Slides
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Interim Report Q1 2025 May 15th 2025
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T oday's Presenters Göran Dahlin CEO
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Agenda 1. Pierce in Brief 2. Financial update 3. Looking forward 4. Q&A
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4 Online leader in a fragmented market • Pierce is a leading e -tailer in the European market for Gear, Parts and Accessories for motorcycle riding • The total European market, which was estimated to some 100 bnSEK in 2021 1 • The market is still fragmented, mainly served by traditional offline retailers while well suited for ecommerce and will likely consolidate at some point • Pierce is the clear leader in the Offroad segment and one of the larger players in the Onroad segment • Pierce is the only true pan -European company in the market with localized sites in 16 markets • Pierce has a uniquely attractive assortment, offering a wide range of top brands as well as the largest range of own brands in the market • Pierce has a turnover of approx. 1.5 bnSEK , HQ in Stockholm and 310 2 employees across Europe Strong private brands 1) ‘Pierce Group AB prospectus, Rights Issue 2022, page 52 . Market estimated to have declined in size since 2021, but no official market data is available. 2) Total headcount of which ap proximately 190 white -collar employees and 120 blue -collar employees. Blue -collar workers are employed in the warehouse 3) Net revenue, freight income and other fees. Pan -European company Motorcycle specialist One -stop -shop offering Net revenue split, Q1 2025 LTM THIS IS PIERCE Brand revenue split3, Q1 2025 LTM 32% Nordics 68% Outside Nordics 62% Offroad 34%Onroad 4% Other Net revenue split, Q1 2025 LTM 56% Gear 20% Parts 20% Accessories 4% Other Net revenue split, Q1 2025 LTM 60% External brands 40% Private brands
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5 A FRAGMENTED MARKET THAT IS STILL MAINLY OFFLINE The different market categories 100bn SEK market where the majority is still offline 1 Source: (1) Data from Pierce Group AB prospectus, Rights Issue 2022, pages 42 and 52 . Market estimated to have declined in size since 2021, but no official market data is available. PARTS GEAR ACCESSORIES STREETWEAR MOTORCYCLES (NOT INCLUDED IN MARKET SIZE) • Anything installed on or in the motorcycle • High wear and tear - demand dependent on intensity of riding • Ideal for online when combined with navigation tool, such as Fit - My -Bike • Motorcycle themed clothing from motocross and motorcycle brands • Popular among enthusiasts and share online characteristics with regular apparel • Protective clothing, such as helmets, boots, suits. • High wear and tear for frequent riders (especially offroad). • E.g. helmets is regulated and therefore owned by all riders • Products used with the motorcycle that are not mounted, e.g. mats, stands, tents • Standardized tools and equipment making accessories suitable for online • Pierce does not currently sell motorcycles as the value chain is very different, with lower margins and require retailers to offer service stations ~30% ~30% ~20% ~20% Online market 2021 SEK ~20bn1) Online market potential Online expected to grow faster than offline – key drivers T otal market 2021 SEK ~100bn1) ONLINE MARKET 2021 ~19% online penetration1) SELECTION, AVAILABILITY AND CONVENIENCE NICHE WELL-SUITED FOR BUYING ONLINE INCREASING BASE OF MOTORCYCLE RIDERS
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6 FRAGMENTED LANDSCAPE Competitive landscape Notes: (1) Assessed primary go -to -market Leading online retailers in Europe Brick-and-mortar Leading European omni channel retailers General / diversified online and marketplaces Direct-to-consumer Direct Competitors Player Home Go-to- market1 Ownership Comment Pierce Nordics Online Listed Nordic Champion. Pan European leader in offroad FC-Moto DE Online Private DE champion online, onroad Motoblouz FR Online Financial, Part of Polo Group FR champion online, onroad Sportsbikeshop UK Online Financial, Part of Polo Group UK champion onroad Motocard ES Omni Financial ES champion, onroad Motea DE Online Private PB Parts & Accessories onroad Polo DE Omni Financial, Part of Polo Group Offline leader with online presence. Louis DE Omni Financial Offline leader with online presence Maciag DE Online Private MX (and MTB) online challenger offroad.
