Boohoo profits surge by 35% in 2020

Online fashion retailer Boohoo has reported a pre-tax profit increase of 35 per cent to £1.2 billion.

The company reaped the benefits from the international shift to online, largely prompted by the closure and restriction of in-store retail during the pandemic, which saw the number of active customers on its website increase by 28 per cent to 18 million.

While revenues jumped by 41 per cent to £1.7 billion, Boohoo expects the next financial year to be less successful.

It predicts revenue growth for the full year to February 2022 of 25 per cent, with newly-acquired brands expected to deliver approximately five per cent of this growth.

The retailer bought a number of UK brands across the year, including Debenhams, Dorothy Perkins, Wallis, and Burton.

Although the group described trading in the first few weeks of the financial year as “encouraging,” it expects the benefits seen from reduced returns over the last twelve months to “begin to unwind this year.”

“Whilst the group did see some benefits to demand in the last financial year due to lockdowns around the world, traditional core categories such as dresses and going out saw significant declines,” said Boohoo in its financial statement.

The company’s third distribution centre is on track for operational use by the end of the month.

A long-term lease has been agreed for a fourth distribution centre, which is expected to go live in the second quarter of the new financial year.

“Our established businesses have continued to grow across all territories as we gain market share with our compelling consumer proposition,” said John Lyttle, chief executive, Boohoo. “We completed over £250 million of acquisitions in the period, which included Oasis, Warehouse, Debenhams, Dorothy Perkins, Burton and Wallis, as well as the purchase of the remaining minority interest in PrettyLittleThing in a transaction that to date has resulted in substantial earnings enhancement for the group's shareholders.”

Lyttle added: “We have also invested in improving the oversight and transparency of our supply chain and we are committed to embedding positive change through our ambitious UP.FRONT sustainability strategy.”

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