The beginning of Black Week with double-digit dynamics, GMV may be at the upper limit

November Black Week promotions began with double-digit growth dynamics, and the increase in GMV – i.e. the total gross value of goods sold on Allegro – may be at the upper end of the range in Q4 this year, according to Allegro CFO Jonathan Eastick.

Allegro announced today that it plans to increase GMV from operations in Poland at the level of 9-11% y/y, but from international operations it will decline in the fourth quarter by 10-14% y/y and, as a result, the increase in the consolidated GMV of the group is expected in the range of 7-14%. 9% y/y in Q4

“Black Week in Poland had a double-digit start and we are pleased. Next time is the upcoming holiday season and when it comes to Polish results, we expect very solid results, but we have to wait to see how Polish consumers will behave during the holiday season,” said Jon Eastick during a conference call with investors.

“Black Week started with double-digit GMV growth, and we have two weeks of Black Week and a few weeks of the holiday season, and the macroeconomy is improving. Based on Black Week, we will be at the high end of this range. […] The willingness to buy and the mood of consumers are slowly improving and they are starting to spend more,” he added.

Allegro CEO Roy Perticucci suggested that the group’s GMV “will remain relatively stable” next year.

The company also announced today that the expected GMV of international operations will decline in the fourth quarter by 10-14% y/y, revenues by 33-38% y/y, and the adjusted EBITDA loss will amount to PLN 160-180 million. Investment expenditure is estimated at PLN 90-100 million in Poland and PLN 20-30 million abroad. As a result, GMV growth of the consolidated group is expected in the range of 7-9% y/y in the fourth quarter, and revenue change in the range of -2% to +2% y/y. Adjusted EBITDA should be 0-6% higher y/y, and consolidated capex is expected at PLN 110-130 million.

The company also announced today that the adjusted EBITDA of the Allegro Group amounted to PLN 677 million in Q3 2023 (an increase of 26% y/y), with PLN 778 million for operations in Poland (an increase of 32.4% y/y ). GMV, i.e. the total gross value of goods sold on Allegro, amounted to PLN 14,066.8 million in this period (an increase of 9% y/y), while in Poland it was PLN 13,270.9 million (+10.5% y/y). . In Q1-Q3 2022, the company had PLN 517.7 million of consolidated net profit attributable to shareholders of the parent company compared to PLN 2,096.4 million loss a year earlier, with sales revenues of PLN 7,150.6 million compared from PLN 5,922.1 million a year earlier.

Previously, Allegro reported that over 3/4 of Polish consumers (77%) admit that they deliberately refrain from purchasing certain products while waiting for November promotions and Black Week shopping festivals. Consumers declare that this year they will pay special attention to looking for price promotions in the categories of clothing, footwear and accessories (48%) and electronics (45%).

Allegro is the number 1 trading platform in Poland. Sales are carried out mainly by companies via the Allegro.pl marketplace e-commerce platform. Since October 2016, Allegro has been owned by Cinven, Permira and Mid Europa funds. The company debuted on the WSE in October 2020. It is included in the WIG20 index.

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