Fashion Group Q2 results presentation. I will now hand over to Patrick Schmidt, CEO. Please go ahead. Thank you. Good morning, everyone, and welcome to Global Fashion Group's Q2 results presentation. I am Patrick Schmidt, and I am joined today by my Co-CEO, Christoph Barchewitz, and our CFO, Matthew Price. I will provide an update on our strategy. Matthew will take you through the financial results for the quarter and the outlook for the remainder of the year. After that, we will open it up for Q&A. Our teams have delivered another great set of results, growing the business strongly and improving profitability. To start, I want to highlight that COVID-19 continues to have a significant impact across all of our markets. Vaccination rates remain low to very low across all our markets. The bar chart illustrates the percentage of the population fully vaccinated at the end of June. While these rates have increased, there is still a meaningful difference to Europe and the U.S. Across most of our regions, physical retail has remained opened. However, day-to-day life is still a long way from normal, impacting the overall demand for fashion and lifestyle products. Given how early our markets are in terms of e-commerce, we believe more than ever in their potential, especially when our markets have fully recovered. The momentum from the first quarter has continued, and we are announcing another strong set of quarterly results today. Last year's comparable quarter was impacted by the onset of COVID. As a consequence, some of the variances are a one-offs, and to help you think about this, we have disclosed the 2019 numbers in some parts of the presentation as a more normalized base. As usual, we are presenting constant currency growth rates today. We achieved net merchandise value of EUR 610 million, up 32% year-on-year. Once again, marketplace was the strongest driver of NMV. Our active customer base grew by 16% to reach 17 million, driven by strong growth in new customers and an increase in the activity of repeat customers. As a result, orders were up by 22% to reach nearly 13 million. Order frequency is growing again, increasing 10% to an all-time high of 2.8x orders per customer per year. Gross margin was 46%, up 3.5 percentage points year-on-year, driven by better retail margin and marketplace growth. Last year, our adjusted EBITDA was supported by unusually low marketing investment, which has now recovered to pre-pandemic levels. Despite the step-up in investment, we have delivered a similar level of adjusted EBITDA margin this year. Let's now have a look at the progress of our strategic priorities in the second quarter of 2021. Our strategic priorities are to build a best-in-class customer experience, to be the partner of choice for brands, and to do this while being people and planet- positive. We have continued our progress on all of these priorities. Let me walk you through the details of this now, starting with our customers on slide 6. We are constantly improving the shopping experience for our customers, and we want to give you a few highlights using the CIS region as an example. Inspiration and personalization are key in fashion. We have observed that customers search less and browse more. That's why we have introduced new ways of exploring fashion online, such as our Discovery Hub, a personal stylist service, and gamification. We've also been making improvements in our delivery service, ensuring it remains fast, convenient, and efficient. Over the last year, we have increased the number of our pickup points in CIS by approximately 40% to now 430, and in Q2 alone, added 35 new cities to our delivery network. Over 80% of our customers in CIS use our try- on service, either at the pickup point or through try- on at the door. It is a fantastic premium service with our couriers reliably delivering to the customers within one hour of their choice. As outlined during the CMD, growing premium remains a key priority for us, and in Q2, we have continued to build our premium proposition, creating more choice and adding new relevant and inspiring brands. We are excited about the successful trials for our new premium packaging, which is being rolled out across the region. As a result of all of these efforts, we are already seeing positive dynamics with premium AOVs increasing 20% year-over-year in CIS. Last quarter, we showed the strong data coming out of NZ, which gives us helpful insights into how demand is going to change when countries reopen. Now, Australia was largely COVID-free in Q2. That obviously has changed, and as a result, in Q2, we have seen going-out categories such as dresses and heels grow faster again. Pre-COVID, these categories have been our most important growth drivers, and we expect for this to be the case again post-pandemic. On the other hand, in Q2, across other regions, we have seen lockdown categories continue to over-index, growing nearly as fast as going-out categories. This difference in category performance is most pronounced in LATAM. This data demonstrates that we are able to capture demand across both categories, that most of our markets have not yet benefited from the bounce back in fashion and lifestyle, which we have seen in Q2 in ANZ. A key differentiator of our business model is our decentralized, highly localized