Q4 2024 D-Market Elektronik Hizmetler ve Ticaret AS Earnings Call
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Speaker Change: Thank you very much for watching this video, see you in the next video, bye!
Speaker Change: The presentation should then one of the seasons during the conference call. You may signal an operator by pressing star 0 or the telephone.
Speaker Change: At this time, I would like to turn the conference over to Ms. Nilhan Ollad, Gokcetekin CEO, Mr. Seckin Koseoglu, CFO, Ms. Teren Tuzcu, Investor Relations Director. Ms. Tuzcu, you may now proceed.
Speaker Change: Thanks, Operator. Thank you very much for joining us today for Hepsi Brothers' fourth quarter and full year 2024 earnings call. I am pleased to be joined on the call today by our CEO, Nilhan Onal Gokcetekin, and our CFO, Seckin Koseoglu.
Speaker Change: The following discussion reflects management's views as of today's date only. We undertake no obligation to update or revise this information except as required by law.
Speaker Change: Certain statements made on today's call are forward-looking statements. Actual results may differ materially from these forward-looking statements.
Speaker Change: Please refer to today's earnings release as well as the risk factors described in the safe harbor slide of today's supplemental slide deck.
today's press release.
Speaker Change: the 6K, our Form 20-F filed with the SEC on April 30, 2025, and other SEC filings for information factors that could cause our actual results to differ materially from this forward-looking statement.
Also, we will reference certain non-IFRS measures during today's call.
Speaker Change: Please refer to the appendix of our supplemental slide deck, as well as today's press release, for a presentation of the most directly comparable IFRS measures and the relevant IFRS to non-IFRS reconciliations.
Speaker Change: As a reminder, a replay of this call will be available on our Investor Relations website.
Speaker Change: With that, I hand over to our CEO, Nilhan. Thank you, Jenna. Welcome, everyone, and thank you for joining us. I'm delighted to be with you today to present our fourth quarter and full year results.
Speaker Change: On an unadjusted inflation basis, although G&A grew 10, 1% to 4% year on year and EBITDA as a percentage of G I needed to one third.
Speaker Change: Now I'd like to go into the performance of other operational metrics during the year.
Speaker Change: Our customers than merchant are always at the core of our ecosystem and we work hard to improve our value proposition for that.
Speaker Change: In line with our customer centric approach the improved reliability speed and convenience of our logistics services as well as payments Columbia with our diverse lending solution.
Speaker Change: Our active customers grew by 235000 to $12 2 million.
Speaker Change: Orders have shown 16 percentage points year on year growth, resulting in $131 4 million or a day and they would order frequency of overlap that mass reach some 0.8 up by 14%.
Speaker Change: Well merchant site D enhanced our logistics to man handling Tuesday, and advertising solution.
Speaker Change: We tend not to nurture faithful over hundred thousand we continue to onboard additional brands, particularly in the lifecycle categories.
Speaker Change: Maybe nobody know what April nobody achievements since the latter part.
Speaker Change: In line with our profitable growth strategy, we remain focused on three priorities.
Speaker Change: Customer loyalty cultivating the sustainable differentiator.
Speaker Change: The Japan has to pay and finally, expanding dollar beat to be servicing the off platform is the turnkey equinox solution partner for merchants.
Speaker Change: In August the basket for these Ted could you targets for each of these strategic priorities and now I'm pleased to share the progress we made throughout the year.
Speaker Change: Our loyalty program helps the world.
Speaker Change: The program continued to register increased customer loyalty, reaching $3 7 million member base enhancing the program offering these signed a partnership with Warner Bros. Discovery into Atlanta for and content providers, it's possible premium program benefits has likely bottomed.
Speaker Change: Our next strategic priority has been our data, we're just starting to see it faster.
Speaker Change: Huntsville to achieving this is tape is that's why the penetration within our merchant bank, thereby they did about 72% of total parcel dispatch during the year.
Speaker Change: Hipster jet confirms its commitment for differentiation to those service excellent confirming its integral role in our digital ecosystem next likely.
Speaker Change: Now, let's move on to our next strategic priority, which is capitalizing on our differentiation through landing solution.
Speaker Change: Our lending solutions include inhouse buy now pay later.
Speaker Change: In house consumer Finance home shopping Ross from partner banks, and general purpose bonds from our partner banks.
Speaker Change: Over the last about a month, our total lending volume.
Speaker Change: Reached 16.2 billion Euro, which is two six times of the total volume into that entity.
Speaker Change: Overall, our beyond yes, consumer finance loans in shopping malls that are utilized in over three points of emails in order.
Speaker Change: They're locked in.
Speaker Change: Next slide please.
Speaker Change: Our fourth key priority is all three strong capabilities to other merchants.
Speaker Change: Let me start with Texas yet.
Speaker Change: We told her forest to mill the imposter. They live origin Salon support hipster jet increased its all speed up on volume by 8% to 9% year on year.
Speaker Change: Accordingly Tonight and support its off platform share rose by 9.7 percentage points year on year, So nearly 30.
Speaker Change: 34, 6% of its total volume.
Speaker Change: Next I would like to talk about pets, the pace won't connect checkout solution pay the types of things.
Speaker Change: We continue to expand its convenient solution to other retailers and all other lucky hits. The pay is not integrated mid continent, 40 care com by Amdocs Tabatha for for all of our strategic priorities solid progress in our kpis throughout the year reflects the dedicated side.
Speaker Change: For myself and strong execution by Ensign.
Speaker Change: Okay.
Speaker Change: Make me say if you work on earnings Tonight.
Speaker Change: Thoughtful answer to Vantiv, five, but very challenging due to ongoing macroeconomic headwinds pressuring purchasing power of our consumers and millions boycott against shopping stocking much.
