EQS-News: Marley Spoon Group SE reports Q3 2024 Results

MARLEY SPOON GROUP REPORTS ANOTHER POSITIVE OPERATING EBITDA QUARTER IN Q3 2024; DELIVERS 8.3% NET REVENUE GROWTH YOY

Marley Spoon Group SE (“Marley Spoon” or the “Company”), a leading global subscription-based meal kit provider, reported its results for the quarter ending 30 September 2024 (“Q3 2024”).

Highlights:

●  Net revenue of €84.0m, up 8.3% year-over-year (YoY);
●  Strong margin expansion to 34.5%, up 3.1 percentage points YoY;
●  Operating EBITDA of €2.0m, up €3.7m YoY;
●  Operating Cash Flow of €(1.1)m in Q3 2024 and quarter-end cash balance of €9.5m;
●  The Company reaffirms full year 2024 net revenue and Operating EBITDA guidance, upgrades FY 2024 contribution margin guidance.

Marley Spoon’s CEO Daniel Raab, commented: “We have delivered another quarter of accelerated year- over-year net revenue growth, with the positive topline development being driven by an increase in order average value, the addition of Bistro to our portfolio and our marketing investment strategy that continues to prioritize quality over quantity. We remain encouraged by increased engagement by our base customers, demonstrated by an increase in year-over-year order frequency.

Operationally, we also saw another quarter of contribution margin improvement vs. the previous year such that we have upgraded our guidance on this KPI. The margin improvement, combined with continued cost discipline, has led to our fourth consecutive positive Operating EBITDA quarter. I would like to thank everyone at Marley Spoon for their continued focus and dedication in delivering consistently against our plans.”

Q3 2024 Business Update

Marley Spoon’s Q3 2024 net revenue landed at €84.0, 8.3% growth year-over-year, an improvement over Q2 2024’s net revenue growth of 0.9%. Average order value was up 13% vs. Q3 2023 driven in part by the Company’s Market offering, premium recipes and an increase of family portions in the plan size mix. The acquisition of bistroMD in February 2024 also contributed to the net revenue performance. Order frequency increased 11% as customer quality continued to positively evolve, owing to the Company’s previously announced adjustments to its investment strategy that reduced reliance on deep discounting to drive customer acquisitions.

Contribution margin (CM) expanded once again in Q3 2024, improving 310 basis points (bps) vs. Q3 2023. The Company’s lower level of marketing discounts given was a large contributor, as was the average order value increase. Operating Contribution Margin (Operating CM), defined as CM excluding the impacts of marketing vouchers and fixed costs such as expenses relating to site leases, contracted just 40 bps to 40.0% in Q3 2024. In the US, the Company started to see the benefits of lower food and packaging costs from FreshRealm, though this was offset by higher picking costs in the US due to fulfillment changes (fulfillment center rationalization) and Australia (temporary staffing inefficiencies). In Europe, Operating CM improved 160 bps YoY driven by improved waste management and logistics utilization.

Marketing spend increased modestly by 3.4% YoY with efficient steering of seasonal investments focused on back-to-school campaigns, while marketing voucher costs were down nearly 30% in the quarter. Marley Spoon continues to see improved order frequency (+11% YoY) from its base customers, an outcome of the continued focus on cohort quality.

G&A decreased 2.3% in Q3 2024 YoY, despite consolidating Bistro’s fixed costs, as a result of the Company’s financial discipline and the continued benefits of last year’s cost reduction programs. Excluding the addition of Bistro, G&A is down 15.0% YoY, or approximately €2.5m.

Overall, the margin improvement and G&A savings offset the increased marketing investments to deliver positive Operating EBITDA in the quarter of €2.0m, an improvement of €3.7m vs. Q3 2023.

 

CASH FLOW

The Q3 2024 ending cash balance for the combined Marley Spoon Group (including bistroMD) and Marley Spoon SE was €9.5m. Cash from operations in Q3 2024 was €(1.1)m, with improvements in inventory offset by lower AP balances, mostly driven by certain one-off transaction fees settled in the beginning of the quarter.

Cash from investing activities amounted to €(2.3)m, with €(1.7)m of the total driven by investment in the Company’s digital platforms. The remaining investment comes from €(0.2)m in expenditure against property, plant and equipment in the Company’s Chefgood production facility and €(0.3)m toward the final earn-out payment for the 2022 acquisition of Chefgood.

Finally, cash from financing activities was €(3.8)m comprised almost equally of payments toward the Company’s leases and loan obligations, offset partially by a drawdown of €0.5m against Bistro’s revolver loan facility.

RECONFIRMING 2024 GUIDANCE

Marley Spoon CFO, Jennifer Bernstein, commented, “Q3 2024 was another quarter of consistent delivery of our plans. Revenue KPIs are stabilizing, margin has expanded and our cost savings initiatives are bearing fruit with lower YoY G&A. As a result, for the fourth consecutive quarter we delivered positive Operating EBITDA.

2024 Guidance:

• Narrowing net revenue growth vs. FY 2023 to flat-to-low single digit growth in constant currency;
• Upgrading Contribution Margin to expand 280-310 basis points vs. the prior year;
• Re-affirming full-year positive Operating EBITDA, with an expected landing in the mid-single digits.

About Marley Spoon

Marley Spoon Group SE, is a global direct-to-consumer (DTC) meal-kit company. Our Vision is to “Build a better everyday, just for you, just right”. We started Marley Spoon in 2014 to help our customers to cook for their families and deal with their busy lives. We also felt there should be a more sustainable way to cook at home, reducing food waste that traditional supermarket supply chains generate. Marley Spoon currently operates various brands in three regions: Australia, the United States, and Europe (Austria, Belgium, Germany, and the Netherlands). Our meal-kit brands, Marley Spoon, Martha Stewart & Marley Spoon, and Dinnerly, bring pre-portioned fresh ingredients with tasty and simple recipes and other eating solutions reliably to our customers every week. Our customers just decide what to eat, when to eat, and leave behind the hassle of grocery shopping. Chefgood and bistroMD are our direct-to-consumer ready- to-heat (RTH) services that offer tasty, high-quality, healthy, and nutritious RTH meals and eating solutions for our wellness and health-focused customers.

Disclaimer

This announcement constitutes neither an offer to sell nor a solicitation to buy securities. Certain statements contained in this release may constitute “forward-looking statements” that involve a number of risks and uncertainties. Forward-looking statements are generally identifiable by the use of the words “may”, “will”, “should”, “plan”, “expect”, “anticipate”, “estimate”, “believe”, “intend”, “project”, “goal” or “target” or the negative of these words or other variations on these words or comparable terminology. Forward-looking statements are based on assumptions, forecasts, estimates, projections, opinions or plans that are inherently subject to significant risks, as well as uncertainties and contingencies that are subject to change. No representation is made or will be made by Marley Spoon Group SE or any of their respective affiliates that any forward-looking statement will be achieved or will prove to be correct. The actual future business, financial position, results of operations and prospects may differ materially from those projected or forecast in the forward-looking statements. Neither Marley Spoon Group SE nor any of their respective affiliates assume any obligation to update, and do not expect to publicly update, or publicly revise, any forward-looking statements or other information contained in this release, whether as a result of new information, future events or otherwise, except as otherwise required by law.

Please see here for further details: 
Q3 statement 2024
Investor presentation with Q3 2024