In July, following a comprehensive selection process that considered both internal and external candidates, the Board appointed Antoine Jouteau to succeed Rolv Erik Ryssdal as CEO. Antoine has a deep understanding of the global marketplaces industry and a clear track record of successfully building and scaling local brands. He was a key figure in developing leboncoin into one of the most visited websites in France, with over 27 million monthly users¹, and he has played an instrumental role in growing LBC to the business it is today. Antoine has a proven ability to lead, innovate and execute during a period of rapid consumer change, industry disruption and technological advancement. The Board therefore believes Antoine’s appointment as CEO comes at exactly the right time for the Group as it embarks on the next phase of its Growing at Scale strategy, which seeks to build on Adevinta’s leadership and unlock its full potential.
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The Board was fully aligned in its evaluation of the qualities and experience that the successful CEO candidate would need. The final decision to appoint Antoine was therefore unanimous and the Board successfully orchestrated a smooth transition. Under Rolv Erik’s leadership, Adevinta became the world’s leading classifieds business, successfully spinning off Adevinta from Schibsted and leading the acquisition of eBay Classifieds Group (eCG). The Board expresses its warm gratitude for his years of dedicated service and visionary leadership and wishes him well for the future.

¹ Mediamétrie

We continued to do the groundwork in 2022 that will support our aim to set and meet ambitious sustainability targets in coming years. We completed our initial high-level strategy at the end of 2021 and appointed a Head of Sustainability in the first half of the year under review. Adevinta is building a team that is creating core sustainability processes and capabilities. Adevinta is at the heart of the second-hand economy and we have become an important European circular economy contributor. As we develop new transactional capabilities that connect buyers and sellers, we are facilitating more and more trade in second-hand goods.

By making it easier for people to reuse things, we are helping our users trade differently at a time when consumers are seeking more sustainable and cost-efficient ways to buy products.At the end of 2022, Adevinta was recognised for the second consecutive year as a sustainability leader in the Dow Jones Sustainability Index (DJSI) Europe, making us one of only six companies listed in the Media & Entertainment industry group.

The DJSI recognised that the Group had advanced in 2022 in the areas of business ethics, risk management, cybersecurity processes and infrastructure as well as indirect greenhouse gas emissions reporting.

The Group has made solid progress in simplifying its operations geographically and from an organisational perspective. Having successfully exited some markets as planned, it is largely focused on five core European markets with an experienced management team that can continue to execute our Growing at Scale strategy. We have built our position as a European technology champion and the nature of our business gives us strong roots in many local communities.

The Board is confident that with the leadership, drive and energy of Adevinta’s CEO, we will continue to help develop the circular economy. We are extremely well placed to deliver the innovation required to facilitate the continued rapid growth in online trade in second-hand goods and the Group recognises the enormous scale of this opportunity.

While the continuing conflict in Ukraine, high inflation, high interest rates and lower consumer confidence all make for a challenging macroeconomic environment, the Group has shown clear resilience. This resilience is something that sets us apart from a number of other technology-led companies.

Adevinta is streamlining its operations, successfully integrating the 2021 acquisition of eCG,
and delivering a simplified organisation around key verticals. These initiatives will allow the Group to pursue major opportunities in developing cutting-edge online marketplaces for second-hand goods, all on a foundation of rich supporting transactional services that allow consumers to complete sales and purchases online. There has been excellent progress in building these transactional capabilities. For example, in mobile.de, we now facilitate the purchase of a used car completely online, supporting both buyers and sellers. We will continue to expand these transactional capabilities across the Group in order to improve the user experience, which in turn will leverage additional revenue opportunities.

There is significant underlying potential at Adevinta and our CEO has taken the reins at a time when his strong track record on execution will serve the Group’s needs exceptionally well. Adevinta is moving into an exciting new era where it can reap the benefits of the far-reaching improvements it is making across the business. The Group’s evolving strategy provides a robust platform for achieving its ambitions and the Board is confident that all the solid work in strengthening the foundations and capabilities of Adevinta will deliver long-term growth and profitability.

Consolidated revenues in 2022 amounted to €1,644 million compared to €1,139 million in 2021, an increase of 44%, mainly due to the eCG acquisition. Barring the impact of the acquisition, revenues increased compared to 2021, demonstrating the resilience of our marketplaces, despite the continued supply softness in the Mobility segment and the weaker market environment.

Consolidated EBITDA amounted to €548 million (compared to €356 million in 2021), an increase of 54% compared to 2021, mainly due to the eCG acquisition (see the section on each business area for more detail).

Depreciation and amortisation amounted to €(300) million (compared to €(156) million in 2021), mainly driven by the eCG acquisition but also due to the reassessment of useful lives of certain trademarks.

