Business

Boohoo hails ‘early rewards’ from Debenhams and Arcadia rescue deals

Boohoo has said it is seeing “early rewards” after snapping up Debenhams and three Arcadia brands in rescue deals as it unveiled strong trading for the past year.

The online fashion giant reported a 41 per cent surge in revenues as it benefited from the online shopping boom during lockdown.

The retailer said revenues jumped to £1.74 billion (€2 billion) in the year to February 28th from £1.23 billion the previous year.

It told shareholders on Wednesday morning that pre-tax profits lifted by 35 per cent to £124.7 million as it was boosted by the sales increase.

The group said it was helped by the “successful integration” of the Oasis and Warehouse brands it bought out of administration last year.

Boohoo bought the Debenhams brand and website for £55 million in January in a deal that confirmed the closure of all its stores (Kirsty O’Connor/PA)

Earlier this year, the group also snapped up the Debenhams, Dorothy Perkins, Burton and Wallis after their owners tumbled into insolvency.

John Lyttle, chief executive of Boohoo, said: “Our newly acquired brands are being re-energised and made relevant for today’s consumer across a broader market demographic.

“We are very excited about their potential and are already seeing the early rewards from their growth.”

The group said it expects to post 25 per cent sales growth for the current year, with five per cent of this from the recently acquired brands.

Boohoo said trading in the first weeks of the financial year has been “encouraging” although it cautioned that the outlook remains uncertain and its expects the recent benefits from reduced returns to begin to unwind.

It said it that while it saw benefits to demand from lockdown measures, the pandemic hit core categories such as dresses and going-out clothing, although it hopes these will rebound in coming months.

Labour abuses

The update comes after a year which saw the business dogged by a supply chain scandal regarding labour abuses and poor working conditions at its Leicester factories.

The group said it has made progress in its Agenda for Change programme to improve its corporate governance.

In a joint statement, co-founders Mahmud Kamani and Carol Kane said: “Over the last year the group has made great progress, delivering another set of record results despite the challenges posed by the Covid-19 pandemic.

“We have made significant progress on our Agenda for Change programme, with greater oversight of our supply chain, stronger governance and more transparency.

“We are embedding a new way of working and improving the sustainability of the group for the benefit of all stakeholders.”

Source:

www.breakingnews.ie

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