windeln.de SE — Interim / Quarterly Report 2016

May 24, 2016

QUARTERLY STATEMENT Q1 2016

WINDELN.DE GROUP AT A GLANCE

Performance Indicators	Q1 2016	Q1 2015 R*	Change
Site Visits	27,477,596	14,298,837	92.2%
Mobile Visit Share (in % of Site Visits)	65.2%	65.5%	-0.3 pp
Mobile Orders (in % of Number of Orders)	47.4%	46.7%	0.7 pp
Active Customers	1,023,405	555,984	84.1%
Number of Orders	708,311	453,793	56.1%
Average Orders per Active Customer
(in number of orders)	2.5	2.8	-9.3%
Share of Repeat Customer Orders (in % of Number of Orders)	80.1%	83.6%	-3.5 pp
Gross Order Intake (in EUR )	63,777,654	41,969,972	52.0%
Average Order Value (in EUR )	90.0	92.5	-2.7%
Marketing Cost Ratio (in % of revenues)	6.7%	5.0%	1.7 pp
Adjusted Fulfilment Cost Ratio (in % of revenues)	18.6%	10.5%	8.1 pp
Adjusted Other SG&A Expenses (in % of revenues)	18.1%	13.6%	4.5 pp
Earnings Position
Revenues (in kEUR )	52,132	35,649	46.2%
Gross Profit (in kEUR )	14,926	9,129	63.5%
Gross Profit (as % of revenues)	28.6%	25.6%	3.0 pp
Operating Contribution (in kEUR)	1,756	3,581	-51.0%
Operating Contribution (as % of revenues)	3.4%	10.0%	-6.6 pp
Adjusted EBIT (in kEUR )	-7,694	-1,276	> 100%
Adjusted EBIT (as % of revenues)	-14.8%	-3.6%	-18.4 pp
Net Asset and Financial Position
Cash flow from operating activities (in kEUR )	-9,033	1,202	< -100%
Cash flow from investing activities (in kEUR )	-896	-585	53.2%
Cash and cash equivalents at the end of the period (in kEUR)	78,730	33,065	> 100%
Other
Basic earnings per share (in EUR)	-0.37	-0.31	19.4%
Diluted earnings per share (in EUR)	-0.37	-0.30	23.3%

MATERIAL TRANSACTIONS IN Q1 2016

In connection with the acquisitions of the Feedo Group and Bebitus, equity-settled share-based payment awards were granted to members of the local management boards. From an economic perspective, the equity-settled share-based payment awards are part of the purchase price. In Q1 2016, personnel expenses of kEUR 1,916 were recognized within administrative expenses. Thereof, kEUR 594 relate to the Feedo Group, and kEUR 1,322 relate to Bebitus. The corresponding portion within share premium increased from kEUR 2,578 on December 31, 2015 to kEUR 4,446 on March 31, 2016. The non-financial asset relating to the prepayment incurred on the acquisition date was reduced by kEUR 48 in Q1 2016. As of March 31, 2016, the non-current portion amounts to kEUR 240, and the current portion amounts to kEUR 192.

The fair value of short-term employee benefits to local management, incurred in the acquisition of Bebitus, increased by kEUR 39 in Q1 2016 and is recognized as personnel expenses within administrative expenses. The liability thus amounts to kEUR 2,310 as of March 31, 2016 is recognized within other current non-financial liabilities.

As of March 31, 2016, fair values of the contingent considerations from the acquisitions of the Feedo Group and Bebitus amount to kEUR 6,813 (December 31, 2015: kEUR 6,856). The change relating to the Feedo Group of kEUR 50 was recognized within financial expenses, the change relating to Bebitus of kEUR 93 was recognized within financial income. For the acquisition of the Feedo Group, kEUR 2,362 is recognized within other current financial liabilities, and kEUR 1,027 is recognized within other non-current financial liabilities, as of March 31, 2016. For the acquisition of Bebitus, kEUR 2,236 is recognized within other current financial liabilities, and kEUR 1,188 is recognized within other non-current financial liabilities, as of March 31, 2016.

In January 2016, a review process of the issued seller guarantees was started, in the course of which windeln.de AG and two of the sellers of the Feedo Group agreed on a compensation payment in March 2016. As a result, windeln.de AG recognized other operating income in the amount of kEUR 1,050. In May 2016, windeln.de AG agreed with the other sellers of the Feedo Group on a compensation payment of kEUR 2,128 as well as on further changes to the contingent considerations (Earn Out).

In the end of 2015, stock options have been exercised. The registration of the corresponding capital increase for the issuance of new shares in the Commercial Register was completed in Q1 2016. As a result, issued capital increased by kEUR 537; and the share premium increased by kEUR 26 compared to December 31, 2015.

