Dear ladies and gentlemen, welcome to the conference call of About You. At our customer's request, this conference will be recorded. As a reminder, all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask questions. If any participant has difficulty hearing this conference, please press star key followed by the zero on your telephone for operator assistance. May I now hand you over to Frank Böhme, who will lead you through this conference. Good morning, everyone, and welcome to our Q4 2022, 2023 results presentation. Today's conference call will be hosted by Hannes Wiese, Co-Founder and Co-CEO of About You. Hannes will walk you through our Q4 results in just a second. The corresponding slides to his presentation have been published on our IR website under the Publication section this morning. After his presentation, Hannes will be happy to answer your questions. With this, I hand it over to you, Hannes. Yeah. Thanks, Frank, good morning to everyone also from my side. Today, as usual, we are focusing on the following topics: Update on our business, which largely consists of a recap of FY 2022, 2023, including additional disclosure on cohort performance, operating models, and TME. In our financial section in turn, we focus on the Q4 results and operating performance. In our outlook section, we provide our new guidance for FY 2023, 2024. We'll close this call as usual with Q&A. Let's directly jump into the business update starting on page four with the key takeaways of the financial year 2022, 2023. Despite a continuously volatile and uncertain macroeconomic environment, we managed to achieve our updated guidance with a top line growth of 10% year-over-year and an adjusted EBITDA of a negative EUR 137 million. The number of active customers in the commerce segments increased by 11.8% and the average order frequency by 7.1% in the last 12 months. In FY 2022, 2023, DACH revenue growth came in at 9.1% and RoE at 17.3%. TME, our B2B segment, saw revenue growth of 16.5%, driven by our highly profitable SCAYLE business. The adjusted EBITDA margin of TME remained on high levels at 16.1% despite impact client revenues and growth investments. All in all, FY 2022, 2023 was characterized as a year where high growth expectations and investment commitments were executed in what turned out to be a challenging market environment. While we made strong progress in our strategic initiatives around products, markets, assortment, and scale, we have seen a significant negative impact on profitability from the related growth investment commitments. For 2023, 2024, our number one priority continues to be to reach adjusted EBITDA even. This is a target we already outlined at the time of listing in June 2021. We have now implemented a broad range of fair pay measures that give us a high level of confidence to achieve the targeted profitability improvements. We are hence comfortable to translate this adjusted EBITDA even target also into our guidance for FY 2023, 2024. Despite the strong focus on profitability this year, we continue to be a growth company and expect re-revenue growth in a range of 1% to 11%, even in a continuously changing market environment. Let's talk about our FY 2022, 2023 in a bit more detail now, starting on page five. As you know, the macroeconomic environment has been challenging throughout the year. The inflation in the Eurozone remained on elevated levels and surpassed levels of 20% in our important CE markets. Consumer confidence has been adversely affected across Europe and is now only slowly improving from historic lows. Withstanding these headwinds, we were able to grow our revenue by 10% year-over-year. This corresponds to a three-year CAGR of 37%, which is a clear outperformance of the overall market and underlines the strength of our business. Moving on to our cohort performance in FY 2022, 2023, shown on page six. Here we can now also analyze the different dynamics caused by the pandemic. Let's start with the cohorts acquired pre-COVID, that is before FY 2021. What we see is a peak in spending during the pandemic, which is now normalizing in a moderate year-on-year decline in FY 2022, 2023. For all pre-COVID cohorts, revenue remains clearly above pre-pandemic levels despite the difficult market environment we faced in 2022, 2023. This is also a clear indicator for the strong and sustainable progress in our proposition, which we've delivered over the last years. For our new customer cohorts acquired during COVID, that is FY 2021 and FY 2021, 2022, we also see a normalization in revenues after the pandemic. Revenue retention on first cohorts, on first orders, also of these cohorts, remain clearly above 100%. That means that the new customers acquired during COVID remain loyal also after the pandemic, despite the difficult market environment we faced in 2022, 2023. One important factor which drives customer retention is the evolution of our assortment over the last years, shown on page seven. We've grown both 1P and 3P item count, onboarded several new brands, and strengthened under-penetrated categories. If we look at growth from an operating model perspective, we see that our own labels and Fulfilled by ABOUT YOU assortments continue to grow over proportionally in revenue. The growth driver for our own labels and exclusive assortments are the numerous co-ops which we've launched with influencers on an international scale. In FY 2022, 2023, Fulfilled by ABOUT YOU assortments generated more than 40% of our 3P revenue. The share is constantly growing, which is intended as this is a strong lever to further improve customer experience and margins from 3P assortments. Moving on to TME, our B2B segment, starting on page eight. We provide more disclosure with this full year release again, showing the revenue and adjusted EBITDA performance of our two TME subdivisions. On the one