approach, which helps to ensure that we are the partner of choice for both local and global brands. During the last quarter, we have successfully onboarded key local partners. In Brazil, we are delighted that we now have three of the Magazine Luiza, which are similar to department stores, offering our customers their assortment. In Australia, we have secured the iconic brands Country Road, Mimco, Trenery, and Witchery, which are all in the top 50 brands in Australia. We're also very pleased with our progress securing key global brands. In CIS, we have extended our partnership with Inditex to Massimo Dutti, which, as mentioned before, helps to strengthen our premium proposition at Lamoda. The same is true for new brands such as kate spade new york, Yves Saint Laurent, Marc Jacobs, and Coach. In summary, our brand assortment has never been stronger. To be the most valued partner for brands, we offer flexible business models which help brands to reach more customers while we create a deeper relationship and new income streams for GFG. The marketplace proposition continues to offer growth to our brands, increasing 60% year-on-year, empowering the selection and inventory efficiency. Marketplace now accounts for 38% of NMV and has supported our rollout of adjacent categories, including beauty and home. We continue to provide our brands with platform solutions tailored to their needs, whether that is taking care of fulfillment, providing them with data to help their decision-making, or improving their marketing to identify new opportunities. The table on the right illustrates the huge opportunity across platform services. In most of our regions, our brand partners can access operations and marketing by GFG. Data by GFG is currently in the rollout phase. There is a lot more to go after. These services will reinforce our position as a trusted partner, as well as improve margin performance and generate incremental revenue streams. Let's now turn to look at our sustainability agenda on slide 10. We continue to advance our people and planet- positive agenda. We released our long-term carbon strategy in the quarter, which demonstrated another step up in our ESG disclosures and provided more detail about our plans for 2021 and beyond. We are proud to have achieved carbon neutrality across our operations, which includes sourcing green energy for 100% of our operations and increasing the number of parcels delivered with zero emissions for the last mile. Later this year, following our recent commitment, we will also announce our science-based targets. On the consumer side, we now have extended the product donation initiatives into CIS, enabling customers to donate pre-loved clothes in return for a voucher. We're also rolling out our adaptive ranges, starting with LATAM, CIS, and now ANZ, designed to meet the unique clothing needs of people with disabilities. Turning now to look at our KPIs from slide 12. NMV growth was predominantly driven by a 22% increase in orders. AOV was up by 9% in constant currency terms, reflecting change to mix and inflation. Marketplace penetration was 38%, up 7% year-on-year, continuing the strong trend we've seen in particular since Q2 last year and making further progress towards our 50% long-term target. Looking at our key customer metrics, there is a positive improvement in all of them. Our active customer base grew by 16% year-over-year to 17 million. This represents over 40% growth since Q2 2019. Order frequency grew by nearly 10% year-on-year to an all-time high of 2.8x. As mentioned during the CMD, we believe that there is a lot of potential in growing order frequency over the coming years. NMV per active customer was up by 14.9%. Turning now to our regional performance on slide 14. Starting with our LATAM business. This region faced significant health and economic challenges in the management of COVID-19. Here, we saw active customer growth of 20% year-on-year and improving AOV, driving NMV growth of 21%. Across CIS, NMV grew by 24%, supported by our growing premium proposition and improvements to the shopping experience. This drove a big increase in both order frequency and average order value, contributing to the very strong 26% improvement in NMV per active customer. Our business in Southeast Asia delivered very strong NMV growth of 33%, supported by an acceleration of marketplace. Active customers grew by 20%. Finally, as explained, ANZ saw strong growth against soft trading last year with a 68% uplift in NMV, recovering order frequency, and a 14% increase in active customers. We remain very confident on the structural shift in online adoption and the recovery of fashion and lifestyle across all of our markets. With that, I'd like to hand it over to Matthew. Thank you. Thanks, Patrick. Good morning, everyone. I'll now take you through our financial performance, which starts on slide 16. We delivered strong revenue growth, a step up in gross margin, and higher adjusted EBITDA. Revenue grew by 24% on a constant currency basis to EUR 397 million in the quarter. Again, we see marketplace scaling up faster than retail growth. We continue to improve our gross profit, increasing it to EUR 184 million, with gross margin increasing by 3.5 percentage points to 46.2%. Marketplace growth contributed about 1 percentage point, and 2.5 points