Sales at online fashion retailer Boohoosurpassed £1billion over the past 12 months as the company continued to defy the retail sector gloom with an ‘outstanding’ performance.
The Manchester-based fast fashion company posted another set of stellar results and boss John Lyttle said Boohoo was entering the second half of the year ‘well placed and confident’.
Sales rose 43 per cent to £564.9million in the six months to the end of August, helping full-year revenues top the £1billion mark, while pre-tax profits surged by 83 per cent to £45.2million.
However, forecasts were left unchanged, after Boohoo upgraded its full year sales growth guidance earlier this month to between 33 per cent and 38 per cent, versus previous guidance of 25 per cent to 30 per cent.
Boohoo shares, which fell in early trading, later rose by 0.5 per cent to 267p. They have risen by more than 40 per cent over the past year, which has seen Boohoo overtake its older rival Asos in terms of market value.
Lyttle said it had been a ‘fantastic’ first half of the year for the group.
‘We have delivered significant market share gains across all of our key markets, and for the first time in our history, revenue has exceeded £1billion in the last 12 months.’
Boohoo’s rapid growth stands in stark contrast to that of its high street fashion counterparts, many of whom are struggling amid falling footfall in some shopping destinations and rising costs.
The company, a sponsor of hit TV show Love Island, is a hit with younger shoppers.
Julie Palmer, partner at Begbies Traynor, said Boohoo’s success was down to its ‘flexible model’ allowing it to adjust and adapt to the rapidly changing current in retail.
‘The business is flourishing as it takes full advantage of the online market and capitalises on the ways in which Generation Z operate, utilising social media channels to focus on those who shop on their devices and partnering with major online influencers to reach its younger target audience.
‘By maintaining a purely digital space, Boohoo has been able to expand at a rapid pace with fewer overheads to act as a barrier.’
Boohoo’s other online brands – PrettyLittleThing and Nasty Gal – continue to see strong growth, with sales rising by 41 per cent at PrettyLittleThing and 148 per cent at Nasty Gal.
Sales for MissPap, which Boohoo acquired earlier this year, were not stated, but the online retailer said it was ‘starting to grow rapidly’ since its launch on the brand’s platform in April.
Boohoo also said that Karen Millen and Coast, which it acquired in August, will begin trading online next month on 1 October.
Its acquisition of the brands has been watched with interest, given their current High Street focus and older clientele.
Emily Salter, a retail analyst at GlobalData, said the risks of these two acquisitions were to devalue the brands, as ‘Coast and Karen Millen rely on high quality product and sophisticated designs’, in contrast to Boohoo’s ‘dependence on repeated discounts and huge product ranges’.
‘Boohoo must protect their positioning as premium brands, which will require investment in product quality and fit, but this is integral for the acquisition’s success,’ she added.
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