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Fashion retailer says revenues grew 32% in the three months to May as Covid crisis fuels online spending

Jun 15, 2021

PrimarkFashion retailer says revenues grew 32% in the three months to May as Covid crisis fuels online spending
Tue 15 Jun 2021 08.51 BST
Boohoo has reported further strong sales growth on the back of the online shopping boom seen during the pandemic, as it launched a new Debenhams digital department store.
The online fashion retailer said its revenues grew 32% in the three months to May compared with the same period in 2020, even as Covid lockdowns eased and other retailers reopened their shops.
UK revenues were strongest, up 50%, followed by the US with a 43% increase while sales in the rest of Europe and the rest of the world fell by 14% and 15% respectively. Overall revenues are up 91% over the past two years, with sales in the UK and US doubling.
Boohoo relaunched the Debenhams website in April, selling fashion, beauty and homeware, with new ranges added. It bought the Debenhams brand and website out of administration for £55m in January, after the 243-year-old department store chain collapsed last year. The Debenhams name has disappeared from the high street, with all stores around the country closed, leading to the loss of about 12,000 jobs.
The Debenhams brand allows Boohoo, which has thrived in the world of fast fashion, to make a big push into beauty and homeware. Debenhams was the UKs second-biggest beauty retailer when it collapsed. Analysts say the acquisition will help Boohoo appeal to older shoppers and enter new markets such as sportswear.
Boohoo has also relaunched the Dorothy Perkins, Wallis and Burton websites, after snapping up the brands for £25m out of administration in February, which completed the break-up of Sir Philip Greens Arcadia Group. As with Debenhams, Boohoo as an online retailer had no interest in the stores.
John Lyttle, the Boohoo chief executive, said: I am delighted with our performance in the first quarter, particularly as it was always going to be challenging to produce strong growth rates on last year, when lockdowns around the globe drove such high traffic to online retailers.
Boohoo is working to improve conditions among UK and overseas suppliers, after allegations of poor pay and conditions last year, particularly in Leicester where the group sources about 40% of its fashions. The overhaul of Boohoos supply chain is being monitored by advisory firm KPMG and the retired judge Sir Brian Leveson.
Leveson said in a progress report, published on Tuesday, that Boohoo had taken the recommendations extremely seriously.
My experience has demonstrated that any transformational change needs continuous investment of time and effort in order to embed the imposed business changes as permanent. That will be even more difficult in a business as dynamic as Boohoo.
However, he added: The progress and commitment are evident and has been the subject of positive comment from a number of those interested and engaged in the problems that Leicester has evidenced.
Leveson said a small number of businesses that were initially approved had been removed from the list of suppliers while new companies were in the process of being added, and that Boohoos due diligence may now go well beyond that of other retailers. With importers that do not themselves manufacture but source garments that they sell on to the group, Boohoo needs to insert fair dealing requirements into a contract, he said.
Lyttle said: We continue to make great progress on our agenda for change programme, with this mornings latest report from Sir Brian Leveson outlining the seriousness with which the group is determined to develop and demonstrate a gold standard in our supply chain.
Richard Hunter, head of markets at interactive investor, said: Rectifying the reputational damage remains a work in progress and the share price has declined by 10% over the last year Over the last two years, however the shares remain up by 49% despite the dip and investor sentiment remains defiantly optimistic on prospects.
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