EARNINGS RELEASE 2Q15 AND 1H15

Transcription

1 EARNINGS RELEASE AND 1H15 B2W DIGITAL ANNOUNCES CONSOLIDATED GMV GROWTH OF 24%, REACHING R$ 2.4 BILLION IN. IN 1H15, CONSOLIDATED GMV GREW 27%, REACHING R$ 4.9 BILLION. Rio de Janeiro, August 13 th, 2015 B2W Companhia Digital (BOVESPA: BTOW3), the leading e-commerce company in Latin America, announces today its results for the 2 nd quarter and 1 st half of 2015 ( and 1H15). The accounting information that serves as basis for the comments that follow are presented according to the international financial reporting standards (IFRS), to the rules issued by the Brazilian Securities Exchange Commission (CVM), to the Novo Mercado listing rules and in Reais (R$). The following analysis refer to the consolidated results and the comparisons refer to the 2 nd quarter and 1 st half of 2014 ( and 1H14), except where otherwise indicated. FINANCIAL AND OPERATIONAL HIGHLIGHTS Executive Summary and 1H15 Comparison to and 1H14 GMV (R$ MM) +24% 2,352 1,900 Marketplace Sales (R$ MM) +17x Gross Profit² and Gross Margin (R$ MM/%) 25.2% 25.1% % Adj. EBITDA³ / Adj. EBITDA Mg. (R$ MM / %) 7.4% 7.0% % Var. (%) Financial Highlights (R$ million) 1H15 1H14 Var. (%) 2, , % GMV¹ 4, , % 1, , % Net Revenue 4, , % % Gross Profit² % 25.2% 25.1% +0.1 p.p. Gross Margin² (%NR) 24.2% 24.6% -0.4 p.p % Adjusted EBITDA³ % 7.4% 7.0% +0.4 p.p. Adjusted EBITDA Margin³ (%NR) 6.7% 6.7% - (82.4) (64.6) 27.6% Net Result (132.8) (122.2) 8.7% Mobile devices in reached a participation of 32% in overall traffic and 18% in total orders placed 4 across B2W Digital s brands Traffic on B2W Digital s websites from mobile devices reached a participation of 32% (+15 p.p. vs. ) and accounted for 18% of total orders placed 4 in (+7 p.p. vs. ). Marketplace reached R$ 158 million in sales in, a growth of 17 times compared to With slightly more than one year of operation, Marketplace sales already totaled R$ million in, growing by 17 times in relation to, while reaching a participation of 7% in the Company s consolidated GMV. New partnerships within the Marketplace B2W Digital established Marketplace partnerships with Staples, Motorola, Emporio da Cerveja (Ambev), Mobly, Orange, Singer and MadeiraMadeira. As a result, B2W ended with more than 1,000 sellers on its platform and increased its product assortment by 8 times compared to. B2W Digital announced the acquisition of 5 companies belonging to the Sieve Group The Sieve Group is comprised of five companies: Sieve, Site Blindado, SkyHub, Admatic and Infoprice; collectively the Sieve Group has more than 2,500 clients and monitors over 8,000 websites. This acquisition aims to accelerate the Marketplace and provide the best services platform for online stores in Latin America, offering an even wider product assortment to B2W s customers. B2W Digital launches the online stores of Xiaomi, MotoMaker and NET B2W Digital was chosen to operate the Brazilian online store for Xiaomi, one of the largest cellphone manufacturers in the world. B2W also began operating Motorola s smartphone customization store, MotoMaker, as well as the online store for NET, Latin America s largest multi-service cable company. B2W Digital was the top recipient of the principal e-bit Awards, reinforcing B2W Digital s brands as the most beloved in Brazilian Internet B2W Digital won in 4 categories. Americanas.com was elected the Most Beloved Diamond Store and awarded as a Top 5 Diamond Store, while Submarino was elected the Best Diamond Store and was also recognized as a Top 5 Diamond Store. 1 - GMV (Gross Merchandise Volume) Gross sales of own merchandise, other revenue and sales in the marketplace platform after returns and including taxes. 2- Gross Profit and Gross Margin Excluding the consolidation effects of the transportation companies, according to explanatory note on page Adjusted EBITDA Operational earnings before interest, taxes, depreciation and amortization and excluding other operational revenues/expenses and equity accounting. 4 - Orders placed through mobile devices Share of the value of orders placed through mobile devices on Americanas.com, Submarino, Shoptime and SouBarato. 1 1

