Redcare Pharmacy NV (RDC) Earnings Call Transcript & Summary

Well, good morning, everybody. Jasper and I, we want to welcome all of you to the release of SHOP APOTHEKE's full year 2020 financials. And of course, we also want to provide you with an outlook for the current year for 2021. Before we get into the detail, over the last few months, I came to realize that some of you are not only closely monitoring how SHOP APOTHEKE does and SHOP APOTHEKE's numbers, but at least one person also seems to monitor the ties that I'm wearing. And I realized I was told that for the last 2 webcasts, I wore the same tie. So hopefully, I'm responding to our investors' needs, and I want to show a greater variety in the ties I'm wearing going forward. Well, as I already mentioned, this is the third time we do the webcast from our new facility, our new headquarters, our new distribution center right here in Sevenum. As we said before, it's literally just a stone throw away from our old facility, even though this was within the boundaries of the city of Venlo. But compared to the last time we talked to you, I can assure you, it's much busier here today because we are literally in the midst of transitioning our logistics activities from the old to the new facility. Before we jump into the meat of our presentation, let me just take a step back and let me remind everybody what drives SHOP APOTHEKE or what gets us up in the morning and what gets us going, what is our mission, what is our ultimate aim. At the end of the day, at SHOP APOTHEKE, we want to make a meaningful contribution to enabling our customers to better manage their health care needs. So as we stated here on the chart, we want to enable everyone to live the healthiest life possible. Well, with this, we have a busy agenda, as we always do. We're probably going to take around 20 minutes to go through everything that we have prepared for you. Jasper and I, we're going to start by sharing with you the review of what happened last year, including the financials, and then we're going to shift gears and we're going to look forward towards 2021, even though we're already in 2021, talking about some of our key strategic initiatives. And of course, then Jasper is going to conclude by sharing with you the outlook, the financial outlook for 2021. At the end, we're going to, of course, answer your questions. Once again, we don't have -- simply at this point of time, we don't have the technical capability to entertain live audio questions. [Operator Instructions] So again, talking about the highlights of 2020. I think all of you would agree with us that this 2020 was truly an extraordinary year, a year that we're not going to forget during our lifetime. Unfortunately, it looks like the corona pandemic is going to cover more than just a 12-month period. But at some point of time, this is also going to be behind us. We're all confident that we're on the right track. But before I talk to you about SHOP APOTHEKE's accomplishments, because we're now talking to our shareholders and to other members of the financial community, I also want to, one more time, express our, Jasper's and mine and management's, deepest gratitude and appreciation to all of those who made the numbers that we have the privilege simply to share with you. Who made this possible? Of course, I'm talking about the teams and the employees of SHOP APOTHEKE across the value chain, across the locations, across all the departments. Also for them, last year wasn't an easy year. But because of their drive, their commitment, we were able to be there when our customers wanted us to be there for them. Well, again, shifting gears again, looking at the numbers, you're already familiar with the strong growth in the fourth quarter, 38%. When you look at the whole year, it's pretty much the same picture, SHOP APOTHEKE in 2020 compared to 2019 grew by a solid 38%. Our sales reached EUR 968 million. I don't want to steal, Jasper, too much of your thunder, but I dare to say that our guidance will indicate that we are clearly going to cross the EUR 1 billion threshold in 2021. Through our continued investment, or almost continued investment in our brand and customer acquisition -- when I say almost continued, we had -- there was an exception in the second half of March and the first half of April last year, when we reduced our online marketing to almost 0 at the start of the corona pandemic. But over the remainder of the year, we continued to invest. And as a result of this, we added 1.6 million active customers to our customer base, which reached 6.3 million unique active customers by the end of December. And needless to say that all our growth last year was fully organic. The strong top line performance cascaded through our P&L. And we ended the year -- across the year, we generated an adjusted EBITDA margin of 2.2%. Again, going back a year, at this time, we had guided towards a breakeven at the adjusted EBITDA level. So we clearly did better than our original guidance. And as Jasper had mentioned in previous earnings releases, even without the corona effect, which certainly contributed, but even without the corona effect, we would have generated a positive adjusted EBITDA margin last year. From my vantage point, they're even more impressive than the percentages are the sheer -- the plain euros. In 2019, we had an adjusted EBITDA loss of EUR 13.5 million. Last year, we had a profit of almost EUR 22 million, which translates into a year-over-year improvement of EUR 35 million. Looking at operating cash flow. At operating cash flow, even more impressive than improvement, we had a negative operating cash flow in 2019 of almost EUR 31 million. In 2020, we had a positive operating cash flow, and Jasper is going to share more details, of almost EUR 18 million, so an improvement, operating cash flow improvement