Zalando targets more than EUR 30 billion GMV by 2025

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DGAP-News: Zalando SE / Key word(s): Annual Results/Annual Report
Zalando targets more than EUR 30 billion GMV by 2025

16.03.2021 / 08:00
The issuer is solely responsible for the content of this announcement.

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Zalando targets more than EUR 30 billion GMV by 2025

  * Zalando further upgrades long-term growth ambition to more than 10% of
    European fashion market

  * Strong financial year 2020 with 30.4% GMV growth, 5.3% adjusted EBIT
    margin

  * Guidance 2021: GMV growth of 27-32% at EUR 350-425 million adjusted EBIT

  * Astrid Arndt appointed to the Management Board as Chief People Officer
    as of April 1

BERLIN, MARCH 16, 2021 // Following a strong financial year 2020, Zalando
significantly upgrades its growth ambitions and aims to grow Gross
Merchandise Volume (GMV) to more than EUR 30 billion by 2025. The company
further aspires to serve more than 10% of the total EUR 450 billion European
fashion market in the long-term.

In 2020, Zalando achieved EUR 10.7 billion GMV, accelerating its growth to
30.4% year-on-year driven by an outstanding intake of new customers and
strong Partner Program performance. Revenues in the same period grew 23.1%
to EUR 8.0 billion. Zalando recorded an adjusted EBIT of EUR 420.8 million,
corresponding to a margin of 5.3%, driven by increasing operating leverage
and a significant decrease in return rates year-on-year, which Zalando
regards as temporary.

Following an extraordinarily strong start to the year 2021 with expected GMV
growth of around 50% in the first quarter, Zalando expects to grow GMV by
27-32% to EUR 13.6-14.1 billion in the financial year 2021. Revenues will
trail GMV growth as a result of the ongoing platform transition at 24-29%
growth or EUR 9.9-10.3 billion. Zalando expects to continue to grow
profitably with an adjusted EBIT of EUR 350-425 million. Zalando will
continue to invest into its logistics infrastructure and technology platform
and plans capital expenditure of EUR 350-400 million in 2021.

Zalando Co-CEO Robert Gentz says: "2020 has been a year like no other. We
have kept our eyes on our long-term vision to be the Starting Point for
Fashion. For the coming years, our focus remains on growth and investments
for the long-term."

STRATEGIC PRIORITIES TO DRIVE LONG-TERM GROWTH

Zalando aims to be the destination that consumers gravitate to for all their
fashion needs. In 2020, Zalando grew its active customer base by 25% to 38.7
million. Building on this strong development, Zalando continues to invest
into innovative ways to engage with customers to build deeper relationships
in existing markets. In addition, Zalando will expand its footprint in
Europe to eight further European markets: Croatia, Estonia, Latvia,
Lithuania, Slovakia and Slovenia in 2021; Hungary and Romania in 2022.

Zalando is an integral part of the digital strategy for fashion brands,
retailers and stores. In the fourth quarter of 2020, Zalando's Partner
Program accounted for 24% of Zalando's Fashion Store GMV. More than 2,400
stores were connected to the Zalando platform by end of 2020 through the
Connected Retail program. The program continues to grow fast in 2021, with
more than 3,400 stores connected by the end of February 2021.

"The growth of Connected Retail underlines the value that the combination of
offline and online can unlock for retailers," says Zalando Co-CEO David
Schneider. "The industry has faced a lot of challenges in the past year, and
we have seen partners engaging with Zalando more deeply than ever. We remain
committed to be part of the solution and support our partners that are
looking for ways to shift their business online."

SUSTAINABILITY IS A KEY PILLAR TO BECOME STARTING POINT FOR FASHION

One year after announcing its do.MORE sustainability strategy, Zalando has
made strong progress towards becoming a sustainable fashion platform with a
net-positive impact for people and the planet. The company has reduced its
own greenhouse gas emissions by 64% since 2017 and runs all its own
operations on 100% renewable energy. In 2020, the sale of more sustainable
products accounted for around 16% of GMV, up from about 7% in 2019. As a
result, Zalando upgrades its goal to 25% (previously 20%) of GMV with more
sustainable products by 2023, while at the same time making the sustainable
product criteria more stringent. Full details on Zalandos progress can be
found in the first stand-alone Annual Sustainability Progress Report.

Rubin Ritter, Zalando Co-CEO, comments: "We have an opportunity and
responsibility to leverage our scale and platform position to drive positive
change in the fashion industry. If we want to build the Starting Point for
Fashion and win the hearts and minds of consumers, we need to be part of the
solution to the sustainability challenge we jointly face."

