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Boohoo Group profits surge despite “most challenging time”

// Boohoo Group reports rise in profits despite its “most challenging time”
// Profit before tax for the group rose 51% year on year to £68.1m in the 6 months to August 31
// Adjusted EBITDA increased 48% to £89.8m during the period

Boohoo Group, which owns Boohoo, PrettyLittleThing, and Oasis and Warehouse among others, has reported a rise in profits despite a “challenging” time.

Profit before tax for the group rose 51 per cent year on year to £68.1 million in the six months to August 31, 2020.

Adjusted EBITDA rose 48 per cent to £89.8 million in the period, compared to the same six months in 2019.

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Revenues were up 45 per cent to £816.5 million, due to strong revenue growth across all geographies and brands.

International revenue increased by 55 per cent, while UK revenue was up by 37 per cent.

Boohoo Group now expects its revenue growth for the year to February 28 2021 to be between 28 per cent and 32 per cent, up from approximately 25 per cent as had previously been guided.

Adjusted EBITDA margin for the year is expected to be around 10 per cent, up from the 9.5 per cent that had previously been forecast.

The group closed the six-month period in 2020 with a net cash balance of £344.9 million, compared to £207.3 million in 2019.

Boohoo Group chief executive John Lyttle said: “Our business, along with many others, has faced some of its most challenging times in recent months: the onset of the pandemic meant we had to adapt our operations with nearly all office-based colleagues working from home; we introduced new ways of working safely in our distribution centres; and we have comprehensively investigated reports on concerning and unacceptable working practices in our Leicester supply chain.”

Boohoo Group’s results came after the company was embroiled in a controversy surrounding its Leicester supply chain – which supplied clothes to Boohoo – and was found to be paying its garment workers less than the minimum wage.

“Immediately after the media reports regarding Leicester garment factories that supply the group, we commissioned an independent review, headed by Alison Levitt QC, to investigate the allegations of low pay and the extent of the group’s knowledge of the allegations, to establish the group’s compliance with the law and to make recommendations for the future,” Lyttle said.

“We published that report on September 25 and we have established a programme to implement the recommendations of the report to make substantive, long-lasting and meaningful change that all stakeholders in the Boohoo Group will benefit from.

“We will keep shareholders updated on our progress. There are many challenges still ahead due to uncertainties posed by the Covid-19 pandemic, but despite these challenges there are many positives from our activities in the first half.

“The resilience of our business model and the commitment and flexibility of our colleagues and partners has enabled us to continue to operate our business successfully.

“We are grateful to all and pleased to be able to report a strong performance with continued high-growth rates in revenue and strong profitability.

“We also acquired two new well-known women’s brands, Oasis and Warehouse, and we acquired the remaining minority interest in PrettyLittleThing, all of which will support our continued growth and profitability.

“The group has continued to gain market share in all key markets and we remain optimistic about the group’s prospects with the belief that it is well-positioned to continue making progress towards leading the fashion ecommerce market globally.”

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The post Boohoo Group profits surge despite “most challenging time” appeared first on Retail Gazette.



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