2 COMPANY STRUCTURE B2W Digital is the leading e-commerce company in Latin America. The Company operates through a digital platform, with businesses that present a strong synergy and a unique multi-channel, multi-brand and multibusiness model. B2W Digital has a portfolio consisting of the brands Americanas.com, Submarino, Shoptime, SouBarato, Digital Finance, Submarino Finance and Ingresso.com, which collectively offers more than 40 categories of own and third party products and services, through multiple distribution channels including the internet, telesales, catalogs, TV and kiosks. B2W Digital also operates the most comprehensive services platform for virtual stores in Latin America. The following chart presents an integrated vision of B2W: 2 2

3 MESSAGE FROM MANAGEMENT In the second quarter of 2015, B2W generated consolidated GMV of R$ 2.4 billion, representing a growth rate of 24% compared to, a period during which we grew by 38% (highlighted by the World Cup). With this result, for the 12 th consecutive quarter we successfully grew above the market, which increased by 4.5% during (according to the e-bit consultancy). This impressive result was achieved against the backdrop of a difficult macroeconomic scenario (inflationary pressure, elevated interest rates, lower discretionary consumption, among other effects) and a fiercely competitive environment. B2W Digital, during the course of the quarter, managed to balance the principal variables of the business, combining sales growth with gross margin expansion (+0.1 p.p.) and EBITDA margin expansion (+0.4 p.p.). The investments made by the Company over the past few years have enabled impressive growth in sales through mobile devices, which during the second quarter of 2015 already accounted for 32% of overall traffic and 18% of total orders placed. Another result of recent strategic investments was the rapid development of the Marketplace operation which, with just over one year of operation, already reached sales volume of R$ 158 million in, growing by 17 times in relation to and reaching a consolidated GMV participation of 7%. The growth of this operation is a reflection of the Company s initiatives to improve the customer shopping experience, which improved by 60% compared to the beginning of the year (according to customer surveys). Recently, we established important new partnerships with Staples, Motorola, Emporio da Cerveja (Ambev), Mobly, Orange, Singer and MadeiraMadeira, finishing the quarter with over 1,000 sellers on the platform and expanding the product assortment by 8 times as compared to. During the quarter we announced the acquisitions of five more companies (Sieve Group): Sieve (pricing intelligence online stores), Site Blindado (internet security and certification), SkyHub (integration of online stores to the Marketplace), AdMatic (digital marketing), and InfoPrice (pricing intelligence offline stores). Sieve Group collectively has more than 2,500 clients and monitors more than 8,000 sites, including the principal players in the market. The rationale for the acquisition includes accelerating the Marketplace and providing an improved services platform for online stores in Latin America, as a means to offer an even wider product assortment to B2W s customers. Another reflection of the recent strategic investments in the technology and logistics pillars is the selection of B2W to operate the online platforms for large and reputable brands. Recently, B2W Digital was chosen to exclusively operate the Brazilian online store of Xiaomi, one of the largest cellphone manufacturers in the world. B2W also began operating Motorola s smartphone customization store, MotoMaker, as well as the online store for NET, Latin America s largest multi-service cable company. Lastly, we highlight that B2W Digital was the top recipient of the principal e-bit awards, reinforcing the status of B2W s brands as the most beloved in Brazilian Internet. Americanas.com won the Loja Diamante mais Querida ( Most Beloved Diamond Store ) award and was recognized as Top 5 Lojas Diamante, while Submarino won the Melhor Loja Diamante ( Best Diamond Store ) award and was also recognized as Top 5 Lojas Diamante. So we would like to express our gratitude for the dedication of all our associates, who again made the difference and are part of the best and most successful digital team in Latin America. We also would like to thank our suppliers for their partnering, our shareholders for their confidence and, especially, to our customers for their preference. MANAGEMENT 3 3

4 OPERATIONAL PERFORMANCE COMMENTARY As a reward for the mobilization of the entire Company in the all-out effort to deliver Latin America s best digital experience, B2W Digital s service level indicators continue to progress, reflecting the extensive improvements in its operations and logistical processes which are the main pillars of sustainable growth. EVOLUTION OF CUSTOMER SERVICE RATINGS The four main brands of B2W Digital (Americanas.com, Submarino, Shoptime and SouBarato) exhibit the best performance in the website for customer service indicators (Reclame Aqui), being the only brands with the RA 1000 Seal, the highest reputation grade offered by the website. These achievements reflect the continuing progress of our operations, consolidating B2W Digital as the leader in customer service. 12 Months Reclame Aqui B2W DIGITAL Competitors #2 #3 #4 Competitors Average RA 1000 Seal 4 of 4 Brands 0 of 3 Brands 0 of 1 Brand 0 of 1 Brand 0 of 5 Brands Average Grade Would Buy Again 79% 53% 52% 70% 58% * Base Date: 08/05/2015 B2W DIGITAL ADDED TO THE CORPORATE SUSTAINABILITY INDEX 2015 PORTFOLIO (ISE) As a recognition of the commitment of the whole company in applying the best sustainability practices, B2W joined the select 2015 portfolio of the Corporate Sustainability Index (ISE) of BM&FBOVESPA, which reflects the Company's strong commitment to sustainable growth by observing the impact on dimensions: economic, social and environmental. PARTICIPATION OF MOBILE DEVICES IN TRAFFIC AND ORDERS PLACED In, the participation of mobile devices in overall traffic reached 32%, compared to 17% in, which represents an increase of 15 percentage points. In, the participation of mobile devices in orders placed reached 18%, compared to 11% in, which represents an increase of 7 percentage points. 32% 18% 17% 11% Traffic Orders Placed 4 4

