elumeo published weaker than expected Q3 figures that are driven by the overall weaker consumer sentiment. Here is what is important:

• Sales came in at only € 11.0m

  (vs eNuW: € 11.7m; -5% qoq, 1% yoy), mainly due to a lower avg sales price of only € 68 (-13% qoq, -14% yoy vs eNuW: € 79) resulting from the overall more restricted spending of its customer group. The increased number of active customers (39k, 18% yoy) and rising no. of items sold (162k, 9% qoq, 17% yoy), only partially compensated for the lower avg sales price.

• EBIT turned negative again to € -0.3m

  (vs € -0.8m in Q1) in contrast to our positive expectation of € 0.1m. While the bottom line decline is purely caused by the weak topline, the cost cutting program that is bearing fruit and the other operating income, cushioned it a bit.

Positively, elumeo was able to keep its sales level rather stable - against the general trend in the overall online jewelry & watches market as well as the multichannel market, (-14% yoy and -19% yoy). Worth highlighting is that the web shop, which grew by 15% in revenues and achieved a new record daily revenue on November, 1^st when Black Friday season kicked-off. Further, the “rising star” of the group, jooli launched of joolipay, which is marking the starting point for the monetization of jooli that should further fuel Group revenues. First KPI´s are promising but not yet meaningful.

Apart from that, management unveil further building blocks of its growth program #juwelo100 with the goal to grow the core business at 10% CAGR to € 100m by FY30 (vs eNuW: 11% p.a to 71.5m by FY26e): A new interactive mobile jewelry shopping app and automatically AI translated shopping shows are expected to contribute together c. € 30m by FY30. The positive sales development paired with declining OPEX relative to sales, should increase EBIT margin to 5% in FY26e (eNuW).

While the challenging macro picture and the weak consumer sentiment should continue to burden the business in the short term, the outlook for the mid to long term remains bright: The growth program #juwelo100 with several initiatives, as well as jooli should fuel the topline from FY24e onwards.

BUY

with a new PT of € 5.50 (old: € 5.70) based on DCF.