Elektroimportøren AS — Interim / Quarterly Report 2021

Nov 4, 2021

Elektroimportøren

Summary of Q3

• Revenue of 359.8 MNOK (334.6 MNOK) up 7.5%. Compared to Q3 2019 up 49.4%
• Adjusted EBITDA of 34.0 MNOK (37.7 MNOK). Adjusted EBITDA margin percentage is 9.5% (11.3%)
• Total like for like sales growth 2.8% driven by -0.2% online and 3.3% physical stores
• B2B sales grow 21.6% and B2C sales have a decline of -5.4%
• Major part of decline is in July, facing last year growth of +60%
• Decline in number of visitors to our stores in July is the major reason for decline in B2C sales
• Electrical vehicle chargers continue to be the fastest growing category 114% growth
• Greater share of business of B2B is the major reason to margin decline vs last year
• No new store openings, one planned opening for Q4

Key take aways

Decline Increase in average basket Conversion rate up Operating expenses are normalized in footfall

More than 400 installations made in Q3 Total sales in Q3 MNOK 4

YTD 2021

900+ installations and MNOK 8 in sales

Joint activities on and offline are driving awareness and sales

Revenues Q3

We had a significant decline in sales to B2C during July. As expected it was challenging to reach 2020 levels for this customer group (64% growth in July last year). Sales in August and September on par with last year

We continue to grow sales to B2B significantly more than market growth

Gross margin for Q3

• Gross margin 38.5%, down from 40.6% last year. Main drivers is increase in share of business from B2B
• We have had more aggressive marketing campaigns during in Q3 this year compared to Q3 2020.

OPEX Q3

• Opex in sales channels have increased from 62.6 MNOK to 68.7 MNOK. Compared to Q3 last year we have two more stores, Klepp and Jessheim. We also have some initial costs for Stavanger 2 which will open in Q4 this year. 4 MNOK of the increase in costs (-5.7 MNOK) is from these three new stores.
• Other Opex have a small increase 36.0 MNOK (35.6). Higher marketing costs, higher costs in general due to more normalized Corona situation, but lower provisions for year-end bonuses. Total provisions for yearend bonuses are at same level as last year as of end September.

Adj. EBITDA Q3

Key financials Q3 - 2021

• Revenue of 359.8 MNOK (334.6 MNOK) up 7.5%. Compared to Q3 in 2019 sales are up with 49.4%. Online share of total sales (excluding pick up in store) 11.6% (12.5%). B2B sales have increased with 21.6% compared to last year, while B2C sales had a decrease with 5.4%. B2B share of total sales in Q3 was 48.4% (42.2%). Total like for like sales growth 2.8% driven by -0.2% online and 3.3% physical stores. Sale of Electrical Vehicle chargers have continued to increase significantly compared to last year. Total sales Q3 with 40 MNOK (18 MNOK). The overall margin percentage is significantly lower compared to other product groups.
• The overall Gross margin percentage of 38.5% was down from 40.6% last year. Key drivers for reduced margin year on year are the significant sales increase of EV chargers and increased sale to B2B customers. In addition to this we had tougher marketing campaigns Q3 this year compared to last year.
• Opex to sales ratio 29.1% (29.3%). For Q3 this year we had a normalized operation with physical meetings and gatherings in contrast to last year. In addition, we increased marketing spend compared trying to increase footfall to our stores. Provision for yearend bonuses last year was higher than in Q3 this year, but year to date they are at the same level. In Q3 2019 cost ratio was 30.9% (last comparable quarter without Corona effects).
• Adjusted EBITDA of 34.0 MNOK (37.7 MNOK). Adjusted EBITDA margin percentage is 9.5% (11.3%)

Outlook for the rest of 2021

• Confident to continue to grow sales and market share in B2B
• Do not expect to meet the number of visitors that we managed to attract in 2020. Expect to compensate for some of the decline in footfall with increased basket, higher conversion rate and price increases
• Expect August and September to indicate what we can expect in Q4
• Uncertainty regarding supply of products but we do not foresee any major challenges in this area
• Opening of store number 25 in Stavanger
• Our strategic review of Sweden continues and we will conclude on way forward before yearend 2021

