Hi, good morning, everyone, and please welcome to the quarterly report of RevolutionRace, our Q2. It's a very strong quarter, the strongest yet for the company. SEK 391.7 million in sales and 58% growth. For the first time ever, we reach over three-digit numbers when it comes to EBIT. EBIT is SEK 117.5 million. That shows me the skills, operational skills, of Team RevolutionRace and also the brand position in the out leisure industry. I want to show you a bit more about RevolutionRace. We are an active outdoor lifestyle brand. The best way to give you a sense about the brand is to show you a video. It's approx two minutes, please enjoy. Thank you.
What an energy boost, at least for me. A lot of colors and colorful people. Let's start this meeting. RevolutionRace is an active outdoor lifestyle brand. We are a digital native, born on social and digital platforms. Me and Niclas Nyrensten, also the co-founder, started RevolutionRace because we wanted to revolutionize the outdoor industry. We thought it was way too conservative. We wanted more colors and also high quality at a reasonable price. Great fitting was a huge part of starting the brand, therefore the name RevolutionRace, because it's not easy to start from scratch and build a brand on social platform where the customers are.
We saw the gap in the pants category, but as you can see, now we have a full assortment with jackets, base layers, and even shoes we launch this quarter, and they sold out in two days. It was a huge success for us. Smaller amount when it comes to impact of total net sales, but it's looking really promising for the future. The reason that we are able to give the customer a great experience is because we skip the middleman and the retailers. The customers, we can talk to them directly and catch their needs and expectations. We are on both social, digital, and entertainment platforms. We are where the customer are. That is a huge part of our brand position, and I talk about it at the start about the out leisure position.
That means that we have caught the needs not only in the core activities like hiking, climbing, but also in the same way as the sport industry catches the need for the athleisure part. RevolutionRace is doing the same in the out leisure part. Our customer can wear our functional clothing on a regular basis for several activities, and that is a huge part of the success of the brand, the position. Also we have a lot of reviews on our products, on and every single products. The score is 4.6, and we also have the Trustpilot at 3.9%.
We constantly trying to improve ourself and read all the reviews weekly, so we can adjust both the products and also the experience for our customers because the customers is the most important part when nowadays for us. Let's go over to the numbers. This quarter we had SEK 391.7 million in sales. That give us 58% growth, and we are growing in all different regions which the strongest is the DACH and recently we launched in Switzerland. It was a huge success, one of the best so far for RevolutionRace, and thirty-nine percent of running twelve comes from the Nordics and rest of the world is nineteen percent. We can see this quarter that the numbers through the P&L is improving.
Average order value is up 2.6% from SEK 776 up to SEK 791. You can see the growth both in this quarter and also in this half year because we have a fiscal year from first of July to end of June. When we comparing the half year's numbers, the EBIT margin is pretty much the same as the last quarter here is 28.6, I think, and this quarter was 28.9%. We are growing rapidly, but at the same time, the EBIT margin is following. I can dig in a bit deeper.
As I said, we have a broken fiscal year with the first of July to end of June, and then the result was SEK 897 million and 252 EBIT margin. This year, 2021, we reach SEK 1,164 million in net sales and 342 EBIT margin. You can see from the start we have been profitable, but you can see that we have economies of scale, so even though we entering new markets and taking new market shares on both existing and new, we are having a great result when it comes to the EBIT margin as well. We grow 58% in this quarter, and the EBIT margin grow 76%. We are improving EBIT margin even better than the net sales.
The result is coming from all of our region. Yeah. 791 is average order value, and that's an increase with 2.6%. The gross margin is slightly less, but it's 0.3%, mostly driven by the supply issues with the higher cost, and some is from price reduction in the quarter. Quarter four for other companies is the most driven quarter with price reduction, so RevolutionRace mostly driving our sales from normal price products. Both Switzerland is a huge success for us, but I would say the whole quarter actually deliver great results. We saw October started strong, and then we ended even stronger in December. We are not one of the companies that building our brand through sales price reduction.
