Boohoo profit up 51 per cent in first half; expects 32 per cent revenue-growth in 2020-21

FILE PHOTO: Mahmud Kamani (Photo: Jerritt Clark/Getty Images).
FILE PHOTO: Mahmud Kamani (Photo: Jerritt Clark/Getty Images).

ONLINE FASHION retailer Boohoo reported a 51 per cent increase in first half profit despite the Leicester supplier scandal.

The company on Wednesday(30) said it expects revenue for 2020-21 to grow by 28 to 32 per cent, up from 25 per cent projected earlier.

The group made a pretax profit of £68.1 million ($87.4 million) in the six months to August 31, on revenue up 45 per cent to £816.5 million.

John Lyttle, Boohoo’s chief executive, said the group is actively considering further acquisitions, particularly in the US and Europe.

Last week, Boohoo accepted all the recommendations of an independent review which found several failings in its supply chain in England after allegations about working conditions and low pay, setting out steps to tackle the problems.

The firm has been under intense scrutiny since July when the allegations surfaced after a lockdown during the coronavirus pandemic.

Founded in 2006 by Mahmud Kamani and Carol Kane, Boohoo expanded its operations quickly, listing its shares in 2014. It sells fashion, beauty and products and shoes aimed at 16 to 24-year-olds.

The Manchester-based company said that the profit before tax had been boosted by shoppers sending back fewer items and ordering an average of 10 per cent more products on every visit.

The growth was driven by sales of jogging bottoms, hoodies, T-shirts and cycling shorts. However, the company is scaling back its stocks of dresses in the run-up to Christmas due to the pandemic.

The retailer’s own factory in Leicester is expected to open next year and employ 250 people. Boohoo is also launching a Garment and Textiles Community Trust to provide advice and support to garment workers in Leicester and switching from paper-based contracts with suppliers to an app-based system.

The UK accounts for more than half the sales of the group which owns Oasis, Warehouse, Pretty Little Thing, Nasty Gal and Karen Millen.

Boohoo was able to trade throughout the first half and said it had made a good start to the second, with momentum continuing into September.