As expected, the British clothing retailer Boohoo Group Plc closed the 2022/23 financial year with sobering figures. On Tuesday, the group reported a significant drop in sales and a significantly higher loss. However, the company expects a positive trend reversal in the course of this year.
In the last financial year, which ended at the end of February, the group’s turnover amounted to 1.77 billion British pounds (2.04 billion euros). It was eleven percent below the level of the previous year. Adjusted for changes in exchange rates, sales fell by 13 percent. The company justified the decline with the adverse economic conditions and the resulting weak consumer sentiment.
Lower revenues and higher costs mean numbers are deep in the red
In addition to the decline in sales, higher freight and logistics costs as well as increased personnel expenses and energy prices weighed on the result. Earnings before interest, taxes, depreciation and amortization (EBITDA) adjusted for special effects fell by 49 percent to 63.3 million pounds sterling compared to the previous year.
As a result, the group slipped deeper into the red: the bottom line was a net loss of 75.6 million British pounds (87.0 million euros). In the previous financial year, the corresponding shortfall was only 4.0 million pounds sterling.
The management expects a positive trend reversal in the current year
For the current 2023/24 financial year, management has set the goal of returning to growth. This will probably not succeed in the first half of the year: a drop in sales of ten to 15 percent is expected. In the second half of the year, however, revenues are expected to rise again due to the recent investments in pricing policy, products and range. For the year as a whole, the group expects sales to develop by -5 to zero percent.
However, the operating result should already increase slightly due to the measures introduced to increase efficiency. Adjusted EBITDA is forecast to be in the range of £69m to £78m.