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Boohoo reports jump in first-half sales and profit

Online fashion retail group Boohoo announced today that group revenue in the six months to 31 August 2018 increased by 50% to £395.3 million – with pre-tax profit up 22% to £24.7 million.

The fast-growing business, which runs Boohoo.com, Pretty Little Thing and Nasty Gal, raised group revenue guidance for the year to 28 February 2019 to 38% to 43%, up from previous estimates of 35% to 40%.

Boohoo’s synonymous website posted a 15% year-on-year increase in revenue to £209 million supported by 6.7 million active customers; Pretty Little Thing achieved a 132% jump in revenue to £168.6 million and four million active customers; and Nasty Gal experienced a 111% hike in revenue to £17.7 million backed by 0.6 million active customers.

An adjusted EBITDA margin between 9% and 10% is expected, and Boohoo used the half-year results announcement to reiterate medium-term guidance to deliver sales growth of at least 25% per annum and EBITDA margin of 10%.

Mahmud Kamani and Carol Kane, Boohoo’s joint CEOs, who recently announced they will take on more strategic board roles next year to make way for new CEO John Lyttle in March 2019, said the half-year results represented “record sales and profits”.

“All of our brands performed extremely well across all territories as we continue to gain market share,” they stated.

“We achieved market-leading growth in all markets, with the rest of Europe and the USA being particularly pleasing. Growth in the UK, our largest market, remains very strong.”

Kamani and Kane talked up the work done in relocating the Sheffield distribution centre for Pretty Little Thing, which they described as an important aspect of building a distribution network capable of generating £3 billion of net sales globally.

Supply chain investment is a big part of current activity for the group as a whole, with the retailer increasing the size of its main distribution hub in Lancashire to support its continued growth.

“Our extended distribution centre in Burnley, which will have a significant element of automation to drive efficiency savings, is scheduled for operational use in 2019,” the CEOs added.

Principal technology projects completed in the first half of the year included new payment solutions and more country returns portals, which Boohoo said allows it to refund customers immediately after the courier collects their parcel. 

Social logins have been introduced for UK customers, and projects now under way include the development of a new app with increased functionality and the aforementioned warehouse automation project, which is expected to drive significant efficiencies.


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