EUROEAT

NEWS

Euroeat: 1Q2021 business review

1Q2021 vs 1Q2020 in numbers

*AOV = Average Order Value.

 

Important developments during 1Q

1Q was very busy for us, mainly for positive reasons.

At the beginning of the year, Euroeat Board of Directors agreed on consolidating the Euroeat e-commerce Ltd (China) and Euroeat Oy numbers into Euroeat Group. The consolidation is not mandated by regulations, but voluntary. We did this to improve transparency & understanding of the actual Euroeat business case. Consolidated numbers for the fiscal year 2020 are being audited at this very moment.

Euroeat got new CEO. Heikki Lassila, one of the original co-founders, took over from Raimo Puustinen.

We also got partially new Board of Directors, with Rauha Tulkki-Wilke, Erica Terranova and Harry Järn joining as new Board members and Heikki Lassila and Martyn Qu continuing in their Board roles.

We made first steps towards securing additional working capital arrangements by signing the 200k€ credit line with ATC Oy, renewed one existing Loantainer (value 30 000 €) and secured one new Loantainer (value 30 000 €). Loantainer is a Euro denominated financing/loan instrument used in Finland for Euroeat Oy, engineered by Euroeat with its partners.

The quarter ended on a high: March was profitable (a little) due to higher sales volumes and improved procurement efficiency.

 

Looking ahead for the rest of 2021

Our theme for 2021 is break even. While we do not see the whole year could turn profitable, we do believe we can achieve sustainable monthly profitability during the second half of 2021. We are focusing all our efforts in achieving this by growing the sales volumes, improving product profitability and creating new revenue streams & opportunities.

Due to the fact that in China the sales performance is dictated by several major sales events and by far the biggest events take place in November & December, Euroeat annual sales volumes are heavily dependent on 4Q performance: in 2020, 43% of annual sales materialized during 4Q. Therefore it is too early to estimate whole year performance.

The single biggest risk for us not reaching our revenue and profitability targets is access to adequate working capital. This is top priority and a team of people both in Helsinki and in Beijing are focusing on new working capital arrangements. We are confident regarding the demand for our offering. Our challenge is to provide the right selection to consumers to buy, exactly at the right time.

The work continues: a lot has already been done and achieved, but a lot of work lies still ahead for us to reach our 2021 targets.

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