TIDMBOO
RNS Number : 9134A
boohoo group plc
28 September 2022
28 September 2022
The information contained within this announcement is deemed by
the company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014 as it forms part of the
domestic law of the United Kingdom by virtue of the European Union
(Withdrawal) Act 2018 (as amended) ("UK MAR"). Upon the publication
of this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
boohoo group plc - interim results for the six months ended 31
August 2022
"Leading the fashion eCommerce market"
6 months 6 months Change 6 months Change
to 31 August to 31 August 2022 on to 31 August 2022 on
2022 2021 2021 2019 2019(1)
(1H FY23) (1H FY22) (1H FY20)
GBP million GBP million GBP million
------------------------------ -------------- -------------- --------- -------------- ---------
Revenue 882.4 975.9 -10% 564.9 +56%
Gross profit 463.5 533.3 -13% 306.6 +51%
Gross margin 52.5% 54.6% -210bps 54.3% -180bps
Adjusted EBITDA(2) 35.5 85.1 -58% 60.8 -42%
% of revenue 4.0% 8.7% -470bps 10.8% -680bps
Adjusted EBIT(3) 9.6 64.2 -85% 51.3 -81%
% of revenue 1.1% 6.6% -550bps 9.1% -800bps
Adjusted profit before
tax(4) 6.2 63.8 -90% 51.9 -88%
Adjusted diluted earnings
per share(5) 0.30p 3.84p -92% 2.91p -90%
Net (debt)/cash(6) at period
end (10.4) 98.4 -108.8m 207.3 -217.7m
------------------------------ -------------- -------------- --------- -------------- ---------
Summary of first half financial performance
-- Gross revenue before returns up 4%, reflecting underlying
growth and ongoing improvements in average order frequency and
spend per customer, offset by weaker than anticipated consumer
demand
-- Net revenue declined 10% in the first half year:
o As previously guided returns rates up significantly year on
year, and ahead of pre-pandemic levels
o UK revenues declined 4%, softening through the second quarter
as inflationary pressures increased and consumer demand appears to
have been impacted by cost of living pressures.
o International revenues declined 17%, with the proposition
continuing to be impacted by extended delivery times. Markets such
as Australia are starting to see improvements from reduced delivery
times, with lower rates of year-on-year declines in revenues as the
first half progressed
-- Gross margin 52.5%, down 210 basis points year-on-year, in
line with expectations, as a result of inbound freight inflation.
Gross margin performance improved 210 basis points versus the
second half of the prior financial year due to tighter inventory
management
-- Adjusted EBITDA GBP35.5 million, with margin at 4.0% impacted
by freight and logistics inflation, weaker than anticipated
consumer demand and high cost inflation from the macro-economic
environment, as well as strategic investments across the
multi-brand platform
-- Free cash outflow was GBP2.7 million (1H 22: 157.3 million
outflow), following capital expenditure of GBP38.7 million. Closing
net debt of GBP10.4m (1H 22: net cash of GBP98.4m, FY 22: net cash
of GBP1.3 million) reflects multi-year investments, including GBP96
million on unencumbered freehold assets since February 2020
-- Significant liquidity headroom for selective investment
programme with gross cash of GBP315 million at period end
Near term focus on improving operational performance
As outlined previously in its full year results and first
quarter update, the near-term focus for the Group is on key
projects that will optimise operations and improve future
performance:
-- Sourcing: sourcing from near-shore markets increased
significantly in the first half, up more than 10 percentage points
year-on-year. Heading into the second half, the Group has lower
levels of forward commitments on inventory, giving greater
flexibility into the uncertain peak trading period
-- Inventory management: inventory levels are leaner, with
approximately 15% fewer units in stock at the end of August,
compared to the end of February. Compared to 2H FY22, inventory
turn and gross margin improved, with the latter increasing by 210
basis points, with the year on year decline in gross margin driven
by inbound cost pressures as previously stated
-- Overheads: macro-economic inflationary factors have
contributed to overhead increases year on year and investments into
recently acquired brands. An increased focus is being placed on
overhead costs in an uncertain consumer backdrop to improve
profitability
Robust financial position underpins strategic investments
The Group continues to maintain a robust balance sheet, with
GBP315 million of gross cash and low levels of net debt (GBP10
million) at the end of the first half, giving significant liquidity
headroom that supports selective investments into strategic growth
initiatives.
-- Automation in our Sheffield distribution centre went live in
late September, and is expected to drive material cost savings and
efficiencies with a five year estimated payback on GBP125 million
of capital expenditure
-- US distribution centre on track to go-live in the first half
of the 2023/24 financial year, supporting significant improvement
in our customer proposition from a reduction in international
delivery times
-- Further progress made with Debenhams online marketplace, with
a new senior leadership team, upgrading of its technology stack;
and rapid expansion of marketplace partners, with 80 new partners
onboarded in the first half
-- New Customs Warehouse went live in July, with duty savings expected in the second half
-- Wholesale sales portal launched, giving greater choice and
flexibility to partners, and future operational efficiencies
Outlook and FY23 guidance
As a result of the impact that the macro-economic and consumer
backdrop has had on the Group's revenues in the first half, our
expectation is for a similar rate of revenue declines to persist
over the remainder of the financial year if these conditions
continue.
Increases in inflation-driven costs as well as the resultant
operational deleverage from lower sales than previously anticipated
mean that adjusted EBITDA margins are likely to be between 3% and
5%, compared to the previously guided range of 4% and 7%.
It is the Board's view that by focusing near term on optimising
its operations, the Group will be well-positioned to improve future
profitability and financial performance through self-help via
delivery of key projects and cost efficiencies and through easing
of macro-economic headwinds facing both consumers and
businesses.
Longer-term competitive positioning and opportunity to take
market share unchanged
Over the last three years, the Group has made notable progress
towards achieving its long-term growth ambitions. It has also made
significant investments during this time and will continue to make
selective investments to support its platform and brands, in a
manner that reflect the current macro-economic environment.
Since 1H20, the group has:
-- Grown significantly with total revenue +56%, (UK: +73%,
International: +35%), during a period in which clothing sales in
key markets remain broadly flat versus 2019
-- Increased in its largest market, the UK, its share of spend
online from 5.6% to 8.4%, with price product and proposition
resonating strongly with consumers
-- Increased its active customer base to 19 million active
customers, up from 13 million, through organic growth and an
increased brand portfolio
-- Extended target addressable market through acquisitions, with
up to 500 million potential customers in key global markets
-- Built infrastructure capable of supporting in excess of GBP4
billion of net sales, with automation driving efficiencies and an
international distribution centre enhancing our proposition
-- Developed numerous growth opportunities through its direct to
consumer proposition, Debenhams and strategic partnerships with
select partners globally
-- Made further progress on its sustainability strategy with
Thurmaston Lane manufacturing facility launched in Leicester, UK in
the first half and the PrettyLittleThing marketplace, a clothing
resale platform, launched in August 2022
John Lyttle, Group CEO, commented:
"Performance in the first half was impacted by a more
challenging economic backdrop weighing on consumer demand. Over the
last three years the Group has seen significant gains in market
share achieved across our brand portfolio, particularly in the UK
where our price, product and proposition resonate strongly with
customers. We have a clear plan in place to improve future
profitability and financial performance through self-help via the
delivery of key projects, which will stand us in good stead as
macro-economic headwinds ease. We remain confident in the long-term
outlook, as we continue to offer customers unrivalled choice,
inclusive ranges and great value pricing, giving them even more
reasons to shop with us."
Investor and analyst webcast
boohoo group plc will today host a presentation video webcast
for analysts and investors at 8.45am (UK time) via the following
link:
https://webcasting.buchanan.uk.com/broadcast/62f125bd2c785a4107c36427
A replay will subsequently be available the same day via the
same link.
boohoo group plc's interim results are available at
www.boohooplc.com .
Enquiries
boohoo group plc
Neil Catto, Chief Financial Officer Tel: +44 (0)161 233
2050
Alistair Davies, Investor Relations Tel: +44 (0)161 233
2050
Clara Melia, Investor Relations Tel: +44 (0)20 3289
5520
Mark Mochalski, Investor Relations Tel: +44 (0)20 3239
6289
Zeus Capital - Nominated adviser and joint
broker
Andrew Jones / James Edis Tel: +44 (0)161 831
1512
Benjamin Robertson Tel: +44 (0)20 3829
5000
Jefferies - Joint broker
Philip Noblet / Max Jones Tel: +44 (0)20 7029
8000
Buchanan - Financial PR adviser boohoo@buchanan.uk.com
Richard Oldworth / Kim Looringh-van Beeck / Tel: +44 (0)20 7466
Toto Berger / Verity Parker 5000
Notes:
(1) Change on 2019 (1H20) is more representative of the
medium-term business growth as it smooths out the exceptional
growth in 1H21 due to the pandemic, when new customer acquisition
was exceptional, and the effect of a material increase in
international shipping costs.
