Revenues in Q4 declined, adj. EBITDA remained positive – PT down, BUY

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Westwing published preliminary figures for FY21, showing a 5% yoy decline in revenues in the final quarter of FY21. For the full year, the company reported revenues of EUR 522m, which was well within guidance range of EUR 510-550m. We believe that the Q4 decline can largely be explained by the high comparable base, as the company has seen a massive boost by pandemic-related restrictions and store closures. In terms of profitability, adjusted EBITDA was in the range of EUR 9-12m in Q4, which corresponds to a margin of 6-8%. The company expects negative supply chain and cost effects (esp. freight and fulfilment costs) to remain at least through the first half on FY22. Despite the revenue decline, Q4 showed a positive adjusted EBITDA, after Q3 had slipped into negative territory. Our adjusted estimates for FY22-23E project a more moderate but increasing margin profile. Our new PT of 35.00 reflects a lowered industry valuation. We confirm our BUY rating.

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