We are building our brand through normal prices. Most part is from normal pricing products. Also I think I need to mention the scale of RevolutionRace team, the way we operate with the internal in-house competence when it comes to marketing, all problem solving with the COVID situation and also the Brexit. We are building a company that are prepared for the unprepared, and you can see that in our result. We are in a front seat, so to speak, and we are solving problem every single day. Even though you see all these great numbers here, that means that our organization is working really, really hard. I send some love to the headquarters in Borås. Also we launched a new product, Shoes.
Even though it was a small amount, we want to hear what the customers think about the products before we put a larger amount in the new product category. The reviews are amazing. The in-house team with Niclas Nyrensten have done an amazing job with the new products here. Two days, they are sold out, so we are expecting to get more of these products later on. Bags are coming in in this quarter. It's a new category as well, and we're looking forward to hopefully it can be a success as well. We have listened to the customers because we asked them what kind of products they want us to produce for the future, and a backpack is one of them. We are very excited, and hopefully, they will deliver as well.
I think I mentioned most of the parts. The supply is struggling for all companies out there. Instead of 5 weeks delivery time, lead time, we have 9 weeks. Of course, that is a problem even for us, but we predicted this, and we have a large amount of running assortment and also a healthy cash flow that make it easier for us to handle the situation. We could sell well in this quarter because we have goods to sell. Market development, yeah, I talk about it a bit earlier. Now the DACH region is the biggest with Germany at 98% growth, and Switzerland is a new market and a very promising start. We also have a great development with 84% growth in rest of the world.
In the quarter, we saw a little bit less growth in the Nordic countries, but when you look at the six months, you can see it's still 30%. The total of the business is developing exactly as we want because it's still double-digit number for growth in Nordic countries. Also the start of the new quarter is showing that we are growing in all of these markets. We constantly trying to improve average order value, and as you can see, we have done that also in this quarter, 2.6%. I think I mentioned almost all these numbers here, so let's skip this slide. Also this one.
Before we went public company, and now we have the third quarter here today, we told that our financial targets are at least SEK 2 billion, and we have SEK 1.164 billion in net sales so far, so it looks good for us. At least 25%, we delivered 28.7% for the half year, and we also made a dividend last year. We keep our promise to the market, and I think it looks really good, so I think I want to hand over to Jesper.
Thank you.
Please, take it away.
Thank you, Pernilla. Hello, everyone. Good morning. I have the honor of briefly touching upon the sales development. Rolling 12 months, we're getting close to SEK 1.2 billion, which is a very healthy number that we intend to increase. For the quarter, we had 58% growth in local currency. It was 59% growth, amounting to SEK 392 million for the quarter. The half year showed a growth of 70%, which is also a very strong number. This is all due to a good marketing optimization, good products, and a broadening of the product offering. We have a situation that is well-known on the global supply side, but we're managing that well, also when it comes to the net sales development.
Moving forward to gross profit and margin. For the rolling 12 months, we have a margin of 72.3% and a gross profit of SEK 842 million. The last quarter, Q2, had a margin of 71.6%, which is a slight reduction in comparison to Q2 of last year. We've had a positive effect from market mix, a slightly negative effect from price reductions, but above all, we have the global supply situation with higher costs and longer lead times. OPEX, we have very good cost control. We see OPEX as share of net sales coming down from the average of around 38% in this quarter, it's down to 37.1%. This is obviously partly due to the seasonal effect.
We have a very strong sales quarter, so fixed costs as a share of net sales comes down. In general, we have a very good cost control in the company. Personnel costs slightly higher than Q2 of last year, but bear in mind that we have recruited to avoid an understaffing situation, so we're pretty well in balance now, and obviously recruiting along the growth of the companies. We will continue recruiting, but we have made the catch-up to where we were before. Adjusted EBIT, rolling 12 months and margin of 28.7% in the most recent quarter, 28.9%.
In this quarter, we had no items affecting comparability, but Q2 of last year, we had slight costs relating to the IPO process, so we are talking about adjusted EBIT now since the comparison quarter has items affecting comparability. SEK 117 million or SEK 117.5, it's the best result for an individual quarter in the history of the company, and it's a consequence of so many things going right. Balance sheet, very few surprises. We see movements in current assets and current liabilities, and that is mainly related to the inventory buildup, and I'll dig into that on the next few slides. Otherwise, very few surprises here. We have a net cash position of SEK 8 million.