hand, our SCAYLE business comprising our SaaS and operation services, which are offered to external clients on a standalone basis. On the other hand, commerce adjacent services like media and fulfillment, which are offered primarily to our suppliers as part of the About You commerce ecosystem. Let's start with our SCAYLE business on the left-hand side. In FY 2022-2023, we've successfully executed a number of SCAYLE growth initiatives. We've improved our product and implementation processes. Further, we've invested into the SCAYLE brand in various B2B channels, and we professionalize our sales processes and establish local sales teams for better Benelux, Scandinavia, as well as the U.K. These efforts have contributed to a SCAYLE revenue growth of 31.5% to EUR 88 million in FY 2022, 2023. Adjusted EBITDA is also growing, although we are seeing a slight decline of the EBITDA margin to 32%. This decline is driven by our accelerated growth investments as well as revenue mix effects, with a currently relatively high share of lower margin implementation revenue in the mix. Despite the changing market environment, where many of our suppliers are cutting their marketing budgets, revenues for the commerce adjacent services increased by 6.6%. Adjusted EBITDA, however, remained flat at EUR 3.7 million due to revenue mix effects. Let's now take a closer look at SCAYLE and the progress we are making on the client acquisition front. In FY 2022, 2023, an external transaction volume of EUR 2.7 billion was powered by SCAYLE. This is another increase versus last year. Many of our clients faced muted to declining e-commerce revenues this year. We still managed to grow total client GMV as we are constantly onboarding new clients, reaching more than 140 external shops which were operated by SCAYLE in the last year. As you can see on the right-hand side, these clients do not only include large fashion players like s.Oliver or Deichmann. Our client base is also expanding outside the fashion picture with a growing number of clients in lifestyle and adjacent categories like the eyewear retailer, Fielmann, or the sports specialist, Ochsner. This clearly proves the adaptability of our SCAYLE technology to different market segments and provides huge growth opportunities going forward. Let's now move on to ESG on page 10. Here, we want to give you another update on the progress made and the initiatives which are closest to our hearts. Let's start with our carbon- footprint on the left-hand side, where we are showing the advances made in our Science Based Targets. By incorporating these targets into our business processes, we've seen further progress in FY 2022, 2023 and remain confident to reach our FY 2025, 2026 targets. We've also significantly increased the share of more sustainable product revenue. As you can see on the right-hand side, 24.6% of total revenues were generated by more sustainable products in 2022, 2023. With that, we've almost already reached our 2023, 2024 target of a 25% revenue share. Moving on to the financial update, where we focus on our performance in Q4. Starting with our top line on page 12. Once again, all our segments were growing despite the difficult market environment. Let's start with the group trading on the left-hand side of this chart. We grew our revenue by 3.4% in Q4, which corresponds to EUR 450 million in revenue. This growth rate is clearly below our own ambitions, but in line with our latest expectations. This is as the market situation remained challenging, with high inflation rates putting pressure on discretionary spend. In the resulting promotional market environment, consumers were not yet back in full price recovery shopping mode. Let's take a closer look at our segments to analyze this. Starting with DACH, where revenue increased by 14.7% in the fourth quarter, accelerating growth versus Q3. While Austria and Switzerland continued to grow stronger than Germany, also the German market saw an acceleration in revenue growth. This was partly driven by higher discounts to clear inventory and stipulate demand. The German consumer sentiment is now slowly improving, making us cautiously optimistic on the performance of our DACH core markets. In the rest of Europe segment, in turn, revenue was up by only 8.9% in Q4, meaning a slight deceleration in growth versus Q3. This moderate top line development in our international markets is caused by a mix of factors. Firstly, we continue to see our large CE markets adversely affected by a weak consumer facing very high inflation rates of partly more than 20% and corresponding pressure on real disposable income. Secondly, globally tightened marketing ROI targets affect our less mature RoE markets disproportionately. This is because new customer shares are naturally higher and brevet targets have previously been extended here. Lastly, we are coming from an elevated RoE comp base in Q4 2021, 2022 due to large-scale market entry campaigns in the Southern European countries last year. Moving on to our TME segment, where revenue grew by 1.9% in the Q4. Top line performance varied across the different TME divisions. On the one hand, as outlined in the business section, we've seen healthy growth for SCAYLE also in Q4. This is as challenge revenues from the installed client base, which see their own revenues adversely affected by the current market environment, are overcompensated by recurring and implementation revenues from new clients. On the other hand, especially our media revenues are under pressure as we continue to observe a relatively low spending willingness also among B2B customers. This is a reaction to the current market environment and especially affects our relatively high margin media campaign revenues. Let's move on to our customer engagement metrics in the commerce segments shown on page 30. We were able to grow