Feb 26, 2021
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Mytheresa rides growth wave in Q2, profits continue to climb

Feb 26, 2021

Mytheresa was yet another luxury e-tailer seeing its sales soaring during the pandemic with the newly-listed German company saying it enjoyed a sales uplift of 32.9% in its second quarter.

Twitter @mytheresa_com

That drove its net sales to €158.6 million in the final three months of 2020. And unlike larger peer Farfetch, it also “continued strong profitability”. In fact, the German company (which is listed in the US) said net income hit €15.7 million, compared to €6.3 million in the prior year period.

It also reported adjusted EBITDA of €22.1 million, up from €12.9 million a year ago, and operating income up to €16.6 million from €7.3 million.  in the prior year period. The adjusted EBITDA margin rose to 14.% from 10.8% and the gross margin was up 60 basis points to 49.5%, helped by a focus on full-price.

The company benefited from active customer growth of 28.2% to 569,000 and saw a record number of first-time buyers (over 100,000 of them) during the quarter. And it enjoyed a record number of daily shipments too, processing as many as 11,000 parcels in just one day during Q2. That may sound small compared to some online businesses, but for a luxury seller, it's pretty big.

And it’s perhaps no surprise given that many shops were temporarily closed during the period in multiple markets because of lockdowns linked to the pandemic. The high-end luxury shoppers that the company focuses on clearly had the cash and the inclination to buy. 

But CEO Michael Kliger said this wasn't only linked to shoppers having nowhere else to go and was a direct benefit of the company’s business model.

“Even considering clear tailwinds by the Covid pandemic, the strong results confirm once more our strategy and unique business model,” he explained. “Mytheresa is about inspiration not aggregation. It is about an unrivalled, highly curated offering, a focus on high-end luxury customers, sophisticated technologies and a first-class in-house managed service experience.”

That bullish attitude seemed to be borne out by the company’s six-month results as well. When Q2 was combined with Q1 (the year’s first fiscal quarter coming at a time when there were fewer lockdowns), it can be seen that it was still able to attract users to its platform when they had the option of going into shops.

First-half net sales jumped 30.4% to €285 million, the gross margin rose 20 basis points to 48.2% and adjusted EBITDA rose to €32.6 million from €17.2 million. Net income was €25.4 million, a massive leap compared to €2 million in the prior year period, while adjusted net income more than doubled to €20.1 million from €10 million.

The company continued to build its offer in the longer period, targeting those luxury consumers with items and initiatives they clearly found appealing. It continued to expand its menswear business and growth here beat expectations with net sales share surpassing 10% in December. 

It also hosted digital events targeting top customers in collaboration with Khaite, Wardrobe NYC, Eera, and selected influencers and held a physical VIC event in Shanghai in December.

The offer included exclusive capsule collections and pre-launches too, in collaboration with Valentino, Moncler, Dolce & Gabbana, Loewe, Christian Louboutin, Max Mara and many more.

Since the end of the first half and second quarter, the company has also listed successfully on the New York Stock Exchange and continues to be upbeat about its future prospects. It said some of the “beneficial performance tailwinds from Covid may be expected to slow down in Q3 and especially in Q4 as stores reopen”. But it still expects “strong results for the full fiscal year in line with long-term expectations of net sales growth and stable Adjusted EBITDA margins”.

That means sales up between 26% and 29% at between €565 million and €580 million and adjusted EBITDA in the range of €45 million to €48 million, representing 27% to 36% growth.

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