Inventory development, we have seen a buildup, a planned buildup of the inventory situation, and bear in mind that we're coming from extremely low levels a year ago, and we're now reaching much more of a balance. The previous quarter, we had around half the inventory in transit and half was sellable. We've now seen the inbound deliveries come through and the inventory which has increased as a total but now is around two-thirds sellable and one-third is in transit. The consequence of our inventory buildup is the net working capital development. We've had, for the first time in a few quarters, we have a positive working capital, but this is due to our previously extremely low levels of inventory.
We are at the top now, right?
Inventory levels, we're seeing that we have replenished. We're in a much better position and looking ahead, we believe that this level is much more balanced than what we've seen previously. A few words on cash flow generation. We are generating cash flows. We have built up our inventory, and we have paid our first dividend of SEK 72 million during the quarter, so we see a slight reduction in cash in bank, but a very healthy cash flow and financial position. With that, I'm handing back to you, Pernilla. Thank you very much.
Thank you, Jesper. Yeah. What can I say? It was a great quarter. It's a great half year. We are heading in the direction that we want, both when it comes to brand position. The company handle all things that happens outside, in a very good way that give us a cost control, and we are in the front seat, and we are growing globally, within category, in new category, and at the same time, we are constantly trying to improve the average order value, and I think this looks really promising. The new country launch went well. Switzerland, one of the best success for RevolutionRace. The shoe launch sold out in two days. We are growing in existing markets. We are growing in new markets. We are growing at Amazon.
Actually, the result for Amazon is better than ever, mostly also driven because of the brand control on the platform. We are selling through Amazon, and we are not selling to them. That give us brand control and development of that channel, marketplace channel, with an existing brand store and control of the content and the whole operation is in-house with the best team in place. We are growing Amazon. U.S. is growing according to plan. We are in line or a bit above our financial goals. I had to say it looks good, and I believe the result here that you are seeing today is a strong brand position in the out leisure category, the multipurpose function of our clothing, both when it comes to quality, price point and also design.
Because many of you don't know that is the main reason for our customers to buy our products is the design, and that tells me that the brand position is great. I think we have proved that we are one of the category winners. We are born online, digital native, and have a clear understanding of the digital landscape. We are in a great position for the future, and I think it's looked promising. That's my end. Maybe I can talk a bit about the quarter that we are in now, a bit about it. We started strong like last quarter, so it all look good. I'm excited to give you time to ask some questions. Over to you guys, and thank you so much for listening.
Our first question comes from the line of Johan Brown from ABG. Please go ahead. Your line is open.
Thank you. Hi, Pernilla and Jesper. A few questions from me. Firstly, I'm wondering about the U.K. and Switzerland. For the U.K., how much sales is returning now, so to say, as you're relaunching in the U.K. on Amazon? For Switzerland, is it possible to quantify the volumes attributable here from Switzerland in the quarter?
Yeah, great question. Switzerland to be a new market, that means that you don't have any existing customers in that new market. The total of net sales is not that impacted, but we can see when we compare numbers from other market launches that this is the Switzerland launch is one of the best. Main reason, I believe, is because that we already are present in the DACH region. The German and also the Austrian countries contribute to the success as well, in my opinion, and they love our products. They are very active people here. That's answer to question number one. The other question were about U.K. Because of the Brexit, we need to pause Amazon U.K.
Now we have a plan for how to handle Amazon UK. I guess it's going to be a small impact on the EBIT margin compared to our own U.K. web store. It's slightly different, and we can operate with trying to get average order value up on Amazon UK, but we cannot do that on our own platform because of web store, the maximum amount of GBP 135 from Sweden. Yeah. It looks good. We are growing in U.K., and we can see that we are growing even better in this quarter in U.K. We have recently started Amazon U.K., so you will see the result for the future more than you will probably see from this quarter from Amazon UK.
Great. Thank you. Then continuing on the gross margin and sort of trying to pick out the raw material price impact here. Of course, many moving parts, but is it possible to say something about the, on a like-to-like basis, how much the raw material prices have impacted your gross margin here?
