Lovehoney has marked its 15th birthday by reporting a 76% rise in pre-tax profits following a year of strong sales at home and abroad.
The sex toy pureplay, a Top250 retailer in IRUK Top500 research, reported profits of £9m in the year to March 31 2017, up from £5.1m a year earlier, on sales of £76m – 31% up on the £58m it reported last year.
Lovehoney , based in Bath, partly puts its success down to its range of branded licensing deals, including collaborations with Fifty Shades of Grey author EL James, rock bands Motörhead and Mötley Crüe and a new collection developed with Comedy Central for the hit US TV show Broad City which has boosted its sales in that market. It also says that winning the Queen’s Award for Enterprise last year has helped it grow its brand overseas.
"It’s wonderful to be celebrating our 15th birthday with record sales and profits and the royal seal of approval,” said co-founder Neal Slateford (pictured right, with co-founder Richard Longhurst left). “We would like to thank the Queen for recognising our achievements – that royal recognition has really helped us to grow the brand overseas. Our online-only model gives us significant advantages over more traditional rivals and will allow us to keep prices and costs low in what is a tough period for all retailers.
“We feel the pleasure product category has been fully embraced by mainstream consumers in the last five years and whole new generation of couples are making adult toys a regular part of their sexual routine. That sea change in attitudes is reflected in our Queen’s Award and the success of branded lines with some of the world’s biggest rock bands, Fifty Shades and a TV show in Broad City which really speaks to Millennials.”
The UK remains Lovehoney’s largest market, with sales of £50m up by 16% on last time, but it also grew its turnover in Europe (£6.4m, +51%) and in the rest of the world, primarily US and Australia (£19.8m, +71%).
The company said its online-only model had contributed to keeping costs to a lower level than bricks-and-mortar rivals and helped it to remain price competitive in a tough retail environment.
Slateford said that sales had not been affected by the Brexit vote to leave the EU last June. He said: "Three-quarters of the trading year followed the Brexit vote and we have not found the political uncertainty has impacted on sales."
Turnover at Lovehoney five years ago was £16 million and the record growth since then has in part been driven by the ‘Fifty Shades effect’. Lovehoney is launching a new set of official products for the new Fifty Shades Freed movie which comes out around Valentine’s Day next year.