our active customer base to 12.7 million in the last 12 months. This is a healthy increase of 11.8% versus last year. The average order frequency per active customer still increased by 7.1%, reaching 3.1 transactions per active customer over the last 12 months. This increase is the result of the expansion of the product range, the improved customer experience, the increase in brand awareness, and age structure effects of the customer cohorts. The average order value, however, declined by 5.2% in the last 12 months. This development is largely driven by increased discount levels as well as higher return rates compared to the previous year. For FY 2022, 2024, we'd expect AOVs to stabilize as the company normalizes and our unique economics measures become effective on a full year basis. With that, let's move on to our bottom line on page 14. Our profitability continues to be under pressure, although adjusted EBITDA losses have been reduced versus financial Q2 and Q3 this year. Let's start again on the left-hand side of this chart, showing our group adjusted EBITDA margin at a negative 5.4% in Q4 2022, 2023 versus negative 2.7% last year. The driver of the adjusted EBITDA loss in Q4 was the high need to clear inventories in a highly promotional market environment. Also, our DACH business was burdened by the resulting low gross margin, but returned to positive EBITDA territory again, reaching an adjusted EBITDA margin of 3.5% in Q4 2022, 2023. While recent developments in DACH are encouraging, profitability still declined versus last year. Next to gross margin pressure, the margin decline resides from a higher fulfillment cost ratio, which was mainly impacted by inflation-related unit cost increases, as well as an increased return ratio. Moving on to our RoE segment, where we are still seeing significant EBITDA losses of a negative EUR 36.5 million in Q4 and an adjusted EBITDA margin of a negative 18.7%. The main drivers for the losses were a lower than expected revenue base and unusually high discount levels to clear inventory in combination with elevated fulfillment costs due to the logistics network expansion and inflation-related cost increases. Now on B2B. Our TME business achieved an improved adjusted EBITDA margin of 26.5% in Q4, up from 24.8% last year. The margin increase is the result of the growth in B2B revenues, which scale against the predominantly fixed cost base. As discussed in the business update section, the adjusted EBITDA increases is increased, is largely driven by scale, while media and enabling streams show a more muted EBITDA development. Let's now move on to page 15 and take a closer look at the key cost lines of the group. Starting with the gross margin, where we saw a decline of 9.4 percentage points to 34% in Q4. This decline was driven by sales campaigns and high discount levels, which were necessary to clear inventory in a highly promotional market environment. These measures have helped us to develop a cleaner inventory position for the start into the spring and summer 2023 season. Stock levels still remain slightly elevated going into our 2023, 2024, which will moderately weigh on profitability in H1. Our fulfillment cost ratio, which increased by 2.7 percentage points to 25% in Q4. The year-over-year increase is attributable to several factors. First, as expected, we are seeing an increase in return rates towards pre-COVID levels. Second, logistics costs face pressure from inflationary dynamics. Third, the expansion of the European distribution network creates non-recurring costs and operational complexity. Lastly, the lower than expected revenue levels continue to cause underutilization of our DCs. The year-on-year increase in the fulfillment cost ratio in Q4 2022, 2023, therefore continues to be a mix of temporary effects, which are expected to ease in the coming quarters, and structural effects, which are expected to persist over a longer time horizon. Let's now move on to our marketing costs. The marketing cost ratio declined to 9.4% in Q4, down 7.9 percentage points compared to last year. This is the result of three factors. First, the fade-out of large-scale market entry and branding campaigns. Second, a more conservative steering of performance marketing channels with tightened ROI targets. Third, cost discipline and process improvements across marketing functions. Lastly, our admin and other cost ratio declined by 1.5 percentage points, despite a generally high level of inflation. This is due to overhead efficiency measures and a slowdown in new hires. All these factors combined resulted in a decrease of our group adjusted EBITDA margin by 2.6 percentage points to a negative 5.4% margin in Q4 2022, 2023. This is as the already visible efficiency improvements in our marketing and admin cost lines were not yet able to offset the current pressure on gross margin and fulfillment costs. Let's now take a look at our cash flow drivers on page 16. Our net working capital returned to positive territory and is at EUR 40.7 million at the end of Q4 2022/23, which is an increase of around EUR 30 million versus last year. This is because our stock turnover is still not fully back to where it should be, and other net working capital levels are not fully compensating this. CapEx in turn amounted to EUR 16.3 million in Q4, which is slightly below last year levels as a result of increased investment discipline. Moving on to our cash position on page 17. Let us first look at our operating cash flow, which is at a negative EUR 77.1 million in Q4. This is due to net working capital dynamics, partly relating to the intake of fresh spring summer 2023 stock as well as the EBITDA loss in Q4. CapEx translates into investing cash flow and our financing cash flow is at a negative EUR 7.9 million in Q4. Financing cash flow is driven by payments for leasing agreements, largely