(2) Adjusted EBITDA is calculated as profit before tax,
interest, depreciation, amortisation, share-based payments charges
and exceptional items.
(3) Adjusted EBIT is calculated as profit before tax, interest,
share-based payments charges, amortisation of acquired intangible
assets and exceptional items.
(4) Adjusted profit before tax is calculated as profit before
tax, excluding share-based payments charges, amortisation of
acquired intangible assets and exceptional items.
(5) Adjusted diluted earnings per share is calculated as diluted
earnings per share, adding back amortisation of acquired intangible
assets, share-based payments charges and exceptional items.
(6) Net cash is cash less bank borrowings.
(7) CER designates Constant Exchange Rate translation of foreign
currency revenue, which gives a truer indication of the performance
in international markets by removing year-to-year exchange rate
movements when local currency sales are converted to sterling.
About boohoo group plc
"Leading the fashion eCommerce market"
Founded in Manchester in 2006, boohoo is an inclusive and
innovative global brand targeting young, value-orientated
customers, pushing boundaries to bring its customers up-to-date and
inspirational fashion, 24/7.
In 2017, the group extended its customer offering through the
acquisitions of the vibrant fashion brand PrettyLittleThing and
free-thinking brand Nasty Gal. In March 2019, the group acquired
the MissPap brand, in August 2019 the Karen Millen and Coast brands
and in June 2020 the Warehouse and Oasis brands, all complementary
to the group's scalable, multi-brand platform. In January 2021, the
group acquired the intellectual property assets of Debenhams, with
the goal of transforming a leading UK fashion and beauty retailer
into a digital department store and marketplace through a new
capital-light and low-risk operating model. In February 2021, the
group acquired the intellectual property assets of UK brands
Dorothy Perkins, Wallis and Burton. As at 31 August 2022, the
boohoo group had 19 million active customers across all its brands
around the world.
Cautionary Statement
Certain statements included or incorporated by reference within
this announcement may constitute "forward-looking statements" in
respect of the group's operations, performance, prospects and/or
financial condition. Forward-looking statements are sometimes, but
not always, identified by their use of a date in the future or such
words and words of similar meaning as "anticipates", "aims", "due",
"could", "may", "will", "should", "expects", "believes", "intends",
"plans", "potential", "targets", "goal" or "estimates". By their
nature, forward-looking statements involve a number of risks,
uncertainties and assumptions and actual results or events may
differ materially from those expressed or implied by those
statements. Accordingly, no assurance can be given that any
particular expectation will be met and reliance should not be
placed on any forward-looking statement. Additionally,
forward-looking statements regarding past trends or activities
should not be taken as a representation that such trends or
activities will continue in the future. No responsibility or
obligation is accepted to update or revise any forward-looking
statement resulting from new information, future events or
otherwise. Nothing in this announcement should be construed as a
profit forecast. This announcement does not constitute or form part
of any offer or invitation to sell, or any solicitation of any
offer to purchase any shares or other securities in the Company,
nor shall it or any part of it or the fact of its distribution form
the basis of, or be relied on in connection with, any contract or
commitment or investment decisions relating thereto, nor does it
constitute a recommendation regarding the shares or other
securities of the Company. Past performance cannot be relied upon
as a guide to future performance and persons needing advice should
consult an independent financial adviser. Statements in this
announcement reflect the knowledge and information available at the
time of its preparation. Liability arising from anything in this
announcement shall be governed by English law. Nothing in this
announcement shall exclude any liability under applicable laws that
cannot be excluded in accordance with such laws.
Review of the business
Group overview
Group revenue for the half-year declined by 10% (9% CER) on the
first half of the previous year to GBP882.4 million (2021: GBP975.9
million, 2019: GBP564.9 million) and increased by 56% on the first
half of three years ago, pre-pandemic. Comparison with three years
ago demonstrates the growth of the business excluding the
exceptional growth and low returns during pandemic periods. Gross
sales before returns increased on the prior half-year by 4%,
indicating the continued momentum of the group's brands as they
gain market share. However, with returns higher than in the
pandemic period, net revenue shows a decline.
Adjusted EBITDA was GBP35.5 million (2021: GBP85.1 million,
2019: GBP60.8 million), a decrease of 58% on the first half of the
previous year, as a result of: softer consumer demand, elevated
returns rates, freight and logistics inflation, high cost inflation
from the macro-economic environment, as well as strategic
investments across the multi-brand platform. Gross margin of 52.5%,
declined 210 basis points year-on-year due to elevated inflationary
cost pressures. Gross margin did, however, improve compared to the
second half of the previous financial year with tighter inventory
management, and our flexibility in moving supply chain sources away
from the Far East, with its associated elevated freight costs, to
Europe, reducing product costs.
Adjusted EBITDA margin reduced to 4.0% (2021: 8.7%, 2019:
10.8%), but was flat when compared to the second half of the
previous financial year. International distribution costs have
continued to be significantly elevated against pre-pandemic rates,
but we are seeing some small, steady rate reductions as the year
progresses. Our more recently acquired brands are demonstrating
improving profitability but continue to operate with higher
overheads as a percentage of revenue compared to the much larger
and more established brands we own. Central overheads increased as
a percentage of net sales in the first half due to the operational
deleverage from a decline in net sales year-on-year, coupled with
inflationary cost pressures as a result of the macro-economic
backdrop.
Loss before tax was GBP15.2 million (2021: Profit GBP24.6
million, 2019: Profit GBP45.2 million). Adjusted diluted earnings
per share was 0.30p, down 92% on the prior half-year. Basic
earnings per share was negative 1.19p, (2021: positive 1.44p, 2019:
positive 2.88p).
Operating cash flow was GBP41.3 million (2021: GBP21.3 million,
2019: GBP55.9 million). Net cash flow was GBP213.3 million inflow
(2021: GBP127.6 million outflow, 2019: GBP15.5 million inflow),
following capital expenditure of GBP38.7 million and a GBP225
million inflow from the group's newly committed GBP325 million
Revolving Credit Facility. Our net cash balance (cash less bank
debt) at the period end decreased to GBP10.4 million net debt
(2021: GBP98.4 million net cash, 2019: GBP207.3 million net cash),
whilst the actual cash balance was GBP314.6 million.
Technology
Investment has continued in key technology projects, including
the delivery of Customs Warehousing, which will improve gross
margin on overseas sales, and building of systems for the
forthcoming US distribution centre. The Sheffield distribution
centre servicing PrettyLittleThing transitioned from a third-party
provider to in-house, requiring significant IT development and
implementation and was successfully completed in June, with 1,400
colleagues joining the boohoo family. In addition, substantial
progress has been made on our automation project ahead of go-live
in September. Further improvements have been made to the group's
wholesale operations, with the implementation of a new sales portal
giving greater choice and flexibility to partners, and greater
operational efficiencies.
Distribution centres
The group continues to operate four warehouses: the
long-established Burnley site, which serves boohoo, boohooMAN,
MissPap and Debenhams; the Sheffield facility for
PrettyLittleThing; Wellingborough, which houses Nasty Gal, Coast,
Oasis and Warehouse; and Daventry, from which the newer brands
Dorothy Perkins, Burton and Wallis operate, as well as Karen
Millen.
The project to automate the Sheffield warehouse reached
completion and go-live in September, with significant capital
expenditure of GBP11 million incurred in the first half year.
Additional costs of working of GBP2 million have been incurred
during the construction period, disrupting the normal efficiency,
and these are included in exceptional costs. Total capital
expenditure for this project is anticipated to total approximately
GBP125 million, in line with prior guidance, driving significant
efficiencies and an anticipated payback of approximately five
years.
Performance by market
UK
The group's largest market continues to be the UK, accounting
for 62% of group revenues (2021: 58%). Revenue has declined by 4%
on the prior half year, although the pre-pandemic three-year growth
remains robust at 73%. Sales before returns increased on the prior
half year by 12%, but the returns rate increased substantially from
the low level during the latter stages of the pandemic last year,
resulting in a net revenue reduction. However, we are encouraged by
the performance of our more recently acquired brands as they pick
up momentum from a low base, continued progression made by our
Debenhams digital department store, as well as the significant
gains in market share achieved across our brand portfolio over the
last three years.
