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SHOP APOTHEKE EUROPE improves profitability in first half of 2017 and continues accelerated growth course.

- Consolidated revenues for the first half of 2017 rose by 54% to EUR 127m.

- Number of active customers increased to more than 2.2m (+47% compared to a year earlier).

- Consolidated gross profit grew by +61% to EUR 27m with gross margin improving to 21.5%.

- Positive consolidated Segment EBITDA in Q2 with EUR 1.1m.

- Market leadership in Germany further extended with revenues increasing by +31% to EUR 92m.

- International revenues more than tripled to EUR 34m with segment's gross margin rising significantly from 17.0% to 22.1% .

Venlo/Cologne, 26 July 2017. Following a strong start into the year, SHOP APOTHEKE EUROPE N.V., Europe's leading OTC online pharmacy (OTC = over the counter), has improved its profitability in Germany and the European markets. The company continued its rapid growth trajectory with consolidated revenues for the first six months of the current fiscal year increasing by 54% to 127m compared to 82m during the same period last year. This makes SHOP APOTHEKE EUROPE the fastest-growing OTC-online pharmacy in Europe. The online pharmacy that is focussed on families increased the number of active customers substantially. It rose from 1.5m at the end of Q2 2016 to more than 2.2 m as per balance sheet date.

SHOP APOTHEKE EUROPE increased its half-year consolidated gross profit at a disproportionate rate compared to revenues, by 61% to EUR 27.2m (2016: EUR 16.9m). The consolidated gross margin also increased, by 1.0 pp to 21.5%, despite increased spending on new customer acquisition. The positive earnings development is the result of both, an increased gross margin in the segment Germany - up 0.5 pp to 21.0% - and a substantial increase of 5.1 pp to 22.1% of the gross margin in the segment "International".

During the second quarter, SHOP APOTHEKE EUROPE achieved a positive consolidated segment EBITDA* of around EUR 1.1m due to these structural improvements in profitability (Q1 2017: EUR -1.7m). The cumulated consolidated segment EBITDA for the first half of 2017 amounts to EUR -0.6m compared to EUR -0.3m during the same period last year.

After deduction of administrative expenses, consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) amount to EUR -4.4m after EUR -3.4m in the first half of 2016. Earnings before interest and taxes (EBIT) were EUR -7.1m (past year: EUR -4.9m).

Market leadership expanded again in profitable segment "Germany"
Germany, SHOP APOTHEKE EUROPE's core segment by revenue, posted profitable growth of 31% during the first half of 2016 compared to the corresponding time period 2016. Revenues increased to EUR 92.1m during the first six months of 2017 after EUR 70.2m a year earlier. The company thus grew twice as fast as the German OTC-mail-order market, which is expected to increase by almost 15% in full year 2017 according to the experts from Sempora Consulting. As a result, SHOP APOTHEKE EUROPE is further expanding its market leadership in the German OTC-online market. At the same time, gross profit grew at a disproportionate rate, up +35% to EUR 19.4m from EUR 14.4m a year earlier. The corresponding gross margin increased by +0.5 pp to 21% during the reporting period compared to 20.5% a year earlier. Segment EBITDA for the first half of 2017 was EUR 2.8m after standing at EUR 1.3m a year earlier.

Gross margin in the rapidly growing international business increases significantly
As part of the international expansion, the "International" segment, which includes the European countries France, Italy, Spain, Austria, Belgium and the Netherlands, had a substantial increase in customer numbers. SHOP APOTHEKE EUROPE has again more than tripled segment revenues during the reporting period to EUR 34.1m compared to EUR 11.2m over the same period a year ago (+206%). Gross profit increased at an even more substantial rate during the reporting period, growing by 297% to EUR 7.5m (past year: EUR 1.9m). This was due to the significant improvement in gross margin, which increased year-on-year by +5.1 pp from 17.0% to 22.1%. The high proportion of orders placed by new customers - and corresponding higher acquisition costs - contributed to a decline in segment EBITDA to EUR -3.6m during the first half of 2017 compared to EUR -2.1m a year earlier.

