Impressive growth shows no sign of slowing down at online retailer

Revenues at Manchester online fashion firm Boohoo soared by 44% in the last four months of the year.

The PrettyLingThing brand was the best performing part of the business which was launched just over ten years ago.

Last year the company which was launched by the Kamani family had sales of £580m.

The retailer issued a trading statement this morning which covered the all important Christmas trading period.

Gross margin for the four months were 54.2% and the firm has a strong balance sheet with net cash of £189m compared with £127m last year.

Revenue for the Boohoo division was £163.5m, up 15% and year-to-date revenue £372.5m.

At subsidiary firm PrettyLittleThing revenues rose was £144.2m, an increase of 95%.

The Nasty Gal brand had revenues of £20.6m an increase of 74%.

Group revenue growth for the financial year to 28 February 2019 is expected to be 43% to 45%, ahead of our previous guidance of 38% to 43%.

The group expects adjusted EBITDA margins to be between 9.25% and 9.75%, narrowing the range from the 9% to 10% as previously guided.

Mahmud Kamani and Carol Kane, joint chief executives, said: “We are delighted to be reporting yet another great set of financial and operational results and would like to say a very big thank you to all our team and customers.

“We remain firmly focused on continuing to provide our customers with great fashion at unbeatable value.

“The global growth opportunity is significant and we will be addressing it in a controlled way – investing in our proposition, operations and infrastructure to capitalise on the opportunity.”

Russ Mould, investment director at AJ Bell, said: “The retail sector is alive and well if your name is BooHoo. The company has proven it is possible to keep growing sales and, importantly, push up profit margins.

“BooHoo is certainly among the winners of the latest round of retail updates with stellar growth rates and upgraded future earnings guidance.

“Of its brands, Boohoo and Nasty Gal’s revenue was below market expectations but PrettyLittleThing’s sales were considerably ahead of forecasts. The latter is important as PrettyLittleThing’s gross margins are higher than Boohoo’s.

“The result is overall group revenue beating market estimates by about 2%. While nobody is perfect in the world of retailing, you cannot deny that BooHoo seems to have the edge over its rivals.”

 

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