Gross margin decreased slightly from 51.7% to 50.2% as a result
of elevated freight cost pressures that did not impact performance
in the first half of the previous financial year.
USA
Performance in the USA has been below expectations, with revenue
declining 29% on the prior half year, albeit revenue growth over
the three-year period is strong at 60%. Delivery times to the USA
are still elevated compared to pre-pandemic levels, and this is
undoubtedly impacting demand, although the situation is improving
slowly.
Gross margin is high, although lower than the prior half year,
reducing from 61.5% to 60.2%. Distribution costs have remained high
due to the ongoing elevated airfreight costs and remain materially
above pre-pandemic levels.
Rest of Europe
Although revenues in Rest of Europe declined 2% in the first
half, the region saw a return to growth in the second quarter at
+5%, with an improving trend in our direct-to-consumer brands and
the positive benefit of our wholesale business. Encouragingly, our
more recently acquired brands are making strong progress, albeit
from a low base. Growth on the pre-pandemic period three years ago
is 17%, and comfortably ahead of the broader market which continues
to be broadly flat versus pre-pandemic levels.
Gross margin declined marginally from 53.6% to 52.7%.
Rest of world
Rest of the world growth was 14%, driven by the success of
wholesale sales to our partners in the Middle East. In addition,
markets such as Australia are starting to see improvements from
reduced delivery times, with lower rates of year on year declines
in revenues as the first half progressed.
Gross margin reduced from 55.7% to 50.8% with profitability
continuing to be impacted by elevated freight costs and high
distribution costs.
Sustainability
In line with our policy on supply chain transparency, we
published the group's 2022 sustainability strategy and updated the
tier 1 global factory supply chain list in August 2022, available
on our corporate website.
We have continued to add more sustainable clothing ranges across
our brands and have entered into the second year of partnership
with CottonConnect to use sustainable cotton from Pakistan. In the
UK, manufacturing of our own clothing at Thurmaston Lane commenced
in the first half, and will ramp up in the second half of the
year.
PrettyLittleThing launched marketplace, a clothing resale
platform, in August 2022. This site enables anyone to sell their
used garments online, contribute towards sustainability, and gives
the group an entry into a high-growth area of the clothing market.
In addition, the trial of a new partnership with clothing resale
service, Thrift+ was launched.
Solar panels on the Burnley distribution centre are active, with
the potential to generate 2.7 megawatts of electricity to support
the power requirements of our operations. This is believed to be a
significant installation of its kind for businesses.
Financial review
Group revenue by geographical market
6 months to 6 months to Change 2022 on Change 6 months to Change 2022 on
31 August 2022 31 August 2021 2021 31 August 2019 2019
GBP million GBP million CER GBP million
---------------- ---------------- ---------------- ----------------- ------- ---------------- ------------------
UK 544.6 569.6 -4% -4% 315.0 +73%
Rest of Europe 102.1 104.7 -2% -2% 87.5 +17%
USA 177.4 250.6 -29% -28% 110.7 +60%
Rest of world 58.3 51.0 14% 15% 51.7 +13%
---------------- ---------------- ---------------- ----------------- ------- ---------------- ------------------
882.4 975.9 -10% -9% 564.9 +56%
================ ================ ================ ================= ======= ================ ==================
KPIs
Group
6 months 6 months Change 6 months Change
to to 2022 to 2022
31 August 31 August on 2021 31 August on 2019
2022 2021 2019
Active customers(1) 19.1 million 18.9 million +1% 13.0 million +47%
Number of orders 27.6 million 30.7 million -10% 20.3 million +36%
Order frequency(2) 3.13 3.09 +1% 2.87 +9%
Conversion rate to sale (3) 3.06% 3.26% -20bps 3.26% -20bps
Average order value(4) GBP56.38 GBP45.41 +26% GBP43.26 +30%
Number of items per basket 3.06 3.21 -5% 3.15 -3%
----------------------------- -------------- ------------- --------- ------------- ---------
1. Defined as having shopped in the last 12 months
2. Defined as number of orders in last 12 months divided by number of active customers
3. Defined as the percentage of website orders taken to internet sessions
4. Calculated as gross sales including sales tax divided by the number of orders
Consolidated summary income statement
6 months to 6 months to Change 2022 on 2021 6 months to Change 2022 on 2019
31 August 2022 31 August 2021 31 August 2019
GBP million GBP million GBP million
-------------------- ---------------- ---------------- -------------------- ---------------- --------------------
Revenue 882.4 975.9 -10% 564.9 +56%
Cost of sales (418.9) (442.6) (258.3)
-------------------- ---------------- ---------------- -------------------- ---------------- --------------------
Gross profit 463.5 533.3 -13% 306.6 +51%
Gross margin % 52.5% 54.6% -210bps 54.3% -180bps
Operating costs (428.0) (448.2) (245.9)
Other income - - 0.1
Adjusted EBITDA 35.5 85.1 -58% 60.8 -42%
Adjusted EBITDA
margin % 4.0% 8.7% -470bps 10.8% -680bps
Depreciation (18.2) (17.5) (7.9)
Amortisation of
other intangible
assets (7.7) (3.4) (1.6)
Adjusted EBIT 9.6 64.2 -85% 51.3 -81%
Adjusting items:
Amortisation of
acquired
intangible assets (6.2) (6.3) (2.3)
Equity-settled
share-based
payments charges (12.9) (12.9) (4.4)
Exceptional costs (2.3) (20.0) -
-------------------- ---------------- ---------------- -------------------- ---------------- --------------------
Operating
(loss)/profit (11.8) 25.0 -147% 44.6 -126%
Finance income 0.5 0.2 0.8
Finance expense (3.9) (0.6) (0.2)
-------------------- ---------------- ---------------- -------------------- ---------------- --------------------
(Loss)/profit
before tax (15.2) 24.6 -162% 45.2 -134%
Tax 0.5 (6.8) (9.1)
-------------------- ---------------- ---------------- -------------------- ---------------- --------------------
(Loss)/profit after
tax for the period (14.7) 17.8 -183% 36.1 -141%
==================== ================ ================ ==================== ================ ====================
Basic earnings per
share (1.19)p 1.44p -183% 2.88p -141%
Diluted earnings
per share (1.19)p 1.38p -186% 2.80p -143%
Adjusted profit
after tax for the
period 3.8 49.5 -92% 41.5 -91%
Amortisation of
acquired
intangible assets (6.2) (6.3) (2.3)
Equity-settled
share-based
payments charges (12.9) (12.9) (4.4)
Exceptional costs (2.3) (20.0) -
Adjustment for tax 2.9 7.5 1.3
-------------------- ---------------- ---------------- -------------------- ---------------- --------------------
(Loss)/profit after
tax for the period (14.7) 17.8 36.1
-------------------- ---------------- ---------------- -------------------- ---------------- --------------------
Adjusted profit for
the period
attributable to
shareholders of
the company 3.8 49.5 -92% 34.7 -89%
Adjusted diluted
earnings per share 0.30p 3.84p -92% 2.91p -89%
-------------------- ---------------- ---------------- -------------------- ---------------- --------------------
Exceptional costs 6 months to 6 months to
31 August 2022 31 August 2021
GBP million GBP million
Dual warehouse operating costs - 9.2
Dual administrative costs under TSA - 3.7
Redundancy costs - 3.6
Sheffield automation disruption costs 2.3 1.9
Restructuring costs - 1.6
2.3 20.0
----------------
Taxation
The group recognised a tax credit of GBP0.5m, an effective rate
of 3.3% (2021: 27.6%, 2019: 20.1%). This is lower than the tax
credit calculated when multiplying the loss before tax at the
blended UK statutory rate of tax for the year of 19%, due to
disallowable expenses and depreciation of buildings in excess of
capital allowances.
Earnings per share
Basic earnings per share for the first half of the year
decreased by 183% from 1.44p to -1.19p. Adjusted diluted earnings
per share was 0.30p, down 92% on the first half of the prior
year.