year-over-year by EUR 48 million. And in parallel, we strengthened our balance sheet with 2 initiatives that Jasper lets, on behalf of SHOP APOTHEKE, we retired. We did an early conversion of our old convertible bond, EUR 135 million, in November. And we replaced it with a new convertible bond in early January, totaling EUR 225 million. I dare to say, Jasper, truly amazing conditions. Again, just one highlight for the EUR 225 million, we're not paying any interest, 0. And I think that's a strong sign of trust from the financial community. And as a result of this, I think we can, with a lot of confidence, based on a strong balance sheet, look into the future. Parallel to achieving strong results last year, we also executed a very focused strategy. And we're going to talk more about this, getting ready for the introduction of e-prescriptions, our new logistics center, the expansion of our same-day offering under the label, SHOP APOTHEKE NOW!, the commencement of the cooperation with Zava, one of the leading online doctor service providers in Europe. Well, again, looking at our 2 reporting segments, the DACH region, we had -- in Q4, we showed growth of 34% versus Q4 2019. When you look at this over the course of the full year, you see growth of 32.5% in the DACH region, this includes growth of our Rx business in Germany by 17.6%. By the end of last year, our Rx business in Germany amounted to almost EUR 220 million. So again, looking at the overall growth of 32.5% and the Rx growth, and we are very proud of last year's Rx growth of 17.6%, that gives you an indication that the non-Rx business grew at a much faster pace than the 32.5% for the whole segment. Our International segment, which is comprised of Italy, France, Belgium and the Netherlands, in Q4 grew by 68%. For the full year, the segment grew by 78%. The drop in Q4 can be attributed to some challenges that we faced, I think especially in November, with getting all of our packages in time to our customers in Belgium. For the full year, sales in the International segment amounted to EUR 153 million. We're also very proud of our NPS, of our Net Promoter Score. Last year, we maintained a strong NPS of 70. For those of you who are familiar with other retail verticals, you will recognize that 70 is already a very strong result. To be transparent at the beginning of last year, we had aimed to improve our NPS a little bit more. But in hindsight, and again with all the dynamics around the corona pandemic, we're very happy, we're very satisfied that we succeeded in maintaining a very strong NPS of 70. And as you all know that only happy customers are returning customers. And that's one reason why we closely monitor our NPS performance. In terms of the average shopping basket value, virtually no change versus last year at around EUR 68. From some of you throughout last year, we have received questions, well, should we expect a drop in our average shopping basket value because of the number of new customers and the dynamics of the corona pandemic? Obviously, that was not the case. Well, the next chart, I really like to look at from time to time. And what you see on this chart is the web traffic. And this covers all of our web shops, so not just the web shop in Germany but across all of the markets. What you see here are the weeks, the 104, 105 weeks from the first week of 2019 through the last week of 2020. So in the middle, you have the first week of 2020. The orange line indicates the total number of visits per week. And you see a steady growth. If you put a regression over the orange line for the year 2020, you would see continuous steady growth. And this is also true for the time from the beginning of the corona pandemic, that's the spike around the beginning of the second quarter that you see in the blue bars here until the end of the year. Looking at the blue bars, the blue bars indicate our percentage growth, the web traffic percentage growth versus the same week a year ago. And this relates now, of course, to the scale on the right-hand side of the chart, the percentages. As I already mentioned, you see the spike at the beginning of the second quarter, meaning at the beginning of the corona pandemic. But even if you then look towards the end of 2020, in every single week, our web traffic grew by 50% or more. So not just our top line went up but also the customer -- number of customers went up and the number of visitors to our website increased significantly. One last remark, and you only see it and it's something that we are also proud of, you see it here in the footnote. In January 2021, shop-apotheke.com, this is our German web shop, was the #3 most frequently visited website in Germany in the health care segment. #1 was the website of the Robert Koch Institute, which is the vaccination, the public vaccination agency in Germany, not a surprise. #2 was netdoktor.de, which is a site that provides general medical advice. The #3 most frequently visited website in Germany in the health category was SHOP APOTHEKE. And again, that is something that doesn't just happen by accident. Well, before I hand it over to Jasper to walk you through the financials of 2020, let's have a quick look at our orders and how they developed. When you look at 2020, the quarterly distribution, no surprise, but we were glad to see that we reached our peak in the fourth quarter with a little bit more than 4.3 million orders. For the whole year, orders amounted to 16.6 million, which translates into a growth versus 2019 of 36%. So again, largely in line with our top line growth. And the green line here indicates the share of repeat orders, which held steady at 83%, which is largely in range where we want the share of repeat orders to be. We're always referring to the 80% range. And with this, Jasper, I'm sure you have something to say about the financials.