5 GROSS MERCHANDISE VOLUME (GMV) In, consolidated GMV reached R$ 2,351.9 million compared to R$ 1,900.1 million in, a growth of 23.8%. In 1H15, consolidated GMV reached R$ 4,903.5 million compared to R$ 3,876.2 million in 1H14, a growth of 26.5%. 4,904 1,900 2,352 3,876 1H14 1H15 NET REVENUE In, consolidated net revenue reached R$ 1,890.0 million, compared to R$ 1,648.8 million in, representing a growth of 14.6%. In 1H15, consolidated net revenue reached R$ 4,027.8 million, compared to R$ 3,378.7 million in 1H14, representing a growth of 19.2%. 1,649 1,890 3,379 4,028 1H14 1H15 EFFECTS IN THE CONSOLIDATION OF B2W DIGITAL S TRANSPORTATION COMPANIES SUBSIDIARIES (100% PARTICIPATION) Click-Rodo and Direct (subsidiaries of B2W Digital) provide merchandise distribution services to the Company, generating an elimination effect in consolidated gross revenue and selling, general and administrative expenses (distribution expenses), according to the present accounting rules. The consolidated gross profit is reduced in an amount equal to the positive effect observed in the selling, general and administrative expenses, but with no effect on EBITDA and EBITDA Margin. As Click-Rodo and Direct continue to provide more services to the Company, this effect will become increasingly relevant. Gross Profit The gross profit presented in, without these consolidation effects, was R$ million or 25.2% of net revenue. In 1H15 gross profit, without these effects, was R$ million or 24.2% of net revenue. 5 5

6 Selling, general and administrative expenses Selling, general and administrative expenses presented in, without these consolidation effects, totaled R$ million or 17.8% of net revenue. In 1H15, selling, general and administrative expenses, without these effects, totaled R$ million or 17.5% of net revenue. Adjusted EBITDA Adjusted EBITDA remains unchanged in the amount of R$ million or 7.4% of net revenue in, and R$ million or 6.7% of net revenue in 1H15. GROSS PROFIT* AND GROSS MARGIN* In, consolidated gross profit reached R$ million, a growth of 15.1% in relation to the R$ million registered in. In this period, the consolidated gross margin was 25.2%, versus 25.1% in. In 1H15, consolidated gross profit reached R$ million, a growth of 17.1% in relation to the R$ million registered in 1H14. In this period, the consolidated gross margin was 24.2%, versus 24.6% in 1H % % % 24.2% H14 1H15 *Gross Profit and Gross Margin Excluding the consolidation effects of the transportation companies, according to explanatory note on page 5. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES* In, consolidated selling, general and administrative expenses totaled R$ million, representing 17.8% of net revenue, a decrease of 0.2 p.p. compared to. In 1H15, consolidated selling, general and administrative expenses totaled R$ million, representing 17.5% of net revenue, a decrease of 0.5 p.p. compared to 1H p.p p.p. 18.0% 17.8% 18.0% 17.5% 1H14 1H15 *Selling, general and administrative expenses Excluding the consolidation effects of the transportation companies, according to explanatory note on page 5. ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN In, consolidated adjusted EBITDA reached R$ million, a growth of 20.7% compared to R$ million in. In this period, the consolidated adjusted EBITDA margin was 7.4%, when calculated as a percentage of net revenue, an expansion of 0.4 percentage point. In 1H15, consolidated adjusted EBITDA reached R$ million, a growth of 18.9% compared to R$ million in 1H14. In this period, the consolidated adjusted EBITDA margin was 6.7%, when calculated as a percentage of net revenue, flat compared to the previous year. 6 6

