3Q17 Results

British online fashion retailer Boohoo.com reported £114.3 million in revenues in 3Q17, up 52% year over year on a constant currency basis and up 55% as reported. Revenues came in ahead of consensus expectations. On a constant currency basis, 9M17 total revenues increased by 46% year over year. Strong sales were driven by growth across all regions and particularly robust momentum in the US. The retail gross margin contracted by 260 basis points year over year in 3Q17, to 54.4%, due to planned investment in price and promotions. In 3Q17, the company had 5.1 million active customers who had shopped in the last year, up 31% year over year. The company’s acquisition of PrettyLittleThing was completed on January 3, 2017.

Geographic Sales Breakdown

In 3Q17, UK sales grew by 31% year over year, to £65.0 million. Rest of Europe sales increased by 54% year over year at constant currencies, to £14.0 million. US sales increased by 188% at constant currency, to £19.7 million, and Rest of World sales expanded by 57% year over year at constant currencies, to £15.7 million.

Guidance

Following strong trading trends through Black Friday and the Christmas season, Boohoo.com raised its revenue guidance for the fifth time this year. The company now expects FY17 revenue growth of 43%–45% versus 38%–42% previously. PrettyLittleThing is expected to report FY17 revenue growth in excess of 150% year over year and to achieve EBITDA breakeven level. Including PrettyLittleThing revenues, Boohoo.com is expected to report FY17 year-over-year revenue growth of 46%–48%. The company maintained its FY17 EBITDA margin guidance of 11%–12%. Consensus estimates for FY17 revenue stand at £284.1 million, implying annual year-over-year growth of 45.4%. Consensus expects operating profit of £26.3 million, implying a year-over-year increase of 74.7%. The FY17 consensus EPS estimate is 2.0 pence, implying a year-over-year increase of 100%.