D-Market Elektronik Hizmetler ve Ticaret (HEPS) Q1 2024 earnings summary

Executive summary

• Achieved strong Q1 performance in 2024, exceeding GMV and EBITDA guidance, with robust operational and financial results driven by effective execution and a favorable base effect from last year's earthquake.

• GMV rose 42.5% year-over-year to TRY 36.3 billion, with revenue up 45.0% to TRY 11.3 billion, and order volume up 21.7% to 29.3 million.

• Net loss narrowed to TRY 130.7 million from TRY 324.9 million in Q1 2023, while EBITDA improved to TRY 289.4 million from TRY 12.2 million.

• Maintained leadership as Turkey's most recommended e-commerce brand, with an NPS of 73 and an active customer base of 12.1 million.

• Strategic focus on loyalty, delivery, affordability, and externalizing services drove operational and financial improvements.

Financial highlights

• Revenue increased 45% year-over-year to TRY 11,309.6 million, with delivery service revenue up 95%.

• GMV grew 138% year-over-year (43% adjusted for inflation), driven by 17% higher average order value and 22% more orders.

• Gross contribution margin improved by 1.2pp to 10.5% of GMV, the highest since IPO.

• EBITDA margin rose to 0.8% of GMV, a 0.7pp improvement.

• Free cash flow reached TRY 1,029.6 million, supported by TRY 1,455.7 million in operating cash flow and disciplined working capital management.

Outlook and guidance

• Q2 2024 GMV expected to grow around 75% year-over-year, with EBITDA margin projected at 1.8%-2% of GMV.

• No corporate tax expected in 2024 due to R&D incentives; tax payments likely to start in 2026.

• Free cash flow expected to improve for full-year 2024, driven by EBITDA growth and negative working capital.

• Focus remains on sustainable, profitable growth and prudent capital allocation.