Quarterly Report Q3|2021

Q U A R T E R L Y S T A T E M E N T

January - September 2021

WESTWING AT A GL ANCE

Q 3 2021 H I G H L I G H T S

• Revenue at EUR 103.2m in the third quarter of 2021 confirming new size levels with 4.7 % growth year-over-year due to last year's extraordinary baseline effects
• Westwing Collection share significantly up to 38 % (Q3 2020: 26 %)
• Number of Active Customers at 1.7m at the end of the third quarter of 2021, an increase of 36 % compared to the previous-year's third quarter

K E Y F I G U R E S (U N A U D I T E D )
								Change								Change
			9M 2021		9M 2020				Q3 2021		Q3 2020
Results of operations
Revenue (in EUR m)			373.4			277.2		34.7 %			103.2			98.6		4.7 %
Adjusted EBITDA (in EUR m)			30.0			24.3		5.7			- 0.4			10.8		- 11.1
Adjusted EBITDA margin (in % of revenue)			8.0 %		8.8 %		- 0.7pp			- 0.3 %		10.9 %		- 11.3pp
Financial position
Free cash flow (in EUR m)			- 0.5			23.4		- 24.0			- 21.0			7.1		- 28.2
Cash and cash equivalents (in EUR m)		97.2			91.5	5.7
Key performance indicators
Westwing Collection share (in %)			33 %			24 %		9pp			38 %			26 %		12pp
GMV (in EUR m)			420			326		28.7 %			118			113		4.6 %
Number of orders (in k)			3,112			2,600		19.7 %			822			874		- 6.0 %
Average basket size (in EUR)			135			126		7.5 %			144			129		11.7 %
Active customers (in k)		1,750			1,284		36.3 %
Average orders per active customer in the preceding
12 months		2.6			2.7		- 1.3 %
Average GMV per active customer in the preceding
12 months (in EUR)			340			330		3.0 %
Mobile visit share (in %)			80 %		79 %		1pp			80 %		80 %		0pp
Other
Full-time equivalent employees (as of reporting date)		2,105			1,436		46.6 %

1

REPORT ON ECONOMIC POSITION

1 .1 FINANCIAL PERFORMANCE OF THE GROUP 1

The condensed income statement for the third quarter of 2021 shows revenue at EUR 103.2m, up by 4.7 % compared to the same quarter of the previous year (Q3 2020: EUR 98.6m). GMV grew by 4.6 % year-over-year from EUR 113m in the third quarter 2020 to EUR 118m in the same period 2021, confirming the new size levels we have now reached and adding slight growth on top.

As anticipated, we see lower relative growth compared to the previous period based on the extraordinary strong baseline of the previous year. Our number of Active Customers stood at 1.7m (Q3 2020: 1.3m), a 36 % increase versus the third quarter of 2020. Both the DACH and International segment showed positive revenue development in the third quarter of 2021, with DACH growing revenues by 4.2 % and International by 5.3 %, respectively.

Our Adjusted EBITDA margin for the third quarter 2021 decreased by 11.3 percentage points to - 0.3 % (Q3 2020: 10.9 %) which was driven by a lower contribution margin due to rising pressure from high sea freight and container costs as well as ongoing industry-wide supply chain disruptions. Despite the fact that we can pass on most of the cost increases to our customers, we still expect a negative short-term impact on our contribution margin in the fourth quarter of 2021 and in the first half of 2022.

To improve product availability in the upcoming fourth quarter and to deal with the increased delayed inbound volumes caused by supply chain disruptions, we have added short-term warehouse capacity at extra costs, before we will open our new warehouse in Poland in the first half of 2022. Thus, we have significantly increased our inventory levels resulting in short-term higher net working capital.

We continue to focus on long-term profitable growth going forward, further investing in marketing, technology and other growth areas like our Westwing Collection.

1 Figures in this section are presented on an adjusted basis, i.e. excluding (i) share-based compensation (in Fulfilment expenses, Marketing expenses as well as in General and administrative expenses), (ii) expenses for a tax claim provision against a divested entity regarding previous years, (iii) expenses for the SE conversion and (iv) income/expenses for the restructuring of the French business (2019). We calculate "Adjusted EBITDA" by adjusting EBITDA for these items.

3	WESTWING GROUP AG Q3 2021 QUARTERLY STATEMENT

C O N D E N S E D N I N E M O N T H S 2021 C O N S O L I D AT E D I N C O M E S TAT E M E N T O N A DJ U S T E D B A S I S 2 (U N A U D I T E D )

