Terminal X 2024 presentation slides: Record profitability as revenue grows 16%

Introduction & Market Context

Terminal X Online (TLV:TRX), Israel’s leading online fashion retailer, presented its 2024 year-end results on March 20, 2025, showcasing significant financial improvements and strategic progress. The company’s stock has responded positively, with shares trading at 475.7, up 4.25% following the presentation.

The company has successfully transitioned from its operational excellence phase (2021-2023) to a scale-up phase (2024-2025), focusing on leveraging its infrastructure and competitive advantages to drive continued growth and profitability.

Executive Summary

Terminal X reported impressive financial results for 2024, with revenue increasing 16.2% to 492 million shekels, while net profit reached 28 million shekels, a substantial improvement from breakeven results in 2023. The company’s adjusted EBITDA grew to 77 million shekels, up from 48 million in 2023.

As shown in the following comprehensive financial overview, the company improved across multiple metrics:

The fourth quarter of 2024 was particularly strong, with Terminal X achieving record results across all key financial indicators. Revenue grew 15% year-over-year to 157.5 million shekels, while net profit surged 669% to 11.2 million shekels compared to Q4 2023.

The following chart illustrates the company’s exceptional Q4 2024 performance:

Detailed Financial Analysis

Terminal X has demonstrated consistent revenue growth since its inception, with a compound annual growth rate (CAGR) of 106% until 2020, moderating to 13% in subsequent years as the company scaled. Revenue has grown steadily from 80 million shekels in 2019 to 492 million in 2024.

The revenue progression over the past six years is illustrated in this chart:

The company has significantly improved its operational efficiency, with operating profit margin expanding from just 0.6% in 2022 to 7.5% in 2024. This improvement was driven by a reduction in both variable costs (from 24% to 19% of revenue) and fixed costs (from 21% to 18% of revenue), while maintaining a consistent gross margin of approximately 25.5%.

Terminal X’s customer metrics have shown robust growth, with website visits increasing from 59.9 million in 2021 to 89.9 million in 2024. The average basket size grew from 327 shekels to 406 shekels during the same period, while registered customers more than doubled from 809,701 to 1,757,301.

The following chart details these key performance indicators:

The company operates through two business segments: Terminal X, its core online fashion platform, and Independent (LON:IOG) Brands, which includes Strongful, Seestarz, and Adah. Both segments have shown impressive growth, with the Independent Brands segment achieving a remarkable 240% CAGR from 2022 to 2024.

The following chart shows the revenue growth in both business segments:

Operating profit has improved dramatically in both segments, with Terminal X’s operating profit growing from 1,065 thousand shekels in 2022 to 30,347 thousand in 2024, while Independent Brands increased from 1,173 thousand to 6,678 thousand over the same period.

Cash flow from operations more than doubled to 98 million shekels in 2024, compared to 47 million in 2023. The company’s inventory management also improved significantly, with days of inventory decreasing from 226 in 2023 to 151 in 2024.

Strategic Initiatives

Terminal X outlined its strategic roadmap, which consists of three distinct phases:

Having successfully completed the market share acquisition phase (2018-2020) and the operational excellence phase (2021-2023), the company is now executing its scale-up strategy for 2024-2025. This phase focuses on leveraging the company’s infrastructure and competitive advantages to drive continued growth and significant profit improvement.

The company’s operational excellence has shown consistent improvement over recent quarters, with operating profit growing from a loss of 8.1 million shekels in Q3 2023 to a profit of 12.9 million in Q4 2024:

Terminal X has strengthened its market leadership position against competitors such as ASOS (LON:ASOS).COM, NEXT.CO.IL, SHEIN.COM, and DELTA.CO.IL, as illustrated in the following competitive analysis:

The company’s acquisition strategy focuses on identifying growing and profitable companies with synergistic activities, improving their operations using Terminal X’s infrastructure, and quickly realizing growth potential. This approach has been successfully demonstrated with acquisitions like Seestarz.

Forward-Looking Statements

Looking ahead, Terminal X aims to continue its market leadership while accelerating growth across both business segments. The company has indicated that continued growth could lead to profit margins of up to 25% as it scales further.

Management expects to expand into additional domains and categories, leveraging its established infrastructure and technology platform to support precise delivery, enhanced customer service, and advanced marketing capabilities.

With a strong cash position of 172 million shekels and robust cash flow generation, Terminal X appears well-positioned to fund its growth initiatives while continuing to return capital to shareholders, having declared 23 million shekels in dividends for 2024.

Full presentation:

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