Absolutely. Thanks a lot, Stefan. And good morning to you all. On this slide, according to me, a set of very strong numbers, reflective of the exceptional year, as Stefan just with a lot of passion explained to you all. Thanks a lot for that. Before I go into the numbers, I also want to tell you that this morning, we did not only release our numbers for the press release on our website, there's also the annual report. And at the same time, I'm also proud to mention that we also released the numbers according to ESEF, or the European Single Electronic Format. There was a possibility provided by Europe to delay the implementation. But we wanted to be a frontrunner there. So our numbers are also available in the new European standards. Then to the numbers. I will discuss with you shortly everything from sales up to including the EBITDA, it's [indiscernible] from quarter 4 last year and this year and then it's full year. And after this, in 2 slides, I will dive into a little bit more detail on the gross margin and the selling and distribution expenses as a percentage of sales, the bridge from last year to this year. But first, high level of the numbers. If we start with sales, I don't want to repeat too much, but the numbers are too nice to not mention them again, so I take the opportunity here. Our sales increase in the fourth quarter was EUR 73 million to EUR 264.7 million, which was a year-over-year growth of 38%. In the full year, our growth was in total EUR 267 million, EUR 267 million higher than the year before. And we were indeed very close to the EUR 1 billion sales in 2020 and it was a growth of around 38.1%. These sales were achieved with a much different gross profit margin compared to 2019 and compared to 2018. I think SHOP APOTHEKE has always reported gross profit margins that were just below the 20%. In 2020, each consecutive quarter, we were significantly north of 20% sales of the margin. If you look at Q4, last year, Q4 2019, the gross profit margin was 19.8%. We improved by 3.8 percentage points to 23.6%. More on this on the next slide. And for the full year, we achieved a 3 percentage point improvement to 22.7%. These sales and these margins were achieved by selling and distribution expenses as a percentage of sales up in Q4, 18.4%. But I'm now presenting for the fourth time the numbers of SHOP APOTHEKE, we have this column, better/worse, in between brackets is worse and otherwise it's better. And it's the first time we have something in between brackets this year. But actually, this was exactly what I've tried to guide you and the markets on. And we are operating at this moment 2 facilities at the same time. And we continued with our marketing expenses. And this is exactly internally according to what we were expecting. So it is 0.7% worse than it was in quarter 4 2019. And over the full year, in addition to the better gross profit margin, we also improved our selling and distribution expenses as a percentage of sales by 0.6 percentage points. The adjusted administrative costs. As always, the adjustments at SHOP APOTHEKE are clear and limited. We only correct for the employee stock option costs and for one-off third-party costs related to certain projects, that certain project was the new logistics center, and certain capital market transactions. If you then look at the adjusted base on the administrative costs, you see both in Q4 and in Q3 that we leveraged the expenses with an improvement as a percentage of sales of respectively 0.2 and 0.3 percentage points. All the numbers I just mentioned, they then roll down, they sum up to the adjusted EBITDA. And in Q4 2019, this was a minus 1.8%. It improved this year to EUR 6.1 million -- or EUR 1.8 million to EUR 6.1 million, an improvement of EUR 7.9 million. And for the full year, the number that Stefan also already pointed out, from a minus EUR 13.6 million to positive EUR 21.6 million. Margin-wise, minus 1% in Q4 last year, which was then considered a very strong number in the fourth quarter of last year. But from a minus 1%, we improved to plus 2.3% this year and for the full year, from a minus 1.9%. With a 3x raised guidance, we ended up even north of 2% at exactly 2.2% of sales. Because of the adjustments that I mentioned already with administrative costs, you see the fully loaded EBITDA is showing exactly the same development. Quarter 4, the year-over-year improvement of EUR 7 million and for full year, an improvement of EUR 38 million. To the next slide, please. Yes, then the full year bridge of the gross profit margin. So we improved for the full year 2020 compared to the year before from 19.7% to 22.7%. The major building block here is the block of 2.7 percentage points of net pricing and product mix. There's a lot in this. But the key here is that in the total optimization of the commercial proposition to our customers, we have gotten significantly more sophisticated. So we only use vouchers when they are really needed. We try to optimize the product mix that we are having. And we are also balancing our promotions that we're having, a total improvement of 2.7% year-over-year. The other of minus 1.1% is mainly related to quarter 2 and quarter 3. But I also mentioned that we had to take a write-off of corona-related articles. To be more specific, on face masks and hand sanitizers, we sourced them at prices that were too high, when we were really wanting to have those products in order to deliver them to our customers. This impact should not directly be added to the 2021 expectations because