Boohoo sales and profits soar in first half

The fast-fashion giant reported that for the six months to August 31 sales increased 45% to £817m, while gross profits surged 47% to £449m.

Adjusted EBITDA for the period grew 48% to £90m, while profit before tax jumped 51% to £68m. 

This left the retailer in a net cash position for the period of £345m, a £138m increase. 

Off the back of these strong results, Boohoo said its expected revenue growth for the full financial year was now between 28% and 32%, up from approximately 25%. 

It also said that expected adjusted EBITDA would be “at around” 10%, up from 9.5% as previously guided. 

Boohoo reported that sales grew across “geographies and brands”, with UK revenues up 37%, international sales growing 55% and the US surging 83%. As a result, international sales now account for 47% of total revenues. 

During the period, the retailer completed the acquisition of the Oasis and Warehouse brands, as well as buying out the remaining 34% stake in PrettyLittleThing. 

During the period Boohoo was caught in a media storm around allegations of modern-day slavery and unsafe working environments at its Leicester factories. Despite happening in June, these seem to have done little to affect sales. 

The retailer launched its own independent enquiry into working practices in the city, published last week, which uncovered “many failings” in its work with garment manufacturers in Leicester.

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.

“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.

“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.”