Manchester-based online fashion firm Boohoo Group plc said its revenue fell 17% to £1.461 billion and its loss before tax widened to £159.9 million from £90.7 million in the year to February 29, 2024.
The group’s core brands are Boohoo, BoohooMAN, PrettyLittleThing, Karen Millen and Debenhams External Marketplace.
The group said the decline in revenue reflected its “increased focus on profitability and difficult market conditions” and the growth of its marketplace busines with its commission-only revenue model.
“Gross margin was 51.8%, up 120bps vs FY23, reflecting growth of marketplace, the impact of our cost savings programme and freight and raw material price decreases,” said the group.
Boohoo Group CEO 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 GMV 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.“
REACTION:
Guy Lawson-Johns, equity analyst, Hargreaves Lansdown: “Boohoo’s full-year results were a painful read for investors. Revenue declined at high double-digit rates across all regions, including an 18% in the US, which is seen as the group’s pathway to major growth.
“For now, it remains a struggling company with a tarnished reputation, reflected in the group’s valuation, which has come down significantly over the last few years.
“Executing its back-to-growth strategy hasn’t been easy.
“And, as part of the drive for profitability, Boohoo has heavily invested in expanding capacity abroad where there’s greater room for growth.
“International markets, especially the US, hold the key to the group’s future growth, but extensive investment has so far yielded weak results.
“And with customer KPIs continuing to trend in the wrong direction, it doesn’t look like a miraculous recovery is around the corner.”