Boohoo, the British fashion e-tailer that also owns the brands PrettyLittleThing and Nasty Gal, posted revenues of £1,235 million (€1,416m-$1,535m) for the full year ended on Feb. 29, up by 44 percent both in actual and constant currency rates. Profits before taxes grew by 54 percent to £92.2 million (€105.7m-$114.6m).
Net cash inflated to £240.7 million (€276.0m-$299.2m) from £190.7 million a year earlier, while the operating cash flow increased to £127.3 million (€146.0m-$158.3m) from £111.9 million.
In the first two weeks of the new financial year, the trading momentum was maintained but since the middle of March, the trend has been mixed due to the Covid-19 pandemic. Initially, the company suffered a marked decrease in year-on-year growth, but the performance has improved in recent weeks. Nevertheless, boohoo remains remain cautious about its outlook.
Chief executive John Lyttle said that the company is “underpinned by its incredibly strong balance sheet” and is “well-placed to leverage its scalable multi-brand platform.” Chief financial officer Neil Catto added that group expects “many opportunities” in the coming weeks and will study them. In August 2019, boohoo acquired the British brands Karen Millen and Coast, which were in administration, for £18.2 million (€20.9m-$22.6m).
Separately, boohoo’s peer Farfetch released preliminary results for the first quarter end on March 31, indicating continued losses on rapidly growing sales. It expects to report gross merchandise value up by 43 to 46 percent, adjusted Ebitda to be a negative $21 to $25 million and the net loss to have amounted to $70 to $125 million, leaving cash and cash equivalents of approximately $420 million at the end of March, up from $322 million at the end of 2019. However, the cash pile was bloated by a $250 million convertible senior note issuance in February.
The cash burn in the first quarter was primarily a result of the working capital outflow, The company anticipates the position to reverse, but nevertheless it has taken action to further support liquidity in the short term.
Farfetch expects an acceleration of sales on online channels and a return to normalized levels of consumer activity in 2021.“This scenario would support our ability to deliver profitability at the adjusted Ebitda level for 2021 as planned,” it said.