We are decreasing 0.3% in the quarter. I guess maybe that is a factor, but it's also including price reduction. We see a slight decrease in the quarter, but bear in mind the half year is 0.5% over. That is because of the expansion of the brand globally. The Nordic countries have less gross margin than we have in European countries, so that's also a factor that helping us. We stick to keep our promise to the customers, so they are not the one who going to pay for the supply situation. We are increasing prices accordingly that RevolutionRace has done for years, and that's with the inflation. They are not the one that pay for the problem and struggling in the supply.
Great. Then a last question from me as well. I'm curious about the price points here you're planning for the bags that you're launching now in Q3. Is it possible to say something about what you're planning there?
We are a brand that have an unmatched value part of the business in the mid-price segment, high quality at reasonable prices, and that's what we are planning for the backpacks as well. I don't want to give you the SEK numbers for the backpacks yet, but we are going to tell about it when we are launching them.
Fair enough. Those were all of my questions. Thank you very much.
Thank you.
Thank you. Our next question comes from the line of Niklas Ekman from Carnegie. Please go ahead. Your line is now open.
Good morning, Pernilla and Jesper, and congratulations on another set of very strong results. I have a couple of questions, if I may. First, coming back to this issue of you talk about supply disruptions and higher rates. How could that impact now in the coming quarters? Are you mainly talking about longer lead times, or are you seeing much higher costs? Obviously in this quarter, yeah, the EBIT margin was very, very strong. But given your comments here about customers not having to pay more, is this something that's gonna have an increasing negative impact in H2? That's my first question.
As I said, they are not the one that's going to pay for the bill. We have an inflation increase when it comes to products cost, but we are not letting them pay increase of the goods from Asia. The expectation is that we have reached the top of the cost because it's quite expensive. I think we can handle it well because that we are growing outside the Nordics even more than in Nordic countries. Also the fact that Germany have a VAT of 19% is also helping us when we are growing that much in that country because it's 98% of the growth in this quarter, and with 19% VAT, that give us a higher gross margin. It's how I see it.
I think we're going to handle it accordingly to our expectation for the future as well.
That's very good. Thank you. Generally on the margin outlook here, I mean, looking at the historical margins, last year you had an extremely high margin of about 29% in Q3. You've now been close to 29% in Q1 and Q2. I'm just curious, are there any seasonal effects we should be aware of? Is there any reason why in a normal Q3 the margins should be lower than in Q1 or Q2 or the other way around? 'Cause looking at the historical figures, it's a little difficult to tell about the seasonal patterns on your margin. Any guidance there would be much appreciated.
Yeah. Last year we moved our warehouse and that made us do less marketing. You should expect that we are going to be more normal in the marketing activities. The 29% is not something that we normally see in Q3 because it's not the best season for RevolutionRace. The demand for the products are not as high, so the organic kind of search part is a little less in this specific quarter. The margin, if I have to compare normally Q3 is one of the weakest EBIT. As you said, we have a great cost control, but if I have to talk about it in a high level, that is the answer you are going to get.
That's very good. That's very helpful. Thank you. A third question here relates to your Trustpilot score. I'm just curious here 'cause it was 3.9 here in this quarter, and I think it was 4.4 two quarters ago, and I think it declined also a bit in the last quarter. You mentioned here several times that you follow very closely what your customers are saying. Do you have any input on why the Trustpilot score is down, and if there's anything that worries you in any way?
No. Actually, it's not totally correct your reflection here, because last year we have even lower percent on Trustpilot. Many times when you come from a Black Week and Christmas sales, the customers are a little bit more about the lead time in other quarters. It's a normal kind of situation for the year. Also the Brexit part is a bit struggling because the customers in U.K. are not used to the Brexit situation in full yet. Also all the what do you call them? Last mile delivery partners, they are not there yet, either. That's that part is a struggling part that we are constantly working on.
We can see that is the most issue with negative comments that are below where we want to be. Also because of that we have less reviews on Trustpilot than resulted from this negative logistics problem through Brexit and the Black Week high season Christmas impact more. The 340,000 reviews impact within the quarter.