Consolidated statement of financial position
6 months 6 months 6 months
to to to
31 August 31 August 31 August
2022 2021 2019
GBP million GBP million GBP million
--------------------------------------- ------------ ------------ ------------
Intangible assets 131.4 121.6 43.8
Property, plant and equipment 358.8 287.9 108.5
Right-of-use assets 60.7 53.6 15.7
Financial assets 0.7 7.3 0.3
Investments 6.5 - -
Deferred tax asset 7.4 2.3 4.1
---------------------------------------- ------------ ------------ ------------
Non-current assets 565.5 472.7 172.4
Working capital (22.7) (47.1) (58.7)
Lease liabilities (62.7) (54.6) (17.7)
Net financial (liabilities)/assets (26.9) 12.8 (27.2)
Cash and cash equivalents 314.6 148.4 213.3
Interest bearing loans and borrowings (325.0) (50.0) (6.0)
Deferred tax liability (24.7) (3.8) (2.0)
Current tax asset/(liability) 6.5 3.0 (6.8)
Net assets 424.6 481.4 267.3
======================================== ============ ============ ============
Working capital has improved due to tighter inventory levels
supporting the brands within the group. A new revolving credit
facility of GBP325 million with a three-year term was agreed in
March 2022 to support the group's liquidity requirements and
provide a greater degree of headroom and was fully drawn down to
provide sufficient buffer for intra-month trading and investment
activity.
Liquidity and financial resources
Operating cash flow was GBP41.3 million (2021: GBP21.3 million,
2019: GBP55.9 million). Net cash flow was GBP213.3 million inflow
(2021: GBP127.6 million outflow, 2019: GBP15.5 million inflow),
following capital expenditure of GBP38.7 million and a GBP225
million inflow from the group's newly committed GBP325 million
Revolving Credit Facility. Our net cash balance (cash less bank
debt) at the period end decreased to GBP10.4 million net debt
(2021: GBP98.4 million net cash, 2019: GBP207.3 million net cash).
Capital expenditure of a substantial GBP38.7 million was invested
in warehousing and office facilities and IT systems infrastructure
for future growth. The closing cash balance for the group was
GBP314.6 million.
Consolidated cash flow statement
6 months 6 months 6 months
to to to
31 August 31 August 31 August
2022 2021 2019
GBP million GBP million GBP million
-------------------------------------------------- ------------- ------------ ------------
(Loss)/profit for the period (14.7) 17.8 36.1
Share-based payments charge 12.9 12.9 4.4
Depreciation charges and amortisation 32.1 27.2 11.8
Finance income (0.5) (0.2) (0.8)
Finance expense 3.9 0.6 0.2
Tax expense (0.5) 6.8 9.1
Increase in inventories 9.7 (110.3) (27.1)
Increase in trade and other receivables (5.7) (6.9) (16.5)
Increase in trade and other payables 4.1 73.4 38.7
-------------------------------------------------- ------------- ------------ ------------
Operating cash flow 41.3 21.3 55.9
Capital expenditure and intangible asset
purchases (38.7) (172.2) (6.4)
Acquisition of new brands (intangible
assets) - (19.4)
Investments (6.5) - -
Tax refunded/(paid) 1.2 (6.4) (3.8)
Free cash (out)/inflow after tax (2.7) (157.3) 26.3
Net proceeds from the issue of ordinary
shares 0.1 4.7 0.8
Purchase of own shares by EBT - (19.2) (4.8)
Finance income received 0.4 0.2 0.7
Finance expense paid (3.4) (0.6) (0.1)
Dividend paid to non-controlling interests - - (3.4)
Lease payments (6.1) (5.4) (2.8)
Proceeds from new loan/(repayment of borrowings) 225.0 50.0 (1.2)
-------------------------------------------------- ------------- ------------ ------------
Net cash in/(out)flow 213.3 (127.6) 15.5
Cash and cash equivalents at beginning
of period 101.3 276.0 197.8
-------------------------------------------------- ------------- ------------ ------------
Cash and cash equivalents at end of period 314.6 148.4 213.3
================================================== ============= ============ ============
Outlook
As a result of the impact that the macro-economic and consumer
backdrop has had on the Group's revenues in the first half, our
expectation is for a similar rate of revenue declines to persist
over the remainder of the financial year if these conditions
continue.
Increases in inflation-driven costs as well as the resultant
operational deleverage from lower sales than previously anticipated
mean that adjusted EBITDA margins are likely to be between 3% and
5%, compared to the previously guided range of 4% and 7%.
It is the Board's view that by focusing near term on optimising
its operations, the Group will be well-positioned to improve future
profitability and financial performance through self-help via
delivery of key projects and cost efficiencies and through easing
of macro-economic headwinds facing both consumers and
businesses.
Other financial guidance for FY23 is outlined below:
-- Underlying depreciation and amortisation of approximately GBP60 million
-- Net interest charge expected to be approximately GBP10-11
million reflecting interest rate increases (GBP7-8 million
previously)
-- Capital expenditure unchanged at GBP100-120 million; and
-- Adjusting items of approximately GBP60-65 million, of which
around GBP40-45 million relates to non-cash items, including:
share-based pay, acquisition intangible amortisation, exceptional
costs of Sheffield automation and warehouse commissioning costs
John Lyttle Neil Catto
Chief Executive Chief Financial Officer
28 September 2022
Unaudited consolidated statement of comprehensive income
for the period ended 31 August 2022
Note 6 months 6 months Year to 28
to to February
31 August 31 August 2022
2022 2021
(unaudited) (unaudited) (audited)
GBP million GBP million GBP million
--------------------------------------- ------ ----------- ----------- -----------
Revenue 3 882.4 975.9 1,982.8
Cost of sales (418.9) (442.6) (941.7)
----------------------------------------------- ----------- ----------- -----------
Gross profit 463.5 533.3 1,041.1
Distribution costs (224.8) (247.3) (516.5)
Exceptional costs (2.3) (14.2) (28.4)
Other distribution costs (222.5) (233.1) (488.1)
----------------------------------------------- ----------- ----------- -----------
Administrative expenses (250.5) (261.0) (515.3)
----------------------------------------------- ----------- ----------- -----------
Amortisation of acquired intangibles (6.2) (6.3) (12.8)
Exceptional expenses - (5.8) (7.4)
Other administrative expenses (244.3) (248.9) (495.1)
----------------------------------------------- ----------- ----------- -----------
Other income - - 0.1
----------------------------------------------- ----------- ----------- -----------
Operating (loss)/profit (11.8) 25.0 9.4
Finance income 0.5 0.2 -
Finance expense (3.9) (0.6) (1.6)
----------------------------------------------- ----------- ----------- -----------
(Loss)/profit before tax 4 (15.2) 24.6 7.8
Taxation 0.5 (6.8) (11.8)
(Loss)/profit for the period (14.7) 17.8 (4.0)
=============================================== =========== =========== ===========
Other comprehensive (expense)/income
for the period
(Gain)/loss reclassified to profit
and loss during the year (1.1) (7.8) (14.8)
Fair value gain/(loss) on cash flow
hedges during the year (1) (35.2) 2.2 (0.7)
Total comprehensive (expense)/income
for the period (51.0) 12.2 (19.5)
======================================== ===== =========== =========== ===========
Earnings per share 5
Basic (1.19)p 1.44p (0.32)p
Diluted (1.19)p 1.38p (0.32)p
---------------------------------------- ----- ----------- ----------- -----------
1. Net fair value gains/losses on cash flow hedges will be
reclassified to profit or loss during the three years to 31 August
2025.