we, of course, in the 2.7%, also had a positive impact from the high-margin corona-specific assortments. So those are the 2 major blocks. And then we have 0.8% positive impact from country and Rx-OTC mix ever growing internationally even faster than we're growing in Germany. That's having a positive mix impact. And the fact that Rx was growing with only 70.6%, which according to us was a strong number. But OTC is growing faster than 40%, is resulting in this mathematical result of 0.8%. Not at all mathematical, but fundamental is the 0.6% improvement from sourcing. This is not only because of better conditions [ one-on-one ] products with our pharma partners, this also includes impact from the fact where in cooperation, we can get the total chain more efficient. In those cases, there is something to win for the supplier and something to us. And we're not only gaining euros, but we're also reducing CO2 by making the supply chain more efficient. The next slide, this slide is on the operational cost as a percentage of sales. So that's an improvement year-over-year of 0.8%. First of all, marketing. Marketing as a percentage of sales improved by 0.2%. But remember, that indeed, in March and April, we virtually have no marketing. So balancing everything, marketing as a percentage of sales is roughly flat or perhaps even increased somewhat. So we were really grabbing the opportunities when we saw them by increasing our sales and our leading positions. Then the shipping, packaging and payments, minus 0.1%. This is only due to the fact that shipping to international is more expensive and we're growing faster there. So this is only mix. And to me, by far, the most impressive number on this slide is the 0.2% improvement of operational labor. So in this very challenging year, with all the unexpected surges in demand from our customers, we were able to keep our operational labor flat, actually even improving 0.2%. But everybody who's running an operation knows that if you operate at max capacity, you also incorporate certain inefficiencies. In this operational labor here, we were able to give our operational people 2x the past year at the start and at the end also a corona bonus, not to management, not to senior or executive management, but to the people who did the real work. And in the operational labor in the second half of the year, we have absorbed the fact that we are operating 2 facilities at the same time. Other, an improvement of 0.5%, is everything else that I did not mention, which is growing at a slower pace than our sales growth, so this is skill. Here again, the adjusted EBITDA numbers in millions of euros and as a percentage of sales. I mentioned that already for the last time from minus EUR 1.8 million last year in Q4 to plus EUR 6.1 million and a EUR 35.2 million improvement for the full year from a minus 1.9% margin to a positive 2.2%. Next, please, Carmen. What does it mean for our cash? We started 2019 with a cash balance of EUR 113 million. If you look at our balance sheet, you see this is the sum of our cash balances and our current other financial assets because we can turn them into cash within a day. So we started with EUR 113 million with the expectation that the operating result would be roughly flat and we knew we had a big investment coming, namely the first 3 quarters of our new logistics facility. What happened in reality? We had EUR 113 million because of the much better operating results we generated, EUR 19 million of cash. And this is the number actually that Stefan just mentioned [indiscernible] improvement of the operating result. This plus EUR 19 million was the year before minus EUR 16 million. And then if you go to working capital, our working capital requirements, our need for working capital increased by only EUR 1 million in 2020 while our growth was 38%. There was also the year before, EUR 50 million of cash needed. And those 2 sum to the EUR 31 million that actually Stefan just mentioned. So cash from operations, including working capital, a positive EUR 18 million throughout the year. Then we get to the investments. The investments include 3 quarters of the Venlo 2020 facility. And then we had a positive inflow of financing, which mainly relates to the April 7 capital raise of EUR 65 million. But we also have interest expenses, lease expenses and we had accelerated interest expenses related to the earlier conversion of the bond, which we did in October and November. So we ended the year with more cash than at the start of the year, namely EUR 128 million. Here's the second and the last slide on cash flow. This is only from Q3 to Q4. So we ended the year at EUR 128 million and we started quarter 4 with EUR 157 million. So what happened then in Q4? We had a positive operating result of EUR 4 million. We had an increase in working capital, which is always the case in the fourth quarter because of seasonality. We had an elevated level of investments because we earlier reached a milestone for our distribution facility, so we paid that. And we have an elevated level of financing mainly related to the early redemption of the bonds. So we ended with EUR 128 million. But also in this slide, you see that already in the first 2 weeks of 2021, we had 2 major transactions. We acquired SMARTPATIENT, and Stefan will talk about that more in a couple of slides, and we had the successful placement of EUR 225 million of convertible bonds with 0 coupon, meaning that at this moment, we have cash of more than EUR 300 million in our accounts. Thank you.