Q&A

Appendix

Alternative Performance Measures

(Amounts in NOK million)	Q2 2021	Q2 2020	H1 2021	H1 2020	2020
Revenue	320,8	271,9	666,5	528,6	1314,9
COGS	$-201,0$	$-163,6$	$-417,8$	$-320,8$	$-792,5$
Gross Profit	119,8	108,3	248,7	207,8	522,5
Gross margin (%)	37,4%	39,8 %	37,3%	39,3%	39,7%
Operating expenses in sales channels	$-50,5$	$-44,0$	$-112,8$	$-99,5$	$-225,9$
Other operating expenses	$-29,8$	$-23,6$	$-63,8$	$-51,9$	$-134,9$
OPEX	$-80,2$	$-67,6$	$-176,6$	$-151,3$	$-360,8$
OPEX to sales margin	$-25,0%$	$-24,9%$	$-26,5%$	$-28,6%$	$-27,4%$
Adjusted EBITDA	39,6	40,7	72,1	56,4	161,7
Adjusted EBITDA margin (%)	12,3%	15,0%	10,8%	10,7%	12,3%
Adjustments	0,3	0,0	$-0,5$	0,0	$-7,0$
EBITDA reported	39,9	40,7	71,6	56,5	154,7
EBITDA reported margin (%)	12,4%	15,0 %	10,7%	10,7%	11,8%
Depreciation	$-6,7$	$-5,4$	$-12,8$	$-10,8$	$-23,3$
Adjusted EBIT	33,0	35,3	59,3	45,6	138,4
Adjusted EBIT margin (%)	10,3%	13,0 %	8,9%	8,6 %	10,5%
Adjustments	0,3	0,0	$-0,5$	0,0	$-7,0$
Amortisation intangible assets	$-2,5$	$-2,5$	$-4,9$	-4,9	$-9,8$
EBIT reported	30,8	32,8	53,8	40,8	121,6
EBIT reported margin (%)	9,6%	12,1%	8,1%	7,7 %	9,2 %
Net financial expenses	$-1,8$	$-3,5$	$-4,2$	$-7,3$	$-14,4$
Profit before tax	29,0	29,3	49,7	33,5	107,2
Net Income	22,1	22,4	37,6	25,0	81,3
Liabilities to financial institutions	205,0	$-205,0$ -	205,0	$-205,0$	$-205,0$
Leasing liabilities (Autostore)	19,3	$-10,7$ -	19,3	$-10,7$	$-20,6$
Cash/Overdraft facility	65,5	2,8	65,5	2,8	94,1
Net interest bearing debt	158,8 ٠	$-212,9$ -	158,8	$-212,9$	$-131,6$

Consolidated statement of profit and loss

Amounts in nok 1000	Note	Q2 2021	Q2 2020	H 1 2021	H1 2020	2020
		Unaudited	Unaudited	Unaudited	Unaudited	Audited
Revenue		320804	271919	666 496	528 601	1315894
Cost of goods sold		$-200959$	-163 615	$-417815$	-320 832	-798389
Employee benefits expenses		$-42913$	-34024	$-102062$	-82 599	$-219294$
Depreciation and amortisation expenses		$-9108$	-7883	$-17720$	-15 686	$-33118$
Other operating expenses		$-37026$	$-33551$	$-75158$	-68 757	$-143491$
Total operating expenses		$-290005$	-239 072	$-612755$	-487 874	-1 194 292
Operating profit		30798	32847	53 741	40727	121 602
Net financial income (+)/expenses (-)		$-1819$	$-3504$	$-4109$	$-7293$	$-14446$
Profit before tax		28 980	29 344	49632	33 435	107 156
Income tax expense		$-6924$	$-7001$	$-11998$	$-8403$	$-25885$
Net profit (loss) for the period		22055	22 343	37634	25 0 32	81 271
Eaming per share (EPS)		1,06	1,08	1,82	1,21	3,92

Return on Equity

Good return on Equity (measured as adjusted net profit/average equity)

