publishes final financial results for the fiscal year and fourth quarter of 2018; Positive adjusted EBIT development in the fourth quarter of 2018

• Revenues of EUR 104.8 million in FY2018 and EUR 26.3 million in Q4 2018; Revenue increase due to Christmas business and successful sales campaigns (+18% sales growth compared to Q3 2018)
• Adjusted EBIT of EUR -18.5 million (-17.8% margin) in FY2018 and EUR -2.5 million (-9.7% margin) in Q4 2018; Improvement in operating contribution margin on a quarterly basis and lower adjusted selling and administrative expenses in Q4 2018
• Successful capital increase to complete restructuring measures in Europe and increase growth in the Chinese market • Available cash and cash
equivalents of EUR 11.1 million as of December 31, 2018; additional gross proceeds from capital increase of EUR 10.1 million
• Significant revenue growth and further improvement in adjusted EBIT expected in FY2019; Break-even based on adjusted EBIT expected at the beginning of 2020

Munich, March 20, 2019: SE ("", "Group" or the "Company"), one of the leading online retailers of family products in Europe and for customers in China, today released its final financial results for the fiscal year (FY) and fourth quarter (Q4) 2018, following the publication of preliminary results on February 7, 2019. In FY2018, the Group generated revenues of EUR 104.8 million (2017: EUR 188.3 million, excluding Feedo) and an adjusted (ber.) EBIT of EUR -18.5 million (-17.8% margin) compared to EUR -21.3 million (-11.3% margin) in FY2017. In addition to the temporarily weaker demand in China in the first nine months, the sales development in FY2018 resulted from the efficiency and profitability measures initiated in February 2018. In Q4 2018, however, the Group recorded an increase in sales and generated revenues of EUR 26.3 million (Q4 2017: EUR 46.2 million, excluding Feedo), an increase of 18% compared to the previous quarter and an improvement in the ber. EBITs of EUR -2.5 million (-9.7% margin) in Q4 2018 (Q4 2017: EUR -5.3 million, -11.4% margin). This positive development and the capital increase successfully completed in March of this year create good conditions for the further development of the company. In 2019, the Group expects significant sales growth compared to the previous year, a further improvement in the ber. EBIT and the achievement of break-even on the basis of the ber. EBITs early 2020.

Sales growth in China and DACH region, stabilization of sales at Bebitus shops

Sales in the China business amounted to EUR 56.7 million in FY2018 (2017: EUR 105.6 million). This decline is mainly due to three factors in the first nine months: price pressure on products from overstocking in the first quarter, temporarily tighter customs controls that led to delays in orders of several weeks, and product launches from the largest milk powder suppliers, which were due in September 2018. The market recovered in Q4 2018, resulting in revenue of EUR 15.8 million (Q4 2017: EUR 27.9 million), an increase of 33% compared to the third quarter of 2018, driven by strong sales events around Singles Day (11/11) and Black Friday.
Revenues in the DACH region (Germany, Austria and Switzerland) amounted to EUR 24.2 million in FY2018 (FY 2017 EUR 44.2 million) and eur 5.9 million in Q4 2018 after EUR 5.7 million in the previous quarter (Q4 2017: EUR 10.0 million). In addition to the DACH region, the "Rest of Europe" (RoE; Spain, Portugal and France), which is covered by the Bebitus shops, mainly affected by the continued focus on improving margins and profitability of the business. RoE generated sales of EUR 23.9 million in FY2018 (FY 2017: EUR 38.5 million, excluding Feedo) and EUR 4.5 million in Q4 2018 (Q4 2017: EUR 8.3 million, excluding Feedo).

Improved contribution margin and further cost reductions lead to better operating profit in 2018; reduced cash burn in Q4 2018

The Group's available liquidity amounted to EUR 11.1 million as of December 31, 2018. The total change in available cash and cash equivalents amounted to EUR -1.6 million in Q4 2018. The quarter-on-quarter improvement is the result of higher operating performance and lower net working capital as of December 31, 2018, mainly due to a reduction in inventory and trade receivables.

Subscription rights capital increase to finance growth in China and to complete restructuring

The Group successfully carried out the capital increase resolved by the Extraordinary General Meeting on January 9, 2019. The share capital was increased by EUR 6,850,023.00 from EUR 3,113,647.00 to EUR 9,963,670.00 by issuing a total of 6,850,023 no-par value bearer shares with a nominal value of EUR 1.00 each and with dividend entitlement as of January 1, 2018 ("New Shares") against cash contributions. Based on the fixed subscription price of EUR 1.48 per new share, the Group generated gross proceeds of around EUR 10.1 million. With the proceeds of the issue, intends to realize projects for the announced growth course in China and complete the restructuring program.
Dr. Nikolaus Weinberger, CFO of explains: "In 2018, we focused on increasing the gross profit margin and optimizing costs, which led to an improvement in the operating result. In the fourth quarter, operating profit and cash flow were positively impacted by sales events, the Christmas business and lower net working capital. With the recently successfully completed capital increase, we have strengthened our capital base and can invest in sustainable growth. We are pleased to have expanded our investor base in our largest sales region, Asia, and with their support we will continue to expand our expertise in China."
For 2019, the Group continues to follow the restructuring course initiated in 2018 and expects significant sales growth compared to 2018, a further improvement in adjusted EBIT and a moderate increase in net working capital in order to enable the growth of the China business, as targeted investments are made in the Chinese market. In addition, new product categories are to be developed to position as an international company for young families in Europe and China. The Management Board also expects a significant improvement in the operating contribution margin (in % of sales). Break-even based on adjusted EBIT is expected in early 2020.
Matthias Peuckert, CEO of comments on the outlook and strategic objectives for 2019: "After the restructuring year 2018, we are concentrating on the long-term development of the company in 2019 and on profitable sales growth as well as further margin optimization. We are making targeted investments in the Chinese market and positioning with new product categories as a full-service provider for young families in Europe and China."

Q4 2018 Q4 2017 2018 2017
Revenue (mio. Euro) 26,3 46,2 104,8 188,3
China 15,8 27,9 56,7 105,6
ROOF 5,9 10,0 24,2 44,2
Rest of Europe 4,5 8,3 23,9 38,5
Operating contribution margin (EUR million) 2,4 2,8 4,1 11,0
in % of turnover 8,7% 6,0% 3,9% 5,8%
Adjusted EBIT (EUR million) -2,5 -5,3 -18,5 -21,3
in % of turnover -9,7% -11,4% -17,8% -11,3%