Boohoo has posted a fall in sales and profits but is working on “improved profitability and getting back to growth” through investments across product, price and proposition.
The fashion group’s revenues plummeted 17% to £729.1m in the six months to August 31. It said that slower-than-expected recovery in sales volumes would see revenue for the year to end-February 2024 decline by 12%-17%.
Profit also plunged 16% to £398.2m.
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Despite the disappointing results, the group hailed ‘substantial progress’ it has made in the last six months, delivering key operational and strategic projects and an improvement in adjusted EBITDA margin.
However, revenues in core brands declined 10%, consistent with prior guidance, with more significant declines in its labels following the decision to target more profitable sales, which contributed to improved group profitability.
Boohoo Group chief executive John Lyttle said:” Over the first half we have made substantial progress across key projects and initiatives, including the launch of our US distribution centre. We have seen significant improvements in sourcing lead times and invested in pricing to reinforce our value credentials.”
“We have identified more than £125m of annualised cost savings that support our investment programme. Our confidence in the medium-term prospects for the Group remains unchanged as we execute on our key priorities where we see a clear path to improved profitability and getting back to growth.”
In July, credit insurer Allianz Trade slashed cover for Boohoo suppliers, which threatened to hit the online retailer’s cashflow.
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