relating to our DC network rollout. We ended the quarter with cash and equivalent of EUR 205 million. While this is still a comfortable cash position, we have evaluated different measures to further optimize our liquidity buffer as announced in the Q3 earnings call. As a result of this process, among other measures, we have agreed with our main shareholders on a back-up loan facility in the amount of up to EUR 97.5 million. Upon signing, the loan agreements have a term of two years and can be flexibly drawn on request of About You. The credit facility fits well into our levers to steer our liquidity buffer, which are among others, the targeted improvement in profitability as well as the optimization of our net working capital. We believe that this set of tools gives us enough buffer and flexibility to successfully navigate through the current market environment. We don't plan any further capital measures in the near future. Let us now move on to the final section of this presentation, the financial outlook. Starting with our FY 2023, 2024 guidance on page 19. It should not be surprising that our guidance for this year is a reflection of our strong focus on profitability and the high level of uncertainty that we are still observing in the market. For our revenues, this translates into an expected growth range of 1% to 11%. The current market environment is not supportive for high growth, and at the same time, we expect some of our profitability measures to adversely affect our top line in FY 2023, 2024. Given the extent of the year-over-year improvement in profitability we are targeting, we believe it is sensible to see FY 2023, 2024 more as a transition year towards a more balanced top and bottom line for the company. On profitability, our number one priority remains to achieve adjusted EBITDA break-even in FY 2023, 2024. We are confirming this target as part of our guidance today. The implied bottom line improvement versus FY 2022, 2023 is in the EUR triple-digit million range and hence certainly ambitious. We can leverage a broad set of self-help measures which make us confident to achieve our goal. We'll get back to these in a minute. Let's move on to CapEx first, which is expected to be around EUR 30 million-50 million in FY 2023, 2024. That means we target another moderate reduction in investments compared to FY 2022, 2023. Our net working capital is expected to remain broadly around the levels seen at the end of our FY 2022, 2023. On the one hand, we expect a moderate decline in inventories. On the other hand, we also target a moderate reduction in utilization of working capital financing to save costs in light of a comfortable liquidity buffer. Let's move on to our segments on the right-hand side to see how the expected P&L dynamics in our FY 2023, 2024 break down through the different revenue streams. We expect slight increases for both revenue and adjusted EBITDA in DACH as the segment continues to contribute to our positive profitability. For our RoE segment, revenue is expected to increase moderately while EBITDA is expected to improve significantly. This is largely the result of lower marketing investment in recently launched markets and tightened IR targets. Our TME segment is expected to see moderate increases for both revenue and adjusted EBITDA. These improvements are largely driven by scale, while our media and enabling revenue streams are expected to show a comparative performance to FY 2022, 2023. Before we move on to a deep dive on our profitability measures for FY 2023, 2024, let me briefly discuss current trading and the expected shape of our P&L over the year. In terms of top line growth, we expect a relatively slow start into the year. We are facing a comparatively high comp base as revenues were boosted by several campaigns, especially in the second half of our financial Q1 last year. Furthermore, the market environment remains difficult in Q1 2023, 2024, and we encountered sub-optimal weather conditions during the start of the spring, summer season. Current trading also implies that we are targeting a slight acceleration in top line growth throughout the year. This is explained by easing comps and expectations of a moderate improvement in consumer sentiment. For our adjusted EBITDA in turn, we expect to see a substantial year-over-year improvement already in Q1 2023/2024 as our profitability measures show the expected positive effects. These effects are expected to materialize throughout the year, meaning profitability for the group should be skewed towards our financial Q3. This is also the usual seasonality pattern which we observe in more matured markets. Now move on to page 20 and take a closer look at the many sales measures which we are implementing to achieve our profitability target. Start with the gross margin levers. The biggest impact here is certainly the adjusted ordering for the spring, summer and autumn, winter 2023 seasons, which is more in line with current demand levels and should ease pressure on gross margins. The new commission scheme for our three-tier model, which we've announced in our Q3 call, has now successfully been rolled out and we are observing the expected positive effects. We have also implemented new prices for our Fulfilled by ABOUT YOU logistic services to offset some of the underlying cost inflation. Moving on to fulfillment costs. As discussed in our Q3 earnings call, we have introduced shipping costs below our minimum order value. Rollout of this measure is now largely completed and we see the expected positive effect on unit economics. We are also taking action on utilization levers. We have progressed well with the rollout of our European DC network and we are currently operating three DCs which are located in Germany, Slovakia and Poland. Our fourth DC in France is also ready to go live, we made a deliberate