• Preliminary revenues as of 30 June 2022: EUR 220 million
• Preliminary EBITDA – before adjustments: EUR 14.5 million (incl. proceeds from the sale of KoRo)
• Operating loss, including restructuring costs, decreases by 35% from Q1 to Q2 to around EUR 9.4 million
• Social Chain AG sells several companies and concentrates on the growing agency business and brand development at DS Group
• Following the portfolio streamlining, expected annual revenue will be adjusted to EUR 415 million
• EBITDA guidance before adjustments remains in the low double-digit million range, between 4 and 5% EBITDA margin
• Working capital financing for DS Group of approx. EUR 100 million to be restructured for the duration of 3 years

Berlin, 11 August 2022. „The post-merger integration and restructuring of Social Chain AG is progressing as planned and in line with expectations despite a difficult market environment,“ says CEO Wanja S. Oberhof. Preliminary revenues in the first half of the year increase from EUR 160 million in 2021 to more than EUR 220 million in 2022 – which is largely due to the acquisition of DS Group. Preliminary EBITDA increased to around EUR 14.5 million before adjustments, from -5.3 million in the first half of 2021, driven by the deconsolidation proceeds from selling the majority stake in KoRo Handels GmbH. With a clear focus on its core areas – the growing social media agency business (2021: EUR 19 million, 2022: EUR 32 million) and the three commerce pillars Core Brands, Maxx Group, and Brand Chain, the company parts with several subsidiaries. The companies RAVENSBERGER Matratzen GmbH, Carl Wilhelm Clasen GmbH, DEF Media GmbH, and bytepark GmbH will be sold at short notice. In doing so, Social Chain AG clearly takes further significant steps towards increasing its profitability. The management board set the course for the these steps on Wednesday evening.

Clear course of implementation: Profitability
„We concentrate on the companies within our group which, in our view will create the best synergies for Social Chain as a whole,“ summarizes CEO Wanja S. Oberhof. „With this focus on our core capabilities and core brands, we implement our strategy with the main objective of ‘profitability’, as announced at our Annual General Meeting in June 2022.”

The product line Clasen Bio will remain within the group to be developed; the white label brand business of Carl Wilhelm Clasen GmbH will be sold
Carl Wilhelm Clasen GmbH produces dried fruits and nuts for white labels of large discounters under their branding. "As this production business is not our core business and does not fit into the strategic concept of our house of brands of the future, we are selling this business unit. By establishing and expanding the Clasen Bio product line, we are increasing gross margin and profitability," comments Ralf Dümmel, Chief Product Officer. "In this way, we are bringing the synergy effects of the strong DS distribution network and the high level of expertise in trade marketing fully into the brand world of Social Chain AG."

Social Chain AG focuses on profitability and brand development
The revenue forecast for Social Chain AG will be revised to EUR 415 million for the financial year 2022, since the sale of these companies will stabilize profitability, the revenue does not belong to the company anymore. „Despite the difficult environment, we expect a positive non-adjusted EBITDA margin of 4 to 5% for the full financial year,“ says CFO Andreas Schneider. While the operating loss in the first quarter before the proceeds of the KoRo sale was around EUR -15.3 million, it fell to around EUR -9.4 million in the second quarter. The loss in the second quarter was due to both one-off effects from the merger of Social Chain AG and DS Group and the significant deterioration in consumer sentiment. „In the third quarter, the company will operate at break-even and return to profitability in the fourth quarter,“ says CFO Andreas Schneider. „This revenue adjustment helps us to consolidate our total earnings for the future and strategically secure the future basis for our profitable development.“ With regards to the medium-term growth, he adds: „Our future growth is also ensured by a new working capital financing for DS Group which amounts to approximately EUR 100 million and is currently being restructured for the next three years.“

As announced in the financial calendar, the detailed half-year report will be published on 15 September 2022.

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Wanja S. Oberhof, CEO: „Needless to say that, as substantially invested entrepreneurs, we also took note of the share price. The main active shareholders, in particular the Chairman of our Supervisory Board, Dr. Georg Kofler, the former partners of DS Group, and I, continued to invest in Social Chain AG at its last capital increase at EUR 46.40, with an amount of just under EUR 20 million. We will remain connected to the company in the long run – because we are confident that its different pillars and its focus on social commerce put us in an ideal position for the future. Our market segment is currently under severe pressure on the stock exchange; nonetheless, we are convinced of our capability to prove to the market that we can earn money in a solid and profitable way and grow accordingly.“
 

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About The Social Chain AG: Social Commerce at a Global Scale

We are Social Commerce pioneers and social media is our marketplace. As a house of entrepreneurs, we are reshaping the world of brands and commerce, turning wishes and ideas into products with our combined sales power. We understand how to develop our own brands and products into direct-to-consumer brands with the power of social media and how to market them to specific target groups. We offer our entrepreneurs and retail partners an all-round carefree package in-house: from our own product development, legal review, production, quality assurance, marketing and communication to logistics and everything that brands and products need to grow and become successful.
Social Chain AG currently has around 10,000 products in the categories of Food, Home & Living, and Beauty & Fitness as well as successful brands such as LANDMANN, the oldest German barbecue manufacturer, and the Lifestyle brand URBANARA in its range. Social Chain AG brings the products “Digital first – direct to Customer” directly to the customers‘ homes. Plus: Thanks to the excellent retail network of the sales experts, the products are placed in more than 40,000 retail shops – to touch and take away immediately.
The best-known heads of The Social Chain AG are Ralf Dümmel and Dr. Georg Kofler, both investors of the VOX start-up show “Die Höhle der Löwen”. In addition to Ralf Dümmel as Chief Product Officer, Andreas Schneider as Chief Financial Officer and Wanja S. Oberhof as Chief Executive Officer manage the company’s business.
The company has its headquarters in Berlin and around 1,000 employees. Other locations are New York, Manchester, Stapelfeld near Hamburg, London, Los Angeles, and Gallin. The shares of Social Chain AG (WKN: A1YC99) have been listed in the Prime Standard of the Frankfurt Stock Exchange.

^{The content of this press release is for information purposes only and does not constitute investment advice or other recommendations pursuant to the German Securities Trading Act by The Social Chain AG or its affiliated companies. The information provided cannot replace investment advice. The information contained in this press release is not to be construed as an assurance of possible price developments and should not be construed as a request to enter into a transaction. The information contained herein does not constitute an offer to sell or the solicitation of an offer to sell securities or rights, or a solicitation to trade in securities or rights. Accordingly, The Social Chain AG and its affiliates make no representations or commitments as to the accuracy, completeness or correctness of the information or opinions contained herein. We assume no liability for direct or indirect damages caused by and/or in connection with the distribution and/or use of this document. The statements correspond to the status at the time of the prepara- tion of this document. They may become obsolete due to future developments without the document being changed.}