In Q1 2016, management decided to change the third-party warehouse supplier for Bebitus Retail S.L. in Spain. As a result of the warehouse move, expenses in the amount of kEUR 238 have been accrued.

In January 2016, management decided to scale down warehouse capacities in Switzerland so as to realize efficiency advantages from one central warehouse.

In January 2016, the secured borrowing base credit framework agreement with Commerzbank AG for kEUR 5,000 was extended by another year and therefore terminates on March 15, 2017.

In February 2016, the secured credit line agreement with DZ BANK AG Deutsche Zentral-Genossenschaftsbank for kEUR 4,000 was extended by another year and therefore terminates on March 31. 2017.

By means of a Shareholders' Agreement effective January 11, 2016, windeln.de AG founded a new subsidiary Cunina GmbH. The subsidiary was founded in order to launch the Group's private label business. The company is a fully owned subsidiary of

windeln.de AG and is fully consolidated in the windeln.de Group financial statements. The entry in the Commercial Register took place on April 6, 2016.

COMMENTS ON NET ASSETS, FINANCIAL POSITION AND RESULTS OF OPERATIONS

As of March 31, 2016, the assets of the windeln.de Group decreased by kEUR 9,469 to kEUR 149,990 compared to December 31, 2015. The decline is substantially attributable to the decline in cash and cash equivalents as presented in the consolidated statement of cash flows.

In contrast, other current financial assets increased by kEUR 351 to kEUR 3,076. The increase results from a compensation claim in the amount of kEUR 1,050 against two of the sellers of the Feedo Group and is recognized in profit or loss in the first quarter 2016. This is contrasted by a decline in accrued advertising subsidies in the amount of kEUR 776.

In April 2016, windeln.de AG changed its ERP system. As of March 31, 2016, expenses for the ERP system of kEUR 1,075 were capitalized within intangible assets.

The liabilities of the windeln.de Group decreased by kEUR 2,569 to kEUR 42,012. This is substantially attributable to a decline in trade payables by kEUR 3.681. Because of the introduction of a new ERP system, the Group made early payments in March 2016 for payables due in April.

In addition, non-current financial liabilities in connection with contingent considerations in the amount of kEUR 1,163 have been reallocated to current financial liabilities in the first quarter 2016.

In the first quarter of 2016, the Group generated revenues of kEUR 52,132, representing an increase of 46% compared to the first quarter 2015 (kEUR 35,649).

Revenues increased in every region and in all three segments. In particular, the segment International Shops shows a strong growth due to the acquisitions carried out in 2015. As a result, the three shops of the Feedo Group (kEUR 4,369) and Bebitus (kEUR 5,109) took an important part in the revenue growth of the Group.

Compared to the first quarter of 2015, the margin (gross profit as percentage of sales) improved by 3 %. The positive development of the margin is in particular attributable to the increased sales of products with higher margin, improved purchasing conditions with suppliers as well as the introduction of direct delivery to China in the third quarter of 2015.

Compared to the first quarter 2015, selling and distribution expenses increased absolutely and also in comparison to gross profit. This can particularly be explained by the introduction of direct delivery to China. In addition, selling and distribution expenses as percentage of gross margin of subsidiaries acquired in the second half of 2015 are slightly higher compared to those of the German shops.

Compared to the first quarter 2015, administrative expenses decreased on an absolute basis as well relatively compared to gross profit. This can mainy be explained with disproportionally higher expenses for share based compensation in the first quarter of 2015 in connection with the modification of the share based payment program.

The increase of other operating income is attributable to a compensation claim in the amount of kEUR 1,050 against two sellers of the Feedo Group recognized in the first quarter of 2016.

The increase of other operating income is attributable to a compensation claim in the amount of kEUR 1,050 against two sellers of the Feedo Group recognized in the first quarter of 2016.

ADJUSTED OUTLOOK

windeln.de Group expects not to reach the revenues and earnings forecasts for the financial year 2016. After record revenues in March, revenues with customers in China are below expectations in the beginning of the second quarter. Based on an updated forecast, the Management Board decided to adjust its outlook for the financial year 2016 on May 18, 2016.

windeln.de Group now expects an increase in revenues of approximately 30 % year over year and an adjusted EBIT margin between -10 % to -12 % in 2016. The gross margin is still expected to be at least 28 %.

On April 8, 2016, the Chinese government changed import and customs regulations for the delivery of goods to China. windeln.de's shipments to China are not affected except for a moderate increase in customs. The new regulations particularly aim at reducing uncontrolled shipments of goods to China by unauthorized traders by starting to tax them. As a result, the Management Board sees additional upside potential for its Chinese business in the medium-term. Among other initiatives windeln.de plans to exploit this by opening a "Tmall" shop in the second half of the year. Currently however, uncertainty and reluctance to purchase exist among Chinese customers as details of the revised regulation and its practical impact have not yet been clarified.

