HelloFresh SE — Earnings Release 2024

Mar 11, 2025

HELLOFRESH
GROUP

Q4 \& FY 2024

Preliminary Results

March $11^{\text {th }}, 2025$

Disclaimer

This document has been prepared by HelloFresh SE (the "Company" and, together with its subsidiaries, the "Group"). All material contained in this document and information presented is for information purposes only and must not be relied upon for any purpose, and does not purport to be a full or complete description of the Company or the Group. This document does not, and is not intended to, constitute or form part of, and should not be construed as, an offer to sell, or a solicitation of an offer to purchase, subscribe for or otherwise acquire, any securities of the Company, nor shall it or any part of it form the basis of or be relied upon in connection with or act as any inducement or recommendation to enter into any contract or commitment or investment decision or other transaction whatsoever. This document is not directed at, or intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction. Persons into whose possession this document comes should inform themselves about, and observe, any such restrictions.

No representation, warranty or undertaking, express or implied, is made by the Company or any other Group company as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein, for any purpose whatsoever. No responsibility, obligation or liability is or will be accepted by the Company, any other Group company or any of their officers, directors, employees, affiliates, agents or advisers in relation to any written or oral information provided in this document or in connection with the document. All information in this document is subject to verification, correction, completion, updating and change without notice. Neither the Company, nor any other Group company undertake any obligation to provide the recipient with access to any additional information or to update this document or any information or to correct any inaccuracies in any such information.

A significant portion of the information contained in this document, including market data and trend information, is based on estimates or expectations of the Company, and there can be no assurance that these estimates or expectations are or will prove to be accurate. Where any information and statistics are quoted from any external source, such information or statistics should not be interpreted as having been adopted or endorsed by the Company or any other person as being accurate. All statements in this document attributable to third party industry experts represent the Company's interpretation of data, research opinion or viewpoints published by such industry experts, and have not been reviewed by them. Each publication of such industry experts speaks as of its original publication date and not as of the date of this document.

This document contains forward-looking statements relating to the business, financial performance and results of the Company, the Group or the industry in which the Group operates. These statements may be identified by words such as "expectation", "belief", "estimate", "plan", "target" or "forecast" and similar expressions, or by their context. Forward-looking statements include statements regarding: strategies, outlook and growth prospects; future plans and potential for future growth; growth for products and services in new markets; industry trends; and the impact of regulatory initiatives. These statements are made on the basis of current knowledge and assumptions and involve risks and uncertainties. Various factors could cause actual future results, performance or events to differ materially from those described in these statements, and neither the Company nor any other person accepts any responsibility for the accuracy of the opinions expressed in this document or the underlying assumptions. No obligation is assumed to update any forward-looking statements.

This document includes certain financial measures not presented in accordance with IFRS, including, but not limited to, AEBITDA. AEBIT, Free Cash Flow pre-leases. These financial measures are not measures of financial performance in accordance with IFRS and may exclude items that are significant in understanding and assessing the Company's financial results. Therefore, these measures should not be considered in isolation or as an alternative to result for the period or other measures of profitability, liquidity or performance under IFRS. You should be aware that the Company's presentation of these measures may not be comparable to similarly titled measures used by other companies, which may be defined and calculated differently. See the appendix for a reconciliation of certain of these non-IFRS measures to the most directly comparable IFRS measure.

We are building the world's leading digital-first FMCG company

2011-2020
Home cooking

2021-2023
Ready-to-Eat (RTE)

2024
Pet Food

2025+
Vitamins, Minerals and Supplements (VMS)

We are laser focused on two major objectives

(a) Deliver on our efficiency program
(b) Create a step change in our customer proposition across MKs and RTE, to return to growth at superior margins and cash flows

Executing on our efficiency program is equally critical to short-term and long-term success

UNAUDITED PRELIMINARY RESULTS

Q4 and FY Results 2024 | 5

H2 2024 was the beginning of a period of efficiency reset

Marketing

Higher marketing ROI thresholds

Nurture existing customers

Higher profitability

and cash flows

Direct costs

Strong
productivity
improvements

Maturing of younger DCs

Fulfilment network

Existing network rationalization

Scaled back capital investments

Higher profitability and cash flows

Q4 and FY Results 2024 | 6

2024 Year in Review

Efficiency reset starts to show first results
Revenue of $€ 7.7$ bn, a constant currency growth of $0.9 \%$