MANAGEMENT TEAM IDEALLY POSITIONED TO EXECUTE GROWTH AMBITIONS

To execute its growth ambitions and following Rubin Ritter's announcement to
leave his position as Co-CEO after the upcoming AGM, Zalando introduces a
new Management Board setup as of April 1, 2021. Zalando founders Robert
Gentz and David Schneider continue to lead the company as Co-CEOs. Robert
Gentz will be responsible for leading on long-term strategy as well as
oversee corporate affairs and corporate development. David Schneider will
continue to define and drive the strategy towards brand partners and lead
Zalando's efforts in sustainability as well as diversity and inclusion.

The Supervisory Board appointed Astrid Arndt to the newly created position
of Chief People Officer at its Board meeting on Monday, March 15, 2021.
Astrid Arndt has been leading and building the People & Organization teams
at Zalando since 2019, having joined the company in 2018. Current Chief
Technology Officer Jim Freeman will develop, market and grow Zalando's
consumer offerings in a newly created Chief Business and Product Officer
role. David Schröder continues to oversee the financial development of the
group as Chief Financial Officer and build best-in-class capabilities to
support Zalando's growth ambitions. Current Co-CEO Rubin Ritter will be
actively involved in an orderly transition and support the team until his
departure after the AGM.

Cristina Stenbeck, Chairperson of the Supervisory Board, says: "The role of
work in society is changing, and the past year has highlighted that
Zalando's unique culture and entrepreneurial approach are key assets for the
company. Ensuring the entire Zalando organisation continues to reveal its
full potential will be an important area of focus for the Management Board.
The Supervisory Board is therefore delighted to welcome Astrid Arndt as
Chief People Officer to the Management Board with the relevant capabilities
she brings to Zalando's strategic priorities. We are convinced that the
Management Board team is ideally positioned to execute its growth ambitions
and reach its vision to be the Starting Point for Fashion."

##

Zalando today hosts its virtual Annual Press Conference and Capital Markets
Day, details of which are available on our corporate website.

Zalando today published its Annual Report and - for the first time - a
dedicated Sustainability Progress Report, which are also available on the
company's website.

(End)
Zalando Group - Key Figures (in EUR million)

                                    FY 2020    FY 2019
     Group GMV                     10,699.8    8,202.9
     percent growth                    30.4       23.6
     Group revenue                  7,982.0    6,482.5
     percent growth                    23.1       20.3
     Fashion Store                  7,257.7    5,964.9
     Thereof DACH                   3,319.0    2,897.2
     Thereof Rest of Europe         3,938.7    3,067.7
     Offprice                         978.1      659.4
     Other                            196.0      252.3
     Reconciliation                 (449.8)    (394.1)
     Adjusted group EBIT              420.8      224.9
     Adjusted group EBIT margin         5.3        3.5
     Fashion Store                    341.7      219.9
     Thereof DACH                     288.4      219.5
     Thereof Rest of Europe            53.3        0.4
     Offprice                          88.0       27.7
     Other                            (9.1)     (23.3)
     Reconciliation                     0.2        0.6
     Net working capital             (87.4)    (147.7)
     Capital expenditure              250.0      306.5
     Net income                       226.1       99.7

Zalando Group - Key Performance Indicators

                                           FY 2020  FY 2019  Change
    Site visits (million)                  5,393.6  4,178.1   29.1%
    Mobile visit share (% of site visits)     86.3     83.7   2.6pp
    Active customers (million)                38.7     31.0   25.0%
    Number of orders (million)               185.5    144.9   28.0%
    Average orders per active customer         4.8      4.7    2.4%
    Average basket size (LTM, EUR)            57.7     56.6    1.9%
Definitions are available in the annual report.

/

Zalando (https://corporate.zalando.com) is Europe's leading online platform
for fashion and lifestyle. Founded in Berlin in 2008, we bring head-to-toe
fashion to over 38 million active customers in 17 markets, offering
clothing, footwear, accessories, and beauty. The assortment of international
brands ranges from world famous names to local labels. Our platform is a
one-stop fashion destination for inspiration, innovation, and interaction.
As Europe's most fashionable tech company, we work hard to find digital
solutions for every aspect of the fashion journey: for our customers,
partners and every valuable player in the Zalando story. Our vision is to be
The Starting Point for Fashion and a sustainable platform with a
net-positive impact for people and the planet.

Media contact
Alexander Styles
Corporate Communications
alexander.styles@zalando.de
+49 1522 2715810

Investor/analyst contact
Patrick Kofler
Investor Relations
investor.relations@zalando.de
+49 (0)30 20968 1584


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16.03.2021 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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   Language:       English
   Company:        Zalando SE
                   Valeska-Gert-Straße 5
                   10243 Berlin
                   Germany
   E-mail:         investor.relations@zalando.de
   Internet:       https://corporate.zalando.de
   ISIN:           DE000ZAL1111
   WKN:            ZAL111
   Indices:        MDAX
   Listed:         Regulated Market in Frankfurt (Prime Standard);
                   Regulated Unofficial Market in Berlin, Dusseldorf,
                   Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange
   EQS News ID:    1175824



   End of News    DGAP News Service
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1175824 16.03.2021

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