In addition to the initiatives for the Chinese business, the Management Board has initiated further measures to support the Group's growth and to further improve profitability:

• The change of the ERP system is the basis to improving operational performance and allows scalability. At this point, the implementation has largely been completed. As expected, the conversion temporarily has affected results in April and May.
• The integration of foreign subsidiaries is progressing as planned especially in IT, marketing and purchasing. This will lead to significant synergies within the next 12 to 24 months at continued strong growth.

REGIONAL AND SEGMENT RESULTS OF OPERATIONS

REVENUES BY REGION

in kEUR	Q1 2016	Q1 2015 R*	Change
Revenues	52,132	35,649	46.2%
Germany, Austria, Switzerland (GSA)	19,225	15,443	24.5%
in % of total revenues	36.9%	43.3%	-6.4 pp
China	21,778	19,578	11.2%
in % of total revenues	41.8%	54.9%	-13.1 pp
Other/rest of Europe	11,129	628	> 100%
in % of total revenues	21.3%	1.8%	19.5 pp

SEGMENT INFORMATION

in kEUR	Q1 2016	Q1 2015 R*	Change
Revenues	52,132	35,649	46.2%
German Shop	34,795	30,698	13.3%
International Shop	12,244	1,402	> 100%
Shopping Clubs	5,093	3,549	43.5%
EBIT	-9,744	-6,283	55.1%
German Shop contribution	-297	1,158	< -100%
International Shops Contribution	-5,214	-736	> 100%
Shopping Clubs Contribution	-1,230	-966	27.3%
Reconciling item to Group EBIT	-3,003	-5,739	-47.7%
Adjusted EBIT	-7,694	-1,276	> 100%
German Shop contribution	-231	1,703	< -100%
in % of revenues	-0.7%	5.5%	-6.2 pp
International Shops contribution	-2,903	-534	> 100%
in % of revenues	-23.7%	-38,1%	14.4 pp
Shopping Clubs contribution	-1,226	-773	58.6%
in % of revenues	-24.1%	-21.8%	2.3 pp
Reconciling item to adjusted Group EBIT	-3,334	-1,672	99.4%

ADJUSTED EBIT

in kEUR	Q1 2016	Q1 2015 R*
Earnings before interest and taxes (EBIT)	-9,744	-6,283
adjusted for costs in connection with the IPO	-	926
adjusted for costs of acquisition, integration and expansion	-585	105
adjusted for share-based compensation	2,322	3,976
thereof cost of sales	2	-
thereof selling and distribution expenses	-21	367
thereof administrative expenses	2,341	3,609
adjusted for costs of reorganization	248	-
adjusted for costs of restructuring under corporate law	65	-
Adjusted EBIT	-7,694	-1,276

* In the comparative period Q1 2015 share based payments have been restated. For further information please refer to the Nine Months Report 2015.

CONSOLIDATED INCOME STATEMENT AND OTHER COMPREHENSIVE INCOME

in kEUR	Q1 2016	Q1 2015 R*
Revenues	52,132	35,649
Cost of sales	-37,206	-26,520
Gross profit	14,926	9,129
Selling and distribution expenses	-19,772	-9,173
Administrative expenses	-5,986	-6,362
Other operating income	1,171	386
Other operating expenses	-83	-263
Earnings before interest and taxes (EBIT)	-9,744	-6,283
Financial income	110	2
Financial expenses	-61	-11
Financial result	49	-9
Earnings before taxes (EBT)	-9,695	-6,292
Income taxes	0	-195
PROFIT OR LOSS FOR THE PERIOD	-9,695	-6,487

Other comprehensive income that may be reclassified to profit or loss in

subsequent periods:

Exchange differences on translation of foreign operations	28	254
OTHER COMPREHENSIVE INCOME/LOSS, NET OF TAX	28	254
TOTAL COMPREHENSIVE INCOME, net of tax	-9,667	-6,233
Basic earnings per share (in EUR)	-0.37	-0.31
Diluted earnings per share (in EUR)	-0.37	-0.30