Speaker Change: Other marketing activities. We're also hidden message in all power former channel due to political instability and the level of cost in the first class it off there.
Speaker Change: However, as you know the I'll say, the very positive milestone forehead, where it all starts tonight to five years on gender balance at nine the closing of the Tonight auction between coffee and other fonder. The members of the armed favorably to purchase at 65, 4% controlling stake and that's worth about that now.
Speaker Change: We are extremely excited about the potential value creation opportunities that arise from this deal. It's coffee is the preeminent payments marketplace and fintech ecosystem in Quebec and stuff.
Speaker Change: With this I. Thank you for listening and leave the floor to fetch Kim our CFO to provide further insights into all of our financial platforms.
Thank you Nicole and welcome everyone.
Kim: I'm delighted to be with you today to present, our fourth quarter and full year results.
On an unadjusted for completion basis, our GMB grew by 49, 4%.
Kim: Close to our guidance of 50% to 55%.
Kim: And our EBITDA as a percentage of G. M. B reached one 8% in line with our guidance of one 8% to 2% in the fourth quarter.
Kim: Adjusted for inflation or G. M D rose by 12, 1% in 2024 compared to full year 2023.
Kim: On the profitability side, our gross contribution margin rose to 11, 3% with a 2.1 percentage point improvement compared to last year.
Kim: Our EBITDA as a percentage of G. M E rose to one point bumpers tend towards the full years. This is a 0.7 percentage points rise year on year.
Kim: Let's go over the details of this performance.
Kim: In 2024, 12 point bumper Centaur real GMB growth came through hungrier than $31 4 million orders and a higher average order value.
Kim: Excluding our digital products, our order growth was the.
Kim: 8% in 2024 compared to the previous years.
Kim: Average order value growth of around 4% due to faster than inflation rising average selling prices.
Kim: During 2024, we saw a two nine percentage point shift towards our marketplace operations compared to 2023.
Kim: Our three P operations corresponded to around 70% of our business.
Kim: This shift came as a result of a 2.9 percentage point shift towards non electronics, which is in line with our broader strategy.
Kim: Let's take a look at our revenue and gross contribution dynamics.
Kim: First some color on revenues.
Kim: Our revenue grew by six 4% in quarter four bringing our revenue growth for the full year to 11.1% compared to the same periods of last year.
Kim: Our revenue growth in quarter, four was mainly due to a 15 percentage rise in GPU revenue, 18% increase in delivery service revenue and 127 increase in other revenue.
Kim: These were partially offset by the one six percentage decrease in our one P revenue as a result of the shift in G M b towards GP compared to quarter four 2023.
Kim: Our revenue growth in 2024 was mainly due to the 50% increase in delivery revenue and 112% increase in other revenue, including our advertising services revenues and hips erode that premium subscription revenues.
Kim: 12% revenue growth in marketplace operations also contributed to our overall revenue growth in 2024.
Kim: The gross contribution margin improved by two points, one percentage points to 11, 3% in 2024 compared to last years.
Kim: This margin improvement was mainly attributable to increased delivery service revenue higher other revenue, including ads on premium subscription revenue together with an increase in the <unk> margin.
Kim: Let's move on to our EBITDA performance on the next slide.
Kim: Okay.
Kim: We recorded 1.1% EBITDA as a percentage of G. M. B in 2024, with a 0.7 percentage points yearly improvement.
Kim: Excluding the one off items in 2023 year on year improvement in EBITDA was at 0.9 percentage points for the full year 'twenty 'twenty four.
Kim: This 0.7% improvement was driven by a two point bump percentage rise in gross contribution margin, partially offset by 0.5 percentage rise in payroll and all sorts of stuff expenses.
Kim: 0.4 percentage rise in shipping and packaging expenses is 0.2 percentage rise in advertising expenses and 0.3 percentage right in other operating expenses.
Kim: The rise in payroll and also stuff expenses came from the annual in midyear salary rises along with Verizon employee number for our subsidiary.
Kim: The increase in shipping and packaging expenses as a percentage of G. M. B was mainly driven by a higher personal volume and the horizon delivery fees per unit combined with annual minimum wage increases.
Kim: The increase in other operating expenses was mainly due to the recognition of provision for the license fee amounting to 180 million TL and higher bad debt provisions in 2024.
Next let's say to look at our cash flow dynamics.
Kim: For full year 2020 for free cash flow decreased by $1 9 billion TL compared to a year ago.
Kim: This decrease was mainly due to a $1 55 billion decrease in net cash provided by operating activities and zero point towards the 4 billion TL in fees and Capex.
Kim: With 2 billion TL in Capex.
Kim: Our free cash flow was $3 7 billion for the full year 2024.
Kim: With this I will now hand over to nil for the key takeaways.
Kim: We leave you with the following key takeaways from today's presentation for the Yadkin vantage for VZ called the real double digit Gianni if at all so that's 0.1 touch that.
Kim: Supported by two one percentage points rising gross contribution.
Kim: EBITDA reached $2 1 billion corresponding to one point sponsors out of G. I mean 74.
Kim: All coupon we had two important developments on one side the your talks with the big macro economic headwinds.
Kim: Yesterday, the purchasing power of consumers and boycott started against shopping on.
Kim: On the other because once it gets by an important milestone in the company's history. It took place on COVID-19.
Kim: They're costly ownership they are excited about the opportunities we foresee going forward right.
Kim: With that I will.
Kim: We'd like to thank you all for listening.
Kim: So they'd be the answer the Q&A, but we are much looking forward to connecting with you and your questions. Please direct them to our Investor relations. Thank you.
Kim: Ladies and gentlemen, the conference is now concluded you may disconnect. Your telephone thank you for calling and have a good afternoon.
Kim: Yeah.
Kim: [music].