Movinn Q3 2022 - Interim Report: +29% topline, profitable growth & execution on international expansion.

We are executing on our international launches and we are adding new units in Denmark faster than expected. Growth remain substantial and profitable. 

Company Announcement nr. 20 - 2022
4 November 2022 08.00 CET. 
This company announcement contains inside information. 

Copenhagen, Denmark - The Interim Report covers results from the third quarter (Q3) of the year (1 July - 30 September 2022), as approved by Executive Management and the Board of Directors. 

In Q3 Movinn has realized revenue of 19.44 mDKK - up from 15.1 mDKK in the same period last year - corresponding to a 29% revenue increase. Growth is driven by stable demand and the ongoing growth in our unit portfolio.

As we have now launched in Sweden, we will be reporting on additional financial information on international markets going forward. The financial information concerning the existing danish operations will be reported seperately and consolidated figures containing information on international markets will be reported as consolidated figures. We have also isolated the numbers for 9M / YTD to offer additional transparency to the market. 

Realized EBITDA from existing danish operations was 2.86 mDKK corresponding to an EBITDA-margin of 14.8%. Realized EBIT was 1.27 mDKK corresponding to a 6.6% EBIT-margin. Annualized Return On Invested Capital (ROIC) was 16.0% for the existing danish operations. The same numbers for the consolidated group was 12.4% (EBITDA), 4.2% (EBIT) and 6.0% (ROIC). The consolidated figures is carrying start up cost in the swedish market which has been taking in at a loss on the P/L. 
Bottom line metrics are less than the comparable period last year. This is due to a) steeper growth is tearing on bottom line metrics, b) listing costs was not present last year and c) international expansions carries costs and deterioation of working capital. 

In Q3 we have added 32 new units across all markets taking our YTD total to 115 new units. Out of the 115 new units, 71 have been launched in Denmark (60-65 being the guided EOY total), meaning we are ahead of our growth curve. We have another 25 units in the Pipeline for Q4, meaning we will reach 140 new units EOY. This is 146% above the guided target from the annual report, meaning we once again revising our Guidance upwards on unit numbers. Because the growth is happening late in the year, the financial impact on the current fiscal year will be limited. However, the high unit number expected to give us an improved starting point going into 2023. 

We remain satisfied with balancing a revenue growth in the high double digits (29%) with continued improvement on fundamenls (14.8% EBITDA, 16% ROIC). We expect to use Q1 and Q2 2023 on optimizing on our existing portfolio. This exercise is expected to generate continued improvement on metrics (with respects to seasonality) and relatively attractive free cash flows. 

The Executive Management is executing on the international expansion plan. In Q3, we have launched a second international market in Lund, Sweden. This means we are covering two key markets in South Sweden. Gothenburg, Stockholm and key cities in Germany is our next focus. 

Financial highlights in Q3 2022: 

• Revenue increased by 29% to 19.44 mDKK (15.1 mDKK) 
• EBITDA margin from danish operations of 14.8% (16.1%)
• EBITDA margin from consolidated operations of 12.4% (16.1%)
• EBIT margin of 6.6% (9.3%)
• Return On Invested Capital (ROIC) of 16.0% (18.8%)
• Maintaining previous guidance for the full year on revenue and EBITDA.
• Revising guidance upwards on unit number. 

Business highlights in Q3 2022: 

• We have launced our second international market in Lund Sweden. 
• We are doing all the legal preparations for launching in Germany. 
• Net increase in new units in Denmark was 21, taking our danish portfolio to 369 at the end of the period.  
• Counting units in Sweden our total unit increase in Q3 has been 32 units taking the overall total to 413 at the end of the period. 
• The total unit number at the end of the year is revised upwards.
• Secondary product, Movinn Co-Living, is growing in parallel and faster than the core business. 
• We have secured 146% of the domestic unit growth / pipeline for 2022 so far.

Patrick Blok, Movinn CEO states: 
"The existing danish business continues to be a strong foundation on which we can build our international subsidiaries to pursue new markets. We are units domestically faster than expected, we have added a second new international market in Lund, Sweden, and we have made all the preparations for a launch in Germany. So we are executing on our strategy accordin to plan and in line with expectations. In 2023, we expect to use the opening quarters on optimizing on our existing portfolio and not resume aggressive growth until Q2-Q3. This exercise is expected to generate improvement on metrics and an relatively strong free cash flows. We have a blue-chip and diversified portfolio of corporate clients and our demand side remains stable. We are monitoring the macro-economic climate and we are planning for different scenarios - including a potential recession. However, we do not experience or expect any deterioration in demand in the foreseeable future". 

Disclosure regulation

The attached Q3 Interim Report contains forward looking guidance. Such guidance are subject to risk and uncertainties as different factors, some of which are beyond the control of Movinn, may cause the actual development and results to differ from forward looking expectations. Interim Report has not been subject to audit or review.