Preliminary selected sales figures of Answear.com S.A. for Q1 2022

The Management Board of Answear.com SA ("Company") presents the preliminary selected sales data for the 1st quarter of 2022 together with the comparative figures for the 1st quarter of 2021:

- in the first quarter, online sales (1) increased by 32% compared to the same period of 2021, amounting to PLN 166 million (Q1 2021: PLN 126 million);

- sales revenue according to IFRS (2) reported for the first quarter of 2022 amounted to PLN 175 million and increased by 42% compared to the same period of last year (Q1 2021: PLN 123 million).

The difference in dynamics between on-line sales and sales revenue according to IFRS reporting results from the fact that in the first quarter of the current year, the company has credited on-line sales with returns of goods received during this period but related to sales transactions made in the fourth quarter of 2021. At the same time, the impact of those returns on sales revenue was netted off by the reversal of provision for returns created for that purpose and charged already in 2021, thus in line with the date of the sale transaction to which they relate.

Management's comment on the figures:

- The company has started 2022 as planned, with sales increases as expected in the month of January and the first weeks of February and continuation of the positive sales trend from the previous year, enhanced by off-sale period in the fashion industry;

- the military aggression in Ukraine had a significant impact on the sales levels recorded from February 24 this year - as already communicated all sales activity on the Ukrainian market were suspended at the first day of the war, moreover the sentiment for purchases on other markets has been negatively influenced by that situation too, especially in the first two weeks of the conflict, which resulted in a significant drop in the number of orders placed by Answear's customers;

- in March, sales gradually improved, coming back to the levels originally planned before the war at the end of this month, with the exception for the Ukrainian market, being still excluded from shipping activities;

- sales on the Ukrainian market in the previous year accounted for 17% of the Company's total sales, at the moment the Management Board is closely monitoring the situation on this market and the Company is ready to relaunch deliveries to our customers in Ukraine in selected regions of this country, as soon as the situation allows for it.

 

 

Explanations:

(1) On-line sales means sales invoiced during the period, including also credit notes related to returns booked during the period and also including sales based on commission agreements with suppliers in its full price (net value) paid by customer. On-line sales include also charges invoiced to customer for shipments below the free delivery threshold.

(2) Sales revenues according to IFRS accounting standards include revenues from the sale of goods purchased for its own account as well as revenues from the sales based on commission agreement expressed as revenue from commission services being calculated as the difference between sales price invoiced to customer and value of merchandise sold. Moreover sales revenue include also commission for running the www.wearmedicine.com internet site and charges invoiced to customer for shipments below the free delivery threshold. Sales revenues are also adjusted by the value of provisions for the returns corresponding to sales transactions executed during reported period but expected to be processed in the next period. Moreover it also includes provision for customer loyalty program accounted for sales recorded in reported period.

Disclaimer: The Company advises that the sales figures presented are preliminary and have been calculated in accordance with the best Management's knowledge at this stage and may differ from the final figures for Q1 2022 which will be published in quarterly report.