Boohoo Group Posts Wider Pre-tax Loss For H1, Revenue Declines; Cuts Annual Guidance

Boohoo Group Plc (BOO.L), a British fashion retailer, on Tuesday reported a wider pre-tax loss for the first-half of 2023, amidst a decline in revenue reflecting a fall in demand. In addition, the company has revised down its full-year 2024 guidance.

For the six-month period to August 31, the retailer registered a pre-tax loss of 26.4 million pounds, compared with a loss of 15.2 million pounds, posted for the same period of previous year.

Excluding items, it reported pre-tax loss of 9.1 million pounds or 0.91 pence per share, versus previous year’s profit of 6.2 million pounds or 0.29 pence per share.

After tax, loss stood at 22.3 million pounds or 1.85 pence per share as against last year’s loss of 14.7 million pounds or 1.19 pence per share.

Operating loss was at 21.2 million pounds, compared with a loss of 11.8 million pounds a year ago.

Excluding items, EBITDA dropped to 31.3 million pounds from 35.5 million pounds in 2022.

Boohoo recorded an adjusted EBITDA margin of 4.3 percent for the first-half, up 30bps year-on-year reflecting improvements in gross margin, distribution cost efficiencies from automation, and overhead cost reduction.

Adjusted EBIT loss stood at 3.9 million pounds, versus last year’s profit of 9.6 million pounds.

Exceptional costs surged to 10.2 million pounds from last year’s 2.3 million pounds.

Revenue was 729.1 million pounds, down from 882.4 million pounds a year ago. A significant decline in revenues came from the company’s labels, following proactive actions taken to target more profitable sales. This accounted for an 8 percentage points of the Group’s revenue decline.

Looking ahead, for the 12-month period, in line with the company’s prior guidance, adjusted EBITDA margins are expected to be in the range of 4 percent to 4.5 percent given the strong progress made on gross margin and cost control.

Excluding items, Boohoo now projects EBITDA of 58 million pounds to 70 million pounds, lesser than its previous outlook of 69 million pounds to 78 million pounds, announced on May 16.

Citing the slower volume recovery than previously anticipated, the Group now expects its revenue to decline by 12 percent to 17 percent, for the year.

On May 16, the Group had projected its 2024 revenue to remain between flat and a decline of 5 percent from 2023. For full year 2023, the company had recorded revenue of 1.768 billion pounds.

For full year 2024, capital expenditure is now expected to be around 75 million pounds, lesser than its previous forecast of 80 million pounds to 90 million pounds.

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