Boohoo looking good

Wednesday, 24th April 2019 11:51 - by Rajan Dhall

Online fashion retailer Boohoo released their latest final results for the year ended 28 February 2019 and it makes for good reading. Prettylittlething and Nasty Gal brands continue to outperform. Here are some of the key highlights:

•     Revenue £856.9 million, up 48% (47% CER(6))

•     Strong revenue growth across all geographies with UK up 37% and international up 64%

•     Gross margin increased to 54.7% (2018: 52.8%)

•     Adjusted EBITDA £84.5 million, 9.9% of revenue (2018: £56.9 million, 9.8%)

•     Adjusted profit before tax £76.3 million (2018: £51.0 million)

•     Strong balance sheet with net cash of £190.7 million (2018: £133.0 million), with robust operating cash flow of £111.9 million (2018: £76.2 million)

Drilling down into the numbers and the report it is very positive that the automated centre will be ready for use this month. This will reduce costs dramatically and finally have the cost of production for the facility complete and clear. Nasty Gal and Prettylittlething's acquisition of new customers is outstanding with both improving active customers by over 70%. The company say "Group revenue growth for the financial year is expected to be 25% to 30% with an adjusted EBITDA margin of around 10% and capital expenditure in the region of £50 to £60 million". From a technical standpoint,  the 216.4 resistance level has now been broken and 247p seems to be the next target. As long as the Pettlelittlething and Nasty Gal brands continue to grow the 273p high could be tested again. Overall the sector is still on the rise and the new CEO seems to be ambitious if the automated warehouse is successful they could implement this across the brand and cut more costs.

The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.