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EQS-News: Zalando SE / Key word(s): Quarter Results
Zalando Boosts Quality Assortment, Grows Lifestyle Offering, Elevates Inspiration and Wins More B2B Partners to Deliver
GMV Growth and Rising Profitability in Q1
2024-05-07 / 07:00 CET/CEST
The issuer is solely responsible for the content of this announcement.
Zalando Boosts Quality Assortment, Grows Lifestyle Offering, Elevates Inspiration and Wins More B2B Partners to Deliver
GMV Growth and Rising Profitability in Q1
. First-quarter gross merchandise volume (GMV) rises 1.3%
. Adjusted earnings before interest and tax (adjusted EBIT) increases to 28.3 million euros in the quarter,
representing a margin of 1.3%
. Business-to-Consumer (B2C) sees strongest growth from the propositions Beauty, Sports, Kids & Family as
well as 'Lounge by Zalando'
. Business-to-Business (B2B) adds more multi-channel fulfilment partners and grows revenue by 13%
. Full-year guidance for 2024 confirmed

Berlin, May 7, 2024 // Zalando delivered growth and improved profitability in the first quarter as it boosted the
quality of its assortment, saw strong growth in its lifestyle offerings, made the customer experience more
inspirational and added more logistics partners. The results are a validation of Zalando's updated strategy, announced
in March, to build the leading pan-European fashion and lifestyle e-commerce ecosystem around its two main growth
vectors: Business-to-Consumer (B2C) and Business-to-Business (B2B).
Gross merchandise volume (GMV) rose 1.3% to 3.3 billion euros in the first quarter compared with a year ago. Revenue
was 2.2 billion euros compared with 2.3 billion euros in the prior-year period. Adjusted earnings before interest and
tax (adjusted EBIT) rose to 28.3 million euros in the first quarter, in line with market expectations and representing
a margin of 1.3%, compared to -0.7 million euros in the prior-year period. The substantial improvement in profitability
was driven by lower fulfilment costs and successful inventory management, leading to an improved gross margin.
"As we are executing our ecosystem strategy, we are excited by the positive response from customers and partners in the
first quarter. We are returning to growth," said Dr. Sandra Dembeck, Zalando CFO. "B2C customers are showing increased
interest in our quality assortment, digital tools, propositions and inspiring content. B2B customers are signing up for
our unique offering. Both of our growth vectors are strong and contributing to results, demonstrating the strength of
our plans."
Within the B2C growth vector, Zalando's first pillar is to differentiate itself through quality to offer the best
possible shopping experience in fashion and lifestyle. In the first quarter, the company further elevated its
assortment, for example by launching the premium sports brand 'On' in 22 markets. To further improve the quality of its
digital experience, Zalando rolled out its size-advice-with-body-measurement tool to customers in Spain, France and
Italy, bringing the total to six markets. Zalando also expanded its inclusive assortment with the launch of 20 adaptive
kid's shoes styles after talking to parents of disabled children to identify their needs.
The second growth pillar of Zalando's B2C strategy - expanding further as a lifestyle destination by elevating existing
categories into distinct propositions - showed strong results in the quarter. Propositions offer a captivating
experience by combining a more comprehensive assortment, advice features, personalised inspiration and seamless
convenience. As part of the new, elevated Designer experience on the website and app, which offers a luxury
boutique-style space for designer brands, the company partnered with British-Japanese musician and actor Rina Sawayama
as a new ambassador for its Designer offering. Zalando also launched an exclusive co-designed capsule collection called
"Cinema Club" in collaboration with the Italian designer brand Aspesi. In the quarter, Zalando saw the strongest growth
from its Beauty, Sports, Kids & Family as well as 'Lounge by Zalando' propositions.
For the third B2C growth pillar - integrating content into commerce and offering personalised inspiration and
entertainment - the company added new functionality to the Zalando Assistant that allows customers to ask questions
using voice instead of just text, making the experience even more intuitive and natural. A new source of inspiration,
called Trend Spotter, shows customers emerging fashion trends across six major European fashion capitals. Entirely
powered by Zalando's data, it presents top items that are trending among customers in Berlin, Paris, Milan, Antwerp,
Stockholm and Copenhagen every week.
GMV at B2C rose 1.3% to 3.3 billion euros in the first quarter, supported by a timely start into the spring/summer
season. Adjusted EBIT rose to 23 million euros, representing a margin of 1.1% in the quarter. The improvement in
profitability by 1.4 percentage points compared to the same quarter of the previous year was driven by a higher gross
margin and lower fulfilment costs.
In B2B, Zalando is opening up its logistics infrastructure, software and service capabilities to be a key enabler for
e-commerce transactions of brands and retailers, regardless whether they take place on or off the Zalando platform.
Five more partners came on board for ZEOS multi-channel fulfilment in the first quarter bringing the total to 27
merchants.
One example of a brand that recently signed up for a more comprehensive package of services is LolaLiza. The successful
Belgian womenswear brand, which has been part of the partner program since 2020, recently signed a new deal to include
ZEOS fulfilment for countries outside its home market and will move to Zalando's marketplace integrator, Tradebyte.
Revenue at the B2B growth vector increased 13% to 215 million euros and adjusted EBIT rose to 5 million euros from 4
million euros in the quarter from the year-ago period. The adjusted EBIT margin improved to 2.5% from 2.2% a year
prior.
Full-year guidance confirmed
Zalando confirms its full year guidance for 2024 and expects both GMV and revenue to grow 0% to 5% this year compared
to 2023. The company will continue to focus on profitable growth, with margin progression, and adjusted EBIT is
expected to be between 380 million euros and 450 million euros.
The Q1 2024 financial report, as well as the earnings presentation for analysts and investors, is available on the
Zalando Investor Relations website. Zalando will report the results for the second quarter 2024 on August 6, 2024.
(End)
Zalando at a glance
Key figures*

