TIDMBOO
RNS Number : 8649W
boohoo group plc
24 April 2019
For Immediate Release 24 April 2019
The information contained within this announcement is deemed by
the company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
boohoo group plc - final results for the year ended 28 February
2019
Strong growth and solid profitability
2019 2018 Change
GBP million GBP million
---------------------------------------- ------------ ------------ ---------
Revenue 856.9 579.8 +48%
Gross profit 469.0 306.4 +53%
Gross margin 54.7% 52.8% +190bps
Adjusted EBITDA(1) 84.5 56.9 +49%
% of revenue 9.9% 9.8% +10bps
Adjusted EBIT(2) 75.1 50.4 +49%
% of revenue 8.8% 8.7% +10bps
Adjusted profit before tax(3) 76.3 51.0 +49%
Profit before tax 59.9 43.3 +38%
Adjusted diluted earnings per share(4) 4.15p 3.23p +29%
Diluted earnings per share 3.22p 2.71p +19%
+GBP57.7
Net cash(5) at year end 190.7 133.0 million
---------------------------------------- ------------ ------------ ---------
Financial Highlights
Group
-- Revenue GBP856.9 million, up 48% (47% CER(6) )
-- Strong revenue growth across all geographies with UK up 37% and international up 64%
-- Gross margin increased to 54.7% (2018: 52.8%)
-- Adjusted EBITDA GBP84.5 million, 9.9% of revenue (2018: GBP56.9 million, 9.8%)
-- Adjusted profit before tax GBP76.3 million (2018: GBP51.0 million)
-- Strong balance sheet with net cash of GBP190.7 million (2018:
GBP133.0 million), with robust operating cash flow of GBP111.9
million (2018: GBP76.2 million)
boohoo
-- Revenue GBP434.6 million up 16% (15% CER)
-- Gross margin 52.9%, up 170bps
PrettyLittleThing
-- Revenue GBP374.4 million up 107% (107% CER)
-- Gross margin 56.6% up 140bps
Nasty Gal
-- Revenue GBP47.9 million up 96% (100% CER)
-- Gross margin 56.7% down 290bps
Operational Highlights
Group
-- Burnley distribution centre extension build and fit-out
completed, with automation live in April 2019
-- PrettyLittleThing's distribution centre successfully
relocated to a larger facility in Sheffield
boohoo
-- 7.0 million active customers(7) , up 9% on prior year
-- Strong international growth, now 44% of total revenue
-- Significant investments in customer service improving the customer proposition
PrettyLittleThing
-- 5.0 million active customers, up 70% on prior year
-- Customer proposition resonating with consumers, driving growth and increasing market share
-- High profile celebrity associations driving traffic and
international expansion, exceptionally well in the US
Nasty Gal
-- 0.9 million active customers, up 122% on prior year
-- Extensive product range now comprises over 8,000 lines
-- Strong growth in US home market and international appeal and revenue growing rapidly
Outlook and guidance
Trading in the first few weeks of the financial year has been
encouraging. Group revenue growth for the financial year is
expected to be 25% to 30% with an adjusted EBITDA margin of around
10% and capital expenditure in the region of GBP50 to GBP60
million. This guidance includes the adoption of IFRS 16, which is
expected to increase EBITDA by GBP4 to GBP5 million and be broadly
neutral at a Profit Before Tax level.
Looking beyond the current year, we will continue to make
investments across the group as part of our vision to lead the
global fashion e-commerce market. Whilst this will require
continued investments in people and infrastructure, we believe that
the benefits of our multi-brand platform will continue to generate
economies of scale, allowing us to target sales growth of 25% per
annum, with an adjusted EBITDA margin of around 10% over the medium
term.
John Lyttle, CEO, commented:
"I am very excited to have joined the boohoo Group at this key
stage of its growth, with the group's disruptive and proven
business model having delivered yet another excellent set of
financial and operational results. In my short time within the
business, I am delighted to have been able to meet a number of
hugely talented people and have already been able to see many parts
of the business. This has confirmed my belief and optimism that the
group's investments into its brands and infrastructure have allowed
it to develop a scalable multi-brand platform that is
well-positioned to disrupt, gain market share and capitalise on
what is a truly global opportunity."
Investor and analyst meeting
A meeting for analysts will be held today at the office of
Buchanan, 107 Cheapside, London, EC2V 6DN commencing 9.30am (UK
time).
A live audio webcast will be available at 9.30am via the
following link:
http://webcasting.buchanan.uk.com/broadcast/5c6bc25be6e1d92d38f4ed2d
A replay will subsequently be available from 12 noon via the
same link.
