Elektroimportøren AS — Interim / Quarterly Report 2021

May 5, 2021

Elektroimportøren

Andreas Niss CEO and Petter Bjørnstad CFO

1.st quarter presentation

Elektroimportøren AS 5th. May 2021

Andreas Niss CEO, Petter Bjørnstad CFO

3

An introduction to Elektroimportøren

• Provider of electrical equipment to B2B and B2C customers
• Disrupts the traditional value chain and distributes directly to end-customers
• Successful development and sourcing of own brand, Namron
• Proven omnichannel concept with a market leading online store and 23 stores across Norway
• Unique service offering through Spoton which connects private customers and installers

Elektroimportøren in brief Nationwide network of stores

Key financials Q1 - 2021

Revenue of 345.7 MNOK (256.7 MNOK) up 34.7%

Online share of total sales (excluding pick up in store) 14.8% (13.2%)

• Strong sales growth in the B2B segment and share of sales have increased compared to last year to 47.9% (44.4%). Sales to B2C 52.1% (55.6%).
• Total like for like sales growth 28.1% driven by 51.8% online and 25.2% physical stores.
• Gross margin for Q1 was 37.3%, down from 38.8% (Q1 2020). Key drivers for reduced margin percentage year on year are strong growth in sales to B2B, negative effect on B2C sales in stores that are closed for this customer group (because of Covid 19 restrictions), and strong sales growth on EV chargers (significantly lower margin compared to other product categories).
• Increase in operational efficiency OPEX to sales ratio 27.9% (32.6%).
• Adjusted EBITDA of 32.3 MNOK (15.7 MNOK). Adjusted EBITDA margin percentage is 9.4% (6.1%)

Summary of Q1 - Operations

• Even though we had to close down 13 of our 23 stores for B2C in March, we managed to grow revenues in all product categories, sales channels and customer segments.
• Throughout the quarter all stores have been open for sales to B2B.
• Electrical vehicle chargers continue to be the fastest growing category, but we see double digit growth across all product categories.
• Sales to B2C had a great start of the quarter but as we had to close down sales , we saw share of business to B2C decreasing.
• Sales to B2B have had a great start of the year and we continue to gain market shares in the professional space.
• Spoton has been rolled out in 22 out of 23 stores
• During the quarter we have built up our stock to secure availability of products and enable continued growth. There have been some minor availability challenges but with good planning we have been able to mitigate these challenges and availability has not been better for the last 12 months.
• Prices on raw materials such as copper and plastic are increasing, and we plan for price adjustments for the coming months to level these increases.

Revenues

• Total revenue in Elektroimportøren for Q1 was 346 MNOK, increasing from 257 MNOK Q1 last year (34.6% growth).
• All growth is organically. Like for like growth in physical stores was 25.2%, while growth in Online sales channel was 51.8% (collect in store is reported as part of sales in physical stores). We had a positive development in both B2B and B2C segments.

Gross margin

• Gross margin for Q1 was 37.3%, down from 38.8% for Q1 2020.
• Key drivers for reduced margin percentage year on year:
  • Strong growth in sales to B2B
  • Negative effect on B2C sales in stores that are closed for this customer group because of Covid 19 restrictions
  • Strong sales growth on EV chargers (significantly lower margin compared to other product categories)

OPEX

• Compared to Q1 last year we have two more stores (Tønsberg and Klepp). Costs in sales channels have increased from 55.5 MNOK to 63.0 MNOK. Costs as percentage of sales have a significant efficiency improvement from 21.6% to 18.2%.
• Other operating expenses was 33.5 MNOK, an increase from 28.3 MNOK. We have an improvement in efficiency measured as percentage of total revenue compared to last year, going from 11% to 9.7%.
• Overall good cost control in stores and other functions

Adj. EBITDA

Adjusted EBITDA for Q1 was 32.3 MNOK increasing from 15.7 MNOK in 2020. Main drivers for this positive development are significant increase in revenue, good cost control in stores and other functions, offsetting a reduction in gross margin percentage.

Return on Equity

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

Alternative Performance Measures

(Amounts in NOK million)	Q1 2021	Q1 2020	2020
Revenue	345,7	256,7	1 314,9
COGS	-216,9	-157,2	-792,5
Gross Profit	128,8	99,5	522,5
Gross margin (%)	37,3 %	38,8 %	39,7 %
Operating expenses in sales channels	-63,0	-55,5	-225,9
Other operating expenses	-33,5	-28,3	-134,9
OPEX	-96,5	-83,7	-360,8
OPEX to sales margin	-27,9 %	-32,6 %	-27,4 %
Adjusted EBITDA	32,3	15,7	161,7
Adjusted EBITDA margin (%)	9,4 %	6,1 %	12,3 %
Adjustments	-0,8	0,0	-7,0
EBITDA reported	31,6	15,7	154,7
EBITDA reported margin (%)	9,1 %	6,1 %	11,8 %
Depreciation	-6,2	-5,4	-23,3
Adjusted EBIT	26,2	10,4	138,4
Adjusted EBIT margin (%)	7,6 %	4,0 %	10,5 %
Adjustments	-0,8	0,0	-7,0
Amortisation intangible assets	-2,5	-2,5	-9,8
EBIT reported	22,9	7,9	121,6
EBIT reported margin (%)	6,6 %	3,1 %	9,2 %
Net financial expenses	-2,4	-3,8	-14,4
Profit before tax	20,6	4,1	107,2
Net Income	15,5	2,7	81,3
Liabilities to financial institutions	- 205,0	-205,0	-205,0
Leasing liabilities (Autostore)	- 20,0	-11,1	-20,6
Cash/Overdraft facility	59,4	-33,6	94,1
Net interest bearing debt	- 165,5	-249,7	-131,6

