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    UNIR   IT0005239881

UNIEURO S.P.A.

(UNIR)
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Unieuro S.p.A.: Record-breaking economic-financial performance in Q1 2021/22, even compared to pre-Covid levels

07/14/2021 | 08:53am EDT

CORPORATE PRESS RELEASE

UNIEURO S.P.A.: RECORD-BREAKINGECONOMIC-FINANCIAL

PERFORMANCE IN Q1 2021/22, EVEN COMPARED TO PRE-COVID LEVELS

  • Quarterly revenue growing by 35.7% to 581.8 million euros compared with the same period of 2020/21, deeply impacted by the lockdown. Performance at +17.5% compared to Q1 2019/20, pre-Covid
  • Excellent recovery of direct sales network (+75.3%) and great performance of affiliates (+33.4%), while ecommerce runs back to expected normal trends (-27.7%)
  • Positive Adjusted EBIT1 of 6.5 million Euros, compared to the -11.1 million caused by the health emergency in Q1 2020/21
  • Adjusted Net Profit2 of 3 million Euros (-13.8 million Euros in the same period the year before), the first positive one in a quarter that is structurally impacted by seasonal dynamics
  • Net cash3 of 121.4 million Euros compared to 154.8 million Euros at start of FY in the light of typical first-quarter absorption
  • Guidance confirmed for current FY, as announced on Investor Day, 10 June

Forlì, 14 July 2021 - The Board of Directors of Unieuro S.p.A. (MTA: UNIR), the Italian leader in the retail market of consumer electronics and household appliances, met yesterday chaired by Stefano Meloni to examine and approve the Interim Financial Report of the Group at 31 May 2021.

In the first quarter of the financial year 2021/22, Unieuro reported sound and strongly growing economic-financial results, not just compared to the same period of the previous financial year - extraordinarily weak due to the impact of the peaking Covid emergency - but also compared with the first quarter 2019/20, the last before the epidemic changed the market scenario.

The revenue, amounting to 581.8 million Euros, hit a new record in a quarter that has been seasonally weak in the sales of electronics and electric household appliances. The 35.7% growth has been driven by the physical network (+75.3% direct stores, +33.4% affiliates), which from March to May 2020 was affected by the dramatic drop in traffic during the first lockdown, as well as by the Company's decision to close direct stores for two weeks to protect customers and employees. Conversely, the online channel suffered a physiological drop (-27.7%), which however is not bound to significantly affect the high levels of turnover that are being consolidated.

A comparison with the first quarter of the pre-Covid FY is quite revealing and positive too: though without any major acquisition, the quarter's total turnover progressed by 17.5% - +13.7% from Retail, +9.8% from the indirect channel and +75.6% from the online channel - compared to the same period of 2019/20.

Unieuro S.p.A.

Sede legale e amministrativa: Palazzo Hercolani via Piero Maroncelli, 10 - 47121 Forlì (FC)

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unieurospa.com unieuro.it linkedin.com/company/unieuro

CORPORATE PRESS RELEASE

High sales volumes also drove profitability to reach new record-breaking levels: in a quarter that is structurally weak due to the typical seasonal dynamics of the market Unieuro works in, the Company reported an Adjusted EBIT1 of 6.5 million Euros (a year before it was -11.1 million Euros) and an Adjusted Net Profit2 of 3 million Euros (from -13.8 million Euros), the first positive one in its history.

Against the backdrop of cash dynamics4 that are also affected by seasonal factors, the Management confirmed its guidance about the current financial year in terms of economic results (an expected turnover of 2.8 to 2.9 billion Euros and an Adjusted EBIT1 of 65 to 75 million Euros) as well as financial results (an Adjusted Free Cash Flow4 of 40 to 50 million Euros).

"The quarter just ended - although less important than those to follow from a seasonal point of view - confirms our expectations of a stepwise return to normality, thus highlighting a successful rebalancing of our channel mix.

The positive revenue and margin trends are strengthening, confirming the trend of the last few months of last year. This gives us optimism in hitting the growth targets we have recently shared with the market.

Giancarlo Nicosanti Monterastelli, CEO of Unieuro.

Revenues for the first quarter 2021/22

In the quarter ended 31 May 2021, Unieuro's revenue amounted to 581.8 million Euros, which is as much as 152.9 million Euros more (equivalent to +35.7%) than the 428.9 million Euros of the first quarter of the previous financial year, which was deeply impacted by the Covid emergency.

The performance is extremely positive even compared to the first quarter of the last pre- Covid financial year ended 31 May 2019, boosted by Unieuro's effective omnichannel strategy and by the consumer trends triggered by the pandemic boosting sales by 17.5%.