decision to postpone this to increase the utilization of the existing warehouses and thus support the fulfillment cost ratio. We remain, of course, committed to the warehouse in France because we will need the capacities to support our medium-term growth ambitions. This measure is more about realizing short-term efficiency gains rather than a change in our distribution strategy. Moving on to the next measure, which is targeting unit economics again. Encouraged by the positive results of the introduction of shipping costs below MOV, we are now also testing return fees below a certain Net MOV. That is the order value after returns in selected markets. Testing is in very early stages we will keep you updated on our insights here. Coming to marketing costs, which are expected to significantly decline in FY 2023, 2024, providing the largest efficiency level compared to last year. We plan to lower our brand marketing costs as large scale events and branding campaigns are reduced and there won't be any major new market entries. On top of that, the full effect of globally tightened ROI targets will become visible on a full year basis. We are also targeting cost reductions for content production and influencer fees as part of a fixed marketing cost efficiency program. Lastly, admin expenses will benefit from operating leverage as we further grow the business and continue to see the positive results from a slowdown in new hires and our operating efficiency measures. Let's now move on to page 21, where we want to update you on our thinking beyond FY 2023, 2024 and put this into the broader context on the timeline. Calendar years 2020 and 2021 were two years of strong growth for the company as the tailwind from COVID boosted revenues, allowing us to focus on top line growth and new market expansion. For 2022, we had similar growth expectations, but we were surprised by a challenging market environment leading to a substantial shift in priorities over the year. For 2023, we expect this transition phase for the company to continue with a strong bottom line focus in FY 2023, 2024 and several measures being rolled out in parallel. Going into 2024, these measures will enable us to switch back into a more aggressive growth mode coming from a healthy revenue and EBITDA base. About You as a growth company and there's a huge growth opportunity ahead of us. After achieving adjusted EBITDA even this year, it is our target to accelerate top line growth towards clear double-digit growth levels again while remaining adjusted EBITDA positive in the future. This should also be supported by an expected improvement in consumer sentiment and a normalized market environment. Thanks for joining us on this exciting journey. I'm now looking forward to answering your questions. Moderator, handing it back to you. Thank you. We will begin our question and answer session. Pardon. If you have a question to our speakers, please dial star one on your telephone keypad now to enter the queue. Once your name has been announced, you can ask a question. If you find your question is answered before it is your turn to speak, you can dial star two to cancel your request. If you're using speaker equipment today, please lift the handset before making your selection. One moment please for the first question. Our first question comes from Nicolas Katsapas from BNP Exane. Please go ahead. Hi, everyone. Thanks for taking my question. Thank you for a very comprehensive and clear presentation. I just had a question firstly on the expected revenue growth for 2024 from a basket and customer metric perspective. Are you're guiding to +1% to +11%, but you commented that you expect basket values to normalize, and you are going to be tighter on your marketing. I just wanted to know what do you see as a driver for growth if it looks like new customers and the average basket size is being held back? Maybe if you could just fill in the color on the average basket size, because we obviously have seen average price inflation, and you've implemented MOVs. Why is that only gonna be stable and, you know, not growing? Then the second question I have is on the guidance for your adjusted EBITDA breakeven. I'm thinking, I just wanna sort of understand, if I look through the courses of a year, how does the gross margin develop, to reach, you know, the 700 basis points improvement for the full year? Thank you. Sure. Thank for the questions. The first one on the different drivers of growth. Indeed, AOV expected to be rather flat in total, and then we would expect an improvement in the frequency driven by the improvement of the proposition, but also age structure with e-effects in the, in the customer cohorts, and then probably also slight uplift in the total number of active customers driven by both continued acquisition of new customers but also retention of previous customer cohorts. This then adds up to a positive revenue development in total. On the AOVs, why is it expected to be rather stable and not growing? If we look at this on a market by market basis, I think the expectation would be that we see a slight growth in the AOV, but then we have revenue mix effects. We are growing faster in markets that have slightly lower AOV, AOVs, which then means that in the mix, in the total, rather flat development expected. The gross margin, we would expect as outlined in the presentation, moderate headwinds still in the H1, given inventories are still slightly elevated. They should improve in the second half of the financial year, meaning we expect a substantial year-over-year improvement in the gross margin for the second half of the year, given weak comms in the H2, and this at the same time, a stabilization of the gross margin towards normal levels. Thank you. Hope this answers the question. Maybe, yeah, I just wanted to have a small follow-up. If you've