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7 Q1 SUMMARY SEKm Q1 2025 Q1 2024 Net Revenue 401 356 Growth, Year over Year % 13% 3% Gross Profit 171 162 Gross Margin % 42.6% 45.6% Variable Costs -95 -80 Variable costs % 23.6% 22.5% Profit after variable costs 76 82 Profit after variable costs % 19.0% 23.1% Overhead costs -72 -59 Overhead costs % 17.9% 16.6% Adjusted EBITDA 4 23 Adjusted EBITDA % 1.1% 6.5% Depreciation & Amortization -15 -16 Depreciation & Amortization % 3.8% 4.4% Adjusted EBIT -11 7 Adjusted EBIT % -2.7% 2.0% Inventory 490 332 Cash 175 278 Cash Flow -120 57 Strong growth in-spite of market headwinds • Q1 showed 13% growth YoY in-spite of a weak consumer demand, especially at the beginning of the quarter thank to sales driving actions implemented as a response. • Consumers are increasingly price-sensitive and concentrating purchases around major promotional events, such as Black Friday and Christmas. This left January and February especially weak with softer demand across several markets. • Performance improved materially in March as new seasonal stock arrived, enabling us to scale back marketing spend to more sustainable levels. Gross profit growth, while gross margin decreased and variable costs increased • Priority in Q1 has been to protect gross profit in absolute terms and to continue to grow the customer base. • Gross margin decreased vs. last year with 3.0 ppt to 42.6% due to strong mix-effects, higher in- freights costs and lower obsolescence reversal versus last year • Variable costs as a result of our increased sales driving actions High overheads due to transformation and FX • Our Overhead costs increased from 59 SEKm to 72 SEKm Change of 13 SEKm consist of 9 SEKm in transformation cost and 4 SEKm from FX effects. • Transformation costs due to implementing new SaaS systems cannot be capitalized, we are still carrying depreciation from our legacy on-prem systems – creating a temporary cost overlap. Once this transition is completed, both transformation costs and depreciation will gradually decline, enabling improved operating leverage from 2026 and onwards. Negative Adjusted EBIT for the quarter • Adjusted EBIT weakened from 7 SEKm last year to -11 SEKm • Apart from a weak demand which required aggressive pricing and higher marketing costs our EBIT was also affected by obsolescence, transformation cost and brand depreciation. Solid cash position • Cash end of Q1 was 175 SEKm, is a decline from an exceptionally high cash level during 2024, but still a very solid level • Inventory levels are higher than last quarter as projected and will likely stay high going forward to capture growth opportunities in line with strategy
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8 KPI HIGHLIGHTS LTM Small decline in private brand revenue due to customer mix effects 650 623 631 641 640 638 635 624 639 638 39% Q4 2022 39% Q1 2023 40% Q2 2023 41% Q3 2023 42% Q4 2023 41% Q1 2024 41% Q2 2024 40% Q3 2024 39% Q4 2024 38% Q1 2025 Net revenues, Private brand LTM (SEKm) Net Revenue, Private brand (% of net revenue) Slight increase in Trustpilot score: 4.4/5.0 Q4 2022Q1 2023Q2 2023Q3 2023Q4 2023Q1 2024Q2 2024Q3 2024Q4 2024Q1 2025 4,3 4,3 4,3 4,3 4,3 4,3 4,3 4,3 4,4 4,4 Aggregated Trustpilot scores
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9 KPI HIGHLIGHTS LTM (CONTINUED) Active customer base increasing AOV increasing, primarily due to mix effects 1,165 1,106 1,083 1,070 1,021 1,016 1,004 1,001 1,042 1,052 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Active customers LTM (000), end of period 955 972 999 1,021 1,055 1,070 1,090 1,088 1,084 1,093 1,749 1,641 1,587 1,548 1,456 1,447 1,434 1,433 1,502 1,530 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 +12% Average order value LTM (SEK) Number of orders LTM (000)
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Agenda 1. Pierce in Brief 2. Financial update 3. Looking forward 4. Q&A