came from better retail margins across all regions through improved product mix, enhanced premium assortment, and strong inventory management. As you may recall, we made some investment in retail margin in Q2 last year in response to the start of the pandemic. Across H1 this year, we are trading retail with a higher margin than we did in 2019. Adjusted EBITDA for the quarter grew to EUR 11.6 million. The margin's only 0.1 percentage points up on last year compared to 2.2 points for H1 as a whole. This is all about the shape of the 2020 comps and not about how we are trading the businesses this year. The way we set the business up on marketing costs, fulfillment investments, and overheads is very stable across Q1 and Q2 this year. In Q2 last year and in Q3, we pulled back marketing at the start of the pandemic to an exceptionally low level. As we flagged at the time, we did not expect this to repeat. This year, as planned, we're investing at a similar level to 2019 to capture the attractive market opportunity. On return rates, they're normalizing in Q2, giving us a small profit upside of around EUR 0.4 million, which is significantly lower than the EUR 2 million-EUR 3 million quarterly benefit we talked about last year. In addition to our share-based comp charge of EUR 15.9 million, there were EUR 1.4 million of costs excluded from our adjusted EBITDA measure this quarter, including prior year tax and other one-off non-trading items. Our NMV- weighted basket of currencies remained broadly stable since the end of 2020. Devaluations late last year meant a decline by 7% year-on-year compared to H1 of last year. This is a translational matter only, as over 80% of our costs are naturally hedged. I'll now take you through our regional performance on slide 17. All regions delivered significant revenue growth whilst expanding their gross margins at the same time. Increased marketplace participation meant group revenue is again a little lower than NMV growth. LATAM revenue grew 9.6%. As Patrick mentioned, the LATAM region was impacted by COVID. We're experiencing heightened levels of competition, and the comparable growth rate of revenue stepped up through Q2 last year. We improved gross margins by 2.9 percentage points with a significant year-over-year increase in marketplace participation and stable retail margins. CIS delivered strong revenue growth of 17.1%. The gross margin improved by 2.7 percentage points to 50.6%. Retail margins improved through good inventory management of the spring and summer collection, and higher marketplace participation accounted for the rest of the improvement. SEA saw quarterly revenue growth of 14% in the face of renewed lockdowns across the region and was the region where we experienced the largest acceleration in year-over-year marketplace participation. Consequently, gross margin improved by 7.1 percentage points to 36.8%, with the improvement being broadly equal between retail margin improvement and the benefit of marketplace participation, which is now around the group average. ANZ delivered outstanding growth of 71.4% in the quarter, trading over a comparative period of negative growth last year. You'll recall that ANZ was our region most severely impacted last year by the initial onset of COVID. The retail business led our growth in the quarter, with improved retail margins resulting in a 2.3 percentage point improvement in gross margin to 45.6%. Let's turn now to regional profitability by segment. This is a new disclosure this year for the half- year to give more insight. Over on page 18. H1 group adjusted EBITDA was EUR 0.1 million, improving by EUR 13.3 million year-on-year. All regions apart from LATAM improved their profitability. LATAM experienced a EUR 4 million step back year-on-year. 50% of this is just an accounting change, a cost reallocation for some cloud-based tech costs, which used to be paid centrally by the group. The external commercial arrangements are now directly with LATAM. The costs are recorded locally. We will see a similar impact in H2. This makes the charging for these costs consistent across all regions. We also invested into fulfillment and marketing costs. We intend to keep investing in service and the proposition to capture the exciting opportunity here, regardless of a volatile near-term trading environment. All the other regions delivered a meaningful step-up in profit. CIS adjusted EBITDA improved by EUR 7.2 million, with efficiency gains in all operating cost lines more than offsetting the marketing investment. SEA significantly reduced its loss. Gross margin stepped up considerably alongside G&A cost efficiencies whilst investing in marketing and fulfillment service. Profitability in ANZ increased by EUR 6.3 million, with cost efficiencies across all operating costs other than fulfillment and marketing. Like our other regions, we operated the quarter around 2019 marketing levels as a proportion of NMV. Our other segment represents the cost of our central group functions. Investments in specialist central functions and in system enhancements were offset by the tech costs transferring to LATAM that I mentioned earlier. I'll now look at the movements in our operating costs and the leverage we've delivered year-on-year. This is over on slide 19. Gross margin increased 3.5 percentage