seen the frequency of orders pick up, then how do I think about the leverage in the fulfillment line feeding through? Maybe you could comment on that, but otherwise very clear. Thank you. There is definitely operating leverage on the fulfillment cost line given that we expect growth and we have quite a substantial portion of fixed cost in our fulfillment cost line. On top of that, as outlined, we are also targeting unit economics measures that should give some support on cost per order. At the same time, however, we also are still in a somewhat inflationary environment, so there are still also headwinds, especially on distribution, but also wage inflation. At this point, it is not fully transparent to us as to which of these effects will outweigh. That's very clear. Thank you. Our next question comes from Georgina Johanan from JP Morgan. Please go ahead. Hi. Thank you for taking my questions. I've got two, please. Firstly, just on the full year marketing ratio that we should expect, is that Q4 level something sensible for fiscal 2024 overall, please? Secondly, appreciate it's still early days, but obviously lots of changes have gone in terms of minimum order value introductions and so on and so forth. What do you think, or what can you see from the data is the impact that that's having on sales? You know, in the areas where you've introduced that, have you seen a sort of directly negative impact from some customers' behavior on top line as a result, please? Sure. Thanks. On the first one, marketing, I think for the full year 2023, 2024, the Q4 is not an exact proxy, so it will probably be higher than in the Q4. That's first explained by seasonality. Usually we tend to have higher marketing cost ratios in the full price quarter, Q1 and Q3 for us, and lower marketing cost revenue ratios in Q2 and Q4. That said, we do indeed expect a substantial improvement in the marketing cost line for the full year. But it will be not be in the high single-digit, I would assume, but rather in the low teens, or maybe slightly below. Second part on MOV introduction. Yeah. First, the rollout is now largely completed, w e are basically live with MOVs in all major markets. What we can say is that, it has a certain impact, positive impact on contribution per order, but it also has a clear impact on revenues. The MOVs usually target a high single-digit share of revenues, which fall below this MOV. Out of these transactions, there's definitely a significant churn. That means top line is adversely affected. Bottom line is also definitely supported by the measures. Thank you. Was that the high single digit share of revenues that you mentioned then? Like, if we were to assume, for example, like half of that fell away, is it fair to assume that even in Q4, there was a 4% to 5% drag on top line from the introduction of those measures then, please? I would say it's lower than the 50%. Yeah. There is, there is a, there is a drag from that. I wouldn't relate top line dynamics exclusively to this feature. I mean, there's a lot of moving parts. There's dynamics in the consumer environment, of course. There's also other profitability measures, but there's also other measures which support the top line. Yeah, it's not Thank you. That's really helpful. Thank you. Our next question comes from Anne Critchlow from Societe Generale. Please go ahead. Good morning, all, and thanks for the presentation, Hannes. I've got two questions, please. First of all, I'm just wondering how you might pursue aggressive growth beyond full year 2023, 2024. You know, for example, will marketing cost to sales need to rise again? The second question's on the new 3P commission scheme. Could you let us know please, how commission% has changed? Thank you. Sure. Growth beyond 2023, 2024. I mean, first, I think we will see substantial growth support from the existing customer base in the sense of many measures that we're implementing right now will lead to a profitable baseline. What we see is that in our core customer segments, which are already heavily profitable today, there is already substantial growth, which will then be materializing going forward. We expect continued growth from existing customer cohorts. On top of that, we may accelerate growth on new customer acquisition in markets where we see lower penetration rates as of today. These are some of the recently entered markets where we are right now a bit more conservative on spending. We may also enter further markets in a time period where the market environment is more supportive for that, and we have leveraged a positive EBITDA. Next to that, some of the levers that we've already discussed, I think, over the last quarters, improving, extending our assortment, improving our digital product proposition and so on. This will also lead to potential incremental revenues from both existing and new customers. That said, we expect a continued positive EBITDA development beyond 2023, 2024, but we would also certainly be willing to continue to invest some of the remaining margin then into future growth, if we believe that's value creating. On the 3P commission scheme, it is... I think we had briefly discussed this on the last call. It is largely a function of the selling price of the item and the product group the single product comes from. The uplift on total commission is definitely in and around the low to mid single-digit percentage rate. There's a substantial uplift coming from that. That said, we believe the current commission scheme or the new commission scheme is also much better aligning the interest of our supplier partners and the platform than the rather flat commission scheme that we had before-hand, which was not supporting unit economics in lower price high return categories that much. Great. Thank you. Our next question comes from Nizla Naizer from Deutsche Bank. Please go