7 7.0% % % 6.7% H14 1H15 Adjusted EBITDA (Earnings before interest, taxes, depreciation and amortization and excluding other operating revenues/expenses and equity accounting) is presented as additional information because we believe it represents an important indicator of our operating performance and is useful for maintaining comparability with previously reported results. EBITDA (CVM 527/12) On October 4th, 2012, Brazilian Securities Exchange Commission (CVM) enacted Instruction 527/12, which disposes about the voluntary disclosure of non accounting information such as EBITDA. The Instruction aims to standardize the disclosure, in order to improve the understanding of this information and make it comparable among publicly listed companies. To keep the consistency and the comparability between previous periods, we present the reconciliation of EBITDA in the following table. EBITDA Reconciliation - R$ MM % 1H15 1H14 % Gross Profit* % % (+) Selling Expenses* (306.8) (268.1) 14.4% (640.6) (556.6) 15.1% (+) General and Administrative Expenses (28.9) (29.2) -1.0% (66.2) (50.2) 31.9% (=) Adjusted EBITDA % % (+) Other Operating Income (Expenses)** (13.3) (11.2) 18.8% (17.0) (17.5) -2.9% (=) EBITDA (CVM 527/12) % % *Excluding the consolidation effects of the transportation companies,acording to page5. **In the old accounting rules, considered as "non operating income". Adjusted EBITDA: Operational earnings before interest, taxes, depreciation and amortization and excluding other operational revenues/expenses and equity accounting. EBITDA s (CVM 527/12) calculation takes into account the net income of the period plus income taxes, financial expenses net of financial revenues and depreciation and amortization. NET FINANCIAL RESULT In, consolidated net financial expense was R$ million, an increase of 10.6% in relation to consolidated net financial expense of R$ million presented in. In the same period, the average CDI* presented an increase of 21%. In 1H15, consolidated net financial expense was R$ million, an increase of 1.9% compared to consolidated net financial expense of R$ million in 1H14. In the same period, the average CDI* presented an increase of 19%. Net Financial Result - R$ Million Δ% 1H15 1H14 Δ% Net Financial Result (188.7) (170.6) 10.6% (342.9) (336.5) 1.9% 7 7

8 The Company continues to reaffirm its commitment to a conservative cash investment policy, demonstrated by the use of hedge instruments in foreign currencies, to offset potential exchange rate fluctuations, whether concerning financial liabilities or total cash position. These instruments offset the foreign exchange risk, transforming the cost of the debt to local currency and interest rates (as a percentage of CDI*). Similarly, it is worth mentioning that the Company s cash is invested with Brazil s largest financial institutions. *CDI - Certificado de Depósito Interbancário: average rate of borrowing in the interbank market. NET RESULT In, the consolidated net result was R$ million, compared to the R$ million obtained in. In 1H15, the consolidated net result was R$ million, compared to the R$ million obtained in 1H14. Reconciliation of the Net Result - R$ Million Δ% 1H15 1H14 Δ% Adjusted EBITDA % % (+) Depreciation / Amortization (62.3) (34.9) 78.5% (109.5) (61.8) 77.2% (+) Net Financial Result (188.7) (170.6) 10.6% (342.9) (336.5) 1.9% (+) Other Operating Income (Expenses)* (13.3) (11.2) 18.8% (17.0) (17.5) -2.9% (+) Income Tax and Social Contribution % % (=) Net Result (82.4) (64.6) 27.6% (132.8) (122.2) 8.7% * In the old accounting rules, considered as "non operating income". Adjusted EBITDA: Operational earnings before interest, taxes, depreciation and amortization and excluding other operational revenues/expenses and equity accounting. INDEBTEDNESS B2W uses its cash generation prioritizing investments that present optimal returns to shareholders. Thus, in 1H15 the consolidated investments in plant, property and equipment and intangibles (development of websites and systems) totaled R$ million. B2W s cash balance at 06/30/2015 amounted to R$ 1,737.1 million, more than three times the Company's sum of short-term debt and debentures, which totaled R$ million. At 06/30/2015, the Company s net debt was R$ million, representing 1.5x the accumulated Adjusted EBITDA in the last 12 months. In order to face the uncertainties and volatility of the financial market, B2W Digital is guided to preserve cash and lengthen its debt profile. Indebtedness - R$ MM 06/30/ /30/2014 Short Term Debt Short Term Debentures Short Term Indebtedness Long Term Debt 1, ,898.5 Long Term Debentures Long Term Indebtedness 2, ,297.0 Total Debt (1) 2, ,986.3 Cash and Equivalents 1, ,948.2 Credit Card Accounts Receivables Net of Discounts Total Cash (2) 1, ,626.7 Net Debt (Cash) (2) - (1) Net Debt (Cash) / Adjusted EBITDA LTM Average Maturity of Debt (days) Adjusted EBITDA: Operational earnings before interest, taxes, depreciation and amortization and excluding other operational revenues/expenses and equity accounting. 8 8

