers, down 11.1% yoy reflecting deliberate reduction in marketing investments. NMV per Active Customer was up by 19.4% as a result of higher Average Order Value, also up 19.4%. AOV was driven by a higher number of items per order with product and country mix shifts also increasing this metric.

This quarter, Revenue grew ahead of NMV. GFGs Marketplace share has trended down from last year to 32.5% of NMV, reflecting some curation of the Marketplace sellers in LATAM alongside customers preference to shop our Retail promotions.

In LATAM, NMV declined 13%. LATAM continues to rationalise marketing to focus on stronger returns, at the expense of bringing in fewer new customers in the short term. SEAs NMV declined 8% reflecting a continued focus on premium and less so on our lower price point assortment which has impacted sales over the short term. ANZ grew strongly with 25% NMV growth. This was driven by customers choosing to buy higher priced fashion items more frequently.

Gross Margin has been impacted by (1.8) ppts related to discounting in preparation of the new season. GFGs inventory position is healthy, 9% higher than last year (on an FX neutral basis) and is also relatively fresh with just over 20% of stock over 180 days. Cost actions meant that the Group was able to ensure the Adj. EBITDA margin remained stable through this period.

GFG has a strong funding position with Pro Forma cash² of 455.4m and Pro Forma net cash² of 157.1m (excluding the Convertible Bond and other third party debt) at the end of the Quarter. These cash balances include the value of the cash held in the CIS business but do not include the additional c.100m of proceeds to be received on completion.

Key Performance Indicators

FURTHER INFORMATION