MYTHERESA(US:MYTE)2024-02-15 19:23Financial Data and Key Metrics Changes - Net sales grew by 8.3% on a constant currency basis, with an IFRS increase of 3.6% to €197 million compared to €190.1 million in the prior year period [8][13] - Adjusted EBITDA margin was 4%, demonstrating profitable growth despite a challenging macro environment [6][123] - Gross profit was €98.3 million, with a gross profit margin of 49.9%, down from 54.8% in the previous year quarter [107][120] Business Line Data and Key Metrics Changes - The average order value increased by 5.4% to €672, indicating a strong performance in high-value transactions [106][98] - GMV grew by 5.9% on a constant currency basis, with nominal growth of 1.5% to €219.1 million compared to €215.9 million in the prior year period [15][8] - Adjusted EBIT was €4.1 million, with an adjusted EBIT margin of 2.1% [18] Market Data and Key Metrics Changes - The US market saw impressive growth of 17.4%, increasing its share of net sales to 19.9% from 17.6% in the prior year quarter [9][115] - Europe accounted for 55.7% of net sales, with a growth of 2.4% [9] - The Rest of World segment experienced stability, with a slight decline in share from 26.1% to 24.5% due to softer demand in APAC [17] Company Strategy and Development Direction - The company continues to focus on high-spending wardrobe-building customers, positioning itself as a key partner for luxury brands [2][4] - Strategic partnerships and exclusive product launches are part of the company's approach to enhance brand awareness and equity [5][12] - The company aims to maintain a strong market position and is preparing for future growth by evolving its business model [10][118] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the medium and long-term outlook, anticipating market share gains and improved profitability as the luxury market recovers [39][124] - The company noted a strong performance in the US market and a slight recovery among aspirational customers, although uncertainty remains in Asia [27][41] - Management highlighted the importance of maintaining a focus on full-price selling to ensure better customer loyalty and economics [56][85] Other Important Information - The company successfully managed inventory levels, reducing year-over-year growth from 56.5% to 33.1% [19][36] - Positive operating cash flow of €18.5 million was reported, with minimal utilization of revolving credit facilities [20][36] - The company is in discussions to replace its revolving credit facilities with a syndicated loan for greater flexibility [20] Q&A Session Summary Question: What are the sales trends post-holidays in the US and Europe? - Management noted a strong US market with early signs of recovery among aspirational customers, while Europe is stabilizing [41][125] Question: How confident is the company in achieving greater full-price selling share in the second half of the fiscal year? - Management expressed confidence in achieving normalized inventory levels and a decrease in promotional intensity, which should support full-price selling [127] Question: What is the outlook for gross margins and inventory management? - Management confirmed guidance for gross profit at the lower end of 8% to 13%, expecting improvements in gross profit margins in Q3 and Q4 [71][120]