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11 GROSS MARGIN Gross margin development since Q1 2023 • We observed a slight decrease in -freight costs in Q1 2025 vs the previous quarter and increase of 1.0 ppt in cost in relation to Net revenue compared to the same quarter previous year. • Market shipping rates from Asia for in -freight have been volatile , but we see a slight decrease since the end of 2024. • In -freight shipping prices impact cash and net working capital when inventory is purchased but are accounted for as costs of goods sold in the P&L at the point of sale - hence fluctuating shipping prices do not materialise in the P&L immediately. • We foresee continuing volatility in market freight prices (but unclear near -term trend in overall levels). We are taking active measures to limit the impact of volatility on actual (average) prices paid and manage any impact on future margins. Shipping costs in relation to revenues • Category performance was highly polarized: Onroad delivered strong growth, while Offroad was softer. The resulting mix shift, combined with strong sales push, inbound freight costs (from orders placed 6–12 months ago) and a significantly lower obsolescence reversal versus last year, negatively impacted gross margin by 3.0 ppt. • Looking ahead we judge that the market will remain highly price sensitive. Q1 2023 42.1% Q2 2023 30.7% 42.8% Q3 2023 44.7% 43.1% Q4 2023 45.6% 43.1% Q1 2024 44.1% 43.4% Q2 2024 45.5% 41.7% 45.2% Q1 2025 42.0% Q3 2024 Q4 2024 42.6%43.2% 39.7% Gross margin (%), reported Gross margin (%), exlcluding the effect from obsolescence & scrapping Note: The negative gross margin trend since 2021 primarily attributed to escalated shipping and supplier costs. The effect of thesecost hikes have gradually been mitigated by passing them on to customers, initiated in Q1 2023. The significant drop in the margin during first half of 2022 was due to our focus on generating cash and reducing net debt. 30 24 27 19 21 16 17 14 18 14 22 20 0 2 4 6 8 10 12 0 5 10 15 20 25 30 6.6% Q2 2022 6.4% Q3 2022 6.2% Q4 2022 5.5% Q1 2023 4.9% Q2 2023 4.4% Q3 2023 4.4% Q4 2023 3.9% Q1 2024 3.9% Q2 2024 3.9% Q3 2024 4.8% Q4 2024 4.9% Q1 2025 In-freight (SEKm) Cost in relation to Net revenue (%)
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12 OVERHEAD COSTS DEVELOPMENT ▪ Cost increase of 13 SEKm ▪ 2025 Q1 has been impacted by transformation costs of 9 SEKm mainly related to our tech stack upgrade – Costs for external consultants and costs associated to systems not yet in use amounted to approx. 9 SEKm in Q1 – Costs for inhouse staff not considered ▪ FX impact on cost has been approximately 4 SEKm ▪ Items Affecting Comparability during the quarter has been 4 SEKm. This refer mainly to one-time costs in Q1 related to role changes primarily in the commercial teams to accelerate our development (not included in graph) 61 67 67 72 59 69 65 76 72 0 5 10 15 20 25 0 10 20 30 40 50 60 70 80 17.7% Q1 2023 15.3% Q2 2023 18.1% Q3 2023 18.8% Q4 2023 16.6% Q1 2024 15.1% Q2 2024 18.0% Q3 2024 17.0% Q4 2024 17.9% Q1 2025 Overhead costs Overhead costs % of net revenue
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13 NET WORKING CAPITAL DEVELOPMENT ▪ Net working capital (NWC) has during the fall 2024 and beginning of 2025 increased from an extra ordinary low point in Q2, as a result of work to improve assortment and product availability ▪ NWC increased vs previous quarter – T otal inventory increased with SEKm 158 Y oY ▪ Due to seasonality, NWC in relation to Revenue LTM has historically normally been lower in Q2 (end of high season) and Q4 (end of campaign season) compared with Q1 and Q3 ▪ NWC expected to remain on a higher level than 2024 to ensure availability before and to capture growth opportunities in line with strategy NWC increased due to higher inventory levels 246 272 227 179 107 86 37 127 99 198 0 5 10 15 20 25 0 50 100 150 200 250 300 14.7% Q4 2022 17.0% Q1 2023 14.3% Q2 2023 11.3% Q3 2023 7.0% Q4 2023 5.6% Q1 2024 2.4% Q2 2024 8.1% Q3 2024 6.1% Q4 2024 11.8% Q1 2025 Net working capital, NWC (SEKm) Net working capital, % of Net Revenue, LTM (%) Extraordinary obsolescence provision 44 SEKm