Thanks, Jasper. Let's go to the next chart. So before I hand back over the microphone to Jasper to talk to you about some of our accomplishments along our sustainability journey and, of course, the guidance for 2021, I want to share with you or talk about some of the initiatives that will allow us to transform SHOP APOTHEKE from being pretty much an online retailer into Europe's leading customer-centric e-pharmacy platform. When I started at SHOP APOTHEKE 2.5 years ago, and since then I'm sure I've talked to some of you about how impressed I was, when in my interactions with a lot of people at SHOP APOTHEKE, how the customer was always top of mind. And the question how can we meet and better meet our customers' needs was always top of mind. And that is something that struck me, as I said, from day 1. I already mentioned only happy customers are returning customers. Again, with an NPS of 70, we have many customers that are returning to SHOP APOTHEKE over and over again. Of course, it's one-on-one of e-commerce. Once you have gained customers, we have to do our utmost to convince the customer to place a second, third and fourth order. So over the next couple of minutes, again just a little bit about some of the key initiatives, of course, e-prescriptions, related to e-prescriptions, the acquisition of SMARTPATIENT. SMARTPATIENT, we want to provide a little bit more color where we are with our same-day pilot and just a quick update on our new logistics center, as I said, before I will hand it over to Jasper again. So if there has ever been in the history of SHOP APOTHEKE, if there has ever been a top, top priority for us, it's certainly the preparation for the introduction of e-prescriptions in Germany. We are using here a little bit of a reference from Formula 1 racing. Our ambition is, of course, that once e-prescriptions start in earnest, we really want to be in a pole position. We installed our task force. And we called the task force, the [ eRx first task force ], already in 2019. And since then, we continue to strengthen also in terms of resources. We strengthened the task force throughout 2020. And of course, Rx is nothing new for SHOP APOTHEKE. We've been doing this for many, many years. We understand the needs of an Rx customer. We have developed some targeted and tailored patient care programs that are really appreciated by the patients that are enrolled in them. I'm going to talk more about the acquisition of the MyTherapy app and SMARTPATIENT. But I already want to state clearly that was not an opportunistic acquisition. That was a clear pillar of our eRx strategy. We were convinced -- we have been convinced for quite some time that sophisticated digital medication management will be a true value-add in the eRx environment. Generally speaking, e-prescriptions are nothing new for SHOP APOTHEKE or digital prescriptions are nothing new for SHOP APOTHEKE. Since we started the cooperation with Zava, one of the leading European online doctor service providers, we have been and we still are processing literally hundreds of digital prescriptions that have been sent by Zava customers to SHOP APOTHEKE. And with the experience that we have gained with handling all of these digital prescriptions, our back-end processes, our back-end systems are well prepared for the start of electronic prescriptions in Germany. And last but certainly not least, we have been and we continue to talk to a lot of market participants. And wherever it makes sense from our vantage point but also wherever it makes sense and provides a benefit for our customers, we have and we will continue to enter into partnerships with others. Just a quick word about the timing of e-prescriptions. We're saying at the bottom, SHOP APOTHEKE will be ready if e-prescriptions launch on July 1. And based on everything that we have heard from Berlin, from the health ministry, from the gematik, from other market participants in Berlin and beyond Berlin, everything that we refer today indicates that the gematik will be ready time. They're going to launch the telematics infrastructure and e-prescriptions around the middle of this year. Everybody acknowledges it's an ambitious, tight timeline. But so far, again based on everything that we have heard, the gematik seems to be on track. But of course, in earnest, e-prescriptions are going to start once it will become mandatory for physicians in Germany to issue electronic prescriptions. So before I talk about the value proposition, SHOP APOTHEKE's value proposition for e-prescription customers in the future, let's look one more time at the potential that's in front of us and our competitors. On the left-hand side, you see the total market size based on 2019 IMS data, the 2020 data is not yet fully available. But in 2019, the Rx market amounted to EUR 50 billion to EUR 52 billion in Germany. This is at AVP -- sorry, I have to torture you with a German term, Apothekenverkaufspreis, that includes VAT. But again, just in order of magnitude, at this pricing level, we talk about EUR 50 billion to EUR 52 billion. Also based on IMS data, the OTC market in 2019 amounted to around EUR 7 billion. So now switching to the right-hand side, looking at the online share of the OTC market, and there are different data points. But it's everything that we are seeing. It's the online share is around 20%. Of course, this is not only SHOP APOTHEKE, this is SHOP APOTHEKE and our direct competitors. When we look at the Rx market, of course, and that is not a surprise to you, a very different picture with an online share from 1% to 1.5%. By no stretch of the imagination do we want to lead you to believe that the Rx online share is going to resemble the OTC market anytime soon. But based on the projections of market experts and some of them are, of course, participating in this call, the projections seem to converge around the 8% to 12% range a couple of years after the introduction of e-prescriptions in Germany. And we as SHOP APOTHEKE, we can get