Boohoo reports record pre-Christmas trading after Karen Millen and Coast acquisitions

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The Boohoo Group has reported record trading in the last four months of its year, as it successfully added new brandsMissPap, Karen Millen and Coast to its multi-brand ecommerce platform.

The fast fashion retailer reported total revenue of £473.7m in the four months to December 31. That’s up by 44% on the same time last year. Sales were up across its markets, from the UK (+42% to £255.8m), rest of Europe (+57% to £69.6m) and USA (+57% to £110.6m) to the rest of the world (+13% to £37.7m). 

Sales of £1bn in the year so far, the 10 months to December 31, were also up by 44%. UK sales of £570.7m were up by 38% during the period, sales in the rest of Europe (+64% to £157.1m) and the US (+60% to £221.3m) were still further ahead. 

But the retailer said that gross margins were down by 70 base percentage points (bps) to 53.5% in a pre-Christmas market that was marked by heavy discounting. While revenue at boohoo came in at £232.6m over the four months (+42%), its gross margin was 52%, down by 20bps. Sales at PrettyLittleThing came in at £190.8m over the same period (+32%) but its margin was down by 130bps. That said, the retail group still expects full-year sales to grow ahead of expectations, by between 40% and 42%, and group earnings before tax and one-off items, to be up by between 10% and 10.2%, slightly ahead of earlier expectations. 

It also said that its two warehouses had delivered “excellent operational performance” over the four months. 

Boohoo chief executive John Lyttle said: “I am delighted to report the group has enjoyed record trading in the last four months of 2019. All of our brands have performed exceptionally well and delivered strong market share gains. We have continued to see operating leverage in our more established brands, and will continue to invest into them and our newly-acquired brands.

“The newly-acquired brands, Miss Pap, Karen Millen and Coast, are showing great promise and open different target markets for the group, in line with our strategy to build our multi-brand platform.”

Commenting on the figures, Richard Lim, chief executive of Retail Economics, said these were “exceptional” results, with sales growth supported by a “superior digital and marketing strategy”. 

“Despite the fierce competition and rising operating costs, the focus on own-brand has been key in delivering both sales growth and profit margins that are expected to come in ahead of expectations later this year,” he said. “The continued integration of Karen Millen will open up new target markets as the business continues to ruthlessly execute the ambitious multi-brand strategy that sets it apart from its competitors.”

Emily Salter, retail analyst at GlobalData, said the figures were evidence of the strength of Boohoo’s key brands. 

Salter said: “The group delivered a record performance across the Black Friday weekend, stating that trading was strong across the key brands and demonstrating that demand was not dampened by frequent discounts throughout the last few months of 2019. Boohoo.com in particular had an impressive Black Friday and festive period, with Q3 revenue growth accelerating significantly on last year, with year to date revenue growth of 38%, proving that despite the brand’s maturity it is still able to attract more shoppers and greater spend from existing customers, by promoting its low prices and niche sizing collections.

Boohoo.com is a Top100 retailer in IRUK Top500 research, while Karen Millen is Top50, PrettyLittleThing is Top150, and Coast is Top250. 

Image courtesy of Boohoo Group

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