* Total revenue up 44% in four months to Dec. 31
* Strong growth across all key geographic regions
* Upgrades 2019-20 sales growth guidance to 40-42%
* Shares hit record highs, market cap overtakes M&S
(Adds graphic, updates share price in 3rd para)
By James Davey
LONDON, Jan 14 (Reuters) - British online fashion retailer
Boohoo lifted its full-year guidance after reporting
robust Christmas sales on Tuesday, outperforming rivals and
overcoming weak UK consumer spending.
Boohoo, which sells own-brand clothing, shoes, accessories
and beauty products targeted at 16 to 40-year-olds, reported a
44% jump in total group revenue for the four months to Dec. 31
of 473.7 million pounds ($614.6 million).
Revenue growth was ahead of analysts' expectations, and just
topped first half growth of 43%. Boohoo's AIM-listed shares were
up more than 5% at 1100 GMT after hitting record highs of 3.35
pounds earlier in the session.
The retailer is successfully tapping into a generation of
younger consumers who shop on their mobile phones and want cheap
clothing, delivered quickly.
Founded in Manchester, northern England, in 2006 Boohoo has
expanded rapidly, listing its shares in 2014. They have risen
71% over the last year, giving the group a market capitalisation
of 3.9 billion pounds - more than the 136 year-old Marks &
Spencer's which is listed on the FTSE 250.
Boohoo bought the PrettyLittleThing and Nasty Gal brands in
2017 and MissPap, Karen Millen and Coast in 2019.
The company has also utilised high-profile celebrity
collaborations promoted on social media, such as with model and
actress Cara Delevingne and pop group Little Mix.
Boohoo saw strong revenue growth across all its key
geographic regions in the September-December period. Sales of
the Boohoo brand rose 42%, with PrettyLittleThing up 32% and
Nasty Gal up 102%.
"All of our brands have performed exceptionally well and
delivered strong market share gains," Chief Executive John
Lyttle said in a statement.
The group is now forecasting full year 2019-20 revenue
growth of 40-42%, up from previous guidance of 33-38%, and a
core profit margin (adjusted EBITDA margin) of 10.0-10.2%,
versus previous guidance of "around 10%".
While Boohoo is thriving, Britain's wider retail sector,
from department stores to fashion brands, is battling some of
the toughest trading conditions seen for a generation.
Industry data published last week showed British shoppers
cut back at the end of 2019, rounding off the worst year since
the mid-1990s for retail sales amid uncertainty over Brexit,
last month's national election and slowing wage growth.
Also last week fashion retailers Superdry and
Joules issued profit warnings, while M&S reported weak
menswear sales.
Prior to Tuesday's update analysts were on average
forecasting for Boohoo's 2019-20 year core earnings (earnings
before interest, tax, depreciation and amortisation - EBITDA) of
116.1 million pounds, according to Refinitiv data, up from 84.5
million pounds in 2018-19.
Analysts at Liberum said the update implied upgrades of
about 8%.
"Boohoo’s business model and operational execution is
delivering best-in-class growth and earnings momentum," they
said, noting they have already upgraded their EBITDA forecast by
22% over the last year.
($1 = 0.7707 pounds)
(Reporting by James Davey, Graphic by Thyagaraju Adinarayan,
Editing by Paul Sandle and Susan Fenton)
Marks & Spencer (MKS)