points year-on-year, leading to a 2.2 percentage point adjusted EBITDA improvement as we leveraged operating costs and returned marketing to 2019 levels. These two metrics are reported as a percentage of revenue. When looking at our operating costs, I'll refer to a percentage of NMV, which is the approach we use to set the targets in our capital markets day, and this better reflects the underlying drivers of our cost base now that marketplace is such an important part of our business. Fulfillment costs reduced to 16.5%, 1.4 percentage points of leverage year-on-year. Our fulfillment operations continue to benefit from our greater scale, which leverages the fixed cost element, and from ongoing efficiency improvements, such as the continued rollout of pickup points in CIS. We continued to invest in enhancing our customer experience. For example, the introduction of cross-docking for marketplace in Brazil. As we communicated at the start of the year, we're setting the business up for growth. As planned, we invest in marketing, returning to around to the pre-pandemic level of investment percentage of NMV. The very low customer acquisition cost in Q2 last year, and also in Q3, were one-off in nature. There are great opportunities in our markets; we're focused on continuing to attract new customers to our platforms and developing our existing customers. We continue to use the ROI framework for marketing payback that we've discussed since IPO. As discussed at the time of our capital raising, we're comfortable with paybacks a little longer than the 12 months we applied in previous years. Our tech and admin costs reduced to 8.6% of NMV, a net reduction of 1.6 percentage points as a result of increased scale, improving fixed cost leverage. During the first half of the year, we ramped up the tech hiring pipeline to support our future growth ambitions. We are pleased with our H1 performance across the group and are running the business for growth in H2. We're taking a similar trading stance as H1, with confident marketing and around a third more inventory than this time last year. Our strong performance in H1 means the quality of our inventory is once again very high. The ongoing COVID situation in our markets means we've less visibility coming into H2 than normal, and we're aware that we're coming into a period of tougher comps. We intend to keep investing in growth. With that in mind, I'll turn to slide 21 for our full- year guidance. Following our successful H1, we're confident we're on track to deliver in line with the guidance we shared at our Capital Markets Day in March and reconfirmed back in May as part of our Q1 results announcement. To recap, NMV growth of over 25% on a constant currency basis. This amounts to between EUR 2.3 billion-EUR 2.4 billion of NMV at 30th of June exchange rates, which is unchanged from the CMD. As I mentioned earlier, we're in the middle of some very unusual comparable quarters last year, the phasing of growth, and even more so profits, will look distorted when looking year-on-year. This is most notable in the LATAM region, which saw NMV growth almost double between Q2 and Q3 last year. We've included a slide in the appendix to our deck showing that at the bottom end of this NMV guidance, it implies a very similar level of growth of around 60% on a two-year basis in both H1 and H2. Revenue will continue to grow at a slightly slower rate than NMV, reflecting the marketplace share increase, and is expected to deliver EUR 1.5 billion at the same exchange rates. We continue to expect a modest improvement in our adjusted EBITDA, allowing us some flexibility to take advantage of the growth opportunities we're pursuing. We expect CapEx of around EUR 60 million. The timing of the costs of the CIS fulfillment center means we plan for H2 to see more investment than H1. To conclude, we're pleased with the strong results delivered so far this year and reaffirm our guidance and the goals we set ourselves for the full year. This is the end of our formal presentation. The operator will please take any questions from the call, and then we'll address any that come from the webcast. Thank you. Thank you. If you would like to ask a question, please press star one on your telephone keypad. Please ensure the mute function on your phone is switched off to allow your signal to reach our equipment. Again, please press star one to ask a question over the phone. We'll take our first question from the phone from Miriam Adisa from Morgan Stanley. Please go ahead. Great. Good morning. Thanks for taking my questions. Firstly, on the gross margin, quite impressive improvement there. Could you give a bit more detail on that, particularly around the retail improvement? Are you also seeing any scale benefits coming through, or were there any pricing adjustments made? How should we think about margins for the second half? Should we expect a similar progression? Secondly, on current trading, if you could comment on the cohort behavior that you've been seeing since the end of the quarter, particularly in Australia? What are you seeing in terms of orders per active? Have there been any changes since cases have started to rise again? Finally, just on marketing spend, if you could just comment on what you are seeing in terms of advertising costs at the moment, particularly