Consolidated statement of profit and loss

Amounts in nok 1000	Note	Q1 2021	Q1 2020	2020
		Unaudited	Unaudited	Audited
Revenue		345 693	256 682	1 315 894
Cost of goods sold		-216 856	-157 217	-798 389
Employee benefits expenses		-54 699	-48 207	-219 294
Depreciation and amortisation expenses		-8 613	-7 804	-33 118
Other operating expenses		-42 545	-35 551	-143 491
Total operating expenses		-322 712	-248 779	-1 194 292
Operating profit		22 980	7 903	121 602
Net financial income (+)/expenses (-)		-2 371	-3 789	-14 446
Profit before tax		20 609	4 114	107 156
Income tax expense		-5 073	-1 446	-25 885
Net profit (loss) for the period		15 536	2 668	81 271
Earning per share (EPS)		0,75	0,13	3,92

Consolidated statement of financial position

Amounts in nok 1000	Note	Q1 2021	Q1 2020	2020
		Unaudited	Unaudited	Audited
Goodwill		121 062	130 321	122 606
Other intangible assets		6 447	6 996	7 356
Total intangible assets		127 509	137 317	129 962
Fixtures and fittings, office machinery and equipment		140 877	129 677	142 778
Inventory		232 566	198 737	208 160
Trade receivables		63 551	46 934	54 386
Other receivables		13 468	15 259	28 251
Cash and bank deposits		59 441	850	94 080
Total current assets		369 026	261 780	384 877
Total assets		637 412	528 774	657 617
Amounts in nok 1000	Note	Q1 2021	Q1 2020	2020
		Unaudited	Unaudited	Audited
Share capital		13 011	13 011	13 011
Other Equity		128 071	83 933	112 535
Total Equity		141 082	96 944	125 546
Deferred tax		43	676	43
Lease liabilities		16 460	11 093	17 923
Other long term liabilities		0	30 000	0
Liabilities to financial institutions		185 000	185 000	185 000
Total long term liabilities		201 503	226 769	202 966
Liabilitites to financial institutions		23 803	55 521	22 702
Trade payable		88 209	73 939	120 798
Tax payable		27 597	4 927	26 518
Dividends payable		50 000	0	50 000
Public duties payable		58 587	37 287	50 559
Other short term liabilities		46 631	33 387	58 528
Total short term liabilities		294 827	205 061	329 105
Total Equity and Liabilities		637 412	528 774	657 617

Consolidated statement of cash flows

Note Amounts in nok 1000	Q1 2021	Q1 2020	2020
	Unaudited	Unaudited	Audited
Cash flow from operations
Profit before income taxes	22 942	7 887	107 156
Taxes paid	-3 995	-4 509	-7 990
Depreciation and amortisation	8 613	7 805	33 118
Change in inventory	-25 615	5 756	-3 605
Change in trade debtors	-12 576	-9 506	-13 815
Change in trade creditors	-27 966	-13 803	29 849
Change in other provisions and receivables	11 193	19 597	10 906
Net cash flow from operations	-27 404	13 227	155 619
Cash flow from investments
Net capital expenditures	-4 229	-10 481	-41 570
Net cash flow from investments	-4 229	-10 481	-41 570
Cash flow from financing
New Loans	0		215 800
Repayment of loans and interest	-3 006	-2 790	-236 663
Net cash flow from financing	-3 006	-2 790	-20 863
Cash and cash equivalents at the beginning of the period	94 080	894	894
Net change in cash and cash equivalents	-34 639	-44	93 186
Cash and cash equivalents at the end of the period	59 441	850	94 080

Consolidated statement of changes in equity

Amounts in nok 1000	Paid in	Other	Total
	Equity	Equity	Equity
January 1st. 2020	13 011	81 265	94 276
Profit for January-March 2020	0	2 668	2 668
Balance at 31st. March 2020	13 011	83 933	96 944
Balance at 1st. January 2021	13 011	112 535	125 546
Profit for January-March 2021	0	15 536	15 536
Balance at 31st. March 2021	13 011	128 071	141 082

Events after the period and outlook

• Our assumptions for the 2nd quarter have been to be on par with last year.
• As stores opens up for B2C we expect sales to pick up.
• Confident in contiuous marketshare growth in B2B
• Opening of store 24 in June
• One new store signed, opening in 2022
• Negotiations for 2 more stores with possible openings in 2021

Q&A