our arms around this range of 8% to 12%. Again, just to provide some context, our share -- SHOP APOTHEKE's share of the 1% to 1.5% last year amounted to around EUR 220 million. So again, thinking about the value proposition for eRx customers going forward, SHOP APOTHEKE has been one of the pioneers in the mail-order Rx market. We've been doing this for many, many years. And as a pharmacy, we have learned what is important for Rx customers if they receive their orders via mail delivery. At the same time, of course, we have deep expertise in e-commerce. We have scaled up SHOP APOTHEKE over the years to almost EUR 1 billion. And our aim with the eRx opportunity is simply to bring our pharmacy expertise and our e-commerce expertise together to provide the best-in-class customer journey, customer experience for our eRx customers. That is -- there are no surprises for you. It's about the customer-centricity as I was referring to earlier. It's about the convenience that people appreciate especially but not only during a pandemic. It's the ability to order 24/7. It's the flexibility in terms of how you submit your prescription, how you pay for your co-pays, very important, and that's really a change for all of us, it's the breadth of the assortment that we can bring to bear in an e-prescription environment. Keep in mind right now, when a customer sends a prescription to us, it's a paper format. And it's really cumbersome to add other products to this -- to the Rx basket. In the future, all of this is going to happen in the digital space. So it will be very easy, very convenient for a customer if she submits a prescription, an e-prescription to SHOP APOTHEKE to add OTC product, to add beauty and personal care products to the same basket. And on the next couple of charts, I'm going to talk more about the role that medication management, digital medication management is going to play in our eRx strategy. So again, having talked about SMARTPATIENT, we are very excited about this acquisition that was concluded at the beginning of this year. And as I mentioned, this was not an opportunistic acquisition. We have been convinced for quite some time that digital medication management will be a true value-add for our customers, will be something that is critical to our success in the eRx market and the more we work with, the more we learn from the SMARTPATIENT team, the more convinced we are getting. At the end of the day, sophisticated digital medication management is going to allow our customers, our -- especially the chronically ill patients, to have better health outcomes. Digital medication management that helps them to adhere to drug therapy. It helps them to have better persistence with their drug therapy, in other words, to take the medication that has been prescribed to them by their doctor regularly and to stay on medication for as long as the doctor has prescribed it. There is a lot of scientific data out there that clearly indicates that better adherence, better persistence, not a surprise to anybody, that it results in a better therapy outcomes, better health outcomes. And digital medication management is a conduit to achieve these better health outcomes. Furthermore, of course, with the MyTherapy app, and I'm going to talk more about the MyTherapy app on the next chart, this will give us at SHOP APOTHEKE an opportunity to interact with our customers, not just once a month but several times per day. So let's have a look at the MyTherapy app, what it looks like. Right now, we just want to give you here an idea. And it might be misleading to think about MyTherapy simply as an app. Because it's much more. It's a platform that already today consists of several different modules. You're going to -- you're seeing here some examples. And the more we think about this and the more we work with the SMARTPATIENT team that has developed expertise in medical -- digital medication management over 8 to 9 years, that is something that we, ourselves, would not have been able to replicate within a reasonable period of time. But going forward, the SMARTPATIENT team, they're going to develop drug-specific content, so we can provide a targeted advice on the medications that our patients are taking. We can provide advice on how to better manage their disease, all of this "pill reminder" functionality. The additional advice and information we can provide to our customers, we are deeply convinced this will be a real value-add for our customers, and it is one of the pillars of our eRx strategy. Another building block for our eRx strategy is no surprise, our same-day delivery service. What you see here on this chart, the dark blue dots is -- are the areas where we were live with our same-day delivery at the end of last year. The light blue area, the most populous area in Europe, the Stuttgart metro area, the Munich area and Berlin. And by the end of this year, we're going to be live in all of the metropolitan areas of Germany, again, not just for OTC, but this is also a building block for our eRx strategy. So -- and before I hand over again the microphone to Jasper, just a quick update on our new logistics center. I already mentioned it's much busier here today than the last time we talked to you. In October, the first customer order left our new facility on its way to a customer in Italy. At the end of January, we took into operation our new equipment with a much, much higher degree of automation of the customers to -- all of the customer orders from customers in our International segment, again Italy, France, the Netherlands and Belgium, are shipped, executed from our new facility. And this summer, we're going to have -- we will have transferred all of our activities from the old facility to the new facility, doubling our capacity. And at least for the next 2 to 2.5 years, we are not going to be constrained by any capacity limitation. And also this year, next year, again if the demand fluctuates and peaks will be well prepared for this. Jasper?