Contribution margin improving throughout the year vs. 2023, driven by productivity improvements
Continued shift in marketing strategy to target higher value customers, resulting in H2 2024 marketing expenses down yoy both in relative and absolute terms

AEBITDA at upper end of guidance: $€ 399.4 \mathrm{~m}$ for FY2024, a $9.8 \%$ margin for meal kits ${ }^{(1)}$ and $1.6 \%$ for $\mathrm{RTE}^{(1)}$

Q4 AEBITDA margin up yoy for all product groups ${ }^{(1)}$. Meal kits: $14.1 \%$ up by c. 3pp; RTE: $5.3 \%$, up by c. 10pp

FCF per diluted share of $€ 0.42$ for FY 2024, stable to last year

EUR 150m buy-back program completed, new EUR 75m share buy-back program started

Number of orders down for the FY against a backdrop of higher marketing discipline starting in H2

• Continued focused on higher value customers over volume
• Flagged sequential deceleration in Q4 as a result of not spending against seasonally weaker trends in the 2nd half of the quarter
• Decreasing numbers of orders yoy:
• NA down $10 \%$ in Q4 2024
• Intl down $5 \%$ in Q4 2024
• Existing customers maintained robust ordering behavior across both NA and Intl markets

Q4 Number of orders (in millions)

FY Number of orders (in millions)

$(3.9 \%)$
$(3.9 \%)$
119.3
114.6

2023
2024

Continued AOV expansion throughout the year

• Further AOV growth in Q4, increasing $4.6 \%$ yoy on a cc basis
• Both segments showed meaningful increase in Q4
• NA: $6.4 \%$ (CC)
• Intl: $3.1 \%$ (CC)
• AOV increase yoy in Q4 driven by
• Increased RTE contribution
• Higher add-on contribution
• Lower price incentives for new customers

Q4 Average Order Value (in €)

FY Average Order Value (in €)

63.4

Q4 2023 Q4 2024
2023
2024

Revenue growth of $0.9 \%$ in cc for the full year

• Revenue growth for the FY at the low end of the revised guidance
• By product category, revenue growth for FY in line with expectations:
• Meal kits (9.5\%) in CC
• RTE $41.5 \%$ in CC
• Q4 revenue declined due to a well flagged stricter stance on marketing spend, particularly in NA:
• NA (4.2\%) in CC
• Intl (1.6\%) in CC
• Q4 trends expected to continue into Q1 2025

Q4 Group Revenue (in € millions)

FY Group Revenue (in € millions)

$$
7,596.6
$$

7,661.3

Q4 and FY Results 2024|10

FY contribution margin down yoy at $25.8 \%{ }^{(1)}$, but improving throughout the year

• Contribution margin down yoy for FY' 24, but improving sequentially due to:
• Continued productivity improvements in NA RTE
• Continued increases in direct labor productivity in NA meal kits
• Partially offset by volume deleverage and Intl margin drag from continued DE/UK fulfillment center ramp-up
• Q4 CM by segment ${ }^{[1]}$ :
• NA: 30.3\%, increase of 1.7pp yoy
• Intl: $23.2 \%$, decrease of (2.8pp) yoy
• €181.5m of impairment recorded in 2024, due to streamlining of production capacity

Q4 Contribution Margin ${ }^{1}$ (in \% of revenue)

HELLOFRESH

[^0]
[^0]: UNAUDITED PRELIMINARY RESULTS

Marketing spend flat for the year, but down yoy for the second consecutive quarter following a shift in marketing strategy since mid 2024

• Q4 marketing spend ${ }^{1}$ down yoy both in relative (3.1pp less than in Q4 2023) and absolute terms, due to continued focus on acquiring high value customers
• Meal kits marketing spend down meaningfully yoy both in relative and absolute terms
• RTE marketing spend up yoy in relative and absolute terms, driven by rapid scaling of customer base within NA and initial launches across several Intl markets

Q4 Marketing Costs ${ }^{1}$ (\% of net revenue)	FY Marketing Costs ${ }^{1}$ (\% of net revenue)
3.1 pp	0.0 pp
$(19.1) \%$	$(18.8) \%$
Q4 2023	Q4 2024

Q4 2023
Q4 2024
2023
2024

HELLOFRESH

GROUP

The marketing shift was of different magnitude for meal kits in the two reporting segments, with a corresponding impact on revenue growth

• Reduction in marketing spend for North America meal kits in H2 more pointed than for Intl, due to:
• Intl a combination of 16 markets at different stages of growth
• Marketing spend over indexed to North America in 2023
• Opportunities to shift spend to RTE US
• Higher ROI thresholds impact value brands (e.g. EveryPlate) more forcefully