Enquiries
boohoo group plc
Neil Catto, Chief Financial Officer Tel: +44 (0)161 233 2050
Alistair Davies, Investor Relations Tel: +44 (0)161 233 2050
Clara Melia, Investor Relations Tel: +44 (0)20 3289 5520
Zeus Capital - Nominated adviser
and joint broker
Nick Cowles/Andrew Jones (Corporate Tel: +44 (0)161 831 1512
Finance)
John Goold/Benjamin Robertson (Corporate Tel: +44 (0)20 3829 5000
Broking)
Jefferies Hoare Govett - Joint broker
Nick Adams/Max Jones Tel: +44 (0)20 7029 8000
Buchanan - Financial PR adviser boohoo@buchanan.uk.com
Richard Oldworth/Sophie Wills/Maddie Tel: +44 (0)20 7466 5000
Seacombe
Notes:
(1) Adjusted EBITDA is calculated as profit before tax,
interest, depreciation, amortisation, share-based payment charges
and exceptional items.
(2) Adjusted EBIT is calculated as profit before tax, interest,
share-based payment charges, amortisation of acquired
PrettyLittleThing and Nasty Gal intangible assets and exceptional
items.
(3) Adjusted profit before tax is calculated as profit before
tax, excluding share-based payment charges, amortisation of
acquired PrettyLittleThing and Nasty Gal intangible assets and
exceptional items.
(4) Adjusted diluted earnings per share is calculated as diluted
earnings per share, adding back amortisation of acquired
PrettyLittleThing and Nasty Gal intangible assets, share-based
payment charges and exceptional items.
(5) Net cash is cash less borrowings.
(6) CER designates Constant Exchange Rate translation of foreign
currency revenue, which gives a truer indication of the performance
in international markets by removing year-to-year exchange rate
movements when local currency sales are converted to sterling.
(7) Active customers defined as having shopped in the last
year.
About boohoo group plc
"Leading the fashion eCommerce market"
Founded in Manchester in 2006, boohoo is an inclusive and
innovative brand targeting young, value-orientated customers. For
13 years, boohoo has been pushing boundaries to bring its customers
up-to-date and inspirational fashion, 24/7. boohoo has grown
rapidly in the UK and internationally, expanding its offering with
range extensions into menswear, through boohooMAN, and now has over
seven million active customers.
In early 2017 the group extended its customer offering through
the acquisitions of the vibrant fashion brand PrettyLittleThing,
and free-thinking brand Nasty Gal and in March 2019 acquired the
Miss Pap brand. United by a shared customer value proposition, our
brands design, source, market and sell great quality clothes, shoes
and accessories at unbeatable prices. This investment proposition
has helped us grow from a single brand, into a major multi-brand
online retailer, leading the fashion eCommerce market for 16 to
30-year-olds around the world. Today the boohoo group has 13
million customer accounts across all its brands around the
world.
Cautionary Statement
Certain statements included or incorporated by reference within
this announcement may constitute "forward-looking statements" in
respect of the group's operations, performance, prospects and/or
financial condition. Forward-looking statements are sometimes, but
not always, identified by their use of a date in the future or such
words and words of similar meaning as "anticipates", "aims", "due",
"could", "may", "will", "should", "expects", "believes", "intends",
"plans", "potential", "targets", "goal" or "estimates". By their
nature, forward-looking statements involve a number of risks,
uncertainties and assumptions and actual results or events may
differ materially from those expressed or implied by those
statements. Accordingly, no assurance can be given that any
particular expectation will be met and reliance should not be
placed on any forward-looking statement. Additionally,
forward-looking statements regarding past trends or activities
should not be taken as a representation that such trends or
activities will continue in the future. No responsibility or
obligation is accepted to update or revise any forward-looking
statement resulting from new information, future events or
otherwise. Nothing in this
announcement should be construed as a profit forecast. This
announcement does not constitute or form part of any offer or
invitation to sell, or any solicitation of any offer to purchase
any shares or other securities in the Company, nor shall it or any
part of it or the fact of its distribution form the basis of, or be
relied on in connection with, any contract or commitment or
investment decisions relating thereto, nor does it constitute a
recommendation regarding the shares or other securities of the
Company. Past performance cannot be relied upon as a guide to
future performance and persons needing advice should consult an
independent financial adviser. Statements in this announcement
reflect the knowledge and information available at the time of its
preparation. Liability arising from anything in this announcement
shall be governed by English law. Nothing in this announcement
shall exclude any liability under applicable laws that cannot be
excluded in accordance with such laws.
Review of the business
"Another outstanding year from all our brands across all
regions."
Overview
2019 2018 Change
GBP000 GBP000
--------------------------------- -------- -------- ----------
Revenue 856,920 579,800 +48%
Gross profit 468,994 306,355 +53%
Gross margin 54.7% 52.8% +190bps
EBITDA 72,601 53,663 +35%
% of revenue 8.5% 9.3% -80bps
Profit before tax 59,856 43,313 +38%
Diluted earnings per share 3.22p 2.71p +19%
Net cash(1) at year end 190,726 133,047 +GBP57.7m
Underlying:
Adjusted EBITDA(2) 84,546 56,932 +49%
% of revenue 9.9% 9.8% +10bps
Adjusted EBIT(3) 75,074 50,403 +49%
% of revenue 8.8% 8.7% +10bps
Adjusted profit before tax(4) 76,250 51,031 +49%
Adjusted diluted earnings per
share(5) 4.15p 3.23p +29%
--------------------------------- -------- -------- ----------
(1) Net cash is cash less borrowings.
