The first half of 2019 at TIM Group: highest turnover and EBITDA in history
In the first half of 2019 revenues from sales of the TIM Capital Group amounted to PLN 417.7 million, i.e. 6.5% more than in the corresponding period of 2018. This was the best first half of the year in the history of the Group in terms of revenues. This record is also accompanied by an impressive EBITDA (almost PLN 24.8 million, i.e. +78.1% y/y) and almost PLN 8.5 million net profit (+27.2% y/y). In the first half of 2019 almost 1/3 of revenues from logistics services of 3LP SA came from entities outside the TIM Group.
Growth dynamics of TIM’s turnover, responsible for 90% of the Group’s revenues, was similar to the dynamics of the entire Group (+6.1% y/y), which also resulted in the highest revenues from sales in the first half of the year in the company’s history – over PLN 376.1 million of which 70.1% generated by the e-commerce channel. Unit EBITDA increased by 179%, to PLN 18.5 million.
More and more customers, continuous development of the assortment
Profit on TIM SA sales increased by as much as 265% y/y reaching PLN 15.3 million despite high market competition.
This is primarily the result of the increase of the percentage gross margin by 2.35 percentage points – explains Krzysztof Folta, the President of the Management Board of TIM SA. – We are also pleased by the constantly growing (at the end of June 2019 by 10.2% higher than at the end of June 2018) number of key customers, i.e. those purchasing for more than PLN 1,500 per month within the last 12 months. Also, the number of loyal customers grew equally fast (by 9.5% comparing the end of June 2019 and June 2018), i.e. those who in the last 12 months made purchases in at least six of them. The group of people regularly using our TIM.pl platform is therefore growing – adds Krzysztof Folta.
A positive phenomenon is also the change in the percentage share of individual customer groups in the revenues from sales of TIM SA. In the first half of 2019 the share of revenues from installers grew by as much as 3.4 percentage points and the share of resellers, i.e. intermediaries – mainly electrical stores and wholesalers, dropped by 2.5 percentage points.
In order to maintain the competitive advantage TIM constantly analyses and enriches its product offer. At the end of June 2019 TIM.pl platform had 207 750unique indices on offer (of which nearly 60 thousand available within 24 hours) as compared to 198 300 at the end of June 2018.
– If we add the increase in the number of unique users up to 1.08 million (+6.01% y/y), transactions (+2.72% y/y) and 433. place among more than 7000 Polish online trading platforms, we have reasons for satisfaction – comments Piotr Nosal, Board Member and Commercial Director of TIM SA. – We are constantly working on new solutions that will make TIM.pl an even more attractive and customer-friendly place – adds Piotr Nosal.
3LP’s cooperation with IKEA
The over six percent increase in consolidated revenues from sales was accompanied by a slower (+4.2% y/y) increase in operating expenses. This is largely the result of greater use of operational capabilities of the logistics centre in Siechnice operated by 3LP SA and of the effective management of other costs.
– The first half of 2019 brought for 3LP, among other things, the commencement of the operational implementation of the contract with IKEA. It is from Siechnice that more than 6,000 products, that have previously been ordered online, find their way to Polish customers of this Swiss brand. These are mainly interior design accessories and small furniture – says Piotr Tokarczuk, Board Member and Financial Director of TIM SA. – As a result of this cooperation the share of 3LP revenues from logistics services from customers from outside the TIM Group in the first half of 2019 increased to 32%. The short-term goal is to increase this ratio to around 40%, and in the long run to 50% – adds Piotr Tokarczuk.
Advanced works related to the use of intra-group synergies in the field of trade, logistics and purchases are in progress in the third of the companies being a part of the TIM Capital Group, i.e. the Bydgoszcz Rotopino.pl SA. In the first half of 2019 the company recorded positive results at all levels of the income statement. Also, finalized was the withdrawal of its shares from trading on the NewConnect market.
1% of gross profit for pro-social activities
While TIM spent the first quarter of 2019 working on the company’s medium-term strategy for 2019-2021, the second quarter was dedicated to the final determination of the directions of responsible business of TIM SA, also for the next three years. After publication of the first in the history of the TIM Group integrated report (for 2018), creation of the “TIM pro” strategy was another natural step in the development of the entire organization in the area of sustainable business.
– By changing the business model and definitely focusing on the online channel, we were the pioneer amongst distributors of electrotechnical products in Poland which has set a new direction for the development for this market segment. Our ambitions are greater – we want to set trends in the industry, bringing additional benefits to the environment in accordance with the principles of sustainable development – explains Krzysztof Folta, the President of the Management Board of TIM SA.
The three directions set in the “TIM pro” strategy relate to the following activities: professional (transparency and business ethics, reliable service quality, employee development, monitoring of environmental impact), proactive (dissemination of modern and pro-ecological solutions, dialogue with the environment, development together with the customer) and pro-social (employee volunteering program, promoting active lifestyle and supporting local communities).
– Over the next three years we will be allocating at least 1% of the gross profit expected for a given year by TIM SA for pro-social activities – declares Krzysztof Folta.