ahead. Great. Thank you. My first question is on the new sort of shareholder loan facility that you mentioned, Hannes. Could you provide us a bit more color as to maybe the interest rate that it's coming with? Any covenants? Which shareholder, just to be precise, from Ion, and has it been signed already? Some color there would be great. Secondly, on the breakeven target for FY 2024, could you remind us, is this an annual number, so you expect the group EBITDA at the end of the year to be in positive territory? Or is it certain quarters of the year where you expect to be breakeven and the full year might still be in loss-making territory? Some color on the direction of travel would be great. Thank you. Sure. Thanks for the questions again. Starting with the loan. That is a facility from which we can actively draw. On the drawn amounts, interest would be paid of 12%, and on the undrawn amounts, there's a commitment fee of 2%. No covenants. It's subordinated. It's being lent by Otto, Heartland and Otto family. Basically the three large core shareholders of About You. It has a duration of twi years. It will be signed over the course of today. We will also send out a notification as a related party transaction. On the break-even target for 2023-2024, that is for the full year. That means we expect the full year 2023, 2024 to be in positive adjusted EBITDA territory. In terms of the shape, profitability is expected to be skewed towards our financial Q3, which is also the usual seasonality pattern that we observe in more mature markets. these this positive EBITDA and I would also expect a more like neutral EBITDA in the financial Q4. This will then lead to the full year positive adjusted EBITDA. Overcompensating the expected negative EBITDA in H1. Great. Very helpful. Thanks. Thank you. Our next question comes from Andreas Riemann from Oddo BHF. Please go ahead. Good morning. Two questions. First one on pricing. Are there any product areas or categories where the price increases are accepted among consumers? That's question number one. Number two, in the past, the growth driver for you and probably also for Zalando and others, was online taking share from offline. Would you say that going forward, it is more about competition within the online segment as the online penetration is not rising that fast anymore? Any thoughts from your side would be appreciated. Yeah, thanks. On the first question, in terms of pricing, I wouldn't call out any particular product groups also where the promotional pressure has been lower. I think that was pretty much across the board. Maybe some adjacent categories for us, like sports, or maybe kids, was not as severe as in the more like fashion and apparel categories. I think it was pretty much across the board. In terms of the channel shift, I mean, what we see right now is certainly a normalization in online penetration coming from the elevated COVID levels. Going forward, we would definitely expect this tailwind to return. There are still substantial room to grow in online penetration in our, in our core markets and in Europe more broadly. We would expect this tailwind to return and also lead to, you know, an extension of the pie, for all players in the market, so that growth is also able without taking share from other on liners. Okay. Thank you. We will now take our next question from Emily Johnson from Barclays. Please go ahead. Morning. I have three questions, please. The first is on the recent developments in DACH, which you mentioned are encouraging. Is that specific to your market share or are you seeing any underlying improvement in consumers more generally? How recent is that improvement? The second question is just a follow-up on the changes to commission rates that you're making at the moment. Is there any kind of feedback from partners that you can share? Are they changing their behavior at all? Are they broadly happy with the commission rate changes? Do you expect that to have any impact on your item point and assortment in FY 2023, 2024? The third question is just, why did the drop shipping revenues decline in FY 2022, 2023? Sure. First question was on DACH, recent developments. We indeed see a slow improvement in consumer sentiment, coming from a low base. I think that was supportive for us, but certainly also for the market more broadly. What we have also seen for us, for About You, is that we had an unusually strong discount offer in the Q4, driven by the need to clear inventories. This, I think, also stimulated revenues a bit in the German-speaking markets. Maybe it's a combination of both slowly improving consumer and then unusually attractive price offering from the About You side. Second question on commission rates, feedback from partners. I think generally that was very well received and accepted given the better alignment of interest from partners and the platforms to differentiation, different unit economics potentials. Of course, when you roll out such a new commission scheme, there are always certain partners which feel they are now worse off than before in some cases. That had been solved by adjusting the assortment which the partners are delivering and so forth. There's definitely a slight impact on the offer side. Overall, I would say no substantial change in the offer to consumers with the described uplift on commissions and a better aligned interest of platform and partners. Net-net, I think it's definitely positive. Drop-shipping, why has this declined? I think that's a mix of a few factors. First of all, as intended, we are growing our Fulfilled by Otto assortment, so we are actively transitioning partners from drop-shipping to FBAY or adding Fulfilled by Otto to a drop-shipping mix. This is intended. I think for both our own assortment as well as for Fulfilled by Otto assortment, the elevated inventory situation that we faced