(2) Adjusted EBITDA is calculated as profit before tax,
interest, depreciation, amortisation, share-based payment charges
and exceptional items.
(3) Adjusted EBIT is calculated as profit before tax, interest,
share-based payment charges, amortisation of acquired
PrettyLittleThing and Nasty Gal intangible assets and exceptional
items.
(4) Adjusted profit before tax is calculated as profit before
tax, excluding share-based payment charges and amortisation of
acquired intangible assets and exceptional items.
(5) Adjusted diluted earnings per share is calculated as diluted
earnings per share, adding back amortisation of acquired
intangibles, share-based payment charges and exceptional items.
Group revenue for the year increased by 48% (47% CER) to
GBP856.9 million (2018: GBP579.8 million). Revenue growth across
all territories and brands was strong.
Adjusted EBITDA was GBP84.5 million (2018: GBP56.9 million), an
increase of 49%, with improved gross margin across the group
leading to an adjusted EBITDA margin of 9.9% (2018: 9.8%). Adjusted
profit before tax was GBP76.3 million (2018: GBP51.0 million), an
increase of 49%. Profit before tax was GBP59.9 million (2018:
GBP43.3 million), an increase of 38%. Adjusted diluted earnings per
share was 4.15p, up 29% on the prior year. Diluted earnings per
share rose to 3.22p, an increase of 19% (2018: 2.71p).
The group has performed exceptionally well during the year.
Revenues have increased across all our brands in all regions. Our
focus on key international markets has been highly successful,
producing growth of 64% and increasing international revenues to
43% of total revenue. PrettyLittleThing continues to perform
exceptionally well, with a growth rate of 107%. Market share is
increasing, driven by the customer proposition of great fashion at
unbeatable prices, supported by an engaging social media presence
and successful celebrity endorsements. Gross margins have improved
as a result of stronger sell through, tighter control on stock
cover and refinement of the customer proposition. Substantial
investments have been completed to secure warehouse capacity for
growth and improve the future efficiency of the Burnley warehouse
with automation.
Cash flow generation was strong, with free cash flow up 118% to
GBP65.1 million. Capital expenditure was GBP46.9 million as we
invest in our infrastructure ahead of our growth curve. Our net
cash balance at the period end increased to GBP190.7 million (2018:
GBP133.0 million).
Distribution centres
During the year, the Burnley distribution centre extension build
and fit-out was completed. Automation went live in April 2019,
which will greatly improve picking efficiency and reduce costs in
the financial year 2020 and beyond. We opened new welfare
facilities to all Burnley employees and provided a bus service to
the distribution centre from nearby towns. PrettyLittleThing's
("PLT") distribution centre relocation to Sheffield was completed
successfully during July and August, with a low level of disruption
to operations. Costs associated with this relocation are considered
exceptional and amounted to GBP6.7 million. The addition of the
Sheffield facility greatly increases our sales capacity, will help
underpin PLT's infrastructure needs and adds further operational
flexibility for the group. We continue to invest in our
infrastructure, with our operations at Burnley and Sheffield
representing significant stepping stones as we build towards
creating a distribution network capable of generating GBP3 billion
of net sales globally.
boohoo (including boohooMAN)
Performance
Revenue for the year increased to GBP434.6 million, up 16% on
the previous year, with growth in all our key focus markets.
International growth continues to be strong and we are
continuing to gain market share in the UK. Gross margin increased
by 170bps to 52.9%, driven by improved stock control and refinement
of the customer proposition.
Product
Our comprehensive size range offerings, the breadth of the
product range and continuous fresh introductions have continued to
drive growth. Hundreds of new styles are added daily and the very
latest fashions appear within days or weeks of trends being spotted
by our fashion experts and offered to our customers at affordable
prices. boohooMAN has performed strongly with an extensive product
range and increasing customer reach.
Marketing
Marketing activity included several high profile celebrity
campaigns: Zendaya, Stefflon Don, French Montana, Dele Alli and
Paris Hilton headed the cast and were instrumental in driving
increased brand awareness. Other marketing activities continued
using a successful formula of a mix of media, including social
media influencers, reality TV ambassadors, bloggers, TV, outdoor,
email, student events and digital acquisition channels. Our social
media presence continues to grow and we now have 5.9 million
followers on Instagram, 2.9 million Facebook fans and 0.5 million
followers on Twitter.
Customer interaction
Active customer numbers over the last 12 months increased by 9%
to 7.0 million. Conversion rate to sale decreased from 4.3% to 3.9%
of sessions, when measured on website statistics alone. Order
frequency increased 0.3%, with customers placing an order with us,
on average, 2.14 times in 12 months, whilst the number of items per
basket decreased 1% to 3.04.
Refinements to the customer proposition included free returns,
next day delivery, shortened delivery times and more overseas
collection points. The cut-off time for next day delivery in the UK
is 11pm and SMS messaging for delivery status has been introduced.
