Investor Relations

Westwing returned to double-digit growth in Q3 2019 and continues increased marketing investments

DGAP-News: Westwing Group AG / Key word(s): Change in Forecast

25.09.2019 / 21:13
The issuer is solely responsible for the content of this announcement.

Westwing returned to double-digit growth in Q3 2019 and continues increased marketing investments
  • Q3 GMV growth returned to over 10%, supported by intensified marketing activities
  • Continued higher level of marketing investments planned to support mid- and long-term growth
  • Guidance update reflecting the marketing investments impacting expected Adjusted EBITDA margin for 2019

Munich, September 25, 2019. After having returned to over 10% GMV growth in the third quarter of 2019, Westwing decided to continue increased marketing investments and, in return, accepts lower short-term profitability in order to accelerate its growth as the leading brand and platform in inspirational Home and Living eCommerce in Europe in the long term.

"We believe that it is the right time to continue our marketing investments as we will benefit from fourth-quarter seasonality and lay solid ground for future growth in 2020 and beyond", said Stefan Smalla, Founder & CEO of Westwing. "We have seen strong returns from the intensified marketing in the third quarter, as our over 10% GMV growth demonstrates. In return, we will accept lower short-term profitability for this year to set ourselves up well for a strong 2020 based on our unique business model, customer loyalty, improved marketing strategy and strong cash balance."

The latest GMV growth rate of above 10% in the third quarter is both significantly stronger than the increase of 1% reported for the first half of 2019 as well as stronger than the growth of 10% in the third quarter of 2018. Growth has been improved both in the DACH segment at above 15% and in the International segment which has returned to growth.

Considering the momentum and based on strong marketing efficiency, Westwing will continue higher marketing investments throughout the fourth quarter at the upper end of the company's strategic marketing range of 6-9%. Westwing believes that higher marketing investments in preparation for the seasonally strongest quarter will be beneficial for the mid- and long-term results of the company, both in terms of growth and profitability.

As a result of the increased marketing investments Westwing is adjusting its profitability guidance for 2019. Westwing now expects Adjusted EBITDA margin at around -3.5% within a range of one percentage point (previously: lower end of -1% to +1%). It expects Free Cash Flow to not exceed outflows of EUR -29 million (previously: no lower than EUR -25 million). As announced with the publication of the results for the first half of the year, Westwing expects to end the year 2019 at the lower end of the updated guidance of 6-12% of revenue growth. While Adjusted EBITDA for the third quarter of 2019 is expected on similar levels as in the first half of the year, Westwing expects a positive Adjusted EBITDA and more than 10% revenue growth for the fourth quarter of 2019.

Westwing has improved its operating performance, mainly through cost improvements in its new logistics center in Poland, strong increases of the share of high-margin Own and Private Label products, and improved operations in the International segment.

Westwing will report its financial figures for the third quarter on November 7, 2019.


About Westwing
Westwing is the leader in inspiration-based Home and Living eCommerce in Europe with EUR 254m of revenue in 2018. Through its 'shoppable magazine', Westwing inspires its loyal, mostly female customers with a curated product selection and combines that with gorgeous content. With unparalleled loyalty, Westwing is generating 85% of sales from customers who visit the company's sites and apps on average 100 times per year. Westwing's mission is: To inspire and make every home a beautiful home. The company was founded in 2011 and is headquartered in Munich. Westwing went public on the Frankfurt Stock Exchange in October 2018 and is active in eleven European countries.


Certain statements in this communication may constitute forward looking statements. These statements are based on assumptions that are believed to be reasonable at the time they are made and are subject to significant risks and uncertainties. You should not rely on these forward-looking statements as predictions of future events and the Company undertakes no obligation to update or revise these statements. The Company's actual results may differ materially and adversely from any forward-looking statements discussed in this press release due to a number of factors, including without limitation, risks from macroeconomic developments, external fraud, inefficient processes at fulfilment centres, inaccurate personnel and capacity forecasts for fulfilment centres, hazardous material / conditions in production with regard to private labels, lack of innovation capabilities, inadequate data security, lack of market knowledge, risk of strike and changes in competition levels.


25.09.2019 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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