Yes. Great. Thanks. Thanks. Yes. I'm really happy to share with you 2 slides on our progress on ESG, environmental, social and governance strategy or sustainability or the sustainability strategy. We really stepped up in 2019. But our major step was actually in 2020. We, as a Board, as a total company, we say we are committed to do the right things. And we installed in 2020 a clear internal structure with governance, with a head of sustainability, with targets and responsibilities. And the language we talk internally for this is because we care. And what do we care about? We care about health. And then we say always the health of our planet, you see on the left side, the health of our patients and the health of our employees. And if you talk about the health of our planet, of course, a major impact there is CO2 reduction. It's about sustainable packaging. It's about reducing our carbon footprint. Then the health of our patient, that's, of course, in our DNA already for more than 20 years. But there's always room for improvement. So besides giving tools to get a healthier life, an easier life, if you are a patient, here's also the areas of being -- applying the highest standards of data and data privacy. And then caring about the health of our employees. That's providing everybody equal opportunities about diversity. We installed a pension insurance for our people in the operations here in Venlo the past year. And of course, the safety of the workplace environment was very important in the past year with corona. And this is something where we, on a continuous basis, want to focus on. So this is the strategy and quite some talks and words that did we do already something in concreteness at least to the next slide. Here are some highlights, what we really did in 2020 on our sustainability agenda. Already in January last year, we committed ourselves to the UN Global Compact. In March, we joined the Leaders for Climate Action and we cooperate in doing our fair share of avoiding that the world will increase by 2% of temperature. And then in July, this was rewarded with an significant upgrade by the MSCI index to a BBB, from a below average to slightly above average. So that's the first step of our improvement that was recognized by the outside world in July. And throughout the year, the first half of 2020, we worked together with ClimatePartner. They have 20 years of experience in determining in all aspects of our operations what our CO2 footprint is. Then in addition to that, we've also asked another independent testing body, TÜV Rheinland, to also certify what we consider as our carbon footprint. And then we decided based upon that information in October to offset all our CO2 emissions, actually not only for CO2 emission according to Scope 1, but Scope 1, 2 and 3. But that's about offsetting. Even more important is, of course, that we also are a frontrunner in reducing CO2. And already from 2019 to 2020 in concreteness, we reduced the CO2, the carbon per parcel, with 15%, and we were able to do so. I gave some examples because of all our standard deliveries in Germany with DHL are now green. And all our energy, our electricity in our German facilities come from renewable resources. And also there was an important impact from us moving to the facility where we are presenting now from, which is according to the highest climate standards. Some other highlights, just a couple to share, is internally we rolled out programs in getting people up to speed and get their commitment and get their energy in having an impact on the health of our customers, people and planets. The last one is that I want to say that already for many years, we have a cooperation with an organization, a charity organization, which the name is Herzenswünsche, which is for seriously ill children. And over the past years, we already donated close to EUR 600,000 to this organization. And what we decided to do at the start of 2021, when the bonus then took effect in Germany, is that we gave our Rx customers the possibility to say, "Okay, instead of me giving the bonus, which is no longer announced, we can make a donation to this charity organization." And this is very successful. I want to finalize this slide is that the annual report that this morning we released is entirely, and for the first time for us, according to the GRI reporting standards. So sustainability is fully integrated in our annual report. And I hope you pay attention to that. And if you have any remarks or questions on our progress in this area, just reach out to us and we're happy to share with you. Something completely different, the guidance for 2021. I think the header says it all, continued faster growth and margin improvements. That's actually our guidance. So we have a longer-term guidance, which is at the bottom, and then we have the guidance for the current year, which is, I have to say, super difficult because the world is very volatile, as we all know. But we felt comfortable enough providing you with this guidance. To start with the number one, with the sales growth. So the big picture from a helicopter view is that last year, our sales growth was 38% fully organically. And now we're promising that we expect that in this year, on top of the 38%, we will grow again around 20% or more. We say this taking into account actually 3 items that I want to point out to you. Number one is, of course, as of March, we are cycling peaks in [indiscernible] of last year. We took that in our guidance into account. Number two is as of mid-December, we have been done on Rx bonuses. So we also took that into account. And the third one, perhaps not familiar to all of you, but we clearly see that in January and February of this year of 2021, we see throughout Europe, we actually see that people are less ill. There is less of a cold and flu season and most probably, most certainly related to the social distancing because of the COVID measures. So this is not impacting us more or less than others with just the whole industry, specifically in Rx, who most likely in January, February, have faced a decline in Rx sales. So we take that into account and then still say we want to grow as a company significantly double digits, around 20%. That's the sales guidance for the year. Adjusted EBITDA margin. We achieved in 2020 a positive 2.2%. This is not a one-off. Now next year, we want to do that again and even improve by 0.5%, approximately in the range of 2.3% to 2.8%. Then we added a new guidance because we always only had sales EBITDA. And that's the guidance on investments on CapEx. We expect that in 2021, in the current year, around 3.5% of sales will be -- investments will be CapEx. And this includes our last phase of the Venlo facility, where we are presenting from. That's the guidance there. And the long-term target profitability unchanged. We expect that our longer-term target profitability will be at 6% EBIT or more. That's it. Let's quickly go to the Q&A.