We are trialling artificial intelligence in customer contact
response. We have 17 country-specific websites and have plans to
introduce more foreign language websites optimised for local
criteria, in line with our aim to attain best-in-class customer
service.
Technology
The principal technology projects completed include new payment
solutions and more country returns portals, which give more returns
flexibility and enable us to refund customers immediately after the
courier collects their parcel. We have also introduced social
logins for UK customers.
The website and app are subject to continuous improvement in
content, functionality, personalisation and ease of use. During the
year we added visual search to the website, which enables customers
to search for similar items either from a photograph they have
uploaded or from an image on the website. Our app has been
downloaded by nearly two million customers, generating a
considerable growth in the number of visits.
PrettyLittleThing
Performance
PrettyLittleThing ("PLT") has had an enormously successful year,
with revenues increasing by 107% to GBP374.4 million. All
territories delivered strong growth and significant increases in
market share and it is clear that there is both the demand and
potential for this to continue. The relocation of the distribution
centre to Sheffield in the summer was executed extremely well, with
a low level of disruption to the business during the move.
Exceptional costs associated with the move amounted to GBP6.7
million. Gross margin has increased 140bps to 56.6%, with stronger
sell-through and refinements to the customer proposition.
Product
Renowned for having the latest and most relevant celebrity
looks, PLT offers over 20,500 styles at affordable prices to its
customers. PLT's "shape" ranges, which include Petite, Tall, Shape
and Plus, have proved very popular in the year and have driven
growth. Highly successful celebrity collaborations in the year
included those with Model Hailey Baldwin, UK Radio presenter Maya
Jama, American Hip-Hop stylist Karl Kani and US model Ashley
Graham. The Karl Kani collaboration launched in January 2019
included PLT's first ever unisex product range.
Marketing
The PLT brand is promoted through a global multi-channel
marketing approach which seeks to engage with customers across the
world. Celebrity collaborations are supported by an influencer
network which seeks to leverage the power of social media to engage
with our customers, giving us a combined reach of over 350 million
impressions globally. The PLT 'Royalty' programme, which has shown
significant growth in the year, gives customers in the UK and
Ireland free unlimited next day delivery and seeks to generate
increased customer loyalty to the PLT brand. Brand awareness is
also supported by more traditional marketing approaches such as
PLT's sponsorship of the E! entertainment channel in the UK,
Ireland, France and Australia, which directly appeals to PLT's
target market, as well as out-of-home advertising including the now
iconic fleet of PLT taxis operating in major cities throughout the
UK.
Customer interaction
We support eight country-specific websites and have plans for
further foreign language sites next year, following the success of
the French language site, introduced in the previous financial
year. For the UK market, we offer a wide range of free return
options. We have also introduced new returns options in
international markets, accelerating the point of refund to enhance
the customer experience. Customers have the option of using a
virtual customer service assistant for frequently asked questions,
which greatly reduces response wait time as well as cutting
costs.
Active customer numbers over the last 12 months increased by 70%
to 5.0 million. Conversion rate to sale decreased from 3.7% to 3.3%
of sessions, when measured on website statistics alone. Order
frequency increased 12%, with customers placing an order with us,
on average, 2.84 times in 12 months, whilst the number of items per
basket increased 12% to 2.72. We have 1.9 million followers on
Facebook, 0.3 million followers on Twitter, 10.5 million Instagram
followers, as well as a presence on several other social media
channels.
Technology
Investment in technology is paramount to PLT's success and we
have a programme of work across our services and customer-facing
applications. The separation of systems with our micro-service
architecture has allowed our platform to be more adaptable to cope
with the business's pace of change and the continuing growth of our
customers' order volumes and website traffic. Through the global
reach of the Cloud, we can roll out new services worldwide so they
are hosted as close as possible to our customers and built in a way
we can ensure high performance. This agility will allow us to
continue to invest at pace, delivering new experiences and
innovation to our customers.
Key highlights for this year have been the introduction of a new
automated chatbot which provides customers with instant assistance
on a number of contact categories. New payment methods have been
launched, with further payment options planned for the coming
financial year. Our iOS and android apps have been developed
throughout the year to improve the customer experience and
conversion rates.
Nasty Gal
Performance
Revenue growth has been strong across all territories with a
growth rate of 96%, increasing revenue to GBP47.9 million. In the
brand's principal market, the USA where the brand originated,
growth has been very strong. The next largest market is the UK,
where brand awareness has increased substantially and growth has
been exceptionally high. Gross margin was 56.7%, a reduction on the
previous year but in line with our proposition strategy.
Product
The product range has increased substantially to over 8,000
styles and targets price points higher than those of boohoo. The
brand has its roots in Los Angeles and portrays a distinctive look
for the confident girl who likes to express her personality through
the clothes she wears. The appeal of the brand extends outside of
the USA, as rapidly increasing sales in the UK have proven.
Marketing
The marketing strategy has focussed on building and extending
the number of bloggers and influencers and staging key media events
to re-engage customer interest and promote brand loyalty. Key
influencers engaged during the year included Taylor le Shae and
Emma Louise Connelly.