EUR m			9M 2021		In % of			9M 2020		In % of
							revenue							revenue
Revenue			373.4				100.0 %			277.2				100.0 %
Cost of sales			- 187.5			- 50.2 %			- 143.2			- 51.7 %
Gross profit			185.8				49.8 %			134.0				48.3 %
Fulfilment expenses			- 77.3			- 20.7 %			- 56.9			- 20.5 %
Contribution profit			108.6				29.1 %			77.1				27.8 %
Marketing expenses			- 35.1			- 9.4 %			- 20.1			- 7.3 %
General and administrative expenses			- 54.3			- 14.6 %			- 40.1			- 14.5 %
Other operating expenses			- 1.7			- 0.5 %			- 1.8			- 0.7 %
Other operating income			3.1				0.8 %			1.5				0.5 %
Depreciation, amortization and impairments			9.4				2.5 %			7.6				2.8 %
Adjusted EBITDA		30.0				8.0 %		24.3				8.8 %
C O N D E N S E D T H I R D Q U A R T E R 2021 C O N S O L I D AT E D I N C O M E S TAT E M E N T O N A DJ U S T E D B A S I S 2 (U N A U D I T E D )
EUR m						In % of						In % of
		Q3 2021				Q3 2020
							revenue							revenue
Revenue			103.2				100.0 %			98.6				100.0 %
Cost of sales			- 52.7			- 51.0 %			- 50.1			- 50.8 %
Gross profit			50.5				49.0 %			48.5				49.2 %
Fulfilment expenses			- 23.4			- 22.7 %			- 19.6			- 19.9 %
Contribution profit			27.1				26.2 %			28.9				29.3 %
Marketing expenses			- 12.2			- 11.9 %			- 7.7			- 7.8 %
General and administrative expenses			- 19.3			- 18.7 %			- 13.0			- 13.2 %
Other operating expenses			- 0.8			- 0.7 %			- 0.5			- 0.6 %
Other operating income			1.5				1.4 %			0.5				0.5 %
Depreciation, amortization and impairments			3.4				3.3 %			2.7				2.7 %
Adjusted EBITDA			- 0.4		- 0.3 %		10.8				10.9 %

Revenue

In the third quarter of 2021, our revenue grew by 4.7 % to EUR 103.2m compared to EUR 98.6m in the same period of the previous year. We had anticipated this development given we had strongly benefited from the previous year's accelerated shift towards online channels across all our markets, which led to a very high baseline in 2020. Additionally, we also observed strong summer seasonality as social distancing restrictions eased, vaccination rates increased across our markets and consumer purchasing behavior steered towards offline avenues such as travel and leisure.

In the first nine months of 2021, revenue amounted to EUR 373.4m, up 34.7 % compared to the previous year (9M 2020: EUR 277.2m).

2 Figures in this section are presented on an adjusted basis, i.e. excluding (i) share-based compensation (in Fulfilment expenses, Marketing expenses as well as in General and administrative expenses) (ii) expenses for a tax claim provision against a divested entity regarding previous years, (iii) expenses for the SE conversion and (iv) income/expenses for the restructuring of the French business (2019). We calculate "Adjusted EBITDA" by adjusting EBITDA for these items.

4	WESTWING GROUP AG Q3 2021 QUARTERLY STATEMENT

Contribution Margin

Our gross margin remained nearly on the same level at 49.0 % in the third quarter of 2021, compared to 49.2 % in the previous-year period. With a strongly increased Westwing Collection share we could offset some of the negative effects of the higher sea freight and container costs. Our Westwing Collection share grew from second quarter 2021 levels of 32 % to 38 % in the third quarter of 2021, a significant increase versus the previous year (Q3 2020: 26 %) and further progress towards our strategic target of 50 %.

Fulfilment costs as percentage of revenue increased from19.9 % in the previous-year period to 22.7 % in the third quarter of 2021. This rise was driven by higher logistics costs, mainly higher warehousing costs due to increased inventory volumes to mitigate supply risks, wage inflation and increased prices for packaging materials.

As a result of the effects described above, our contribution margin declined from 29.3 % in the third quarter of the previous year to 26.2 % in the third quarter of 2021.

For the first nine months of 2021 the contribution margin was 29.1 %, compared to 27.8 % in the first nine months of 2020.

Marketing Expenses

Marketing expenses were up to 11.9 % of revenue or EUR 12.2m in the third quarter of 2021, compared to 7.8 % of revenue or EUR 7.7m in the previous-year period, especially due to marketing investments to drive future growth which we will continue in the next quarters.

In the first nine months of 2021, marketing expenses amounted to EUR 35.1m or 9.4 % of revenue, while they were at EUR 20.1m or 7.3 % of revenue in the same period last year.

General and Administrative Expenses

In percent of revenue, general and administrative expenses in the third quarter of 2021 increased by 5.5 percentage points to 18.7 % compared to the same period of the previous year (Q3 2020: 13.2 % of revenue). This development was primarily driven by investments in personnel, particularly in technology and our Westwing Collection teams, to implement growth initiatives for the coming years. In absolute terms, general and administrative expenses rose by EUR 6.3m to EUR 19.3m in the third quarter of 2021 (Q3 2020: EUR 13.0m).

In the first nine months of 2021, general and administrative expenses amounted to EUR 54.3m (9M 2020: EUR 40.1m), corre-

sponding to 14.6 % of revenue (9M 2020: 14.5 %).

Adjusted EBITDA

The Group's Adjusted EBITDA decreased by EUR 11.1m to EUR - 0.4m in the third quarter of 2021 (Q3 2020: EUR 10.8m). Our Adjusted EBITDA margin declined by 11.3 percentage points, from 10.9 % in the third quarter of 2020 to - 0.3 % in the same period of 2021.

In the third quarter of 2021, a positive effect of EUR 0.6m was recognized within reported EBITDA due to a partial release of the tax claim provision against a divested entity from previous years which was done in the second quarter of 2021. We have adjusted for this positive effect. In addition, we adjusted EUR 0.3m expenses related to the conversion of Westwing Group AG into a Societas Europaea (SE). Due to their non-recurring nature, related expenses and income for those transactions were excluded from our Adjusted EBITDA.

Adjusted EBITDA for the first nine months of the year increased toEUR 30.0m (9M 2020: EUR 24.3m) which corresponds to

an Adjusted EBITDA margin of 8.0 % (9M 2020: 8.8 %).

5	WESTWING GROUP AG Q3 2021 QUARTERLY STATEMENT