The evolution of like-for-likerevenues5, that is the comparison of sales with those of the previous year based on a homogeneous perimeter of activity, reflected the favourable basis of comparison and reported a staggeringly high +32.6% increase.

Revenues by sales channel

Unieuro S.p.A.

Sede legale e amministrativa: Palazzo Hercolani via Piero Maroncelli, 10 - 47121 Forlì (FC)

2

unieurospa.com unieuro.it linkedin.com/company/unieuro

CORPORATE PRESS RELEASE

(in millions of Euro and as a

Period ended

Chamges

percentage of revenues)

31 May 2021

%

31 May

%

%

2020

Retail

394.6

67.8%

225.1

52.5%

169.6

75.3%

Online

89.0

15.3%

123.0

28.7%

(34.0)

(27.7%)

Indirect

65.7

11.3%

49.3

11.5%

16.5

33.4%

B2B

26.9

4.6%

28.5

6.6%

(1.6)

(5.7%)

Travel

5.6

1.0%

3.1

0.7%

2.5

82.7%

Total revenues

581.8

100.0%

428.9

100.0%

152.9

35.7%

The Retail channel (67.8% of total revenue) - which as at 31 May 2021 consisted of 265 direct stores, including the Unieuro by Iper shops-in-shop - reported 394.6 million Euros of sales, which is a powerful growth (+75.3%) compared to the 225.1 million Euros of the same period in 2020/21. The dynamics of revenue has been favourably affected by the gradual lifting of restrictions on customers' access to the direct network, while the first quarter 2020/21 was deeply impacted by the total closure of direct stores from 14 to 29 March. It should also be considered the transition to the direct management of 18 Unieuro by Iper shops-in-shop, previously run as affiliates and insourced as from the second half of the previous financial year, as well as the new openings in the Spazio Conad superstores, Milano Portello (June 2020), Savona (November 2020), Torino Orbetello, Pino Torinese and Messina (April 2021). Such effects propelled the channel to a positive performance even compared to that of the first quarter of the last pre-Covid FY (+13.7%).

The Online channel (15.3% of total revenue) totalled a 27.7% drop to 89 million Euros, compared with the 123 million Euros reported for the same period of the previous financial year, as a consequence of the progressive normalisation of market dynamics. The performance of the first quarter ended 31 May 2020 was actually due to the pandemic emergency, which had led customers to prefer e-commerce over physical stores. Compared with the first pre-Covid quarter ended 31 May 2019, the channel's revenue is still remarkably increasing (+75.6%), boosted by the mainstream and digital marketing campaigns focused on the Company's ecommerce as well as to its double presence on the web through two well-known but clearly separate brands such as Unieuro and Monclick.

The indirect channel (11.3% of total revenue) - which includes the turnover from the network of affiliate stores, totalling 258 stores as at 31 May 2021 - reported 65.7 million Euros of sales, which is 33.4% higher than the 49.3 million Euros of the same period of the previous financial year. The gradual relaxation of restrictions and the distinctive features of the affiliate stores - medium-small in size and targeted to local customers - contributed to such success, as they benefited from the closing of the shopping malls in the weekends. Add to this the contribution made by the new openings, mainly driven by the start of the partnership with Gruppo Partenope in November 2020, which took the Unieuro brand over to Naples, partly making up for the transition of the previously affiliated Unieuro by Iper shops-in-shop to the Retail channel in the second half of the previous financial year. The

Unieuro S.p.A.

Sede legale e amministrativa: Palazzo Hercolani via Piero Maroncelli, 10 - 47121 Forlì (FC)

3

unieurospa.com unieuro.it linkedin.com/company/unieuro

CORPORATE PRESS RELEASE

channel's performance is positive even compared to the first quarter of the last pre-Covid financial year (+9.8%).

The B2B channel (4.6% of total revenue) - which caters to business customers, including foreign customers, operating in sectors other than that of Unieuro, such as hotels and banks, as well as operators purchasing electronic products to be distributed to their regular customers or to employees for loyalty points, prize contests, or incentive plans (referred to as B2B2C segment) - reported a turnover of 26.9 million Euros, which is 5.7% less than the 28.5 million Euros of the same period in the previous financial year. This therefore confirms the random nature of the revenue generated by such channel, which typically has an opportunistic approach and is affected by multiple exogenous factors, so that even a comparison with the first quarter of the last pre-Covid financial year would be fairly irrelevant (-7.2%).