9 Accounts receivable is mainly composed of credit card receivables, net of the discounted value, which have immediate liquidity and can be considered as cash. The breakdown of B2W s accounts receivable is demonstrated in the table below: Accounts Receivable Conciliation - R$ MM 06/30/ /30/2014 Gross Credit-Cards Receivable 2, ,308.8 Receivable Discounts (1,695.8) (1,630.3) Credit Card Accounts Receivables Net of Discounts Present Value Adjustment (5.8) (8.2) Allowance for Doubtful Accounts (29.6) (31.5) Other Accounts Receivable Net Accounts Receivable For the purposes of calculating working capital, the consolidated gross credit cards receivables, excluding FIDC, at 06/30/2015 and 06/30/2014 were R$ 1,657.6 million and R$ 1,676.6 million, respectively. The days calculation of accounts receivable is over the accumulated GMV of the last twelve months. On June 11, 2013 the Board of Directors of the Company approved the expansion of the Receivables Investment Fund (FIDC) from R$ million, reaching approximately R$ 1.3 billion. The FIDC credit card model structured by the company is a unique tool on the market and represents an important source of funding. Because of the adoption of the new CPCs/IFRS, in particular the CPC 38 and its corresponding IAS 39, the Company began to write off (derecognize) receivables from credit card administrators at the moment they are effectively discounted (as of the explanatory notes of the financial statements). However, to better demonstrate the volume of receivables discounted on the base-dates analyzed, in the table above the Company presents the accounts receivable adjusted by the discounts made until the base-dates under analysis. NO FOREIGN CURRENCY EXPOSURE At 06/30/2015, B2W Digital s balance sheet included foreign currency denominated debt. Such debt, however, is FULLY PROTECTED against any foreign exchange fluctuations through derivative operations (swaps) that replace the foreign exchange risk with the variation in the basic Brazilian interest rate (CDI). SALES BY MEANS OF PAYMENT Sales evolution by means of payment can be seen in the following table: Means of Payment % 1H15 1H14 % Credit Card 66% 65% +1 p.p 61% 65% -4 p.p Other Means of Payment 34% 35% -1 p.p 39% 35% +4 p.p NET WORKING CAPITAL The consolidated net working capital at June 30, 2015 was 52 days. Relative to June 30, 2012, when we announced the Company s Investment Plan, net working capital improved by 57 days, compared to the position of 109 days registered at that time. This result reinforces the Company s efforts to manage the working capital variables and reinforces its commitment to maximizing shareholder value. 9 9

10 INVESTMENT AND INNOVATION We have adopted an investment plan for which the main objective is to enable growth and improvements in operations. In 1H15, B2W Digital invested R$ million, mainly concentrated in the areas of logistics, technology and innovation. Logistics and Distribution On June 14, 2014 it was announced the acquisition of Direct, the biggest and best e-commerce logistics operator in Brazil, specialized in deliveries of small items (packets). The Administrative Council for Economic Defense (CADE) approved the acquisition on July 8, In 2013, the Company had already acquired Click- Rodo, a logistics operator also specialized in deliveries for e-commerce, focusing on large items (outsized packages). With these two acquisitions, B2W has enhanced its level of logistics services, counting on the two major Brazilian Internet last mile carriers. Aiming to be closer to the customer and provide the best delivery service, in October 2014, B2W Digital opened 4 new Distribution Centers (DC): one in São Paulo, one in Pernambuco and the other two in Santa Catarina; and expanded the one in Rio de Janeiro. As a result, two smaller-capacity DCs, located in São Paulo and Pernambuco, were replaced. With these changes, B2W increased its total storage capacity by 50% and now has nine (9) distribution centers located in São Paulo (4), Rio de Janeiro (1), Minas Gerais (1), Pernambuco (1) and Santa Catarina (2). In line with the announced investment plan, at least 3 new DCs will be opened by the end of In addition, the Company established strategic alliances with the leading transportation companies of the country, ensuring the joint commitment to offer the best level of service to the customers. Technology and Innovation In line with the investment plan and the strategy to be a reference in the technology and internet market, B2W Digital has acquired, since 2013, nine best-in-class technology companies with various important specializations. As a result, the Company has tripled its technology/internet team, which is the largest in Latin America and nowadays has over 1,000 engineers. Below are the highlights of the acquired companies: Uniconsult: Optimization of orders control (shipping and reverse), of systems for managing multiple distribution centers and development of specific systems for marketplace operation; Ideais Tecnologia: Development and optimization of online sales platforms, B2B/B2B2C and mobile systems; Tarkena: Optimization of search systems and algorithms for shipping management; e-smart: Main developer of the Magento platform for e-commerce; Sieve: Specialized in website monitoring, intelligence and price management; Site Blindado: Specialized in certification and digital security services; SkyHub: Specialized in the integration of online and offline stores to the online Marketplace, as well as price comparison operations; Admatic: Specialized in digital marketing tools for the optimization and integration of virtual stores; Infoprice: Specialized in data collection in physical stores and pricing optimization. 10