Unaudited consolidated statement of financial position
at 31 August 2022
Note 6 months 6 months Year to
to 31 August to 31 August 28 February
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP million GBP million GBP million
-------------------------------------- ---- ------------- ------------- ------------
Assets
Non-current assets
Intangible assets 6 131.4 121.6 128.5
Property, plant and equipment 7 358.8 287.9 349.2
Right-of-use assets 8 60.7 53.6 49.7
Financial assets 0.7 7.3 2.8
Investments 9 6.5 - -
Deferred tax 10 7.4 2.3 7.5
-------------------------------------- ---- ------------- ------------- ------------
Total non-current assets 565.5 472.7 537.7
Current assets
Inventories 269.7 255.2 279.4
Trade and other receivables 11 61.6 47.5 58.0
Financial assets 12.0 15.9 14.2
Current tax asset 6.5 3.0 7.8
Cash and cash equivalents 314.6 148.4 101.3
Total current assets 664.4 470.0 460.7
Total assets 1,229.9 942.7 998.4
Liabilities
Current liabilities
Trade and other payables 12 (291.5) (295.5) (296.6)
Provisions 13 (62.5) (54.3) (53.5)
Interest bearing loans and borrowings 14 - (50.0) (100.0)
Lease liabilities (8.1) (8.1) (7.9)
Financial liabilities (27.7) (1.4) (3.7)
Total current liabilities (389.8) (409.3) (461.7)
Non-current liabilities
Interest bearing loans and borrowings 14 (325.0) - -
Lease liabilities (54.6) (46.5) (44.0)
Financial liabilities (11.2) (1.7) (3.1)
Deferred tax 10 (24.7) (3.8) (25.3)
Total liabilities (805.3) (461.3) (534.1)
Net assets 424.6 481.4 464.3
====================================== ==== ============= ============= ============
Equity
Share capital 15 12.7 12.7 12.7
Shares to be issued 16 31.9 31.9 31.9
Share premium 922.9 920.8 922.8
Hedging reserve (26.1) 20.1 10.2
EBT reserve (75.6) (75.7) (75.6)
Other reserves 17 (797.1) (795.3) (795.5)
Retained earnings 355.9 366.9 357.8
-------------------------------------- ---- ------------- ------------- ------------
Total equity 424.6 481.4 464.3
====================================== ==== ============= ============= ============
Unaudited consolidated statement of changes in equity
Share Shares to Share Hedging EBT reserve Other Retained Total
capital be issued premium reserve reserves earnings equity
GBP million GBP GBP million GBP GBP million GBP GBP GBP million
million million million million
----------- ---------- ----------- ---------- ----------- ---------- ---------- -----------
Balance at 28
February 2022 12.7 31.9 922.8 10.2 (75.6) (795.5) 357.8 464.3
Loss for the
period - - - - - - (14.7) (14.7)
Other
comprehensive
income/(expense):
Gain reclassified
to profit and
loss in revenue - - - (1.1) - - - (1.1)
Fair value loss on
cash flow hedges
during the year - - - (35.2) - - - (35.2)
------------------ ----------- ---------- ----------- ---------- ----------- ---------- ---------- -----------
Total
comprehensive
expense for the
period - - - (36.3) - - (14.7) (51.0)
Issue of shares - - 0.1 - - - - 0.1
Share-based
payments credit - - - - - - 12.9 12.9
Excess taxation on
share-based
payments - - - - - - (0.1) (0.1)
Translation of
foreign
operations - - - - - (1.6) - (1.6)
Balance at 31
August 2022 12.7 31.9 922.9 (26.1) (75.6) (797.1) 355.9 424.6
------------------ ----------- ---------- ----------- ---------- ----------- ---------- ---------- -----------
Share Shares to Share Hedging EBT reserve Other Retained Total
capital be issued premium reserve reserves earnings equity
GBP million GBP GBP million GBP GBP million GBP GBP GBP million
million million million million
Balance at 28
February 2021 12.6 31.9 916.2 25.7 (56.5) (795.2) 337.8 472.5
Profit for the
period - - - - - - 17.8 17.8
Other
comprehensive
income/(expense):
Gain reclassified
to profit and
loss in revenue - - - (7.8) - - - (7.8)
Fair value gain on
cash flow hedges
during the year - - - 2.2 - - - 2.2
------------------ ----------- ---------- ----------- ---------- ----------- ---------- ---------- -----------
Total
comprehensive
income for the
period - - - (5.6) - - 17.8 12.2
Issue of shares 0.1 - 4.6 - (19.2) - - (14.5)
Share-based
payments credit - - - - - - 12.9 12.9
Excess taxation on
share-based
payments - - - - - - (1.6) (1.6)
Translation of
foreign
operations - - - - - (0.1) - (0.1)
Balance at 31
August 2021 12.7 31.9 920.8 20.1 (75.7) (795.3) 366.9 481.4
------------------ ----------- ---------- ----------- ---------- ----------- ---------- ---------- -----------
Share Shares to Share Hedging EBT reserve Other Retained Total
capital be issued premium reserve reserves earnings equity
GBP million GBP GBP million GBP GBP million GBP GBP GBP million
million million million million
------------------ ----------- ---------- ----------- ---------- ----------- ---------- ---------- -----------
Balance at 28
February 2021 12.6 31.9 916.2 25.7 (56.5) (795.2) 337.8 472.5
Loss for the year - - - - - - (4.0) (4.0)
Other
comprehensive
income/(expense):
Gain reclassified
to profit and
loss in revenue - - - (14.8) - - - (14.8)
Fair value loss on
cash flow hedges
during the year - - - (0.7) - - - (0.7)
------------------ ----------- ---------- ----------- ---------- ----------- ---------- ---------- -----------
Total
comprehensive
income for the
year - - - (15.5) - - (4.0) (19.5)
Issue of shares 0.1 - 6.6 - (19.1) - - (12.4)
Share-based
payments credit - - - - - - 26.1 26.1
Excess taxation on
share-based
payments - - - - - - (2.1) (2.1)
Translation of
foreign
operations - - - - - (0.3) - (0.3)
Balance at 28
February 2022 12.7 31.9 922.8 10.2 (75.6) (795.5) 357.8 464.3
------------------ ----------- ---------- ----------- ---------- ----------- ---------- ---------- -----------
Unaudited consolidated cash flow statement
for the period ended 31 August 2022
Note 6 months 6 months Year to
to 31 August to 31 August 28 February
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP million GBP million GBP million
Cash flows from operating activities
(Loss)/profit for the period (14.7) 17.8 (4.0)
Adjustments for:
Share-based payments charge 12.9 12.9 26.1
Depreciation charges and amortisation 32.1 27.2 53.8
Finance income (0.5) (0.2) -
Finance expense 3.9 0.6 1.6
Tax (credit)/expense (0.5) 6.8 11.8
--------------------------------------------- ---- ------------- ------------- ------------
33.2 65.1 89.3
Decrease/(increase) in inventories 9.7 (110.3) (134.5)
Increase in trade and other receivables 11 (5.7) (6.9) (17.7)
Increase in trade and other payables 12 4.1 73.4 73.2
Cash generated from operations 41.3 21.3 10.3
Tax refunded/(paid) 1.2 (6.4) -
Net cash generated from operating activities 42.5 14.9 10.3
Cash flows from investing activities
Acquisition of intangible assets (16.8) (13.0) (32.0)
Acquisition of property, plant and equipment (21.9) (159.2) (229.5)
Investments (6.5) - -
Finance income received 0.4 0.2 -
Net cash used in investing activities (44.8) (172.0) (261.5)
Cash flows from financing activities
Proceeds from the issue of ordinary
shares 0.1 4.7 6.8
Purchase of own shares by EBT - (19.2) (19.2)
Finance expense paid (3.4) (0.6) (0.9)
Lease payments (6.1) (5.4) (10.2)
Proceeds from new loan 225.0 50.0 100.0
Net cash generated from financing activities 215.6 29.5 76.5
Increase/(decrease) in cash and cash
equivalents 213.3 (127.6) (174.7)
Cash and cash equivalents at beginning
of period 101.3 276.0 276.0
--------------------------------------------- ---- ------------- ------------- ------------
Cash and cash equivalents at end of
period 314.6 148.4 101.3
============================================= ==== ============= ============= ============
Notes
(forming part of the interim report and accounts)
1 Accounting policies
General information
boohoo group plc is a public limited company incorporated and
domiciled in Jersey and listed on the Alternative Investment Market
(AIM) of the London Stock Exchange. Its registered office address
is: 12 Castle Street, St Helier, Jersey, JE2 3RT. The company was
incorporated on 19 November 2013.
Basis of preparation
The interim condensed financial statements for the six months to
31 August 2022 have been prepared in accordance with IAS 34,
"Interim Financial Reporting" as adopted by the UK. The interim
financial statements should be read in conjunction with the group's
Annual Report and Financial Statements for the year ended 28
February 2022, prepared and approved by the directors in accordance
with UK-adopted international accounting standards and the
Companies (Jersey) Law 1991 applicable to companies reporting under
IFRS.
The interim condensed financial statements contained in this
report are not audited and do not constitute statutory accounts
within the meaning of Companies (Jersey) Law 1991. The Annual
Report and Financial Statements for the year ended 28 February 2022
has been filed with the Jersey Companies Registry. The auditors'
report on those accounts was unqualified and did not include
reference to any matters on which the auditors were required to
report by exception under Companies (Jersey) Law 1991.
The group's business activities together with the factors that
are likely to affect its future developments, performance and
position are set out in the Business and Financial Reviews. The
Financial Review describes the group's financial position, cash
flows and bank facilities.
The interim financial statements are unaudited and were approved
by the board of directors on 28 September 2022.
Going concern
The directors have reviewed the group's forecast and
projections, including assumptions concerning capital expenditure
and expenditure commitments and their impact on cash flows, and
have a reasonable expectation that the group has adequate financial
resources to continue its operations for the foreseeable future.