"Germany Services" segment on track
During the first six months of 2017, the segment Germany Services had gross revenues of
EUR 3.1m compared to EUR 2.0m in the same period last year. The figure for the period under review includes revenues from intracompany services of EUR 2.7m (past year: EUR 1.1m), which are eliminated in consolidation. Gross profit for the period under review was EUR 3.0m compared to EUR 1.7m the previous year. Adjusted for intracompany transactions equivalent to EUR 2.7m, gross profit for the reporting period was EUR 0.3m compared to EUR 0.6m during the first half of 2016, with segment EBITDA at EUR 0.2m (2016: EUR 0.5m).

With regard to the half-year figures CFO Dr. Ulrich Wandel explains: "As the fastest-growing OTC online pharmacy in Europe, we are driving the market. Thanks to our unique access to the relevant European markets and our ongoing investments, we have created the necessary infrastructure for both, future growth and the path towards profitability. The growing business volume and the higher efficiency have led to a significant increase in the gross margin in the first half of the year. This encourages us to continue to invest at an unabated pace in the development and expansion of market leadership within each country."

In consideration of the company's dynamic first half-year growth, the Board of Management has confirmed its forecast for the 2017 fiscal year, i.e. a 45%-55% increase in consolidated revenues. The Board expects an increase in profitability for the 2017 fiscal year due to effects of scale, improvements in efficiency and further automation. This forecast is further supported by our expectation that the profitable growth course in the company's German core market will continue. The consolidated gross margin is expected to increase in line with projected growth. Furthermore, management expects a year-on-year improvement of the company-level EBITDA margin to around -2% to -3% (compared to -3.3% a year earlier).

The full half-year financial report is available online in the Investor Relations/Publications section of the corporate website www.shop-apotheke-europe.com.

_{* Consolidated segment EBITDA = Sum of the EBITDAs of the individual segments, adjusted for intra-group transactions, which are eliminated during the consolidation.}

ABOUT SHOP APOTHEKE EUROPE.
SHOP APOTHEKE EUROPE is Continental Europe's leading online OTC pharmacy with a portfolio that focuses on OTC medication and pharmacy-related beauty and care products (BPC). The Company operates online pharmacies in Germany, Austria, France, Belgium, Italy, Spain and the Netherlands. In Germany, the TÜV-certified shop-apotheke.com is the market leader in terms of traffic. SHOP APOTHEKE EUROPE delivers a broad range of more than 100,000 original products to more than 2.2 million active customers quickly and at attractive prices. In addition, SHOP APOTHEKE EUROPE provides comprehensive and consistent pharmaceutical services.

SHOP APOTHEKE EUROPE generated sales of about EUR 127 million in the first half of 2017 and a growth of +54% compared to the same period last year. Headquartered in Venlo (the Netherlands), SHOP APOTHEKE EUROPE also has offices in Cologne, Düsseldorf, Paris and Tongeren, Belgium. The online pharmacy has been listed on the regulated market of the Frankfurt Stock Exchange (Prime Standard) since 13 October 2016.
 

EVENTS 2017

CONFERENCES 2017

MEDIA CONTACTS.

Trade and public media:
Sven Schirmer
Mobil: +49 152 28 50 63 61
E-Mail: presse@shop-apotheke.com

Financial media:
Thomas Schnorrenberg
Mobil: +49 151 46 53 13 17
E-Mail: presse@shop-apotheke.com

Investor Relations:
Dr. Ulrich Wandel
Telefphone: +31 77 850 6117
E-Mail: ulrich.wandel@shop-apotheke.com

DISCLAIMER.

This announcement does not constitute a public offer or an offer to subscribe to any securities in any jurisdiction. The offer was made exclusively on the basis of the company's securities prospectus that had been published in connection with the offer. The shares have already been sold.
This announcement contains forward-looking statements that relate to the future course of business and future financial performance, as well as future transactions or developments concerning SHOP APOTHEKE EUROPE. The bases of these statements are current expectations and assumptions of SHOP APOTHEKE EUROPE's management, of which a large number are outside SHOPE APOTHEKE EUROPE's sphere of influence. These statements are therefore subject to a variety of risks and uncertainties. If such risks and uncertainties occur, or if the underlying expectations do not materialize or the assumptions made are not correct, the actual events, both positive and negative, may differ materially from those events contained in the forward-looking statements. SHOP APOTHEKE EUROPE assumes no obligation to update these forward-looking statements or to correct them in the event of occurrences or developments other than those anticipated. Such updates or corrections are not intended.