Customer interaction
Nasty Gal operates through six country and regional websites and
Android and iOS apps in the UK, US and the Australian markets.
On social media we have 3.6 million followers on Instagram, 1.3
million Facebook likes and 0.2 million followers on Twitter.
From strength to strength
Financial review
"The group has achieved a strong performance with revenues and
profits increasing in all territories."
Group revenue by brand
2019 2018 Change Change
GBP000 GBP000 CER
------------------- -------- -------- ------- -------
boohoo 434,565 374,115 +16% +15%
PrettyLittleThing 374,445 181,269 +107% +107%
Nasty Gal 47,910 24,416 +96% +100%
856,920 579,800 +48% +47%
=================== ======== ======== ======= =======
Group revenue by geographical market
2019 2018 Change Change
GBP000 GBP000 CER
---------------- -------- -------- ------- -------
UK 488,199 355,614 +37% +37%
Rest of Europe 115,124 66,281 +74% +67%
USA 166,262 92,690 +79% +81%
Rest of world 87,335 65,215 +34% +30%
---------------- -------- -------- ------- -------
856,920 579,800 +48% +47%
================ ======== ======== ======= =======
KPIs
boohoo
2019 2018 Change
Active customers(1) 7.0 million 6.4 million +9%
Number of orders 14.9 million 13.6 million +10%
Order frequency(2) 2.14 2.13 +0.3%
Conversion rate to sale (3) 3.9% 4.3% -36bps
Average order value(4) GBP41.38 GBP39.25 +5%
Number of items per basket 3.04 3.06 -1%
----------------------------- -------------- ------------- -------
PrettyLittleThing
2019 2018 Change
Active customers(1) 5.0 million 3.0 million +70%
Number of orders 14.3 million 7.5 million +89%
Order frequency(2) 2.84 2.55 +11.7%
Conversion rate to sale (3) 3.3% 3.7% -47bps
Average order value(4) GBP40.41 GBP36.05 +12%
Number of items per basket 2.72 2.43 +12%
----------------------------- ------------- ------------- -------
Nasty Gal
2019 2018 Change
Active customers(1) 0.9 million 0.4 million +122%
Number of orders 1.3 million 0.6 million +128%
Order frequency(2) 1.41 1.37 +2.9%
Conversion rate to sale (3) 2.5% 1.7% +71bps
Average order value(4) GBP49.83 GBP52.82 -6%
Number of items per basket 3.15 2.89 +9%
----------------------------- ------------ ------------ -------
(1) Defined as having shopped in the last 12 months
(2) Defined as number of orders in last 12 months divided by
number of active customers
(3) Defined as the percentage of orders taken to internet
sessions
(4) Calculated as gross sales including sales tax divided by the
number of orders
Consolidated income statement
2019 2018 Change
GBP000 GBP000
---------------------------------------------------------------------------- ---------- ---------- --------
Revenue 856,920 579,800 +48%
Cost of sales (387,926) (273,445) +42%
---------------------------------------------------------------------------- ---------- ---------- --------
Gross profit 468,994 306,355 +53%
Gross margin 54.7% 52.8% +190bps
Operating costs (384,687) (249,582)
Other income 239 159
Adjusted EBITDA 84,546 56,932 +49%
Adjusted EBITDA margin % 9.9% 9.8% +10bps
Depreciation (6,972) (3,997)
Amortisation of other intangible assets (2,500) (2,532)
Adjusted EBIT 75,074 50,403 +49%
Adjusted EBIT margin % 8.8% 8.7% +10bps
Adjusting items:
Amortisation of acquired PrettyLittleThing and Nasty Gal intangible assets (4,449) (4,449)
Equity-settled share-based payment charges (5,278) (3,269)
Exceptional items - warehouse relocation (6,667) -
---------------------------------------------------------------------------- ---------- ---------- --------
Operating profit 58,680 42,685 +37%
Finance income 1,320 774
Finance expense (144) (146)
---------------------------------------------------------------------------- ---------- ---------- --------
Profit before tax 59,856 43,313 +38%
Tax (12,397) (7,313)
---------------------------------------------------------------------------- ---------- ---------- --------
Profit after tax for the year 47,459 36,000 +32%
============================================================================ ========== ========== ========
Diluted earnings per share 3.22p 2.71p +19%
Adjusted profit after tax for the year 60,803 42,310 +44%
Amortisation of acquired PrettyLittleThing and Nasty Gal intangible assets (4,449) (4,449)
Share-based payment charges (5,278) (3,269)
Exceptional items - warehouse relocation (6,667) -
Adjustment for tax 3,050 1,408
---------------------------------------------------------------------------- ---------- ---------- --------
Profit after tax for the year 47,459 36,000
---------------------------------------------------------------------------- ---------- ---------- --------
Adjusted profit for the period attributable to shareholders of the company 48,781 37,610 +30%
Adjusted diluted earnings per share 4.15p 3.23p +29%
---------------------------------------------------------------------------- ---------- ---------- --------
Gross margin increased from 52.8% to 54.7%, due to improvements
in the customer proposition, tighter stock control and reduced
clearance.
