XXL

Earnings Release • Oct 25, 2017

XXL ASA - Third quarter 2017 results - Results back on track and solid start in Austria

XXL ASA - Third quarter 2017 results - Results back on track and solid start in Austria

XXL ASA delivered a growth of 16 per cent for the third

quarter 2017, driven by new stores and like-for-like growth

of 6 per cent. The Swedish and Finnish operations showed the

strongest improvements compared to last year. EBITDA for the

Group amounted to NOK 252 million in the quarter,

corresponding to 18 per cent growth and a stable margin of

10.4 per cent, despite the establishment of XXL in Austria.

Group EBITDA adjusted for the start-up in Austria were NOK

268 million, corresponding to a margin of 11.1 per cent. XXL

has been well received by the Austrian consumers both in the

store and online, proving the uniqueness of the XXL concept.

Highlights Q3 2017

- Total revenues of NOK 2 417 million (NOK 2 080

million), up 16 per cent

- Like-for-like growth of 6 per cent

- EBITDA of NOK 252 million (NOK 214 million)

- Solid results driven by Sweden and Finland

- Launch in Austria proving the strength of the XXL

concept

Outlook

XXL has signed 11 new lease agreements for store openings in

2017 where of 1 in Norway, 4 in Sweden, 4 in Finland and 2

in Austria. This includes 6 stores that XXL had opened by

the end of Q3 2017.

XXL has already signed 5 new lease agreements for future

store openings in 2018 and aims for 7-10 new stores in total

for 2018. XXL will at all time evaluate the trend of

E-commerce growth compared to opening of new stores. The

required market size for a new store will be increased.

To continue the growth strategy, within both stores and

E-commerce, and in new markets as well as existing markets,

XXL will invest in infrastructure, IT and training

facilities. These investments are expected to be in the

range of NOK 70-90 million for 2017. In addition XXL has

refurbished two stores with CAPEX similar to two new stores.

The Group maintains the following long term objectives (on

full year basis):

- Like-for-like growth of mid-single digits over time

including E-commerce

- Gross margins to be stable. In Norway at low 40's, high

30's in Sweden and between mid and high 30's in Finland. Due

to the demanding macro in Finland the lift to high 30's may

take longer time than in Sweden

- EBITDA-margin stable as a result of stable gross margins

and operating expenses. In Norway at low 20's, in Sweden low

double digits and in Finland high single digits. Due to the

demanding macro in Finland the lift to high single digits

may take longer time than in Sweden.

Austria - average sale per store is expected to be around

EUR 12 million, while the gross margin and EBITDA-profile

will be as in Sweden over time when excluding for the build

up of a centralized organization for buying and support.

Hence, the start-up in Austria will have higher costs than

the launch in Sweden, Finland and Denmark. CAPEX per store

will be in the range of EUR 1.7-1.9 million and the average

pay-back per store is estimated to 4-5 years including net

working capital. The average pay-back time is after being

some time in the market, following an establishing period.

XXL expects between 15-20 stores in total in the Austrian

market.

For further information please find attached the quarterly

report and the presentation material.

The results will be presented at 08:30 CET by CEO Fredrik

Steenbuch and CFO Krister Pedersen. The presentation will

take place at our headquarters in Oslo, Strømsveien 245,

Alna Senter (entrance on the right side of Maxbo). The

presentation will be held in English and will be webcasted

at www.xxlasa.com. You may also follow the presentation live

by telephone. Dial-in details: +47 21 56 33 18 (Norway) and

+44(0) 20 3003 2666 (International), passcode - XXL Q3.

For further queries, please contact:

Tolle O. R. Grøterud

Investor Relations XXL ASA

Tel: +47 90 27 29 59

E-mail:ir@xxlasa.com

This information is subject of the disclosure requirements

pursuant to section 5-12 of the Norwegian Securities Trading

Act

About XXL ASA

XXL is a leading sports retailer with stores and e-commerce

in Norway, Sweden, Finland, Denmark and Austria. It is the

largest among the major sports retailers in the Nordics and

the fastest growing among the major sports retail chains in

the World. XXL pursues a broad customer appeal, offering a

one stop shop experience with a wide range of products for

sports, hunting, skiing, biking and other outdoor

activities. XXL's concept is to have the largest stores with

the best prices and the widest assortment of products,

focusing on branded goods.