LR Health & Beauty SE
LR Group confirming its double-digit growth trends in sales and profitability in first half of 2021

LR Group confirming its double-digit growth trends in sales and profitability in first half of 2021

• Group sales in the first half of 2021 rose by 14.3% to EUR 153.2 million
• Normalized EBITDA increased by 15.8% to EUR 22.7 million
• Strategic initiatives aimed at expanding the business successfully launched
• Positive outlook for financial year 2021 confirmed

Ahlen, 31 August 2021 – LR Global Holding GmbH, the leading European digitally-enabled social selling company in the area of high-quality health and beauty products, achieved outstanding growth in sales and normalized earnings before interests, taxes, depreciation and amortisation (EBITDA normalized) in the first six months of 2021 and thus continued on its dynamic growth course. The LR Group generated sales (i.e. sales from goods sold) of EUR 153.2 million in the first six months of 2021, representing a robust growth of 14.3% compared to the sales of EUR 134.0 million generated over the same period of the previous year. The LR Group achieved double-digit percentage growth in all regions in the second quarter. In addition, adjusted EBITDA significantly increased by 15.8% from EUR 19.6 million to EUR 22.7 million in the first half of the year, mainly driven by the outstanding sales growth over the same period. The higher growth percentage in normalized EBITDA compared to sales demonstrates the scalability and highly variable costs concept of the business model.

“Despite the ongoing COVID-19 pandemic, we managed to confirm the growth trend shown at the beginning of the year in the second quarter, which is reflected in the significant increase in sales. As a result, as of May 2021, we succeeded in exceeding the EUR 300 million sales mark for the first time on the basis of the last twelve months. We also successfully continued our strategic initiatives. Firstly, we continued to invest in our business model digitization in order to satisfy the growing demand from young target audiences. Already about a third of our new community members are now between 18 and 29 years old. Secondly, we made a step change in our international expansion with the successful market entry in South Korea in March 2021”, commented Dr. Andreas Laabs, CFO and COO of LR Global Holding GmbH.

In this context, one focus in the current financial year is on completing the roll-out of the new LR Connect app as part of the continued digitization of the company. The app provides the community with the latest information on the product range as well as marketing toolboxes for end consumer sales activation. It also enables the community to have unlimited access to a large library of online trainings. Furthermore, as a third strategic initiative, LR is investing in the construction of a modern logistics centre with the latest picking and shipping technology at the site in Ahlen. This will enable LR to further automize its logistics processes so that orders can be processed even faster in the future.

High-quality product range selectively expanded in the first half of the year

LR currently markets over 300 products in the areas of health and beauty via its community of more than 300,000 members. The new limited product line “LR meets Sansibar” was launched in April 2021 and was already sold out within a short time. In addition, LR relaunched its Aloe Vera Sun Care products, which had an extremely positive impact on business as sales on this product range increased by more than 50% in the second quarter of 2021 compared to the same quarter of the previous year.

“Our natural, high-quality products are a key factor in our company’s success. This year, we once again demonstrated our innovative strength and received the TOP 100 Award, an award for the 100 most innovative, medium-sized companies in Germany. We plan to add a new product category to our product range by the end of this year. In view of the continuing tight situation on the procurement market, we will also pay close attention to the supply chain. Especially for our best-selling products, we have already increased our inventories accordingly at an early stage. We are well-equipped for the planned growth,” said Dr. Andreas Laabs.

For the current financial year 2021, the management confirms the forecast published in the 2020 Annual Financial Report and continues to expect EBITDA at the level of financial year 2020 with a slight increase in revenue. In general, the forecast remains unchanged under the assumption that the ongoing COVID-19 pandemic, the scope of which still cannot be fully assessed, will not have any significant effects on the LR Group’s business.

In order to further support the strong growth of the company, LR Group is constantly considering various options for expanding its financing options, which may include a stock exchange listing.

The report for the first half of 2021 is available online as of today on the company’s website at https://www.lrworld.com/investorrelations.

LR Group
Following the motto “More quality for your life”, the LR Group with headquarters in Ahlen/Westphalia produces and markets various health and beauty products in around 28 countries. As a modern social selling platform, the company combines personal exchange in its community with efficient, digital solutions. This expertise is particularly evident in the “LR Connect” app developed by LR itself, which supports the community in building and developing its business. The community often acting as micro influencers is young, flexible and increasingly uses social media as a sales platform.

LR’s goal is to improve people’s well-being and health with its portfolio – consisting of nutritional supplements and personal care, health representing close to 65% and beauty 35% of our sales. That is why the company continuously develops new products – from the power of nature in combination with the latest scientific findings.

The processing of Aloe Vera has been one of the core competencies of LR Health & Beauty for almost 20 years. Only the valuable inside of the leaf is used for the products. In Ahlen, the company has established one of the most modern Aloe Vera production sites for Aloe Vera Drinking Gels in Europe. LR has been firmly established in the market for over 35 years with around 1,200 employees and more than 300,000 registered community members. LR also established the LR Global Kids Fund e.V. which provides efficient and unbureaucratic support for deprived children and their families in many different countries around the world in cooperation with local institutions. The commitment to take responsibility in terms of ESG is part of LRs philosophy. Since 2020 LR started using FSC-certified paper, takes various measures to avoid plastic consumption and switched to green power.

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