For this reason, they have continued to adopt the going concern
basis in preparing the financial statements.
In preparing the interim announcement, the directors have also
made reasonable and prudent judgements and estimates and prepared
the interim announcement on the going concern basis. The interim
announcement and management report contained herein give a true and
fair view of the assets, liabilities, financial position and profit
and loss of the group.
Accounting policies
The interim financial statements have been prepared in
accordance with the accounting policies set out in the group's
Annual Report and Financial Statements for the year ended 28
February 2022, with the addition of the policy on equity
instruments.
Equity instruments
Equity instruments are those that are held over an indefinite
period of time and that may be disposed of in response to the needs
of the group. Purchases and sales are recognised on the trade date.
The group has decided to classify equity investments as fair value
through other comprehensive income.
Significant estimates and judgements
The preparation of financial statements in conformity with IFRS
as adopted by the UK requires management to make judgements,
estimates and assumptions that affect the reported amounts of
assets and liabilities and the disclosure of contingent assets and
liabilities. The estimates and assumptions are based on historical
experience and various other factors believed to be reasonable
under the circumstances. Actual results could differ from these
estimates and any subsequent changes are accounted for when such
information becomes available. The judgements, estimates and
assumptions that are the most subjective or complex are discussed
below and are unchanged from those at 28 February 2022:
Exceptional items
Exceptional items are those of significant size and of a
non-recurring nature that require disclosure in order that the
underlying business performance can be identified. The exceptional
costs in these interim statements include additional costs
associated with the automation project in the Sheffield facility.
Such additional costs do require estimation by management.
Exceptional costs 6 months 6 months
to 31 August to 31 August
2022 2021
GBP million GBP million
--------------------------------------- -------------- --------------
Dual warehouse operating costs - 9.2
Dual administrative costs under TSA - 3.7
Redundancy costs - 3.6
Sheffield automation disruption costs 2.3 1.9
Restructuring costs - 1.6
2.3 20.0
--------------
2 Principal risks and uncertainties
The board considers the principal risks and uncertainties which
could impact the group over the remaining six months of the
financial year to 28 February 2023 to be unchanged from those set
out in the group's Annual Report and Financial Statements for the
year ended 28 February 2022, which in summary are: on-going
COVID-19 impact on trading; competition risk; fashion and consumer
demands risk; systems and technical risk; supply chain risk; loss
of key facilities; people risk; negative perception of the brands;
and financial risk. These are set out in detail on pages 34 to 39
of the group's Annual Report and Financial Statements for the year
ended 28 February 2022, a copy of which is available on the group's
website, www.boohooplc.com.
3 Segmental analysis
6 months to 31 August 2022
UK Rest of Europe USA Rest of Total
world
GBP million GBP million GBP million GBP million GBP million
---------------------------------- -------------- ----------- ----------- -----------
Revenue 544.6 102.1 177.4 58.3 882.4
Cost of sales (271.3) (48.3) (70.6) (28.7) (418.9)
-------------------------- ------- -------------- ----------- ----------- -----------
Gross profit 273.3 53.8 106.8 29.6 463.5
Distribution costs - - - - (224.8)
Administrative expenses
- other - - - - (244.3)
Amortisation of acquired
intangibles - - - - (6.2)
Other income - - - - -
-------------------------- ------- -------------- ----------- ----------- -----------
Operating loss - - - - (11.8)
Finance income - - - - 0.5
Finance expense - - - - (3.9)
-------------------------- ------- -------------- ----------- ----------- -----------
Loss before tax - - - - (15.2)
========================== ======= ============== =========== =========== ===========
6 months to 31 August 2021
UK Rest of Europe USA Rest of Total
world
GBP million GBP million GBP million GBP million GBP million
----------------------------- ------------------------- ------------ ------------ -----------
Revenue 569.6 104.7 250.6 51.0 975.9
Cost of sales (275.0) (48.6) (96.4) (22.6) (442.6)
----------------- ----------- ------------------------- ------------ ------------ -----------
Gross profit 294.6 56.1 154.2 28.4 533.3
Distribution
costs - - - - (247.3)
Administrative
expenses
- other - - - - (254.7)
Amortisation of
acquired
intangibles - - - - (6.3)
Other income - - - - -
----------------- ----------- ------------------------- ------------ ------------ -----------
Operating profit - - - - 25.0
Finance income - - - - 0.2
Finance expense - - - - (0.6)
Profit before tax - - - - 24.6
================= =========== ========================= ============ ============ ===========
Year ended 28 February 2022
UK Rest of USA Rest of Total
Europe world
GBP million GBP million GBP million GBP million GBP million
----------------- ----------- ----------- ------------ ------------ ---------------------------
Revenue 1,202.8 219.2 451.6 109.2 1,982.8
Cost of sales (608.6) (99.7) (181.5) (51.9) (941.7)
----------------- ----------- ----------- ------------ ------------ ---------------------------
Gross profit 594.2 119.5 270.1 57.3 1,041.1
Distribution
costs - - - - (516.5)
Administrative
expenses
- other - - - - (502.5)
Amortisation of
acquired
intangibles - - - - (12.8)
Other income - - - - 0.1
----------------- ----------- ----------- ------------ ------------ ---------------------------
Operating profit - - - - 9.4
Finance income - - - - -
Finance expense - - - - (1.6)
----------------- ----------- ----------- ------------ ------------ ---------------------------
Profit before tax - - - - 7.8
================= =========== =========== ============ ============ ===========================
IFRS 8, 'Operating Segments', requires operating segments to be
determined based on the group's internal reporting to the chief
operating decision maker. The chief operating decision maker is
considered to be the executive board, which has determined that the
primary segmental reporting format of the group for the year ending
28 February 2023 is by geographic region.
4 Profit before tax
Profit before tax is stated after charging: 6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
------------------------------------------- -------------------------- -------------------------- -----------------
Short-term operating lease rentals for
buildings - 0.4 0.6
Equity-settled share-based payments charges 12.9 12.9 26.1
Exceptional acquisition and restructuring
costs 2.3 20.0 35.8
Depreciation of property, plant and
equipment 12.7 12.9 22.0
Depreciation of right-of-use assets 5.5 4.6 10.0
Amortisation of intangible assets 7.7 3.4 9.0
Amortisation of acquired intangible assets 6.2 6.3 12.8
------------------------------------------- -------------------------- -------------------------- -----------------
5 Earnings per share
Basic earnings per share is calculated by dividing profit after
tax attributable to members of the holding company by the weighted
average number of shares in issue during the year. Own shares held
by the Employee Benefit Trust are eliminated from the weighted
average number of shares. Diluted earnings per share is calculated
by dividing the profit after tax attributable to members of the
holding company by the weighted average number of shares in issue
during the year, adjusted for potentially dilutive share
options.
