Boohoo suffers as shoppers return to the high street

Boohoo watched sales fall over Christmas as shoppers return to the high street and increased delivery times reduced the demand for ecommerce.

The fast-fashion retailer recorded revenues of £637.7 million in the four months to 31 December, down 13% on a constant currency basis against the same period in 2021.

“Performance in the period is in line with expectations and reflects the normalisation of the channel shift online over the last 12 months,” Boohoo chief executive John Lyttle said.

“Looking ahead, whilst the demand outlook is uncertain due to macroeconomic factors, cost inflation is expected to begin to moderate in the second half of the year”.

Boohoo said that revenues would decline by approximately 12% for the full financial year.

Sales in the UK and the US saw the biggest decline year-on-year.

The company’s share price fell by 4% in early morning trading, after losing nearly 90% of its value since its pandemic peak in June 2020, when shoppers looked to online merchants as bricks-and-mortar retail closed its doors.

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Edison Group director of consumer Russell Pointon said: “Once again, Boohoo has announced negative results across all regions, continuing a trajectory of decreasing revenue seen throughout 2022.

“The poor results reflect the tough comparative from the prior year, ongoing challenges faced by online retail brands, with high cost inflation and weaker consumer demand having an impact on the very fabric of the online fashion industry.

“The drop in revenue experienced by Boohoo exemplifies a broader pattern of decline, that saw online fashion firm Missguided fall into administration in May 2022.

“While increased consumer demand over the Christmas period would have had a positive impact on Boohoo’s overall revenue, this was countered by the disruption resulting from postal strikes and the effect this had on customer confidence in online retail.

“The coming months, however, offer some hope for Boohoo. Stabilising inflation levels and positive indications in global supply chains imply that the online retail sector could be looking forward to a more prosperous year than the past twelve months.”



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