Consolidated statement of financial position

Note Amounts in nok 1000	Q2 2021	Q2 2020	H 1 2021	H 1 2020	2020
	Unaudited	Unaudited	Unaudited	Unaudited	Audited
Goodwill	118747	128006	118 747	128006	122 606
Other intangible assets	6310	6859	6310	6859	7356
Total intangible assets	125 057	134 865	125 057	134 865	129 962
Fixtures and fittings, office machinery and equipment	147050	129094	147050	129094	142778
Inventory	219258	192122	219258	192 122	208 160
Trade receivables	73891	51316	73891	51316	54386
Other receivables	13526	15 002	13526	15 002	28 25 1
Cash and bank deposits	65523	2838	65523	2838	94 080
Total current assets	372 198	261 278	372 198	261 278	384 877
Total assets	644 305	525 237	644 305	525 237	657617
Note Amounts in nok 1000	Q2 2021	Q2 2020	H1 2021	H 1 2020	2020
	Unaudited	Unaudited	Unaudited	Unaudited	Audited
Share capital	13011	13 011	13011	13 011	13011
Other Equity	150 169	106 297	150 169	106 297	112535
Total Equity	163 180	119308	163 180	119308	125 546
Deferred tax	44	676	44	676	43
Lease liabilities	19281	10702	19281	10702	17923
Other long term liabilities	0	30000	0	30000	0
Liabilities to financial institutions	185 000	205 000	185 000	205 000	185000
Total long term liabilities	204 325	246378	204 325	246378	202 966
Liabilitites to financial institutions	20188	1063	20188	1063	22702
Trade payable	102030	91334	102 030	91334	120798
Tax payable	30526	11928	30526	11 928	26518
Dividends payable	50000	0	50000	0	50000
Public duties payable	35 165	31 3 35	35 165	31 3 35	50559
Other short term liabilities	38891	23891	38891	23891	58528
Total short term liabilities	276 800	159551	276 800	159551	329 105
Total Equity and Liabilities	644 305	525 237	644 305	525 237	657617

Consolidated statement of cash flows

Note Amounts in nok 1000	Q2 2021	Q2 2020	H1 2021	H 1 2020	2020
	Unaudited	Unaudited	Unaudited	Unaudited	Audited
Cash flow from operations
Operating profit	30798	32847	53741	40727	121 602
Taxes paid	$-3995$	0	$-7990$	$-4509$	$-7990$
Depreciation and amortisation	9108	7883	17720	15 686	33 1 18
Change in inventory	13308	6615	$-12306$	12371	$-3605$
Change in trade debtors	$-10341$	$-4382$	$-22917$	$-13887$	$-13815$
Change in trade creditors	13821	17396	$-14146$	3593	29849
Change in other provisions and receivables	$-31174$	$-15562$	$-19982$	1816	10906
Net cash flow from operations	21525	44 797	$-5880$	55 798	170065
Cash flow from investments
Net capital expenditures	$-12829$	$-4847$	$-17058$	$-15328$	$-41570$
Net cash flow from investments	$-12829$	-4847	$-17058$	$-15328$	$-41570$
Cash flow from financing
New Loans	0	0	0	0	215800
Repayment of loans and interest	$-2614$	$-3504$	$-5619$	$-38526$	$-251109$
Net cash flow from financing	$-2614$	-3504	$-5619$	-38526	$-35309$
Cash and cash equivalents at the beginning of the period	59441	$-33608$	94 080	894	894
Net change in cash and cash equivalents	6082	36 446	$-28557$	1944	93 186
Cash and cash equivalents at the end of the period	65523	2838	65523	2838	94 080

Consolidated statement of changes in equity

Amounts in nok 1000	Paid in	Other	Total
	Equity	Equity	Equity
January 1st. 2020	13011	81 265	94 276
Profit for January-June 2020	0	25 0 32	25 0 32
Balance at 30th. June 2020	13011	106 297	119308
Balance at 1st. January 2021	13011	112535	125 546
Profit for January-June 2021	0	37 634	37634
Balance at 30th. June 2021	13011	150 169	163 180