Boohoo sales soar as market share in UK and US doubles

// Boohoo reports a jump in sales in the first half of the year

// The retailer cited £26 million of freight and logistics cost inflation relating to Covid as a key factor in profits being down

Fast-fashion giant Boohoo has seen its profits and sales jump compared to pre-pandemic levels, as its market share in both the UK and the US doubled.

However profits were down on last year’s pandemic highs as increased operational costs slightly offset business gains.

The e-commerce giant announced this morning that revenue surged 20 per cent in the six months ending August 31, with sales jumping to £975.9 millioj from £816.5 million in the same period last year.

Despite this, profit before tax was down 5 per cent to £85.1 million, sliding from what the retailer described as its “exceptional levels” of profitability in the same period last year, when Ebitda stood at £89.8million.

Earnings per share also slumped 15 per cent to 3.84 pence from 4.53 pence last year.

Addressing the drop in profitability, the retailer cited £26 million of freight and logistics cost inflation relating to Covid during the first half of the year as a key impacting factor.

Other costs that held back profit included increased marketing investment in key markets to up to 500 million new customers, new acquisitions, the integration and relaunch of four new brands including Debenhams marketplace, and two warehouse operational moves to support an extra £4 billion of net sales.

Looking ahead, Boohoo said it expects full year sales growth of between 20 per cent to 25 per cent, implying sales growth of 20 per cent to 30 per cent in the second half of the financial year – much in line with the first half.

The retailer forecast its profit expectations for the full year down from previous estimates, to between 9 per cent and 9.5 per cent growth, down from 9.5 per cent to 10 per cent as previously guided.

It warned that the short-term cost headwinds that affected profit in the first half were likely to continue for the rest of the year, due to inflation in freight and supply chain costs, as well as “wage inflation” within its distribution centres.

Boohoo chief executive John Lyttle said: “In the first half of this financial year, our teams have yet again delivered: integrating four new brands, launching two new warehouses and strengthening our infrastructure in a manner that will allow our multi-brand platform to

“Entering the second half of the year, the Group is well-positioned to accelerate its growth and our confidence in the Group’s medium term targets remain unchanged.”

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