D-Market Electronic Services & Trading ((HEPS)) has held its Q4 earnings call. Read on for the main highlights of the call.
Hepsiburada’s recent earnings call highlighted a balanced outlook amidst strong growth and macroeconomic challenges. The company demonstrated robust growth in GMV and customer base, supported by strategic initiatives like Hepsiburada Premium and HepsiJet. Despite facing macroeconomic pressures and increased operating expenses, the overall sentiment during the call was positive, reflecting confidence in the company’s revenue growth areas.
GMV Growth
Hepsiburada reported a real GMV growth of 12.1% in 2024, with an unadjusted inflation basis growth of 74% year-on-year. This significant increase underscores the company’s ability to expand its market presence despite challenging economic conditions.
Customer Base Expansion
The company saw its active customer base grow by 235,000, reaching a total of 12.2 million. Additionally, order frequency increased by 14%, indicating enhanced customer engagement and satisfaction over the past year.
Hepsiburada Premium Program Growth
The Hepsiburada Premium loyalty program expanded its member base to 3.7 million, bolstered by new content offerings through a partnership with Warner Bros. Discovery. This strategic move aims to enhance customer loyalty and retention.
HepsiJet and Hepsipay Expansion
HepsiJet delivered 72% of total parcels dispatched, while Hepsipay integrated with 140 key accounts by the end of 2024. These expansions are pivotal in strengthening Hepsiburada’s logistics and payment solutions.
Revenue Growth in Key Areas
In Q4 2024, Hepsiburada experienced a 15% rise in 3P revenue, an 18% increase in delivery service revenue, and a remarkable 127% growth in other revenue streams, highlighting the company’s diverse revenue generation capabilities.
Macroeconomic Headwinds and Boycotts
The beginning of 2025 posed challenges due to macroeconomic pressures affecting consumer purchasing power and boycotts against shopping, impacting overall market dynamics.
Decrease in Free Cash Flow
The company reported a decrease in free cash flow by TRY 1.9 billion compared to the previous year, attributed to reduced net cash from operating activities and increased capital expenditures.
Rising Operating Expenses
Hepsiburada faced increased payroll, shipping, packaging, and other operating expenses, which affected profitability despite improvements in gross contribution margin.
Forward-Looking Guidance
Hepsiburada provided optimistic guidance for 2024, with a real GMV growth of 12.1% and a growth contribution margin of 11.3%. The company’s EBITDA as a percentage of GMV expanded to 1.1%, reflecting operational efficiency. Additionally, HepsiJet’s delivery service and lending solutions showed significant volume growth, indicating strong future potential.
In summary, Hepsiburada’s earnings call reflected a positive sentiment with strong growth in key areas despite facing economic challenges. The company’s strategic expansions and robust customer engagement are expected to drive future performance, maintaining a balanced outlook for the upcoming year.