Q4 2022 – the quarter in brief

• Net revenue was SEK 387.2 (407.2) million, corresponding to a fall of -4.9% (3.4%)
• Gross profit was SEK 159.3 (176.7) million, corresponding to a gross margin of 41.1% (43.4%)
• Operating loss was SEK -1.8 (-3.2) million, corresponding to an operating margin of -0.5% (-0.8%)
• Net income was SEK -7.9 (-8.4) million, corresponding to earnings per share of SEK -0.44 (-0.47)

January-December 2022 – the period in brief

• Net revenue was SEK 1,299.0 (1,428.4) million, corresponding to a fall of -9.1% (2.5%)
• Gross profit was SEK 566.2 (638.7) million, corresponding to a gross margin of 43.6% (44.7%)
• Operating loss was SEK -56.1 (-38.6) million, corresponding to an operating margin of -4.3% (-2.7%)
• Net income was SEK -71.7 (-47.8) million, corresponding to earnings per share of SEK -3.98 (-2.65)

A challenging year
The fashion industry grappled with a challenging market in 2022, and the fourth quarter in particular was even more dominated by inflation, consumer anxiety and high pressure to reduce prices. During the period, we saw a continued decline in our total footfall, and our net revenue fell by 4.9% on the previous year. During the quarter, we decided to promote sales
by reducing prices to increase the movement of our autumn and winter stock, which also had a negative impact on our gross margin. To boost our working capital during this period of change, we have now decided to issue new shares and have announced this today.

Early positive signs following our changes
The extensive transformation work we began in 2022 is not complete, but we are already seeing early positive signs that it is having an effect, primarily in the form of lower operating costs in many areas. Our marketing costs fell during the fourth quarter as a result of the continuing greater focus on organic traffic and a lower proportion of paid traffic. We also achieved
further efficiency improvements in our logistics operations, primarily a considerable reduction in warehousing costs, and we reduced our employee benefit expenses after the reorganisation in the autumn. In both the third and fourth quarters, we also
saw an improved return rate. This was on account of a more favourable product mix in which we increasingly managed to add
attractive everyday wear to our customers’ party wardrobe. This will be an important component of our range strategy now, to boost buying frequency and consolidate our relationships with our customers.

Continued focus on building a profitable core business
We achieved great improvements in many areas of the company in 2022, returning above all to a clearer focus on our customers and our products. In 2023, we will continue to refine our customer offer and simplify all aspects of our operations
and organisation with a clear focus on costs. We can see that the conditions are now starting to fall into place for a return to profitability during the year by offering our customers an attractive range at the right price point with more appropriate,
sustainable expenses.

Helena Karlinder-Östlundh,
acting CEO of Nelly Group AB

Webcast of the year-end report
Analysts, investors and the media are invited to a webcast presentation of Q4 on 3 February at 10 a.m. The presentation will be held in English by Helena Karlinder-Östlundh, acting CEO, and Ola Wahlström, interim CFO. The webcast will be made available on the Nelly Group website.

Webcast:
https://nelly.videosync.fi/2023-02-03-q4

To listen to the Q4 report by phone, the following callin details are available:

• Finland: +358 9 4245 0972
• Sweden: +46 8 525 07003
• United Kingdom: +44 20 7043 5048
• United States: +1 (774) 450-9900

Conference ID (PIN): 100337#

The presentation material and the webcast will be available at:
www.nellygroup.com/en/investors/presentations/