Profits fall by half at Bath based adult retailer

Profits at adult retailer Lovehoney have fallen by half as a result of the cost of living crisis.

The sexual wellbeing brand, which has its headquarters in Bath, said inflation and the squeeze on consumer spending led to a sharp drop off in sales in 2023.

As a result revenues fell to £101m from £121m in the previous 12 months.

Lovehoney also saw its pre-tax profit more than half to £12.7m, down from £29.6m in the 12 months before.

The company axed more than 60 staff during the period, bringing its average monthly headcount to 328 from 389 in 2022.

Richard Longhurst and Neal Slateford founded Lovehoney in 2002, identifying a gap in the market for a couple-friendly online shopping experience.

In a statement published to Companies House Lovehoney said: “The 2023 year continued to see a very challenging environment and consumer climate with increasing interest rates and high energy costs really impacting the consumer and thus reducing demand for our products.

“Within this environment the company focused on efficiency and profitability rather than trying to maintain the turnover.

“Gross profit was £37.7m and as a proportion of sales decreased slightly to 37 per cent; as the year developed the company managed costs, and in particular marketing, closely to ensure that it was delivering the right return and to maintain the financial return as best as could be.

“Non-exceptional administrative expenses were £23.6m compared to £24.7m in the prior year, as the company tightly control expenditure during a period of reduced demand.

“EBITDA decreased to £17.7m, compared to £24m in the prior year, in line with the reduction of sales.”