11 OPERATIONAL HIGHLIGHTS B2W Digital, always seeking to strengthen its multi-business, multi-channel and multi-brand strategy, continues investing in a digital platform with businesses that present meaningful synergy. The Company has a portfolio with the most well-known and beloved brands in the Brazilian Internet. Americanas.com The largest Store. The lowest prices. Americanas.com (americanas.com) is the largest and most beloved online store in Latin America. The brand offers over a million products, distributed in 36 categories, which can be purchased through the website, telesales, apps or in more than 900 kiosks in brick and mortar stores, as well as products from other stores available in the Marketplace. In Americanas.com, clients find many deals and the best prices throughout the year. Submarino The products you like and the Internet's best service. Submarino (submarino.com.br) offers the latest in technology, entertainment, culture and innovation to its customers. The broad assortment of products is divided into 30 categories like electronics, computers, telephony, games, books, fashion, online services, among others. Submarino also has the exclusive areas coolstuff, where the most trendy and innovative products can be found, and wearable tech, where are the modern Internet connected devices that facilitate the daily lives of users. Shoptime Exclusive products and live demonstrations. Shoptime (shoptime.com.br) is the largest and most beloved Brazilian sales TV channel, and also operates on the Internet. With a specialized programming in product demonstrations, the channel joins the charisma of its presenters with the wide variety of categories to entertain, teach the use and sell the best products of the market. SouBarato SouBarato (soubarato.com.br) is the largest outlet in Latin America, which sells new products and also repacked in perfect conditions. The site, outlet of the brands Americanas.com, Submarino and Shoptime offers exclusive limited time offers, with prices below the market average. Submarino Finance Result of a joint venture with Cetelem, Submarino Finance offers the Submarino Mastercard Card, which offers special advantages in Submarino website, as exclusive discounts and installments, differentiated credit limit and a loyalty program, the Léguas Program. In 2014, we surpassed the number of 1.3 million cards issued and participation of 37% in sales of Submarino. Digital Finance To provide an even better shopping experience to the customer, B2W established a new partnership with Cetelem, part of the BNP Paribas Group, creating Digital Finance, focusing on the provision of credit cards and other financial services in Americanas.com and Shoptime websites, replicating the model successfully developed by Submarino Finance. Ingresso.com Brazilian leader in ticket sales over the Internet, Ingresso.com (ingresso.com.br) provides technology and ticket purchasing services for movies, theaters, concerts, soccer matches and cultural events. With over 5 million registered customers, the company offers the convenience of purchase tickets online, apps for iphone, Android, Facebook and telesales. 11

12 CORPORATE GOVERNANCE AND CAPITAL MARKETS B2W Digital is listed on BM&FBOVESPA and Novo Mercado, the listing segment with the highest corporate governance standards in Brazil. These include an ownership structure exclusively comprised of common shares and the election of independent members to the Board of Directors. B2W Digital s Board of Directors is comprised of seven members, four of whom appointed by the controlling shareholders and another three independent members. The requests to be registered as a publicly-traded Company and the listing of its shares under the Novo Mercado were approved by Brazilian Securities and Exchange Commission (CVM) and the BM&FBOVESPA on July 25 and 26, 2007, respectively. B2W s common shares are listed on BM&FBOVESPA and have been traded under the ticker symbol BTOW3 (common) since August 8, Below is a short description of the main events which occurred during the year: On April 30, 2015 the Company s General and Extraordinary Shareholders Meetings were held, at which the following resolutions were approved: 1- To take recognizance of the accounts prepared by the managers and related financial statements for the fiscal year ended December 31, 2014; 2- Reelection of the following members for the Company s Board of Directors: Celso Alves Ferreira Louro, Jorge Felipe Lemann, Miguel Gomes Pereira Sarmiento Gutierrez, Osmair Antônio Luminatti, Luiz Carlos Di Sessa Filippetti, Mauro Muratório Not and Paulo Antunes Veras to hold office until the 2017 General Shareholders Meeting; 3- Setting the global compensation to be paid to officers; 4- Fiscal Council installation and election of Messrs. Carlos Alberto de Souza, Pedro Carvalho de Mello and Peter Edward Cortes Marsden Wilson to the positions of full members and Messrs. Ricardo Scalzo, Luciano Mancini and André Pines to the positions of alternate members; 5- Inclusion in the social object of the Company of the programming of mass electronic communication by subscription, telesales or infomercial channel activities; 6- Amendment to the heading of Article 5 of the Company s Bylaws to reflect the capital increases approved by the Board of Directors on September 1, 2014, October 3, 2014, November 5, 2014, December 3, 2014 and January 7, 2015, through the exercise of options granted under the Company s Stock Option Plan, approved on August 31, 2011, and the approval of the increase in the Company s capital, approved by the Extraordinary Shareholders Meeting held on June 5, 2014, such approval having been ratified at the Board of Directors meeting held on August 13, The minutes of the shareholders meeting and the reelection aforementioned, as well as other corporate and financial information of B2W Digital are available for consultation on our Investor Relations website ( 12