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Agenda 1. Pierce in Brief 2. Financial update 3. Looking forward 4. Q&A
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15 Fuelling our growth and profits Strengthening Our Core We are expanding and refining our assortment, improving product availability, and shortening delivery times. With our new tec h s tack launching in the second half of 2025, we will gain significantly better control over product and customer data. This will enable enhanced product presentatio n, personalized experiences, and a faster, more intuitive website. Together, these improvements will support both customer acquisition and retention. Accelerating Geographic Expansion In 2025, we will launch fully localized websites in 12 additional European markets —featuring local languages, payment methods, a nd delivery options. These markets already show above average growth via our . eu domain, and full localization is expected to unlock further potential. Scaling Adjacent Verticals We also see good growth opportunities in underpenetrated categories like mountain bike and moped/scooter. These can during th e c oming years be scaled efficiently through cross -selling and by leveraging existing infrastructure, with limited incremental investment. Positioning for Industry Consolidation The European e -commerce market for motorcycle gear and equipment is ripe for consolidation. The benefits of scale are clear, and it's a matter of when —not if — consolidation will occur. With our pan -European platform, Pierce is uniquely positioned to lead such a development. Balancing Margin and Growth We will continue to prioritize gross profit growth in absolute terms, as it is the best road to maximize both short and long -ter m profitability. While our onroad segment — being larger and less penetrated —may grow faster than offroad, this shift may impact our margin percentage negatively. However, this growth provides leverage to negotiate better terms with suppliers. We also remain committed to expanding our high -margin private label portfolio. Leaving Negative Cost Gearing in our Rearview Mirror Our transition to a SaaS -based IT infrastructure is well underway. Although transformation costs cannot be capitalized, we are s till incurring depreciation on legacy on - premise systems —causing a temporary cost overlap. Once the migration is complete, both cost streams will taper off, enabling imp roved operating leverage from 2026 and beyond. We are on the right track, in -spite of the bumpy road in Q1 Despite strong headwinds this quarter, I remain fully confident in our strategic direction. 2025 will be heavily impacted by our transformation, but from this we will benefit for many years ahead.
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Agenda 1. Pierce in Brief 2. Financial update 3. Looking forward 4. Q&A
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17 Appendix Appendix
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18 Development of minimum wages Poland Year Jan (PLN) Jul (PLN) Yearly increase 2020 2 600 – 15,6% 2021 2 800 – 7,7% 2022 3 010 – 7,5% 2023 3 490 3 600 19,6% 2024 4 242 4 300 19,4% 2025 4 666 – 8,5%
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19 CONSOLIDATED FINANCIAL INFORMATION SEKm (unless stated otherwise) 2023 2024 Q1 2025 LTM Net Revenue 1,537 1,628 1,673 Growth (y/y) (%) -8% 6% 8% Growth in local currencies (y/y) (%) -13% 6% 12% Growth in private brand sales (y/y) (%) -1% 0% 0% Gross Profit 607 724 733 Gross margin (%) 39.5% 44.5% 43.8% Variable sales- and distribution costs -351 -363 -378 Variable sales- and distribution costs (%) -22.8% -22.3% -22.6% Profit after variable costs 256 361 355 Profit after variable costs (%) 16.7% 22.2% 21.2% Overhead costs -267 -270 -283 Overhead costs (%) -17.4% -16.6% -16.9% Adjusted EBITDA -11 91 72 Adjusted EBITDA margin (%) -0.7% 5.6% 4.3% Depreciation, amortisation and impairment -75 -66 -65 D&A (% of net revenue) -4.9% -4.0% -3.9% Adjusted EBIT -85 25 7 Adjusted EBIT margin (%) -5.6% 1.5% 0.4% Items affecting comparability (IAC) -42 -7 -10 IAC (% of net revenue) -2.7% -0.4% -0.6%