if there are any competitive pressures that you are seeing on that as well. Thank you. Hi. Thanks, Miriam. It's Matthew. I'll start off with margin and then hand over to Patrick on ANZ. I think the drivers of the marketplace we've got the ongoing improvement in the marketplace participation that you're familiar with. What's interesting, I think, is around retail. Within retail, we're obviously going over a comp in Q2 in particular, where we were doing some more discounting in order to clear inventory at the start of the pandemic because we didn't know how it was going to play through. That is probably about 50% of the retail margin improvement. The other 50% is absolutely solid and is an improvement over where we were H1 2019. That is mostly premiumization and mix into more positive categories. We've got a little bit of inflation going through, but we believe that our inflation rates are no higher than, and in most cases, lower than what's going on in general CPI in the markets. It really is a mix into higher margin products. Patrick. Thanks, Matthew. Miriam, I'll take your second question in regards to cohorts and deep dive a bit more on ANZ. Overall, in terms of the cohorts we have acquired last year, what we were seeing in repurchasing behavior is pretty similar to what we have seen in the years before, or better. It's basically not worse, and for some, in some regions, basically exactly the same or marginally better. The trends are basically in line with what we have discussed in previous quarters, where we have disclosed these numbers, which were about, I think, between 5% and 15% better, looking at the second order in the same quarter from these customers. In terms of ANZ, we've certainly seen a huge shift in category mix, basically right at the end of a quarter, because different states went into different kinds of lockdowns in different weeks. Really, the most pronounced shift was right at the end of a quarter. The lockdowns have essentially now been going on for about six weeks, and we believe that this will be extended. We have not seen a dramatic shift in order frequency, but it's also very early days. Usually, these changes take some time to actually be seen. What we have seen is really a change in category mix to effectively exactly the category mix we have seen in Q2 and Q3 last year. Effectively, much less going out categories and a much stronger demand for lockdown categories. Thankfully, we obviously have stocked up on these categories last year and also earlier in the year, and thanks to our high marketplace share, are also able to react there very swiftly to the changing demand of these customers. Christoph, do you want to take the marketing question? Miriam, on the marketing question, I think there's really a few things happening. Number one, as Matthew pointed out earlier as well, we're really just only back to the marketing levels and even a bit below the 2019 numbers. Actually, we see more of a normalization than an increase. What we do see, however, is that some of the marketing channels are becoming more expensive. Partially, that is also driven by some of the privacy-related changes on the platform, especially iOS. Some of the tracking limitations that are coming in through those changes from the large platforms are having an impact on the whole industry and affecting us as well. We're not very concerned about it. It's a normalization of where we were in 2019 overall. We're comfortable with this marketing environment. Great. Thank you. As a reminder, to ask a question, please press star one on your telephone keypad. We will take the next question from Michael Benedict from Berenberg. Morning, all. Thanks a lot for taking my questions. I have three if I can. Firstly, I wondered if you could give a bit of color on your marketplace pipeline, and can we expect a continued increase over H2 in terms of the marketplace mix? Second one is you mentioned in the presentation, heightened competition in LATAM. Wondered if you could give a bit more color there. What sort of competitors are ramping up that competitive threat? Last one is just, I think in historic presentations you mentioned a couple of projects around LATAM returns logistics, and I think the size and fit of the marketplace at group level. I wondered if we could get an update on how those projects are progressing, please. Thanks very much. Hi, Michael. I'll kick it off. Marketplace has seen a huge growth for us. Frankly, we definitely wouldn't have anticipated that two years ago. In 2019, just as a reminder, we were at 19%. Now we are almost 20 percentage points higher. We basically doubled our marketplace participation. We believe that we're going to get to 50%. We don't believe that we're going to get there in the next couple of quarters or even next year. Which if you put a straight line from the 19% to the 38%, you would probably get to 50% pretty quickly. That is simply because of the retail business is working really well. It's a business which is as profitable as our marketplace business, and we want to grow this business as well. We want to grow marketplace, but we are not focused on a certain percentage of participation on marketplace per quarter of the year. We just know that the business model itself, with basically almost unlimited inventory in