13 EXHIBIT I INCOME STATEMENT EXCLUDING EFFECTS IN THE CONSOLIDATION OF B2W DIGITAL STRANSPORTATION COMPANIES SUBSIDIARIES (100% PARTICIPATION) B2W - Companhia Digital Income Statements Period ended on June 30 Period ended on June 30 (in million of Brazilian reais) Variation 1H15 1H14 Variation Gross Merchandise Volume (GMV) 2, , % 4, , % Gross Sales and Services Revenue 2, , % 4, , % Taxes on sales and services (304.0) (241.8) 25.7% (636.2) (486.0) 30.9% Net Sales and Services Revenue 1, , % 4, , % Cost of goods and services sold (1,414.2) (1,235.4) 14.5% (3,053.1) (2,546.6) 19.9% Gross Profit¹ % % Gross Margin (% NR) 25.2% 25.1% 0.1 p.p. 24.2% 24.6% -0.4 p.p. Operating Revenue (Expenses) (398.0) (332.2) 19.8% (816.3) (668.6) 22.1% Selling expenses (306.8) (268.1) 14.4% (640.6) (556.6) 15.1% General and administrative expenses (28.9) (29.2) -1.0% (66.2) (50.2) 31.9% Depreciation and amortization (62.3) (34.9) 78.5% (109.5) (61.8) 77.2% Operating Result before Net Financial Result and Equity Accounting % % Net Financial Result (188.7) (170.6) 10.6% (342.9) (336.5) 1.9% Financial revenues % % Financial expenses (251.2) (243.3) 3.2% (492.1) (499.2) -1.4% Other operating income (expenses)² (13.3) (11.2) 18.8% (17.0) (17.5) -2.9% Income tax and social contribution % % Net Result (82.4) (64.6) 27.6% (132.8) (122.2) 8.7% Net Margin (% NR) -4.4% -3.9% -0.5 p.p. -3.3% -3.6% 0.3 p.p. Adjusted EBITDA³ % % Adjusted EBITDA Margin (% NR) 7.4% 7.0% 0.4 p.p. 6.7% 6.7% 0.0 p.p. NOT EXCLUDING THE EFFECTS IN THE CONSOLIDATION OF B2W DIGITAL STRANSPORTATION COMPANIES SUBSIDIARIES (100% PARTICIPATION) B2W - Companhia Digital Income Statements Period ended on June 30 Period ended on June 30 (in million of Brazilian reais) Variation 1H15 1H14 Variation Gross Merchandise Volume (GMV) 2, , % 4, , % Gross Sales and Services Revenue 2, , % 4, , % Taxes on sales and services (304.0) (241.8) 25.7% (636.2) (486.0) 30.9% Net Sales and Services Revenue 1, , % 4, , % Cost of goods and services sold (1,522.0) (1,235.4) 23.2% (3,187.4) (2,546.6) 25.2% Gross Profit¹ % % Gross Margin (% NR) 19.5% 25.1% -5.6 p.p. 20.9% 24.6% -3.7 p.p. Operating Revenue (Expenses) (290.2) (332.2) -12.6% (682.0) (668.6) 2.0% Selling expenses (199.0) (268.1) -25.8% (506.3) (556.6) -9.0% General and administrative expenses (28.9) (29.2) -1.0% (66.2) (50.2) 31.9% Depreciation and amortization (62.3) (34.9) 78.5% (109.5) (61.8) 77.2% Operating Result before Net Financial Result and Equity Accounting % % Net Financial Result (188.7) (170.6) 10.6% (342.9) (336.5) 1.9% Financial revenues % % Financial expenses (251.2) (243.3) 3.2% (492.1) (499.2) -1.4% Other operating income (expenses)² (13.3) (11.2) 18.8% (17.0) (17.5) -2.9% Income tax and social contribution % % Net Result (82.4) (64.6) 27.6% (132.8) (122.2) 8.7% Net Margin (% NR) -4.4% -3.9% -0.5 p.p. -3.3% -3.6% 0.3 p.p. Adjusted EBITDA³ % % Adjusted EBITDA Margin (% NR) 7.4% 7.0% 0.4 p.p. 6.7% 6.7% 0.0 p.p. ¹ Gross Profit and Gross Margin: Refer to page 5 for explanatory note regarding the consolidation effect. ² In the former accounting rules, considered as "non-operating income". ³ Adjusted EBITDA: Operational earnings before interest, taxes, depreciation and amortization and excluding other operational revenues/expenses and equity accounting. 13