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20 QUARTERLY CONSOLIDATED FINANCIAL INFORMATION SEKm (unless stated otherwise) Q1 Q2 Q3 Q4 FY23 Q1 Q2 Q3 Q4 FY24 Q1 Q1 LTM Net Revenue 345 441 369 382 1,537 356 456 365 451 1,628 401 1,673 Growth (y/y) (%) -18% -2% -1% -10% -8% 3% 3% -1% 18% 6% 13% 8% Growth in local currencies (y/y) (%) -22% -7% -9% -15% -13% 2% 2% 1% 19% 6% 12% 12% Growth in private brand sales (y/y) (%) -15% 5% 7% -1% -1% -2% -2% -7% 9% 0% -1% 0% Gross Profit¹ 137 186 113 171 607 162 201 166 195 724 171 733 Gross margin (%) 39.7% 42.1% 30.7% 44.7% 39.5% 45.6% 44.1% 45.5% 43.2% 44.5% 42.6% 43.8% Variable sales- and distribution costs -83 -98 -79 -91 -351 -80 -98 -84 -102 -363 -95 -378 Variable sales- and distribution costs (%) -24.1% -22.1% -21.4% -23.8% -22.8% -22.5% -21.4% -23.0% -22.5% -22.3% -23.6% -22.6% Profit after variable costs 54 88 34 80 256 82 104 82 93 361 76 355 Profit after variable costs (%) 15.6% 20.0% 9.3% 20.9% 16.7% 23.1% 22.7% 22.5% 20.6% 22.2% 19.0% 21.2% Overhead costs -61 -67 -67 -72 -267 -59 -69 -65 -76 -270 -72 -283 Overhead costs (%) -17.7% -15.3% -18.1% -18.8% -17.4% -16.6% -15.1% -18.0% -17.0% -16.6% -17.9% -16.9% Adjusted EBITDA -7 21 -32 8 -11 23 35 17 16 91 4 72 Adjusted EBITDA margin (%) -2.1% 4.7% -8.7% 2.1% -0.7% 6.5% 7.6% 4.6% 3.6% 5.6% 1.1% 4.3% Depreciation, amortisation and impairment -14 -14 -15 -32 -75 -16 -18 -17 -15 -66 -15 -65 D&A (% of net revenue) -4.0% -3.2% -3.9% -8.4% -4.9% -4.4% -3.9% -4.6% -3.4% -4.0% -3.8% -3.9% Adjusted EBIT -21 6 -47 -7 -69 7 17 0 1 25 -11 7 Adjusted EBIT margin (%) -6.2% 1.5% -12.7% -1.9% -4.5% 2.0% 3.7% -0.0% 0.3% 1.5% -2.7% 0.4% Items affecting comparability (IAC) 0 -4 -1 -38 -42 0 0 0 -6 -7 -4 -10 IAC (% of net revenue) -0.0% -0.9% -0.2% 9.8% -2.7% -0.0% -0.0% -0.0% -1.4% -0.4% -0.9% -0.6% ¹ Revaluation of working capital items 0 0 -1 0 1 -1 -1 2 -3 0 1 -1 Number of orders (000) 354 429 332 342 1,456 344 416 332 411 1,502 372 1,530 Average order value (AOV) (SEK) 974 1,028 1,110 1,119 1,055 1,034 1,097 1,100 1,098 1,084 1,078 1,093 Net revenue from private brands 145 187 148 160 640 142 185 137 175 639 141 638 Active customers, LTM (000) 1,106 1,083 1,070 1,021 1,021 1,016 1,004 1,001 1,042 1,042 1,052 1,052 1) Exchange rate revaluation of working capital items are included in cost of goods sold. 20252023 2024
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21 QUARTERLY CONSOLIDATED NET WORKING CAPITAL 1) Defined as cost of goods sold LTM divided by end of quarter inventory. 2023 SEKm (unless stated otherwise) Q4 Q1 Q2 Q3 Q4 Q1 Physical stock 283 274 233 280 301 385 Goods in transit 61 58 74 121 118 105 Inventory 344 332 307 400 419 490 Working capital assets 14 25 27 26 24 35 Working capital liabilities -251 -270 -297 -299 -344 -327 Net working capital 107 86 37 127 99 198 As % of net revenue LTM 7.0% 5.6% 2.4% 8.1% 6.1% 11.8% Stock turnover¹ 2.7x 2.8x 3x 2.1x 2.2x 1.9x Inventory % of net revenue LTM 22.4% 21.5% 19.7% 25.7% 25.7% 29.3% 2024 2025
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22 CONDENSED CONSOLIDATED STATEMENT OF PROFIT/LOSS Apr 2024- Jan-Dec SEKm 2025 2024 Mar 2025 2024 Net revenue 401 356 1,673 1,628 Cost of goods sold -230 -194 -940 -903 Gross profit 171 162 733 724 Sales and distribution costs -132 -116 -531 -515 Administration costs -53 -43 -206 -196 Other operating income- and expenses -1 3 -1 5 Operating profit -15 7 -3 18 Financial net -19 18 -13 24 Profit/loss before tax -33 26 -16 42 Tax -1 0 -7 -6 Profit/loss for the period -34 25 -23 36 Jan-Mar