Operating costs comprise distribution costs and administrative
expenses excluding depreciation and amortisation and have increased
by 180bps on revenue. The distribution cost element excluding
depreciation and exceptional item has increased with revenue growth
and increased on the prior year as a percentage of revenue by
146bps due to the higher proportion of international shipments. The
administrative expense element, which includes marketing expenses,
but excluding the exceptional item, share-based payment charges,
depreciation, amortisation and amortisation of acquired
intangibles, has risen due to the combination of revenue growth and
the building of our infrastructure to support the future business
expansion and increased by a small margin of 37bps on the prior
year percentage of revenue.
Adjusted EBITDA, which is not a statutory measure, represents
earnings before interest, tax, depreciation, amortisation, non-cash
share-based payments charges and exceptional items. It provides a
useful measure of the underlying profitability of the business.
Adjusted EBITDA increased by 49% from GBP56.9 million to GBP84.5
million and, as a percentage of revenue, increased from 9.8% to
9.9%.
Adjusted profit after tax, as with Adjusted EBITDA, provides
another more consistent measure of the underlying profitability of
the business by removing non-cash amortisation of intangible assets
relating to the acquisition of PrettyLittleThing and Nasty Gal
(being their trademarks and customer lists), share-based payment
charges and exceptional items.
Taxation
The effective rate of tax for the year was 20.7% (2018: 16.9%),
which is higher (2018: lower) than the blended UK statutory rate of
tax for the year of 19.0% (2018: 19.1%), due to expenditure not
deductible for tax purposes, the increase this year being
principally depreciation on buildings and fit-out.
Consolidated statement of financial position
2019 2018
GBP000 GBP000
--------------------------------------- --------- ---------
Intangible assets 27,165 30,877
Property, plant and equipment 108,498 71,994
Financial assets 3,756 2,445
Deferred tax asset 4,034 6,479
---------------------------------------- --------- ---------
Non-current assets 143,453 111,795
Working capital (64,969) (30,923)
Net financial assets 4,047 5,466
Cash and cash equivalents 197,872 142,575
Interest-bearing loans and borrowings (7,146) (9,528)
Deferred tax liability (2,102) (2,101)
Net current tax liability (753) (4,505)
Net assets 270,402 212,779
======================================== ========= =========
Working capital has reduced primarily due to an increase in
payables and accruals relating to our increased trading
activity.
Intangible and fixed asset additions
2019 2018
GBP000 GBP000
--------------------------------------------------- ------- -------
Purchased intangible and fixed assets
Intangible assets
Patents and licences 307 9
Software 2,930 2,403
---------------------------------------------------- ------- -------
3,237 2,412
Tangible fixed assets
Distribution centres 36,678 33,753
Offices, office equipment, fixtures and fit-outs 6,837 9,991
Motor vehicles 115 228
---------------------------------------------------- ------- -------
43,630 43,972
Total intangible and fixed asset additions 46,867 46,384
==================================================== ======= =======
Liquidity and financial resources
Operating cash flow was GBP111.9 million compared to GBP76.2
million in the previous year and free cash flow was GBP65.1 million
compared to GBP29.9 million in the previous financial year. Capital
expenditure was GBP46.9 million, which includes a GBP36.7 million
investment in our distribution centres to support projected growth
in trade. The closing cash balance for the group was GBP197.9
million and the net cash balance GBP190.7 million.
Consolidated cash flow statement
2019 2018
GBP000 GBP000
---------------------------------------------------- --------- ---------
Profit for the year 47,459 36,000
Depreciation charges and amortisation 13,921 10,978
Share-based payments charge 5,278 3,269
Loss on sale of fixed assets 24 -
Tax expense 12,397 7,313
Finance income (1,320) (774)
Finance expense 144 146
Increase in inventories (18,558) (14,078)
Increase in trade and other receivables (4,935) (5,393)
Increase in trade and other payables 57,513 38,780
---------------------------------------------------- --------- ---------
Operating cash flow 111,923 76,241
Capital expenditure and intangible asset purchases (46,867) (46,384)
Free cash flow 65,056 29,857
Net proceeds from the issue of ordinary shares 3,653 51,531
Purchase of own shares by EBT (1,833) -
Proceeds from the sale of fixed assets 59 -
Finance income received 1,249 612
Finance expense paid (144) (146)
Tax paid (10,361) (7,227)
Repayment of borrowings (2,382) (2,382)
Net cash flow 55,297 72,245
Cash and cash equivalents at beginning of year 142,575 70,330
---------------------------------------------------- --------- ---------
Cash and cash equivalents at end of year 197,872 142,575
==================================================== ========= =========
Trends and factors likely to affect future performance
The market for online fashion is forecast to continue to grow
and, along with the increasing use of the internet globally,
provides a favourable backdrop for the group with much opportunity
for further growth. Customers throughout the world are seeking a
wide choice of quality products at value prices lower than those
available on the high street with the convenience of home delivery.
