Design Milk : Q4 Business Update and Appendix 4C

nal use only

Q4 FY22 Trading Update

@servomuto

only

Q4 FY22 Trading Highlights

9.65m f o l l o w e r s

A c r o s s I n s t a g r a m , T w i t t e r ,

P i n t e r e s t , F a c e b o o k a n d e m a i l

A$4 13 k

Q 4 F Y 2 2 D e s i g n M i l k

e C o m m e r c e g r o s s r e v e n u e 1

2 8 % C A G R o v e r t h e l a s t 2 y e a r s

A$7 49 k

Q 4 F Y 2 2 g r o s s r e v e n u e 1

2 0 % C A G R o v e r t h e l a s t 2 y e a r s

A$3 47 k

Q 4 F Y 2 2

a d v e r t i s i n g r e v e n u e

7 7 % C A G R o v e r t h e l a s t 2 y e a r s

use

Total transaction value

12%

Design Milk

Kaufmann Mercantile

88%

Gross revenue1

eCommerce

46%

Advertising

54%

@servomutonal

All figures in AUD. Based on USD/AUD conversion rate of 0.6889 per RBA website as at 30 June 2022
Note: 1. Represents gross sales revenue pre commission from sale of goods.	2

Sydney, Australia and Columbus, OH, USA

29 July 2022: Design Milk Co. Limited (ASX: DMC)

Jul-21

Jul-21

Mar-22

May-22

Jan-22

Mar-22

May-22

Jan-22

Sep-21

Sep-21

Nov-21

Nov-21

o n r a t e 2

Q4 FY22 Financial and Operational Performance

e C o m m e r c e t r a n s a c t i o n v a l u e ( A $ ' 0 0 0 s )

		Design Milk	Design Milk contributed to 88% of
1,200		Group TTV with AHAlife switched off
	Kaufmann Mercantile
	from 30 December 2021
1,000		AHALife

G r o s s r e v e n u e 1 ( A $ ' 0 0 0 s )

eCommerce revenue continued to be impacted by supply chain delays

1,500		eCommerce
		Advertising

only800

600

400

200

-

Q3FY20 Q4FY20 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22

1,000

500

-

Q3FY20 Q4FY20 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22

D e s i g n M i l k c o n v e r s i

L T M r o l l i n g a v e r a g e 3

D e s i g n M i l k a v e r a g e o r d e r v a l u e ( U S $ )

L T M r o l l i n g a v e r a g e 3

0.800%			126
0.750%			124
	The conversion rate for Design Milk	122
		Average order value for Design Milk
0.700%	store has steadily improved from 0.70%	120
use0.650%	to 0.77% on a LTM rolling average basis	Store has been maintained at
			US$120+ over the last 12 months
		118

All figures in AUD. Based on USD/AUD conversion rate of 0.74
Notes: 1. Represents gross sales revenue pre commission from sale of goods. 2. Represents total number of Design Milk store orders divided by online sessions; 3. Represents the average over the	3
l st 12 months for each month.	Sydney, Australia and Columbus, OH, USA
nal	29 July 2022: Design Milk Co. Limited (ASX: DMC)

Design Milk's Journey

•

Continued to

•

The team focussed

strategically focus

on producing high

Design Milk social media followers (millions)

on projects that

quality content,

support sustainable

discovering

•

The Design Milk

growth with an

amazing designers

Design Milk Shop Launch in Q2

operationally lean

and brands,

eCommerce

FY20 (Nov-19), complementing

platform remained

team of 15 (e.g.

growing our

•

Strongest

produce shop

community, and

the existing offering of our high

resilient despite

friendly video

significantly

quality editorial content

•

Genesis (car

quarterly sales

global supply

content, develop

improving our order

since acquisition

company) media

chain struggles,

high-quality editorial

management and

campaign

and launch of

inflationary

•

Equity raise of

content with

customer service

9.6

•

15th anniversary

•

500 vendor

Design Milk

pressures and

•

Announced

$2.45m

•

compressed

levels

for Design Milk

brands

Q1 FY22 revenue

softer retail

planned name

•

Q2 FY21 revenue

timeline)

9.4

•

50:1 share

•

Q4 FY21 revenue

of A$1.2m, up

trading conditions

•

Equity raise of

change from

of A$1.1m, up

consolidation

of A$1.1m, up

128% vs. LY

US$1m

•

Design Milk

AHAlife to

63% vs. LY

•

Q3 FY21 revenue

111% vs. LY

Design Milk

•

Recovery of

9.2

•

Launched

already

•

of A$706k, up

Upgrade of

advertising sales,

initiatives to

represents over

94% vs. LY

behind-the-scenes

following the

support brick &

50% of sales in

marketing,

decline due to

9.0

mortar stores and

Q4 since

onlydigital pop-up

launching in Q2

communication

COVID-19

store

•

New media sales

and data

8.8

•

apparatus

Over 200 vendor

opportunities

brands

(Design Milk TV

use8.0

on Instagram)

8.6

•

Secured US$220k

of COVID-19

stimulus funding

8.4

8.2

7.8

nal

Q3FY20

Q4FY20

Q1FY21

Q2FY21

Q3FY21

Q4FY21

Q1FY22

Q2FY22

Q3FY22

Q4FY22

4

Sydney, Australia and Columbus, OH, USA

29 July 2022: Design Milk Co. Limited (ASX: DMC)

onlyuse

@ateliernalareti

CEO Update

Dear Shareholders,

There is no escaping the challenges and economic pressure businesses face today. Positively, thanks to our

team's creativity and energy we have been able to limit the impact, with Q4 and FY22 total revenue closing

slightly down vs. LY, significantly stronger than many competitors and the industry in general.

We continue to produce high quality content, have increased our advertising revenue vs. LY, discovered amazing designers and brands, grown our community to nearly 9.7M followers, strengthened our operating procedures and significantly improved our order management and customer service levels.

Design Milk is at a key point in our growth trajectory. Since launching eCommerce we focused on building our vendor base, customer growth and conversion, and avoided unnecessary costs whilst we scale and build our

operating structure. Having established Design Milk's foundations, we continue to refine our strategic roadmap in line with profitable growth and increasing shareholder value.

As we look toward 2023, we are considering multiple opportunities including strategic partnerships in the B2B and B2C arena, our representation of larger categories / higher ticket products, the expansion of our advertising business into new categories and geographies, and the revival of pop-up retail / omni-channel revenue as design shows and events return.

The Board have committed to supporting and investing in the business as we navigate these opportunities.

I'd like to thank them, our shareholders, and my team as we develop these new channels of growth.

Robert Mancini,

CEO, Design Milk Co.

Sydney, Australia and Columbus, OH, USA

29 July 2022: Design Milk Co. Limited (ASX: DMC)