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

2015 2016 in kEUR NON-CURRENT ASSETS 32,748 Intangible assets 1,682 Fixed assets 151 Other financial assets 495 Other non-financial assets 2 Deferred tax assets 35,078 Total non-current assets CURRENT ASSETS 28,158 Inventories 653 Prepayments 1,361 Trade receivables 5 Income tax receivables 3,076 Other financial assets 2,929 Other non-financial assets 78,730 Cash and cash equivalents 114,912 Total current assets 149,990 TOTAL ASSETS December 31, March 31, Equity and liabilities 2015 2016 in kEUR EQUITY 26,283 Issued capital 156,276 Share premium -74,587 Accumulated loss 6 Cumulated other comprehensive income Total equity 107,978 NON-CURRENT LIABILITIES Defined benefit obligations and other accrued employee benefits 224 Other Provisions 152 Financial liabilities 147 Other financial liabilities 2,337 Deferred tax liabilities 6,167 9,027 Total non-current liabilities CURRENT LIABILITIES Other provisions 2,322 Financial liabilities 42 Trade payables 14,456 Deferred revenue 4,797 Income tax payables 10 Other financial liabilities 7,926 Other non-financial liabilities 3,432 32,985 Total current liabilities 149,990 TOTAL EQUITY AND LIABILITIES	Assets	March 31,	December 31,
32,428 1,334 33 289 2 34,086 27,099 1,670 2,469 5 2,725
2,727 88,678 125,373 159,459 25,746 154,046 -64,892 -22 114,878 201 221 73 3,542 6,171 10,208 2,221 41 18,137 4,352 9 6,028 3,585 34,373 159,459

CONSOLIDATED STATEMENT OF CASH FLOWS

in kEUR	Q1 2016	Q1 2015 R*
Profit or loss for the period	-9,695	-6,487
Amortisation (+) / write-up (-) of intangible assets	201	163
Depreciation (+) / write-up (-) of fixed assets	136	48
Increase (+)/decrease (-) in other provisions	32	194
Non-cash expenses (+) from emplyee benefits	2,229	3,989
Other non-cash expenses (+) / income (-) items	-208	48
Increase (-) / decrease (+) in inventories	-1,061	-67
Increase (-) / decrease (+) in prepayments	1,018	44
Increase (-) / decrease (+) in trade receivables	1,302	-27
Increase (-) / decrease (+) in other assets	-772	908
Increase (-) / decrease (+) in restricted cash	-107	-
Increase (+) / decrease (-) in trade payables	-3,644	356
Increase (+) / decrease (-) in deferred revenue	445	355
Increase (+) / decrease (-) in other liabilities	1,106	1,478
Interest expenses (+) / income (-)	-10	5
Income tax expenses (+) / income (-)	-6	195
Income tax paid (-) / received (+)	1	-
Net cash flows from / used in operating activities	-9,033	1,202
Purchase (-) of intangible assets	-503	-494
Purchase (-) of fixed assets	-408	-92
Interest received (+)	15	1
Net cash flows from / used in investing activities	-896	-585
Transaction cost (-) on issue of shares	-	-10
Repayment (-) of finance-lease liabilities	-11	-7
Proceeds (+) from financial liabilities	-	146
Repayment (-) of financial liabilities	-3	-1,505
Interest paid (-)	-5	-6
Net cash flows from / used in financing activities	-19	-1,382
Cash and cash equivalents at the beginning of the period	88,678	33,830
Net increase / decrease in cash and cash equivalents	-9,948	-765
Change in cash and cash equivalents due to foreign exchange rates	0	0
Cash and cash equivalents at the end of the period	78,730	33,065

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

				Actuarial	Exchange
				gains/losses	differences
				from remeas	on transla
				urement of	tion of	Other com
	Issued	Share	Accumu	defined benefit	foreign	prehensive	Total
in kEUR	Capital	premium	lated loss	pension plans	operations	income	Equity
As at January 1, 2016	25,746	154,046	-64,892	-28	6	-22	114,878
Total comprehensive income for the period	-	-	-9,695	-	28	28	-9,667
Issue of share capital	537	27	-	-	-	-	564
Transaction costs	-	-	-	-	-	-	-
Share-based payments	-	2,203	-	-	-	-	2,203
As at March 31, 2016	26,283	156,276	-74,587	-28	34	6	107,978
As at January 1, 2015	163	68,911	-34,488	10	25	35	34,621
Total comprehensive income for the period	-	-	-6,487	-	255	255	-6,232
Issue of share capital	-	-	-	-	-	-	-
Transaction costs	-	-7	-	-	-	-	-7
Share-based payments	-	10,325	-	-	-	-	10,325
As at March 31, 2015 R*	163	79,229	-40,975	10	280	290	38,707

windeln.de AG Quarterly Statement Q1

Editorial team and contact : windeln.de AG • Hofmannstrasse 51 c • 81379 Munich, Germany • corporate.windeln.de Investor Relations: Alexandra von Kempis • E-Mail: investor.relations@windeln.de Concept, text, layout and design: windeln.de AG • Picture credits : Fotolia, iStock