Okay. So Jasper and I will take turns in reading the questions. So we have a question from Olivier Calvet from Kepler Cheuvreux. Rx year-to-date, are you expecting any impact from the absence of a flu season or from COVID-related excess mortality this quarter? Why or why not? Well, let me -- I'll take the first cut at this. I don't know about the excess mortality, whether that is having any impact on the overall market. But certainly, and Olivier, you are familiar with this, we have seen a significant a drop in prescriptions in January. We don't expect -- first indicators actually tell us that this will continue in February as well. And this has an impact on the overall market and has an impact on SHOP APOTHEKE as well. And again that is, as Jasper mentioned, that is reflected in our top line guidance for 2021.

Okay. If you can go a little bit more up so that we can take a question with somebody else, Carmen, please? Okay. It's from Christian from Hauck. Maybe ask the forecast of 10% in 2025, '26, thanks to the [ e-prescriptions ] launch next year. Do you feel comfortable with the mid-term assumption of around 10% in 2025, 2026? Or do you think it's too aggressive? Stefan, can you answer this?

Yes. I think we answered this in the presentation. We get comfortable with the projections that come, Christian, from analysts and other market observers like you. An 8% to 12% market share a couple of years after the launch of e-prescriptions, that is something that we're very comfortable with. So we don't think that's too aggressive. We think it's reasonable.

Okay. Can you continue, please? We're looking at -- no, continue up, please, Carmen.

We just want to take a mix of questions from a variety of participants.

Okay. Gerhard from Berenberg, same-day delivery, how does that work from a logistic perspective in areas that are further away from Venlo, for example, Stuttgart? How do you do that? Do you have to use a partner? Should I take that one?

Yes.

Okay. Thanks, Gerhard, for your question. Yes, indeed, in the Rhine-Ruhr, we do it from our facility in Venlo and Sevenum. But in the Stuttgart, in Berlin, in the Munich area, we do this together with our partner physical pharmacies. So we work together with existing pharmacies there in a win-win situation, customers happy, local pharmacy is happy and we are happy with that. Yes. So that's how we do the logistics in the large country of Germany. You pick the next one, Stefan.

So we have a question from Andreas Riemann from Commerzbank. Good morning, profitability. I don't know whether you saying good morning to us to profitability, Andreas. What is driving higher EBITDA margin in 2021? Marketplace, how big is the marketplace to date? What could be the share in 2 to 3 years? Jasper, do you want to take a cut at this?

Yes. The EBITDA margin improvement that we foresee for the year 2021, to make it very short, is driven by better commercial, better gross profit margin. That's the main reason. It is not coming from leverage of marketing. It's not coming from leveraging operational expenses as a percentage sales. Because actually, the first 6 months, we will continue to operate 2 facilities. It's coming from further gross profit margins, better sourcing, optimization and also immediate income. And then the second one of your question is how big is the marketplace today? And what could be the share? Shall I do that also?

Yes. Go ahead.