Meal kits marketing spend change, yoy

FY 2024 AEBITDA at upper end of guidance with €399.4m, Q4 up meaningfully yoy across all operating segments and product groups

	Q4		FY
	By segment
In MEUR	Q4 2024	Q4 2023	FY 2024	FY 2023
North America	136.3	87.9	368.8	417.4
International	68.7	59.2	186.8	175.3
Holding	(39.8)	(33.2)	(155.0)	(145.0)
Group	164.3	113.6	399.4	447.6

	By product category
In MEUR	Q4 2024	Q4 2023	FY 2024	FY 2023
Meal kits	181.3	166.6	$\mathbf{5 4 2 . 3}$	550.6
AEBITDA margin meal kits	$\mathbf{1 4 . 1 \%}$	$11.4 \%$	$\mathbf{9 . 8 \%}$	$9.0 \%$
RTE	$\mathbf{2 6 . 0}$	$(16.3)$	$\mathbf{3 1 . 6}$	57.0
AEBITDA margin RTE	$\mathbf{5 . 3 \%}$	$(4.2 \%)$	$\mathbf{1 . 6 \%}$	$4.0 \%$
Others	$\mathbf{( 3 . 1 )}$	$(3.4)$	$\mathbf{( 1 9 . 4 )}$	$(15.1)$
Holding	$\mathbf{( 3 9 . 8 )}$	$(33.2)$	$\mathbf{( 1 5 5 . 0 )}$	$(145.0)$
Group	$\mathbf{1 6 4 . 3}$	113.6	$\mathbf{3 9 9 . 4}$	447.6

HELLOFRESH
GROUP

• FY AEBIT lower yoy given lower AEBITDA in H1 2024
• AEBIT ${ }^{1}$ increased in Q4 24 yoy to $€ 95.2 \mathrm{~m}$
• Q4 AEBIT by segment: ${ }^{(1)(2)}$
• NA: $€ 106.2 \mathrm{~m}$, up by $81.8 \%$ yoy
• Intl: $€ 44.6 \mathrm{~m}$, up by $17.2 \%$ yoy

HELLOFRESH
GROUP

UNAUDITED PRELIMINARY RESULTS

Q4 and FY Results 2024 | 15

FY meal kit AEBIT ${ }^{1}$ margin at 6.6\%, up yoy with an accelerating improvement in Q4, despite lower volumes

• Q4 2024 Mealkit AEBIT ${ }^{1}$ at $10.6 \%$, up yoy in absolute and relative terms for the second quarter in a row
• Key driver is continued focus on marketing ROI, leading to lower Q4 2024 yoy marketing spend, both in absolute and relative terms

Q4 meal kits AEBIT ${ }^{1}$ Margin (in € millions \& in \% of revenue)

FY meal kits AEBIT ${ }^{1}$ Margin (in $€$ millions \& in \% of revenue)

$6.4 \%$
$6.6 \%$

Q4 2023
Q4 2024
Q4 and FY Results 2024 | 16

Break-even FY RTE AEBIT, reflecting continued productivity improvements

• Q4 2024 RTE AEBIT ${ }^{1}$ positive at $€ 16.8 \mathrm{~m}$, a c. 10 pp yoy margin improvement
• Primary driver was an improved contribution margin, resulting from direct productivity gains, which are expected to continue into 2025

Q4 RTE AEBIT ${ }^{1}$ Margin (in $€$ millions \& in \% of revenue)

FY RTE AEBIT ${ }^{1}$ Margin (in $€$ millions \& in \% of revenue)

$(2.4 \%)$
34.4

$(2.8)$
$(2.8)$
$(2.4.1)$

Q4 2023 Q4 2024
2023
2024

Broadly stable Free Cash Flow of $€ 73.2 \mathrm{~m}^{(1)}$ for FY 2024

• FY 2024 Cash Flow from Operating activities lower yoy, primarily driven by lower EBIT and temporary adverse impact from changes in working capital
• Capex significantly reduced yoy from EUR 305.8m in 2023 to EUR 166.1m in 2024
• Acceleration of capex streamlining measures
• Some deferral of capex payments into 2025 (teens EURm)
  

2025 Outlook: Focus on efficiency reset

Illustrative numbers

Our efficiency measures target to disproportionately and sustainably boost profitability and cash generation

HELLOFRESH

GROUP