Online European furniture business Westwing has reported a decline in sales during its second quarter of 2023 but did experience profit growth.
According to its latest trading update, Q2 20233 sales amounted to €101.8m, down 1.2% from €103m. The Westwing Collection share increased from 38% of GMV in the previous-year period to 46% in the second quarter of 2023.
Westwing reported the third proﬁtable quarter in a row with Adjusted EBITDA at €4.4m and 4.4% Adjusted EBITDA margin in the second quarter 2023, up €6.8m versus the previous year.
In the ﬁrst half of 2023, revenue was €204.7m, a reduction by €9.5m or 4.4% compared to the same period of the previous year from €214.1m.
Westwing said that while the number of orders decreased by 10% to 0.6m from 0.7m, the average basket size increased strongly by 12% to €178. The number of active customers who made at least one order in the last 12 months declined by 16% to 1.3m. Compared to the ﬁrst quarter of 2023, it remained nearly stable with a reduction by 1% only.
Commenting on its performance, Westwing said: “Despite the very challenging market environment we stabilised our top line in the second quarter of 2023. We signiﬁcantly improved unit economics and increased the high margin Westwing Collection share comparing to the same period of the last year.
“Additionally, we have continued to deliver cost savings initiated in the second half of 2022. Both gross and contribution margins increased in the second quarter of 2023 by 1.9 percentage points and 3.6 percentage points respectively compared to second quarter of the previous year.
“As a result of these measures, Westwing achieved a positive Adjusted EBITDA for the third quarter in a row. Free cash ﬂow was positive at EUR 10.1m in the ﬁrst half year of 2023. Our cash balance stays strong at EUR 76.3m.
“Therefore, we are conﬁdent to return to revenue growth in the second half of 2023 while at the same time keep margins high and maintain cost consciousness on a reasonable level.”