Marketplace, is fueling usually more growth than our retail business, and that is why we are confident to get over 50%. In terms of the second question, I will hand over to Christoph for that one. Yeah, sure. On competition in Latin America, clearly, what we see is a couple of things. Number one, we see continued competition from general merchandise, and that certainly affects us more in parts of the assortment, certain categories, certain price points, where our assortment is more similar to those players. As you know, a big chunk of our assortment sits at different price points, is more branded, and is not widely available on general merchandise players. The more price- sensitive part of the assortment certainly is more widely available. That's number one. Number two, we've seen more cross-border e-commerce happening as well in the region, from global fast fashion players of some degree, but also from some of the general merchandisers. I think one name that has been flagged quite significantly, and we've seen as well, is Shopee, who we know well given their presence and their heritage from Southeast Asia. They're certainly now also expanding into Latin America, so far, primarily in Brazil. That is further competition for the general merchandisers, also more broadly affects the market. Thirdly, I think we've also seen that some of the local, primarily offline players in the fashion lifestyle market have gotten stronger in their online capabilities over the last 18 months, for very obvious reasons. They have been able to put together a customer proposition that is stronger. All of this motivates us to really double down on the quality of our customer experience in every aspect, from assortment to discovery, to delivery. To your question about returns, that certainly still continues to be a pain point in several of the Latin American markets, and something we're making some good progress to improve it. We're also looking at delivery times, where there's quite some differences based on the geography and also the fulfillment model. We're really trying to play to our strength of being very local, having a very large fulfillment center, as you know, in Brazil, and leveraging our capabilities around retail and around fulfillment from that site outside São Paulo, as good as we can. Clearly, we've seen competition is a little bit more intense now than it was a year ago. Patrick, you want to cover the last point on size and fit? Sure. Size and fit is going really well. We are actually trialing it in several regions already, with a couple of thousand SKUs live with a few brands. We are obviously learning a lot. This is obviously a relatively complicated technology, both from a back-end and front-end point of view. We will roll this out to more regions and then also scale it to obviously, many more brands, many more SKUs. We believe that this will be a meaningful share of our overall Marketplace sales when it's fully live. Brilliant. Thanks very much. As there are no further questions on the phone, I would like to hand the call over to Scott for questions from the webcast. Great. Thanks for that, Marion. We've got our first question from Paul Rossington from HSBC. Can you comment on any meaningful change in competition, if any, beyond Latin America? What has been the impact on trading where physical retail has fully opened? Sure. Sorry, Christoph, go ahead. Thanks for the question, Paul. LATAM, we obviously just covered. In the other regions, I don't think that we have a meaningful change in competition. What we see, obviously, broadly is that the industry is moving more online. The brand dot-coms are certainly developing, and we've seen general merchandisers grow very rapidly in our category, more importantly, in other categories. Clearly, there's very large general merchandisers who are growing their business aggressively in CIS, in Southeast Asia in particular. I wouldn't say there's a fundamental change in competition. It is competitive, but we also have a much larger addressable market given the acceleration in online adoption. In terms of the second part of the question of physical retail, I think what we have seen is that despite physical retail being largely open in many of our markets, not fully open everywhere, and certainly recently there's been some restrictions again in Australia, for example. There's also some restrictions in Southeast Asia. By and large, it has been open for the quarter. What we've seen is that there's been a recovery in physical retail, but it's still significantly, in our industry, below the 2019 levels. We see that there is some hesitancy from at least parts of the customer base and the population to really embrace offline shopping fully, and we think that continues to benefit the online adoption in fashion and lifestyle e-commerce, but more broadly in e-commerce and digital services. I think our thesis in terms of long-term impacts and trends of really habits forming is very, very intact and supported by what we're observing there, despite physical retail offering being open. Thank you for that. We've got no further questions from the webcast at the moment. I'll pass back to you, Patrick, for closing remarks. Well, thank you, everybody, for joining. We look forward to the rest of the year, strong trade, and all be well. Thank you.