"Leading the fashion eCommerce market"
6 months to 31 August 2020
6 months to 31 August 2019
% of revenue
% of revenue
Adjusted profit before tax(3)
Profit before tax
Adjusted diluted earnings per share(4)
Diluted earnings per share (2019 restated(5))
Net cash(6) at period end
· Revenue £816.5 million, up 45% (44% CER(7))
· Strong revenue growth across all geographies and brands (UK: +37%; international: +55%, including US +83%). International now 47% of group revenue (2019: 44%)
· New customer acquisition in Q1 driven by pandemic's impact on consumer behaviour
· Healthy customer KPIs with a continued improvement in share of wallet
· Acquisition of the remaining 34% minority shareholding in PrettyLittleThing
· Acquisition and integration of the Oasis and Warehouse brands, complementary additions to the group's scalable, multi-brand platform
· Robust balance sheet with net cash of £344.9 million (2019: £207.3 million), healthy operating cash flow of £147.2 million (2019: £55.9 million) and net cash flow of £99.5 million (2019: £15.5 million)
· Non-participation in UK Government's financial support schemes to support jobs and businesses
· Successful £198 million share placing to support future acquisitions
· Independent Review ("Independent Review") of working conditions of supply chain in Leicester published. All recommendations accepted, improvements in supply chain governance to be robustly implemented in full
Guidance and current trading
Group revenue growth for the year to 28 February 2021 is expected to be 28% to 32%, up from approximately 25% as previously guided, with adjusted EBITDA margin for the year at around 10%, increased from the 9.5% to 10% as previously guided. The group has made a good start to the second half of the year, with momentum continuing into September. At this stage we feel it is prudent to continue to plan for a period of economic uncertainty in the second half of the financial year, including possible reduced consumer spending. It is also prudent to plan for return rates returning to normal levels, continued near-term carriage inflation in some of our overseas markets and increased marketing spend likely in the second half. Capital expenditure is expected to be higher than previously anticipated, in the region of £80 million to £100 million, reflecting the step-up of investments into automation at our Sheffield facility, further expansion of existing automation at the Burnley facility and significant IT projects to support the growth of the business and improve efficiency.
Our medium term guidance for 25% sales growth per annum and a 10% adjusted EBITDA margin remains unchanged.
John Lyttle CEO, commented:
"Our business, along with many others, has faced some of its most challenging times in recent months: the onset of the pandemic meant we had to adapt our operations with nearly all office-based colleagues working from home; we introduced new ways of working safely in our distribution centres; and we have comprehensively investigated reports on concerning and unacceptable working practices in our Leicester supply chain.
Immediately after the media reports regarding Leicester garment factories that supply the group, we commissioned an Independent Review, headed by Alison Levitt QC, to investigate the allegations of low pay and the extent of the group's knowledge of the allegations, to establish the group's compliance with the law and to make recommendations for the future. We published that report on 25 September and we have established a programme to implement the recommendations of the report to make substantive, long-lasting and meaningful change that all stakeholders in the boohoo group will benefit from. We will keep shareholders updated on our progress.
There are many challenges still ahead due to uncertainties posed by the COVID-19 pandemic, but despite these challenges there are many positives from our activities in the first half. The resilience of our business model and the commitment and flexibility of our colleagues and partners has enabled us to continue to operate our business successfully. We are grateful to all and pleased to be able to report a strong performance with continued high growth rates in revenue and strong profitability. We also acquired two new well-known women's brands, Oasis and Warehouse, and we acquired the remaining minority interest in PrettyLittleThing, all of which will support our continued growth and profitability. The group has continued to gain market share in all key markets and we remain optimistic about the group's prospects with the belief that it is well-positioned to continue making progress towards leading the fashion e-commerce market globally."