Share of profit of joint ventures and associates decreased from €(8) million in 2021 to €(121) million in 2022, mainly driven by lower results in Brazil due to an impairment loss amounting to €(80) million, mostly attributable to revised growth trajectory of the business accompanied by increased market interest rates affecting the WACC applied for the impairment assessment, and a decrease in deferred tax assets amounting to €(16) million after reassessing their recoverability.

Impairment loss in 2022 was €(1,722) million (€(22) million in 2021) and was mainly attributable to Canada (€(802) million), eBay Kleinanzeigen (€(489) million), mobile.de (€(411) million) and Hungary (€(17) million) with the loss being distributed to goodwill (€(1,492) million) and other intangible assets (€(228) million). Adevinta acquired the businesses in Canada, eBay Kleinanzeigen and mobile.de as part of the eCG acquisition in June 2021, where 80% of the purchase amount was paid in Adevinta shares with the share price increasing 48% from the signing to the closing date of the transaction (share price was NOK 170 at closing), which significantly increased the goodwill attributable to the businesses.

The macroeconomic uncertainties and increasing inflation during 2022 triggered a significant increase in market interest rates and equity risk premiums. This significantly increased the weighted average cost of capital (WACC) that Adevinta uses for discounting cash flows when estimating the recoverable amounts of its cash-generating units (CGUs), which has resulted in the impairment loss for Canada, eBay Kleinanzeigen and mobile.de. In eBay Kleinanzeigen and mobile.de the impact of the WACC was partly offset by better mid-to-long-term business performance, while for Hungary and Canada there was a negative impact considering the revised growth trajectory of the businesses.

In 2022, the Group’s other income and expenses amounted to €(112) million (€(140) million in 2021). This is primarily due to integration-related costs, mainly arising from the acquisition of eCG, the Digital Services Tax (DST) in France for the period 2019 to 2021 and a restructuring provision recognised due to reorganisation in France. Operating profit in 2022 amounted to €(1,707) million (€29 million in 2021).

The carrying amount of the Group’s assets decreased by €(2,262) million to €11,984 million during 2022, mainly due to the impairment of goodwill and other intangible assets (€(1,722) million), the depreciation and amortisation (€(300) million), the decrease in cash and cash equivalents (€(161) million), the sale of the assets that were presented as held for sale as of 31 December 2021 (€(115) million), the decrease in deferred tax assets (€(149) million) and the share of profit (loss) of joint ventures and associates (€(121) million). These were partially offset by CAPEX (€89 million), the increase in receivables related to the sales of subsidiaries (€60 million) and by the exchange gain in the period driven by the appreciation of the exchange rate of the BRL against the EUR, increasing both the investments in joint ventures and associates (€39 million) and the value in EUR of the loan in BRL (increase of €20 million) granted by Adevinta Finance AS to Bom Negócio Atividades de Internet Ltda (OLX Brazil joint venture). Also contributing was the interest accrued in relation to this loan (€24 million) as well as the increase in fair value of the crosscurrency interest rate swap contracts due to USD appreciation versus EUR (€49 million).

The carrying amount of the Group’s liabilities decreased by €(425) million to €3,436 million during 2022, mainly due to the repayment of the multicurrency revolving facility (€(150) million) and the repayment of the EUR Term Loan B (€(165) million) as well as a decrease in deferred tax liabilities (€(140) million), mainly due to amortisation of intangible assets and impairment of intangible assets, that was partly offset by the increase in the USD TLB due to the exchange rate of the USD against the EUR (€27 million).

The Group’s equity ratio was 71% as at 31 December 2022, compared to 73% as at 31 December 2021.

The Group had at 31 December 2022 net interest-bearing debt of €2,199 million and €520 million total liquidity available. Management considers Adevinta’s liquidity and refinancing risk to be acceptable considering the cash generation projections as well as the cash conversion rate of the business.

Net cash flow from operating activities was €352 million for the year, compared to €193 million in 2021. The increase is primarily related to the increase in gross operating profit as well as a decrease in tax payments being partially compensated by a negative impact from DST payments in France amounting to €(33) million, including €(22) million in respect of DST for prior years, and increased integration and interest expenses. Net cash flow from investing activities was €(92) million for the year, compared to €(1,983) million in 2021. Although in 2022 the investment in development and purchase of intangible assets and property, plant and equipment in other shares has increased compared to 2021, the decrease in cash outflow is mainly due to the cash consideration paid for the eCG acquisition (net of cash acquired) partly offset by proceeds received from disposal of subsidiaries (net of cash sold) in 2021 being much higher. Net cash flow from financing activities was €(429) million for the year, compared to €1,898 million in 2021. The decrease is primarily related to the repayments of interest-bearing loans and borrowings during 2022, whereas in 2021 there was an increase due to the cash received from the new financing obtained in 2021 related to the eCG acquisition. Other movements were the acquisition of treasury shares to meet the long-term incentive obligations for 2022 and 2021 (10,000,000 and 1,700,000 treasury shares respectively).