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zooplus AG: Growth trend continues in the first half of 2017
- Sales increase 21% to EUR 517 m
- EBT at previous year’s level of EUR 5.1 m
- Positive free cash flow of EUR 7.4 m
- Full-year 2017 sales and earnings forecast confirmed
zooplus AG (WKN 511170, ISIN DE0005111702, ticker symbol ZO1), Europe’s leading online retailer of pet supplies, continued its growth trend in the first half of 2017. With sales of EUR 517 m, the company was able to achieve year-over-year growth of 21% (H1 2016: EUR 428 m). Currency-adjusted sales growth was 22%. The key growth driver, above all, was the sustainable business with existing customers. This was made evident by the sales retention rate, which in the first half of 2017 again reached a very high level of 94% on a currency-adjusted basis.
Earnings before taxes (EBT) in the first half of 2017 were at the previous year’s level and reached EUR 5.1 m (H1 2016: EUR 5.1 m).
Due to the persistent, very intense competitive environment, the gross margin in the first half of 2017 reached a level of 24.5%, which was slightly below the gross margin reported in the first six months of the 2016 financial year (H1 2016: 24.9%). Other operating income, which primarily consists of advertising cost subsidies from suppliers, increased in the first half of 2017 allowing the total margin to reach a level of 29.3% (H1 2016: 29.6%).
The total cost of marketing, logistics, payment, personnel, administration, depreciation, amortization and interest as a percentage of sales in the first half of 2017 improved versus the previous year and reached a level of 28.3% (H1 2016: 28.4%). The cost ratio in the first half of 2017 was impacted by ramp-up costs for the fulfillment center in Antwerp, which commenced operations at the end of 2016, and for the local fulfillment center in Birmingham, which opened in March of 2017. Targeted investments were also made in the first six months of the current financial year in order to increase IT development capacity for the continued expansion of zooplus’s IT platform in full consideration of the company’s further growth and differentiation versus competitors.
Growth in the first half-year could once again be fully financed from operating cash flow. Free cash flow in the first six months of the 2017 financial year amounted to EUR 7.4 m (H1 2016: EUR 8.7 m).
Dr. Cornelius Patt, CEO of zooplus AG, commented: "For the first time in a half-year period, we have achieved sales of more than EUR 500 m. This demonstrates that we are consistently following our long-term oriented growth strategy. In the upcoming quarters, the focus of our activities in the intensely competitive market environment will be to continue to expand our excellent strategic market position and further enhance our product offer. High sales growth will continue to be at the forefront in order to fully exploit the market’s potential and drive future profitability."
Based on the business development in the first half of 2017, the Management Board of zooplus AG confirms the full-year 2017 forecast for sales of at least EUR 1,125 m and EBT in the range of EUR 17 m to EUR 22 m.
The full report for the first half of 2017 is available on the company’s website at http://investors.zooplus.com.
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