IN EUR M                      Q1/24   Q1/23 
Group GMV                     3,269.7 3,226.9 
Percent growth                1.3 %   2.4 % 
Group revenue                 2,241.4 2,255.6 
Percent growth                -0.6 %  2.3 % 
B2C revenue                   2,028.0 2,068.1 
B2B revenue                   215.1   189.7 
Reconciliation revenue        -1.7    -2.1 
Adjusted group EBIT           28.3    -0.7 
Adjusted group EBIT margin    1.3 %   0.0 % 
B2C adjusted EBIT             22.9    -4.8 
B2B adjusted EBIT             5.4     4.1 
Reconciliation adjusted EBIT  0.0     0.0 
Net working capital           -328.6  8.9 
Capital expenditure           -59.5   -37.7 
Net income                    -8.9    -38.5 

Q1/24 Q1/23
Key performance indicators

Active customers (million) (last 12 months)           49.5  51.2 
Number of orders (million)                            55.2  56.7 
Average orders per active customer (last 12 months)   4.9   5.1 
Average basket size (EUR) (last 12 months)            60.4  57.3 

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*Definitions are available in the Annual Report 2023

About Zalando Founded in Berlin in 2008, Zalando is building the leading pan-European ecosystem for fashion and lifestyle e-commerce around two growth vectors: Business-to-Consumer (B2C) and Business-to-Business (B2B). In B2C, we offer an inspiring and quality multi-brand shopping experience for fashion and lifestyle products to about 50 million active customers in 25 markets. In B2B, we are using our logistics infrastructure, software and service capabilities to help brands and retailers run and scale their entire e-commerce business, on or off Zalando. As an ecosystem, Zalando aims to enable positive change for the fashion and lifestyle industry.

Contact Media inquiries Sheenagh Matthews Business & Financial Communications presse@zalando.de Investor/Analyst inquiries Patrick Kofler Investor Relations investor.relations@zalando.de

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2024-05-07 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The EQS Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.eqs-news.com

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Language:     English 
Company:      Zalando SE 

Valeska-Gert-Straße 5
10243 Berlin
Germany

E-mail:       investor.relations@zalando.de 
Internet:     https://corporate.zalando.de 
ISIN:         DE000ZAL1111 
WKN:          ZAL111 
Indices:      DAX 
Listed:       Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, 

Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange
EQS News ID: 1896881

End of News EQS News Service
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1896881 2024-05-07 CET/CEST

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May 07, 2024 01:00 ET (05:00 GMT)