Okay. That sounds like a very temporary issue. Thanks for clarifying that. Just a final question from me as well regarding the U.S. When do you think you would be ready to make a full launch on your own using a 3PL warehouse? Then, what are your thoughts on advertising efforts to build brand awareness in the U.S. at the moment?
Now we are calibrating our offer on that specific market. That means that we are trying to figure out what products to invest in for the marketing part and also the region, the states. When it comes to the logistics part, it's the hardest part in this huge country where to put a warehouse. You shouldn't expect that in the near future from RevolutionRace, but we are going to use our own channels. We are making a soft launch, and that is according to plan, and we are going to increase the activity in the marketing part, but we are still collecting a lot of data.
Okay. Thank you. That's very clear. Thank you so much for taking my questions.
Thank you.
Thank you. Our next question comes from the line of Daniel Ovin from Nordea. Please go ahead. Your line is open.
Yes. Good morning, Pernilla and Jesper, and congratulations on a very well-executed quarter. I had a few questions here, and one question coming back to the freight costs and the supply constraints that you see. Given the lead times that we have, it's a bit harder to understand where to expect the peak, so to say. If you would compare now the last part of this financial year to what you see in Q2, for example, should we expect this pressure to get worse? Just trying to understand the delta here or are we already seeing that in Q2, basically, and we should expect more of the same in the last part of the financial year? That's my first question. Thank you.
I think we both need to answer this one, Jesper, but I can start. I think that we have the most of the goods in place, so the build out of the warehouse that impacts even more for the quarter that we have. With that said, it had some impact in the next coming quarter as well, but I don't expect that to change our gross margin. Do you have a different opinion here, Jesper?
No, I don't. Lead times, they are longer than a year ago. Our expectation is not that they are moving either upwards or downwards. This is our current situation, and hopefully we'll see a return to normal levels going forward, but it's not really in the crystal ball at the moment.
Yeah, we have one problem that I want to talk about a bit, and that is the running assortment is very healthy, and we don't have any problem here. When it comes to producing new products with longer lead time, that puts some pressure on when they are arriving. With that said, we, the total impact, net impact when it comes from the new products aren't that big, effect on the total net sales within every single quarter. As a total for this year, that is the most struggling part, for RevolutionRace to handle. The running assortments is good to go, and the new kind of products we see some, issues with, when it comes to delay.
Great. Okay. Perfect. Thank you. Then I have another question on the regions here, and I'm thinking a bit about the Nordic region. In Q2 here, you grew 12% year-over-year, but for the half year, you grew close to 30% year-over-year. I'm just wondering how to think about this going forward as it's a bit of a more mature region. Is there any one-offs perhaps in Q2, and is the 12% or is the 30% more representative of where you see growth here in the medium term?
First, you need to focus on the financial goal for RevolutionRace, and that is at least SEK 2 billion in net sales, the coming three years. That's one of the answer. We are growing more outside the Nordics because the Nordics are the most mature. When it's from the financial perspective, we are expecting that it's a little bit. We don't expect it to be that low as now because we have very tough comparison number, this specific quarter. I think somewhere in between for the region, between the 30%. Yeah, that's my expectation at least.
Okay. Perfect. That's very helpful. Just a last question, and that's also on Amazon here. Now I know that you have been working on increasing your sales in different countries on Amazon also. I think around the time of the IPO, you mentioned that you had about 5% of sales in Germany on Amazon. Could you perhaps give any indication of where that level is now and perhaps also where it is overall for the group? That's my final question.
Yeah. We have for the fiscal year, SEK 897 million. The impact of Amazon were 3% net sales. We are planning to increase net sales from 3%, but we are going to focus on our own channel. We think that it's a great place to be when you're building a brand store. The effect, you can see in this quarter that we have a massive growth on Amazon's platform, but we are still giving you great result both when it comes to revenue and EBIT margin. We are going to expect more than 3%, but we are also at the same time very focused on cost control and brand control.
Perfect. Okay. That's all my questions. Thank you very much.
Thank you. As we have no more questions registered, I hand back to our speakers.
Go, Pernilla.
Thank you so much for listening to us today. I'm excited to continue the journey with RevolutionRace. Please get in touch with us if you have any more question. We are available for you guys. Have a nice day. Thank you for listening. Thank you.
Thank you.