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Hut Group reports sales up by more than 50% following strategic move away from low-margin categories

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The Hut Group today unveiled sales up by more than 50% in the first half of its financial year following its move away from low margin business sectors including music and book sales.

Sales at the pureplay group, which now concentrates on higher-end markets such as health and beauty and sells through 15 brands including Lookfantastic, Zavvi and I Want One of Those rose by 54% to £66.2m in the six months to the end of June from £42.9m last time, the company said in a trading update. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose to £4m from £0.3m at the same time last year.

Today the company also said it had successfully integrated two new acquisitions of the last 18 months, Lookfantastic and Myprotein, for whom taekwondo Olympic gold medallist Jade Jones (pictured) is brand ambassador, into its supply chain and technology platform, resulting in “significant synergy benefits”.

Chief executive Matthew Moulding said: “The group is positioned as market leader in a number of differentiated and high growth sectors with significant barriers to entry.

“The combination of our market positioning and constant advances in customer insight through data analytics is driving both customer and revenue growth. The group’s gross margin progression is very pleasing.”

Angus Monro, chairman, said: “Management has successfully integrated two large acquisitions in the past 18 months whilst at the same time delivering substantial organic sales and earnings growth. The strong trading performance of the business is testament to the calibre of the management team and the strength of the business model.”

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