14 EXHIBIT II BALANCE SHEET B2W - Companhia Digital Balance Sheet (in million of Brazilian reais) ASSETS CURRENT ASSETS Cash and banks Marketable securities 1, ,658.1 Accounts receivable Inventories 1, Recoverable taxes Prepaid expenses and other accounts Total Current Assets 3, ,970.2 NON CURRENT ASSETS 06/30/ /30/2014 Deferred income tax and social contribution Recoverable taxes Escrow deposits and other receivables Plant, property and equipment Intangible assets 2, ,857.0 Total Non-Current Assets 4, ,929.2 TOTAL ASSETS 7, ,899.4 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Suppliers 1, ,472.7 Loans and financing Debentures Salaries and social contribution Taxes payable Deferred income tax and social contribution Other accounts payable Total Current Liabilities 2, ,315.0 NON-CURRENT LIABILITIES Long-term liabilities: Loans and financing 1, ,898.5 Debentures Related parties Provision for contingencies and other accounts payable Total Non-Current Liabilities 2, ,393.3 SHAREHOLDERS' EQUITY Capital 3, ,680.2 Capital reserves Equity valuation adjustment (0.2) (0.5) Accumulated income (losses) (670.9) (497.1) Total Shareholders' Equity 2, ,191.1 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 7, ,

15 EXHIBIT III CASH FLOW STATEMENT B2W - Companhia Digital Cash Flow Statement (in million of reais) Operating Activities 06/30/ /30/2014 Variation Net Result for the Period (132.8) (122.2) (10.6) Adjustment to the Net Result: Depreciation and amortization Deferred income tax and social contribution (84.9) (71.2) (13.7) Interest, monetary and currency changes Others (30.0) 20.3 (50.3) Adjusted Net Result (74.2) (96.4) 22.2 Change in Working Capital: Accounts receivable (20.6) Inventories (23.5) Suppliers (815.2) (420.8) (394.4) Change in Working Capital: (353.0) (253.4) (99.6) Change in Assets: Prepaid expenses (6.4) (0.2) (6.2) Escrow deposits Recoverable taxes (160.0) (32.5) (127.5) Other accounts receivable (current and non-current) 11.9 (30.4) 42.3 Change in Assets: (151.0) (62.7) (88.3) Change in Liabilities Salaries and social charges security Recoverable taxes (current and non-current) Other liabilities (current and non-current) 10.6 (81.6) 92.2 Change in Liabilities: 40.2 (72.3) Cash Flow from Operating Activities (538.0) (484.8) (53.2) Investing Activities Marketable securities (47.4) Purchases of property, plant and equipment assets (52.4) (64.6) 12.2 Intangible assets (251.4) (359.1) Value paid for the acquisition of subsidiaries (56.8) - (56.8) Cash Flow from Investing Activities (276.8) (292.5) 15.7 Financing Activities Funding Payments (178.2) (642.0) Discount of receivables (37.2) (143.2) Capital increase in cash ,481.2 (1,461.0) Capital reserves Cash Flow from Financing Activities (305.3) Change in cash balance (142.1) (342.7) Beginning Cash Balance Ending Cash Balance

16 INFORMATION ABOUT THE WEBCAST AND THE CONFERENCE CALL Conference calls with simultaneous translation into English, followed by a bilingual Q&A session will be held as followed: Adjusted EBITDA (Earnings before interest, taxes, depreciation and amortization and excluding other operating revenues/expenses and equity accounting) is presented as additional information because we believe it represents an important indicator of our operating performance and in order to maintain comparability with the results previously reported. EBITDA (CVM 527/12): On October 4th, 2012, Brazilian Securities Exchange Commission (CVM) enacted Instruction 527/12, which disposes about the voluntary disclosure of not of accounting information as EBITDA. The Instruction aims to standardize the disclosure, in order to improve the understanding of this information and making it comparable among the publicly listed companies. EBITDA s (CVM 527/12) calculation takes into account the net income of the period plus income taxes, net financial expenses of financial revenues and depreciation and amortization. We make forward-looking statements that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our management, and on information currently available to us. Forward-looking statements include statements regarding our intent, belief or current expectations or that of our directors or executive officers. Forward-looking statements also include information concerning our possible or assumed future results of operations, as well as statements preceded by, followed by, or that include the words ''believes,'' ''may,'' ''will,'' ''continues,'' ''expects,'' ''anticipates,'' ''intends,'' ''plans,'' ''estimates'' or similar expressions. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur. Our future results and shareholder values may differ materially from those expressed in or suggested by these forward-looking statements. Many of the factors that will determine these results and values are beyond B2W ability to control or predict. 16