6 months 6 months Year to
to 31 August to 31 August 28 February
2022 2021 2022
------------------------------------------- -------------- -------------- -------------
Weighted average shares in issue
for basic earnings per share (million) 1,239.7 1,238.0 1,235.3
Dilutive share options (million) 39.7 50.9 48.2
-------------------------------------------- -------------- -------------- -------------
Weighted average shares in issue
for diluted earnings per share (million) 1,279.4 1,288.9 1,283.5
============================================ ============== ============== =============
Earnings attributable to owners
of the parent company (GBP million) (14.7) 17.8 (4.0)
Basic earnings per share (1.19)p 1.44p (0.32)p
Diluted earnings per share (1.19)p 1.38p (0.32)p
-------------------------------------------- -------------- -------------- -------------
Earnings attributable to owners
of the parent company (GBP million) (14.7) 17.8 (4.0)
Adjusting items:
Amortisation of intangible assets
arising on acquisitions 6.2 6.3 12.8
Share-based payments charges 12.9 12.9 26.1
Exceptional costs 2.3 20.0 35.8
Adjustment for tax (2.9) (7.5) (14.4)
Adjusted earnings 3.8 49.5 56.3
-------------------------------------------- -------------- -------------- -------------
Adjusted basic earnings per share 0.31p 4.00p 4.56p
Adjusted diluted earnings per share 0.30p 3.84p 4.39p
-------------------------------------------- -------------- -------------- -------------
6 Intangible assets
Patents Trademarks Customer Computer Total
and licences lists software
GBP million GBP million GBP million GBP million GBP million
-------------------------- -------------- ------------ ------------ ------------ ------------
Cost
Balance at 28 February
2022 0.6 115.6 8.1 53.2 177.5
Additions 0.3 - - 16.5 16.8
Balance at 31 August
2022 0.9 115.6 8.1 69.7 194.3
========================== ============== ============ ============ ============ ============
Accumulated amortisation
Balance at 28 February
2022 0.6 26.0 6.8 15.6 49.0
Amortisation - 5.8 0.4 7.7 13.9
Balance at 31 August
2022 0.6 31.8 7.2 23.3 62.9
========================== ============== ============ ============ ============ ============
Net book value
At 28 February 2022 - 89.6 1.3 37.6 128.5
At 31 August 2022 0.3 83.8 0.9 46.4 131.4
========================== ============== ============ ============ ============ ============
7 Property, plant and equipment
Short Fixtures Computer Motor Land Total
leasehold and fittings equipment vehicles & buildings
alterations
GBP million GBP GBP million GBP GBP GBP
million million million million
-------------------------- ------------- -------------- ------------ ---------- ------------- ---------
Cost
Balance at 28 February
2022 26.5 230.5 12.3 1.0 136.3 406.6
Additions 3.0 18.1 1.3 - - 22.4
Exchange differences - - - - 0.4 0.4
Disposals - - - - (0.5) (0.5)
-------------------------- ------------- -------------- ------------ ---------- ------------- ---------
Balance at 31 August
2022 29.5 248.6 13.6 1.0 136.2 428.9
========================== ============= ============== ============ ========== ============= =========
Accumulated depreciation
Balance at 28 February
2022 6.7 38.0 6.5 0.6 5.6 57.4
Depreciation charge 1.2 8.3 1.7 0.2 1.3 12.7
Balance at 31 August
2022 7.9 46.3 8.2 0.8 6.9 70.1
========================== ============= ============== ============ ========== ============= =========
Net book value
At 28 February 2022 19.8 192.5 5.8 0.4 130.7 349.2
At 31 August 2022 21.6 202.3 5.4 0.2 129.3 358.8
========================== ============= ============== ============ ========== ============= =========
8 Right-of-use assets
Short leasehold properties
GBP million
Cost
Balance at 28 February 2022 77.9
Additions 16.5
Balance at 31 August 2022 94.4
================================= ===========================
Accumulated depreciation
Balance at 28 February 2022 28.2
Depreciation 5.5
--------------------------------- ---------------------------
Balance at 31 August 2022 33.7
================================= ===========================
Net book value
At 28 February 2022 49.7
At 31 August 2022 60.7
================================= ===========================
9 Investments
GBP million
Cost
Additions 6.5
Balance at 31 August 2022 6.5
=============================== ============
The investment is for quoted shares acquired in Revolution
Beauty Group plc and is valued at fair value. The investment
represents 12.85% of the share capital of Revolution Beauty Group
plc. The purchase price of the investment is GBP6.5m, which is
considered to be equivalent to the fair value, given the very short
time for which the investment has been held at the balance sheet
date.
10 Deferred tax
Assets
Unused Depreciation in excess of Share-based payments Total
tax losses capital allowances
GBP million GBP million GBP million GBP million
--------------------------------- ------------ -------------------------------- --------------------- ------------
At 28 February 2021 - 0.6 2.6 3.2
Recognised in statement of
comprehensive income - (0.6) 1.3 0.7
Debit in equity - - (1.6) (1.6)
--------------------------------- ------------ -------------------------------- --------------------- ------------
At 31 August 2021 - - 2.3 2.3
================================= ============ ================================ ===================== ============
At 28 February 2022 7.5 - - 7.5
Recognised in statement of
comprehensive income (0.1) - - (0.1)
At 31 August 2022 7.4 - - 7.4
================================= ============ ================================ ===================== ============
Liabilities
Business combinations Capital allowances in Share-based payments Total
excess of depreciation
GBP million GBP million GBP million GBP million
---------------------------- ---------------------- --------------------------- --------------------- ------------
At 28 February 2021 (1.0) (3.2) - (4.2)
Recognised in statement of
comprehensive income 0.1 0.3 - 0.4
At 31 August 2021 (0.9) (2.9) - (3.8)
============================ ====================== =========================== ===================== ============
At 28 February 2022 (0.8) (22.5) (2.0) (25.3)
Recognised in statement of
comprehensive income 0.1 (0.8) 1.4 0.7
Debit in equity - - (0.1) (0.1)
At 31 August 2022 (0.7) (23.3) (0.7) (24.7)
============================ ====================== =========================== ===================== ============
Recognition of the deferred tax assets is based upon the
expected generation of future taxable profits. The deferred tax
asset is expected to be recovered in more than one year's time and
the deferred tax liability will reverse in more than one year's
time as the intangible assets are amortised. Deferred tax is
calculated at 25% as enacted from April 2023 by the UK Government,
however, this is likely to remain at the current rate of 19% as
announced by the UK Government on 23 September 2022.
11 Trade and other receivables
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
------------------ -------------------------- -------------------------- -----------------
Trade receivables 33.9 36.9 34.6
Prepayments 24.1 9.5 21.3
Accrued income 3.6 1.1 2.1
61.6 47.5 58.0
================== ========================== ========================== =================
Where specific trade receivables are not considered to be at
risk and requiring a provision, the trade receivables impairment
provision is calculated using the simplified approach to the
expected credit loss model, based on the following percentages:
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
Age of trade receivable % % %
------------------------ -------------------------- -------------------------- -----------------
60 - 90 days past due 1 1 1
91 - 120 days past due 5 5 5
Over 121 days past due 90 90 90
------------------------- -------------------------- -------------------------- -----------------
Trade receivables represent amounts due from wholesale customers
and advance payments to suppliers.
The fair value of trade and other receivables is not materially
different from the carrying value.
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
------------------------------- -------------------------- -------------------------- -----------------
Due within 30 days 26.3 12.8 25.1
Provision for impairment (0.1) (2.4) (0.1)
Due in 31 to 90 days 8.7 22.4 10.7
Provision for impairment (2.4) (1.0) (2.4)
Past due 1.4 5.1 1.3
Total amounts due and past due 36.4 40.3 37.1
Total provision for impairment (2.5) (3.4) (2.5)
------------------------------- -------------------------- -------------------------- -----------------
33.9 36.9 34.6
=============================== ========================== ========================== =================
12 Trade and other payables
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
---------------------------------- -------------------------- -------------------------- -----------------
Trade payables 85.2 63.9 97.5
Other creditors 8.4 12.2 6.6
Accruals 153.6 196.5 152.4
Deferred income 19.3 6.2 16.7
Taxes and social security payable 25.0 16.7 23.4
---------------------------------- -------------------------- -------------------------- -----------------
291.5 295.5 296.6
================================== ========================== ========================== =================
13 Provisions
Dilapidations Returns Claims Total
GBP million GBP million GBP million GBP million
------------------------------------------------------------ -------------- ------------ ------------ ------------
Provision at 28 February 2021 5.9 24.2 23.4 53.5
Movements in provision charged/(credited) to income
statement:
Prior year provision utilised - (24.2) (4.3) (28.5)
Increase in provision in period - 29.3 - 29.3
------------------------------------------------------------ -------------- ------------ ------------ ------------
Provision at 31 August 2021 5.9 29.3 19.1 54.3
============================================================ ============== ============ ============ ============
Provision at 28 February 2022 3.7 32.0 17.8 53.5
Movements in provision charged/(credited) to income
statement:
Prior year provision utilised - (32.0) (0.7) (32.7)
Increase in provision period - 41.7 - 41.7
------------------------------------------------------------ -------------- ------------ ------------ ------------
Provision at 31 August 2022 3.7 41.7 17.1 62.5
============================================================ ============== ============ ============ ============
14 Interest-bearing loans and borrowings
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
------------------------------------------- -------------------------- -------------------------- -----------------
Non-current liabilities
Revolving credit facility 325.0 - -
=========================================== ========================== ========================== =================
Current liabilities
Current portion of revolving credit
facility - 50.0 100.0
=========================================== ========================== ========================== =================
Movement in financial liabilities
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
------------------------------------ -------------------------- -------------------------- -----------------
Opening balance 100.0 - -
Drawdown on rolling credit facility 225.0 50.0 100.0
Interest accrued 3.5 0.1 0.8
Interest paid (3.5) (0.1) (0.8)
Closing balance 325.0 50.0 100.0
==================================== ========================== ========================== =================
The group has obtained a GBP325 million rolling capital facility
that is secured on the assets of the group. The facility was fully
drawn down as at 31 August 2022.