in 2022, 2023 led to higher discounts for these product types or operating models than for drop-shipping, which also supported a slightly higher growth. Lastly, visibility. Of course, in a situation where stock levels tend to be elevated, algorithms detect a higher stock risk on especially own inventory and give more visibility to these products as opposed to 3P products. I hope this answers the question. Can I just really quickly follow up on the second question around the item count? If items grew 21% last year, do you still expect that to grow broadly in line with where your revenues are growing, or should that flatten out? I would definitely expect continued growth in item count. Whether this will be in line or different revenues, too early to tell, but maybe in a similar corridor. Thank you. Thank you. As a reminder, to ask a question, please signal by pressing star one. Our next question comes from Simon Bowler from Numis. Please go ahead. Good morning. Two for me, if okay. I'll ask them one at a time. First one, just around kind of the fulfillment network. Can you share a sense of where, with now the French DC being postponed, whereabouts you're running versus capacity? If there's any other kind of levers you can pull to exit or reduce your use of that capacity. You obviously mentioned kind of the greater complexity that's coming with your kind of multi-warehouse footprint. Are there kind of further learnings to your mind to drive further efficiencies out of that network? Sure. With regards to capacities, I think with the three warehouses, which are fully operational now, Germany, Slovakia and Poland, we have a good set up for 2023, 2024, in terms of capacity provided versus utilized. Towards 2024, 2025, we will certainly make up our mind on expected top line demand prospects and based on that decide whether it's rational to then start the ramp up of the French DC, which would be possible on relatively short notice given that it's actually ready to go live. We do not yet pursue this given utilization aspects. Further potential to drive efficiencies, I mean, there's quite a lot actually in the operation of the network as a whole. If we look at the share of cross-docking orders, if we look at what items are being made available where, which items are, you know, relocated before order. There's a lot of moving parts in the whole system, and there are many efficiency levers. I think many of these have already been pulled. To be honest, over the next years, I think we will still have substantial room for further efficiency levers across the entire value chain. Great. Thank you. On the second one, I was just wondering if you talk a little bit around what you've seen, specifically within, that fourth quarter, where there's obviously quite a marked change from a trading stance perspective in terms of the mix of kind of markdown clearance versus marketing. In terms of your makeup of your customer base, obviously overall active customer numbers look like they've kind of progressed as one would expect. You know, have you seen greater customer acquisition offsetting kind of greater customer churn, or, has that kind of dynamic remained fairly stable with previous periods? I think it remained fairly stable. As you pointed out, I mean, there's definitely a bit of a trade-off then in providing discounts versus stimulating top line via marketing for the Q4. As outlined before, we had a need to clear inventory quite substantially. That was also carried out successfully, but of course affected the gross margin quite significantly. In this market environment and with the given discount that we offered, there was no need to drive up marketing further to reach the aspired top line and sell out of stock levels. Great. Thank you. We will now take our next question from Richard Edwards from Goldman Sachs. Please go ahead. Yeah. Hi, thank you. It was just a quick question on working capital. In the context of the higher inventory levels you had at the year-end. I think you referenced in your remarks moderate reduction in FY 2024. Just wanna see, if not in FY 2024, do you still expect inventory to sales, for example, to normalize or when do you expect to normalize, or are you really operating at a higher level of inventory going forward? Sure. Yeah, there's no set target, but the improvement, I think, will materialize largely in the second half of the year. For H2, or autumn winter 23 respectively, ordering is fully in line with the demand levels that we expect now, and this should then also lead to a normalization of the inventories, towards a more healthy stock turn, as we've also observed in the past. Okay. I was just sort of looking back at history. I think inventory to sales was sort of somewhere around about the high teens or low twenties historically, and it was closer to 30% last year. Are you expecting to get back to sort of the low twenties then in FY 2025? Or is that really what you're saying, second half of 2024, you might head in that direction? We, we will not be fully back there, I think, in the H2 of 2022/2024. This normalization back to normal levels, I think this will be carried out also towards 2024/2025. The decline in inventories, we will see already in the H2 of this year. It will not only just start in 2024/2025. Understood. Thank you. Thank you. With this last remark, we will be ending the Q&A session. Frank will address you with a few final remarks. Let me close our presentation by saying thank you for your support and for joining us today in our conference call for Q4 2022/2023. If there are any further questions, please feel free to contact the IR team directly. We are looking forward to seeing some of you during our upcoming virtual roadshow. Have a good day. Bye-bye. Ladies and gentlemen, thank you for your attendance. This call has been ended. You may now disconnect.