Fashion retailer Boohoo has said it is “well positioned to return to growth” despite widening losses and a drop in revenue and profit.

Boohoo Man 2023

Boohoo said it took ‘significant steps’ to reposition the group for ‘sustainable, profitable growth’

In the full year to February 29, 2024, Boohoo saw revenue fall 17% year on year to £1.4bn, which it said reflected “difficult market conditions”.

The group also recorded a loss before tax of £159.9m, increasing from £90.7m year on year.

Gross profit dropped 16% to £756m, while adjusted EBITDA declined 7% to £58.6m.

UK revenues also fell 16% year on year to £921m, which the group said reflected the “impact of the macro environment on consumer demand” as well as price investments and “the increase of Debenhams marketplace within the sales mix”.

US revenues declined 18%, while the rest of Europe and the rest of the world saw revenues fall 20% and 30% respectively.

Active customer numbers fell 11% to 16 million over the year but Boohoo saw “strong growth” from the Debenhams marketplace, which improved its performance in the second half of the year.

Boohoo said it took “significant steps” to reposition the group for “sustainable, profitable growth” and it is confident of hitting its 6% to 8% medium-term EBITDA margin target.

It remains on track to deliver annualised cost savings of £125m across goods, supply chain and overheads in financial year 2025.

Boohoo chief executive John Lyttle said: “Despite difficult market conditions, caused by high levels of inflation and weakened consumer demand, we made continued progress in the year.

”I am particularly encouraged with the ongoing trend of improved performance in our core brands which saw gross merchandise value down 9% in H124 and down just 4% in H224 demonstrating increasing momentum and validating our strategy to focus on these brands which are much loved by our customer base.

“We continue to take actions to deliver on our goal of bringing the entire group back to profitable growth. In FY24, we completed our investment cycle with the launch of our US distribution centre and the successful delivery of our Sheffield automation project.

“Sheffield is already delivering significant efficiency improvements, which, together with the traction of Debenhams marketplace, is generating margin improvement across the group. We have also taken steps to transition several of our labels over onto Debenhams marketplace to drive enhanced profitability.

“This proved effective during the year and is something that will drive additional profitability going forward. These factors, combined with improving market conditions, give us strong confidence in our medium-term outlook.

“The group is now well positioned to return to growth, and we are focused on ensuring that growth is both sustainable and profitable.

“We will host a capital markets day in due course to provide more detail on our strategy, key growth drivers and the longer-term outlook for the group”.