Lastly, the Travel channel (1% of total revenue) - consisting of 11 direct stores located in some of the busiest hubs, such as airports, train stations and underground stations - reported an 82.7% recovery and 5.6 million Euros of sales. Such performance benefited from the gradual resumption of traffic in train stations and airports, which had been partly or totally closed down during the pandemic. The level of pre-Covid turnover (8.5 million Euros in the first quarter of 2019/20) remains significantly higher, though.

Revenues by product category6

(in millions of Euro and as a percentage of revenues)

Period ended

Changes

31 May 2021

%

31 May 2020

%

%

Grey

289.5

49.8%

223.6

52.1%

66.0

29.5%

White

156.1

26.8%

109.8

25.6%

46.3

42.1%

Brown

83.4

14.3%

57.6

13.4%

25.8

44.7%

Other products

25.1

4.3%

19.9

4.6%

5.2

26.3%

Services

27.7

4.8%

18.0

4.2%

9.7

53.5%

Total revenues

581.8

100.0%

428.9

100.0%

152.9

35.7%

The Grey category (49.8% of total revenue) - i.e. telephones, tablets, information technology, telephone accessories, cameras, as well as any wearable technology - generated a turnover of 289.5 million Euros, which is 29.5% higher than the 223.6 million Euros for the same period in the previous financial year. The quarter's sales have been mainly driven by telephones, which in the first quarter 2020/21 had been burdened by the poor mobility induced by the lockdown, and by IT, due to the continuation of the positive buying trends influenced by smart working, e-learning and communication. The same trends underlie the remarkable +19.2% performance compared to the first quarter of the last pre- Covid financial year.

Unieuro S.p.A.

Sede legale e amministrativa: Palazzo Hercolani via Piero Maroncelli, 10 - 47121 Forlì (FC)

4

unieurospa.com unieuro.it linkedin.com/company/unieuro

CORPORATE PRESS RELEASE

The White category (26.8% of total revenue) - i.e. major domestic appliances (MDA), such as washing machines, refrigerators or freezers and cookers, small domestic appliances (SDA), such as vacuum cleaners, automatic multi-cookers, coffee machines as well as air conditioning units - generated a turnover of 156.1 million Euros, growing 42.1% from the

  1. million Euros of the same period of the previous financial year and 19.6% from the
  1. million Euros of the first quarter of the last pre-Covid financial year. Over such time, the category was bumped up by the positive results of home care products, especially major domestic appliances, which benefited from the success of the "Passione Casa" promotional campaign, which did not take place last year. Vacuum cleaners and coffee machines performed well too.

The Brown category (14.3% of revenue) - consisting of TVs and TV accessories, audio and sound equipment, Smart TV devices, car accessories and storage systems - reported a total revenue of 83.4 million Euros, that is, +44.7% compared to the 57.6 million Euros of the same period of the previous financial year. Such great performance was driven by TVs, which are making the most of the major switch-off due to start on 1 September 2021, its effects brought forward and amplified by the resumption of the sports events that had been cancelled because of the pandemic. The category, hit the hardest in the first quarter 2020/21, performed better even compared to the first quarter 2019/20, with a positive performance of +4.3%.

The Other Products category (4.3% of total revenue) - which includes both entertainment products and other products that fall outside of consumer electrics, such as hoverboards and bicycles - reported revenues of 25.1 million Euros, up 26.3% from the same period in the previous financial year and 28.5% from the first quarter of the pre-Covid financial year. The rise in turnover generated by electric vehicles, hit hard by the restrictions due to the Covid emergency in 2020, is also due to social distancing rules, which encourage the use of sustainable vehicles.

The Services category (4.8% of total revenue) saw a 53.5% growth to 27.7 million Euros, running to even higher levels than pre-Covid ones (turnover of the first quarter of FY 2019/20 amounted to 22.2 million Euros). Such positive trend benefited from Unieuro's continued focus on customer services, especially the extended warranty service.

Operating profitability

Unieuro S.p.A.

Sede legale e amministrativa: Palazzo Hercolani via Piero Maroncelli, 10 - 47121 Forlì (FC)

5

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Disclaimer

Unieuro S.p.A. published this content on 14 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 July 2021 12:52:05 UTC.


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Sales 2022 2 852 M 3 334 M 3 334 M
Net income 2022 44,7 M 52,3 M 52,3 M
Net cash 2022 145 M 170 M 170 M
P/E ratio 2022 8,82x
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Last Close Price 19,80 €
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Managers and Directors
Giancarlo Nicosanti Monterastelli Chief Executive Officer & Director
Marco Pacini Chief Financial Officer
Stefano Meloni Chairman
Luigi Fusco Chief Operations Officer
Marino Marin Independent Non-Executive Director
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