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23 CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION SEKm 31 Mar 2025 31 Mar 2024 31 Dec 2024 Intangible assets 276 304 281 Property, plant and equipment 14 14 15 Right-of-use assets 151 53 54 Financial assets 5 3 6 Deferred tax assets 1 7 2 Total non-current assets 447 382 358 Inventory 490 332 419 Other current assets 37 27 29 Cash and cash equivalents 175 278 297 Total current assets 702 638 745 Total assets 1,149 1,020 1,103 Total equity 630 654 666 Leasing liabilities 113 23 25 Deferred tax liabilities 24 26 25 Provisions 0 0 0 Total non-current liabilities 138 50 50 Leasing liabilities 33 30 27 Trade payables 61 83 111 Other current liabilities 288 203 248 Total current liabilities 382 316 386 Total equity and liabilities 1,149 1,020 1,103
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24 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW Apr 2024- Jan-Dec SEKm NOTE 2025 2024 Mar 2025 2024 Operating profit A -15 7 -3 18 Adjustments for non-cash items B 22 21 70 69 Paid interest -2 -2 -5 -4 Received interest 1 1 7 8 Realised currency derivatives 1 1 3 4 Paid/received tax -2 -1 -4 -4 Cash flow from operating activities before changes in net working capital 5 29 69 92 Changes in net working capital C -115 37 -139 13 Cash flow from operating activities -110 65 -70 105 Investing activities Investments in non-current assets D -3 -1 -8 -6 Paid/received blocked funds 0 0 -2 -2 Cash flow from investing activities -3 -1 -10 -8 Financing activities Share issue costs - 0 0 0 Change in utilised credit facility - - - - Repayment of liabilities to credit institutions¹ - - - - Repayment of leasing liabilities E -7 -7 -30 -29 Cash flow from financing activities -7 -7 -30 -29 Cash flow for the period -120 57 -110 68 Cash and cash equivalents at the beginning of period 297 222 278 222 Exchange rate difference -1 -1 7 7 Cash and cash equivalents end of period 175 278 175 297 Operating cash flow before IFRS 16 interest A+B+C+D+E -118 57 -109 66 Interest IFRS 16 -1 -1 -3 -2 Operating cash flow -119 56 -112 63 1) Including capitalised interest expenses. Jan-Mar
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25 RECONCILIATION OF ADJUSTED FINANCIALS Apr 2024- Jan-Dec SEKm 2025 2024 Mar 2025 2024 Net revenue 401 356 1,673 1,628 Cost of goods sold -230 -194 -940 -903 Variable sales- and distribution costs -95 -80 -378 -363 Other costs¹ -91 -75 -358 -342 EBIT -15 7 -3 18 Reconciliation of adj. EBIT and adj. EBITDA EBIT -15 7 -3 18 IAC related to: IPO-costs - - - - Restructuring expenses 0 0 0 0 Share-based payments 0 0 -1 -1 Share-based payments (social costs) 0 - 0 0 Goodwill impairment - - 0 0 Other costs (XO) -3 - -9 -5 Adjusted EBIT -11 7 7 25 Adjusted EBIT margin (%) -2.7% 2.0% 0.4% 1.5% Depreciation -9 -8 -36 -35 Amortisation -6 -7 -30 -31 Goodwill impairment - - - - (of which PPA amortisations included in adjusted EBIT) -2 -2 -7 -7 Adjusted EBITDA 4 23 72 91 Adjusted EBITDA margin (%) 1.1% 6.5% 4.3% 5.6% 1) Other costs mainly consist of non-variable sales- and distribution costs, administration costs and other operating expenses/income. Jan-Mar
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26 Pierce Group's mid to long term financial targets Financial targets • Net revenue growth: In the medium to long term (3 -5 years), organically outgrow the European online market for motorcycle gear, accessories and parts. • Adjusted operating margin (EBIT): In the medium to long term (3 -5 years), achieve an adjusted operating margin (EBIT) of 5 -8%. • Capital structure: Net debt/ EBITDA * not exceeding 2.0x, subject to temporary flexibility for strategic initiatives. • Dividend policy: Over the next few years, the Company plans to use free cashflows** for continued development*** and does not intend to pay dividends to shareholders. * Net debt in relation to last twelve month adjusted EBITDA, excluding IFRS 16 effects. ** Free cashflow refers to cashflow from ongoing operations and investment activities. *** Development means investments in, for instance, IT -hardware, IT -development, expansion of distribution warehouse, marketing, customer acquisitions, business acquisitions and acquisitions of net assets.