The group's target market has a high propensity to spend on fashion
and the market is resilient to external macroeconomic factors.
Outlook
The continued strong growth of our brands across all geographic
regions is highly encouraging. Our proven strategy offering the
latest fashion at unbeatable prices, supported by excellent
customer service continues to resonate with consumers globally.
Investments in our proposition and technology ensure we remain
innovative and live up to our customers' expectations.
Our extended Burnley distribution centre now has a significant
element of automation, which will enhance productivity and improve
efficiency. Following the addition of the Sheffield facility for
PrettyLittleThing, our distribution centres in Burnley and
Sheffield represent significant stepping stones as we build towards
creating a distribution network capable of generating GBP3 billion
of net sales globally.
Trading in the first few weeks of the financial year has been
encouraging. Group revenue growth for the financial year is
expected to be 25% to 30% with an adjusted EBITDA margin of around
10% and capital expenditure in the region of GBP50 to GBP60
million. This guidance includes the adoption of IFRS 16, which is
expected to increase EBITDA by GBP4 to GBP5 million and be broadly
neutral at a Profit Before Tax level.
Looking beyond the current year, we will continue to make
investments across the group as part of our vision to lead the
global fashion e-commerce market. Whilst this will require
continued investments in people and infrastructure, we believe that
the benefits of our multi-brand platform will continue to generate
economies of scale, allowing us to target sales growth of 25% per
annum, with an adjusted EBITDA margin of around 10% over the medium
term.
Consolidated statement of comprehensive income
for the year ended 28 February 2019
Note 2019 2018
GBP000 GBP000
---------------------------------------- ---- --------- ---------
Revenue 2 856,920 579,800
Cost of sales (387,926) (273,445)
---------------------------------------- ---- --------- ---------
Gross profit 468,994 306,355
Distribution costs (207,083) (126,757)
---------------------------------------- ---- --------- ---------
Exceptional distribution costs (6,162) -
Other distribution costs (200,921) (126,757)
---------------------------------------- ---- --------- ---------
Administrative expenses (203,470) (137,072)
---------------------------------------- ---- --------- ---------
Exceptional administrative expenses (505) -
Amortisation of acquired intangibles (4,449) (4,449)
Other administrative expenses (198,516) (132,623)
---------------------------------------- ---- --------- ---------
Other income 3 239 159
---------------------------------------- ---- --------- ---------
Operating profit 58,680 42,685
Finance income 4 1,320 774
Finance expense (144) (146)
---------------------------------------- ---- --------- ---------
Profit before tax 6 59,856 43,313
Taxation 10 (12,397) (7,313)
Profit for the year 47,459 36,000
======================================== ==== ========= =========
Profit for the year attributable to:
Owners of the parent company 37,772 31,652
Non-controlling interests 9,687 4,348
---------------------------------------- ---- --------- ---------
47,459 36,000
======================================== ==== ========= =========
Total other comprehensive income for the year
(Gain)/loss reclassified to profit
and loss during the year (2,337) 6,516
Fair value gain on cash flow hedges
during the year 2,229 12,981
Total comprehensive income for the
year 47,351 55,497
======================================== ==== ========= =========
Total comprehensive income attributable
to:
Equity attributable to owners of the
parent company 37,664 51,149
Non-controlling interests 9,687 4,348
---------------------------------------- ---- --------- ---------
47,351 55,497
======================================== ==== ========= =========
Earnings per share 7
Basic 3.27p 2.78p
Diluted 3.22p 2.71p
---------------------------------------- ---- --------- ---------
Consolidated statement of financial position
at 28 February 2019
Note 2019 2018
GBP000 GBP000
-------------------------------------- ---- --------- ---------
Assets
Non-current assets
Intangible assets 11 27,165 30,877
Property, plant and equipment 12 108,498 71,994
Financial assets 3,756 2,445
Deferred tax 14 4,034 6,479
-------------------------------------- ---- --------- ---------
143,453 111,795
Current assets
Inventories 15 66,806 48,248
Trade and other receivables 16 22,576 17,499
Financial assets 5,883 6,770
Current tax receivable 3,186 -
Cash and cash equivalents 17 197,872 142,575
Total current assets 296,323 215,092
Total assets 439,776 326,887
Liabilities
Current liabilities
Trade and other payables 18 (154,351) (96,670)
Interest-bearing loans and borrowings 19 (2,382) (2,382)
Financial liabilities (1,421) (837)
Current tax liability (3,939) (4,505)
Total current liabilities (162,093) (104,394)
Non-current liabilities
Interest-bearing loans and borrowings 19 (4,764) (7,146)
Financial liabilities (415) (467)
Deferred tax 14 (2,102) (2,101)
Total liabilities (166,501) (114,108)
Net assets 270,402 212,779
