International growth boosts Boohoo profit
Boohoo revenue and profit soared in the first half of the year driven by strong international growth at the fast fashion brand.
The figures
Revenue soared 43 per cent from £395.3m in the first half of 2018 to £564.9m in the first six months of this year. The company’s revenue was more than £1bn over a 12-month period of the first time following its strong performance in the six months to the end of August.
Gross profit increased 40 per cent to £306.5m, from £218.6m last year and profit before tax was up 83 per cent to £45.2m.
Earnings before interest, tax, depreciation and amortization (Ebitda) were up 53 per cent from £39.6m to £60.7m.
Net cash increased from £155.6m last year to £207.4m in the first half of 2019.
Why it’s interesting
The online retailer said international sales now account for 44 per cent of group revenue, up from 41 per cent last year, after growing by 55 per cent in the first half of the year.
UK sales were up 35 per cent during the six month period.
Boohoo owns brands Pretty Little Thing and Nasty Gal, which saw revenue increase 41 per cent and 148 per cent respectively.
The retailer launched new apps in key markets for Boohoo, Boohoo Man and Nasty Gal in the first half, and introduced new payment methods which helped to increase order size and frequency.
Meanwhile, automation at the firm’s Burnley warehouse, which went live in April, has improved efficiency and helped the group handle its rapid expansion.
The company bought Miss Pap, Karen Millen and Coast earlier this year as it continues to expand. In today’s interim results the retailer said it expects Karen Millen and Coast to begin trading online next month.
Fidelity Personal Investing associate director Emma-Lou Montgomery said: “Having turned over more than £1bn worth of merchandise over the past 12 months, Boohoo is showing it’s the fashion group for its competitors to keep their eye on.
“It’s certainly one Sport’s Direct’s Mike Ashley might want to take a closer look at – not as another potential purchase for his flailing retail empire, but as an example of how to successfully acquire and integrate brands.”
What Boohoo said
Chief executive John Lyttle said: “It has been a fantastic first half of the year for the group. We have delivered significant market share gains across all of our key markets, and for the first time in our history, revenue has exceeded £1 billion in the last 12 months.
We have delivered strong growth and operating leverage in our more established brands and will continue to invest in both our more established and newly-acquired brands.
“We enter the second half of the year well-placed and confident that our platform, which combines the latest fashion, great prices and excellent customer service, all underpinned by a well-invested infrastructure, will deliver further market share gains.”