Redcare Pharmacy N.V. — Call Transcript 2021

Nov 1, 2021

Q3 2021 EARNINGS CALL PRESENTATION.

SEVENUM, 2 NOVEMBER 2021

WELCOME TO EUROPE'S LEADING CUSTOMER-CENTRIC E-PHARMACY PLATFORM. Q3 EARNINGS CALL.

THURSDAY, 28 OCTOBER 2021: FIRST E-PRESCRIPTIONS RECEIVED AND SUCCESSFULLY PROCESSED.

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UPDATE ON E-RX.

• GEMATIK E-RX PILOT SCALED UP AND EXTENDED UNTIL END OF NOVEMBER.
• COVERAGE OF TECHNICAL REQUIREMENTS CONNECTORS, E-HBAs, PHYSICIAN / PHARMACY SOFTWARE SYSTEMS – EXPANDING QUICKLY.
• NO "BIG BANG" ON JANUARY 1 BUT GRADUAL E-RX ADOPTION OVER COMING MONTHS.

ALREADY RECEIVED AND SUCCESSFULLY PROCESSED FIRST E-PRESCRIPIONS.

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UPDATE ON LOGISTICS. READY FOR E-RX.

PROCESS AND SHIP MORE THAN 100,000 PARCELS A DAY.

PRESENTING YOU OUR NEXT-GENERATION LOGISTICS CENTRE.

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UPDATE ON LOGISTICS.

• MOVE TO OUR NEW LOGISTICS CENTRE FULLY COMPLETED IN EARLY SEPTEMBER THIS YEAR.
• PREVIOUS CAPACITY CONSTRAINTS RESOLVED.
• SHORTAGE OF LOGISTICS PERSONNEL SUCCESSFULLY ADDRESSED.

RETURNING TO OUR GROWTH TRAJECTORY.

FINANCIAL PERFORMANCE.

KEY FACTS / 9 MONTHS.

• SUSTAINED GROWTH AFTER 9 MONTHS. SALES INCREASE 9.8% TO EUR 772.3M; DACH UP 4.5%, INTERNATIONAL UP 38%.
• ADJ. EBITDA EUR 4.7M. ADJ. EBITDA MARGIN 0.6%.

KEY FACTS

Q2

2021

• STRONG CUSTOMER GROWTH. YEAR OVER YEAR INCREASE ACTIVE CUSTOMERS BASE 1.4M TO 7.3M.
• CUSTOMER SATISFACTION BACK ON HIGH LEVEL. NPS RECOVERED AFTER TEMPORARY DIP MID-YEAR.
• SOLID BALANCE SHEET.

POSITIVE OPERATING CASH FLOW OF EUR 28M; Q3 CASH BALANCE EUR 315M.

• E-RX HAS STARTED – FINALLY.

KEY FINANCIALS. BOTH SEGMENTS WITH CONTINUED GROWTH. DACH UP 4.5%; INTERNATIONAL UP 38%.

7.3M ACTIVE CUSTOMERS. CUSTOMER BASE GROWING STRONG.

BACK ON TRACK. CUSTOMER SATISFACTION ON HIGH LEVEL AGAIN.

WEB TRAFFIC. GROWTH +30% AFTER PURPOSEFUL SLOWDOWN MID-YEAR.

WEB TRAFFIC. SHOP-APOTHEKE.COM MOST POPULAR ONLINE PHARMACY IN GERMANY.

SOURCE: SIMILARWEB, 30. SEPTEMBER 2021.

GOOGLE ANALYTICS: SHOP-APOTHEKE. MOST SEARCHED PHARMACY BRAND IN GERMANY.

SOURCE: GOOGLE ANALYTICS 2021.

80%+ OF ORDERS FROM RETURNING CUSTOMERS. MORE THAN 14M ORDERS PROCESSED YTD.

KEY FINANCIALS. EUR 772M SALES AND EUR 4.7M ADJ. EBITDA.

Adjusted numbers in millions of euros	YTD 9M 2021 vs. 9M 2020			Q3 Q3 2021 vs. Q3 2020
	9M 2020	9M 2021	better/ (worse)	Q3 2020	Q3 2021	better/ (worse)
Sales	703.3	772.3	9.8%	238.7	237.9	(0.3%)
Gross profit margin	22.3%	25.4%	3.1pp	21.9%	25.0%	3.1 pp
Selling & distribution as percentage of sales	-17.5%	-21.7%	(4.2) pp	-17.6%	-22.7%	(5.1) pp
Administrative costs as percentage of sales	-2.6%	-3.1%	(0.5) pp	-2.6%	-3.2%	(0.6) pp
Adj. EBITDA	15.5	4.7	(10.8)	4.2	-2.2	(6.4)
Adj. EBITDA margin	2.2%	0.6%	(1.6) pp	1.8%	-0.9%	(2.7) pp
EBITDA	12.1	-3.6	(15.7)	2.8	-5.2	(8.0)

Q3 2020	Q3 2021	better/ (worse)

Adjustments in 9M 2021 EUR 8.2M: Non-cash employee stock option costs and one-off costs related to projects, which included the set-up of new logistics centre and acquisition expenses.

9M KEY FINANCIALS. GROSS MARGIN UP 3.1 PERCENTAGE POINTS.

9M KEY FINANCIALS. SELLING & DISTRIBUTION UP 4.2 PERCENTAGE POINTS.

KEY FINANCIALS. SOLID CASH POSITION.

OPERATING CASH: +EUR 28 MILLION. Positive EBITDA and working capital improvements.

INVESTMENTS: EUR 73 MILLION. Smartpatient, MedApp, new logistics centre in NL, regular IT and PP&E.

FINANCING: EUR +232 MILLION. Successful convertible bonds campaign of EUR 225 million past Q1 (coupon of 0%).

FINANCIAL GUIDANCE.

• LONG-TERM TARGET PROFITABILITY UNCHANGED: IN EXCESS OF +6% EBIT.
• GUIDANCE FOR 2021
• SALES GROWTH GUIDANCE FOR THE FULL YEAR NARROWED DOWN TO THE LOWER END OF THE RANGE TO AROUND 10%.
• ADJUSTED EBITDA MARGIN GUIDANCE FOR THE FULL YEAR NARROWED DOWN TO -1% (-10M)
• CAPEX EXCLUDING ACQUISITIONS UNCHANGED: AROUND 45M.

Q&A SESSION.

FEEL FREE TO ASK QUESTIONS... PLEASE MUTE THE WEBCAST. DIAL IN FROM YOUR PHONE.

LOCATIONS.	PHONE NUMBERS.
GERMANY, Frankfurt	+49 (0) 69 2222 2018
UK, LOCAL	+44 (0) 33 03 36 94 34
USA, Los Angeles	+1 323-794-2093
Confirmation Code: 5155882

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THANK YOU FOR YOUR TIME.