3Q18 Trading Update

British online fashion pure-play Boohoo.com had another bumper trading period of revenue growth. In 3Q18, the four months ended December 31, group revenue jumped by 100% as reported and by 93% at constant currency to £228.2 million. Group gross margin contracted by 60 basis points to 52.5%, and the retail margin softened by 20 basis points to 54.2%.

Revenue Breakdown by Brand

• Boohoo: Revenue was £142.6 million, denoting 25% growth as reported and 21% at constant currency, against a strong comparative of 55% growth in the prior year.
• PrettyLittleThing: Revenue soared by 191% year over year to £73.8 million.
• Nasty Gal: Revenue was £11.9 million, “increasing month on month” since Boohoo.com acquired it in March 2017.

Revenue Breakdown by Region (at Constant Currency)

• UK revenues were up 107%.
• Rest of Europe revenues were up 76%.
• US revenues were up 102%.
• Rest of World revenues were up 46%.

Outlook

Boohoo.com raised its group revenue growth guidance for the third time this fiscal year. The company now expects FY18 revenue growth of 90% versus previous guidance of 80%, which was raised from 60%. Boohoo now expects full-year group adjusted EBITDA margin to be between 9.25% and 9.75%, a narrowing from the previous guided range of 9%–10%. Consensus estimates were compiled before the latest update. For FY18, analysts expect group revenue to grow by 88% to £554.5 million and EBITDA to be £50.2 million, implying a 190 basis-point reduction of the EBITDA margin to 9.1%. Analysts estimate EPS to strengthen by 50% to 3.0 pence in FY18. The company reports full-year results on April 25, 2018.