Reconciliation of movements in cash flows from financing
activities to movements in liabilities:
Balance Cash flow Additions Statement Movement Balance
28 February from financing of comprehensive in retained at 31 August
2022 activities income earnings 2022
and other
reserves
GBP million GBP million GBP million GBP million GBP million GBP million
----------------- ------------- ---------------- ------------ ------------------ ------------- --------------
Equity 464.3 0.1 - (51.0) 11.2 424.6
Leases 51.9 (6.1) 16.5 0.4 - 62.7
Bank borrowings 100.0 221.6 - 3.5 - 325.0
----------------- ------------- ---------------- ------------ ------------------ ------------- --------------
616.2 215.6 16.5 (47.1) 11.2 812.3
================= ============= ================ ============ ================== ============= ==============
15 Share capital
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
------------------- -------------------------- -------------------------- -----------------
At start of period 12.7 12.6 12.7
Share issues - 0.1 -
------------------- -------------------------- -------------------------- -----------------
At end of period 12.7 12.7 12.7
=================== ========================== ========================== =================
Share capital at period end: 1,268,186,789 authorised and fully
paid ordinary shares of 1p each (2020: 1,261,276,479). No dividends
have been paid or are payable by the parent company for the period
ended 31 August 2021 (2020: GBPnil).
16 Shares to be issued
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
-------------------------- -------------------------- -----------------
31.9 31.9 31.9
The shares to be issued represents the fair value of the
contingent shares to be issued to the non-controlling interests of
PrettyLittleThing.com Limited, in accordance with the acquisition
agreement entered into and announced on 28 May 2020. Under this
agreement, 16,112,331 Ordinary Shares in boohoo group plc are to be
issued subject to the group's share price averaging 491 pence per
share over a six-month period, up until a longstop date of 14 March
2024. If this condition is not met, the consideration will
lapse.
17 Reserves
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
------------------------------------------- -------------------------- -------------------------- -----------------
Translation reserve (1.4) 0.4 0.2
Capital redemption reserve 0.1 0.1 0.1
Reconstruction reserve (515.3) (515.3) (515.3)
Acquisition of non-controlling interest in
PrettyLittleThing.com Limited (281.3) (281.3) (281.3)
Proceeds from issue of growth shares in
boohoo holdings Limited 0.8 0.8 0.8
------------------------------------------- -------------------------- -------------------------- -----------------
(797.1) (795.3) (795.5)
=========================================== ========================== ========================== -----------------
The translation reserve arises from the movement in the
revaluation of subsidiary balance sheets in foreign currencies; the
capital redemption reserve arose from a capital reconstruction in
2014; the reconstruction reserve arose on the impairment of the
carrying value of the subsidiary company in 2014 at that date; and
the acquisition of the non-controlling interest in
PrettyLittleThing is the excess of consideration paid over the
carrying value of the non-controlling interest as at the date of
acquisition in May 2020, written off to reserves.
18 Capital commitments
Capital expenditure contracted for at the end of the reporting
period but not yet incurred is as follows:
6 months to 31 August 2022 6 months to 31 August 2021 Year to
28 February 2022
GBP million GBP million GBP million
------------------------------ -------------------------- -------------------------- -----------------
Property, plant and equipment 25.5 58.2 21.8
------------------------------ -------------------------- -------------------------- -----------------
The capital commitment relates largely to automation equipment
in the Sheffield warehouse.
19 Contingent liabilities
From time to time, the group can be subject to various legal
proceedings and claims that arise in the ordinary course of
business which may include cases relating to the group's brands and
trading names. All such cases brought against the group are
robustly defended and a liability is recorded only when it is
probable that the case will result in a future economic outflow and
that the outflow can be reliably measured.
As at 31 August 2022, there are no contingent liabilities, which
in the opinion of the directors are expected to have a material
adverse effect on its liquidity or operations.
Appendices
Growth rates on prior period revenue by region
Revenue by period for the 6 months to 31 August 2022 (FY23)
GBPm 3m to 31 May 3m to 31 August 6m to 31 August
----------------------------
FY23 FY22 yoy yoy FY23 FY22 yoy yoy FY23 FY22 yoy yoy
% % CER % % % %
CER CER
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
Total 445.7 486.1 -8% -8% 436.7 489.8 -11% -10% 882.4 975.9 -10% -9%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
Revenue by region
------ ------ ----- ----- ------ ------ -----
UK 272.1 274.6 -1% -1% 272.5 295.0 -8% -8% 544.6 569.6 -4% -4%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ -----
ROE 49.6 54.4 -9% -7% 52.5 50.0 +5% +5% 102.1 104.7 -2% -2%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
USA 95.0 131.9 -28% -26% 82.4 118.7 -31% -29% 177.4 250.6 -29% -28%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
ROW 29.0 25.2 +15% +15% 29.3 26.1 +12% +15% 58.3 51.0 +14% +15%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
Revenue by period for the 6 months to 31 August 2021 (FY22)
GBPm 3m to 31 May 3m to 31 August 6m to 31 August
----------------------------
FY22 FY21 yoy yoy FY22 FY21 yoy yoy FY22 FY21 yoy yoy
% % CER % % % %
CER CER
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
Total 486.1 367.8 32% 32% 489.8 448.7 9% 10% 975.9 816.5 20% 20%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
Revenue by region
------ ------ ----- ----- ------ ------ -----
UK 274.5 183.0 50% 50% 294.9 247.2 19% 19% 569.4 430.2 32% 32%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ -----
ROE 54.4 63.4 -14% -12% 50.0 60.3 -17% -16% 104.4 123.7 -16% -14%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
USA 131.9 92.0 43% 40% 118.6 110.2 8% 9% 250.5 202.2 24% 23%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
ROW 25.2 29.4 -15% -10% 26.3 31.0 -15% -18% 51.5 60.4 -15% -14%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
Revenue by period for the year to 28 February 2022 (FY22)
GBPm 4m to 31 December 2m to 28 February 12m to 28 February
----------------------------
FY22 FY21 yoy yoy FY22 FY21 yoy yoy FY22 FY21 yoy yoy
% % CER % % % %
CER CER
------ ------ ----- ------- ------ ------ ----- ----- -------- -------- ----- -----
Total 714.5 660.8 8% 9% 292.5 268.0 9% 9% 1,982.8 1,745.3 14% 14%
------ ------ ----- ------- ------ ------ ----- ----- -------- -------- ----- -----
Revenue by region
------ ------ ----- ----- -------- -------- -----
UK 451.0 356.7 26% 26% 182.3 158.3 15% 15% 1,202.8 945.1 27% 27%
------ ------ ----- ------- ------ ------ ----- ----- -------- -------- -----
ROE 79.9 90.3 -11% -11% 34.9 30.5 14% 13% 219.2 244.7 -10% -9%
------ ------ ----- ------- ------ ------ ----- ----- -------- -------- ----- -----
USA 145.8 168.2 -13% -12% 55.4 64.6 -14% -13% 451.6 435.1 4% 4%
------ ------ ----- ------- ------ ------ ----- ----- -------- -------- ----- -----
ROW 37.8 45.6 -17% -16% 19.8 14.6 36% 34% 109.2 120.4 -10% -8%
------ ------ ----- ------- ------ ------ ----- ----- -------- -------- ----- -----
GBPm 3m to 31 May 3m to 31 August 6m to 31 August
----------------------------
FY22 FY21 yoy yoy FY22 FY21 yoy yoy FY22 FY21 yoy yoy
% % CER % % % %
CER CER
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
Total 486.1 367.8 32% 32% 489.8 448.7 9% 10% 975.9 816.5 20% 20%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
Revenue by region
------ ------ ----- ----- ------ ------ -----
UK 274.5 183.0 50% 50% 294.9 247.2 19% 19% 569.4 430.2 32% 32%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ -----
ROE 54.4 63.4 -14% -12% 50.0 60.3 -17% -16% 104.4 123.7 -16% -14%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
USA 131.9 92.0 43% 40% 118.6 110.2 8% 9% 250.5 202.2 24% 23%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
ROW 25.2 29.4 -15% -10% 26.3 31.0 -15% -18% 51.5 60.4 -15% -14%
------ ------ ----- ------- ------ ------ ----- ----- ------ ------ ----- -----
CER in this appendix for the year ended 28 February 2022 is
calculated using exchange rates prevailing during the year ending
28 February 2022. Nomenclature: ROE - rest of Europe; ROW - rest of
world; yoy - year-on-year; CER - constant exchange rate
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END
IR BCGDCIUDDGDR
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September 28, 2022 02:02 ET (06:02 GMT)
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