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Boohoo ups full-year sales forecast again as revenues double
Fast fashion brand Boohoo.com bumped up its full-year sales forecast again on Thursday as it said revenues doubled in the four months to the end of December.
The company said revenue growth for this financial year is now expected to be around 90%, up from its previous guidance of 80%, which was raised from 60% at the interim results in September. It now sees group adjusted earnings before interest, tax, depreciation and amortisation margins between 9.25% and 9.75%, narrowing the range from the 9% to 10% guided at the interims.
In the four months to 31 December, group revenue rose 100% to £228.2m, with Boohoo revenue up 25% to £142.6m and PrettyLittleThing sales up 191% to £73.8m.
Joint chief executives Mahmud Kamani and Carol Kane said: "We are delighted to report another set of strong financial and operational results, with record sales in the four months to December across all our brands. The Black Friday period was our most successful ever and we traded well throughout the period under review.
"Boohoo has continued to perform well, delivering strong revenue growth on increasingly challenging comparatives last year. PrettyLittleThing has continued to deliver exceptional results and Nasty Gal is making excellent progress in its first year. Our focus remains on the customer proposition: offering the best range of the latest fashion at affordable prices, coupled with great customer service."
RBC Capital Markets said it remains cautious on Boohoo's mid-term margin outlook.
"While our EBITDA forecast for FY18e is broadly in line with consensus, we see greater risk to FY19-20e earnings expectations of 10-15%. We think the investments in price guided over the mid-term will not be offset by operating leverage and instead expect greater investments in improving the proposition to increase customer retention to be a priority for management."
It added that Boohoo's rich valuation reflects expectations of continued superior level of growth, but said it does not think this can happen without additional margin investment.
At 1410 GMT, the shares were down 3% to 200.80p.