Member Info for Peoplepower1

Return on capital employed at 50% for TGA compared to minus 9% for Boohoo.

Investing in price - what could that mean? Maybe lowering their prices, maybe making their products better for the prices they charge? What do you think?

RNS for fy 2023 gives you exactly what Boohoo plans to do for 2024/25.

One of them is investing in price.

Mangling growth, I think that description was used by Hexam about you t4g. I know you love to pinch things from other posters.

How do you manage to get back to growth which is Boohoo's strategy at present?

Didn't your read the RNS for Boohoo's fy 2023? I'm sure you did.

Did you miss the Boohoo comparison to TGA?

All retail is losing ground because of high interest rates and high inflation. Plus people's priorities have moved away from buying new clothes in this high interest, high inflation era.

Oil prices will remain high because of OPEC making sure they do. This adds to people's costs and to costs for business too.

Colder weather is coming with more money needed for heating and less money available for unnecessary expenditure.

Boohoo was a rapidly growing company in the past. it's no longer a rapidly growing company. Boohoo have stated they are trying to get back to double digit growth. I assume this to be about 10% growth.

Boohoo were able to rapidly grow in the past because there was little competition to them. They were the cheapest. Now there's loads of competition with prices cheaper than Boohoo's and customers prepared to wait longer for their purchases because of the cheap prices.

No-one knows what will happen for Boohoo in the future. Will their reduced prices have to be maintained to get and keep growth? Will Debenhams and the other brands become sufficiently profitable for Boohoo in the future? The figures released by Boohoo in the future will only provide the proof for this or not.

For now, it's a guessing game.

Unfortunately if Boohoo have to cut their prices to get growth and have to keep their prices lower to maintain growth, then that average 4.4% net profit margin could end up much lower.

With comparisons you must always compare like with like. Like with like for Boohoo is ASOS and never Next.

BOOHOO - ADJUSTED EBITDA MARGIN AND NET PROFIT MARGIN FROM FY2015 TO FY2023

This is why people don’t trust EBITDA. Look at the difference between adjusted ebitda margin and net profit margin. Net profit margin is the reality of Boohoo. The highest net profit margin for Boohoo was in 2017 at 8.5%.

An average of 4.4% net profit margin for Boohoo from fy2015 to fy 2023 is not enough to reinvest in growth for Boohoo. Hence why growth is going to cost Boohoo.

At present, Boohoo have a revolving dredit facility of £325m and will need this for some years to grow Boohoo. It’s an expensive time to need to borrow and use this money for growth. This puts more pressure on Boohoo’s net profit margin in the future.

FY2015 - ADJUSTED EBITDA MARGIN - 12.8% FY2015 - NET PROFIT MARGIN - 6%

FY2016 - ADJUSTED EBITDA MARGIN 9.6% FY2016 - NET PROFIT MARGIN - 6.25%

FY2017 - ADJUSTED EBITDA MARGIN 12.1% FY2017 - NET PROFIT MARGIN - 8.5%

FY2018 - ADJUSTED EBITDA MARGIN 9.8% FY2018 - NET PROFIT MARGIN - 6.25%

FY2019 - ADJUSTED EBITDA MARGIN 9.9% FY2019 - NET PROFIT MARGIN - 5.5%

FY2020 - ADJUSTED EBITDA MARGIN 10.2% FY2020 - NET PROFIT MARGIN - 6%

FY2021 - ADJUSTED EBITDA MARGIN 10.0% FY2021 - NET PROFIT MARGIN - 5.5%

FY2022 - ADJUSTED EBITDA MARGIN 6.3% FY2022 - NET LOSS MARGIN - MINUS 0.2%

FY2023 - ADJUSTED EBITDA MARGIN 3.6% FY2023 - NET LOSS MARGIN - MINUS 4.5%

From £2bn, Boohoo's growth has gone down.

Why would Boohoo launch a back to growth strategy because even they know their growth is slowing.

4.4% net profit margin is not enough to reinvest for future growth.

Boohoo will need a revolving credit facility for some years to come to grow the business.

Boohoo have a revolving credit facility of £325m at present.

Boohoo's revenue grew nearly 7 times from 2015 to 2019. From 2019 to 2023 Boohoo's revenue grew two times.

Slowing growth from 2019 to 2023.

In ecommerce, the average net profit margin is 10%.

Bad profit margins are those that cannot sustain the business' operations or unlock growth.

For ecommerce, net profit margins below 5% are widely considered bad profit margins.

Boohoo's average net proft margin from fy2015 to fy2023 is about 4.4%

Thought these figures might help Hex and Broke. Please check my figures for anything I may have got wrong:-

BOOHOO REVENUE AND NET PROFIT FROM FY 2015 TO FY 2023

FY2015 REVENUE £139.85m FY2015 - NET PROFIT £8.5M IS ABOUT 6%

FY2016 REVENUE £195.39m FY2016 - NET PROFIT £12.5M IS ABOUT 6.25%

FY 2017 REVENUE £294.64m FY2017 - NET PROFIT £24.6M IS ABOUT 8.5%

FY2018 REVENUE £579.8m FY2018 - NET PROFIT £36M IS ABOUT 6.25%

FY2019 REVENUE £856.92m FY2019 - NET PROFIT £47.5M IS ABOUT 5.5%

FY2020 REVENUE £1,234.88m FY2020 - NET PROFIT £72.9M IS ABOUT 6%

FY2021 REVENUE £1,745.3m FY2021 - NET PROFIT £93.4M IS ABOUT 5.5%

FY 2022 REVENUE £1,982.8m FY2022 - NET LOSS £4M IS ABOUT MINUS .2%

FY 2023 REVENUE £1,768.7M FY2023 - NET LOSS £75.6M IS ABOUT MINUS 4.5%

AVERAGE PERCENTAGE FOR NET PROFIT/LOSS FROM FY 2015 TO FY 2023 IS ABOUT 4.4%

Thank you Hexam, yes you're absolutely right.

I learnt from my mistakes, thankfully.

T4g - more spin from you to try to cover up what's really going on at Boohoo. The share price went from £4 down to 30p on this reality.

Don't bother looking at really what's going on at Boohoo. Focus on shutting me up.