====================================== ==== ========= =========
Equity
Share capital 20 11,631 11,496
Share premium 606,086 602,578
Capital redemption reserve 100 100
Hedging reserve 7,803 7,911
EBT reserve (2,174) (351)
Translation reserve - 168
Reconstruction reserve (515,282) (515,282)
Non-controlling interest 19,064 8,761
Retained earnings 143,174 97,398
-------------------------------------- ---- --------- ---------
Total equity 270,402 212,779
====================================== ==== ========= =========
Consolidated statement of changes in equity
Share Share Capital Hedging EBT Translation Reconstruction Non-controlling Retained Total
capital premium redemption reserve reserve reserve reserve interest earnings equity
reserve
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 28
February 2017 11,233 551,720 100 (11,586) (761) 5 (515,282) 3,978 61,089 100,496
Profit for the
year - - - - - - - 4,348 31,652 36,000
Other
comprehensive
income:
Loss reclassified
to profit and
loss in revenue - - - 6,516 - - - - - 6,516
Fair value gain on
cash flow hedges
during the year - - - 12,981 - - - - - 12,981
------------------ ------- ------- ---------- -------- ------- ----------- -------------- --------------- -------- -------
Total
comprehensive
income for the
year - - - 19,497 - - - 4,348 31,652 55,497
Issue of shares 263 50,858 - - 410 - - - - 51,531
Share-based
payments credit - - - - - - - 435 2,834 3,269
Excess deferred
tax on
share-based
payments - - - - - - - - 1,823 1,823
Translation of
foreign
operations - - - - - 163 - - - 163
Balance at 28
February 2018 11,496 602,578 100 7,911 (351) 168 (515,282) 8,761 97,398 212,779
Profit for the
year - - - - - - - 9,687 37,772 47,459
Other
comprehensive
income/(expense):
Gain reclassified
to profit and
loss in revenue - - - (2,337) - - - - - (2,337)
Fair value gain on
cash flow hedges
during the year - - - 2,229 - - - - - 2,229
------------------ ------- ------- ---------- -------- ------- ----------- -------------- --------------- -------- -------
Total
comprehensive
income for the
year - - - (108) - - - 9,687 37,772 47,351
Issue of shares 135 3,508 - - (1,823) - - - - 1,820
Share-based
payments credit - - - - - - - 616 4,662 5,278
Excess deferred
tax on
share-based
payments - - - - - - - - 3,342 3,342
Translation of
foreign
operations - - - - - (168) - - - (168)
Balance at 28
February 2019 11,631 606,086 100 7,803 (2,174) - (515,282) 19,064 143,174 270,402
================== ======= ======= ========== ======== ======= =========== ============== =============== ======== =======
Consolidated cash flow statement
for the year ended 28 February 2019
Note 2019 2018
GBP000 GBP000
--------------------------------------------- ---- -------- --------
Cash flows from operating activities
Profit for the year 47,459 36,000
Adjustments for:
Share-based payments charge 5,278 3,269
Depreciation charges and amortisation 13,921 10,978
Loss on sale of fixed assets 24 -
Finance income (1,320) (774)
Finance expense 144 146
Tax expense 12,397 7,313
--------------------------------------------- ---- -------- --------
77,903 56,932
Increase in inventories 15 (18,558) (14,078)
Increase in trade and other receivables 16 (4,935) (5,393)
Increase in trade and other payables 18 57,513 38,780
Cash generated from operations 111,923 76,241
Tax paid (10,361) (7,227)
Net cash generated from operating activities 101,562 69,014
Cash flows from investing activities
Acquisition of intangible assets 11 (3,237) (2,412)
Acquisition of property, plant and equipment 12 (43,630) (43,972)
Proceeds from the sale of fixed assets 59 -
Finance income received 1,249 612
Net cash used in investing activities (45,559) (45,772)
Cash flows from financing activities
Proceeds from the issue of ordinary shares 3,653 52,281
Share issue costs written off to share
premium - (750)
Purchase of own shares by EBT (1,833) -
Finance expense paid (144) (146)
Repayment of borrowings (2,382) (2,382)
Net cash (used in)/generated from financing
activities (706) 49,003
Increase in cash and cash equivalents 55,297 72,245
============================================= ==== ======== ========
Cash and cash equivalents at beginning
of year 142,575 70,330
--------------------------------------------- ---- -------- --------
Cash and cash equivalents at end of year 197,872 142,575
============================================= ==== ======== ========
Notes to the financial statements
(forming part of the financial statements)
1 Accounting policies
General information
boohoo group plc is a public limited company incorporated and
domiciled in Jersey and listed on the Alternative Investment Market
(AIM) of the London Stock Exchange. Its registered office address
is: 12 Castle Street, St Helier, Jersey, JE2 3RT. The company was
incorporated on 19 November 2013 and changed its name from
boohoo.com plc to boohoo group plc on 10 July 2018.
Basis of preparation
This condensed consolidated financial information for the year
ended 28 February 2019 has been prepared in accordance with the
recognition and measurement criteria of International Financial
Reporting Standards as adopted by the European Union ("Adopted
IFRSs"), IFRS IC Interpretations and the Companies (Jersey) Law
1991.
The financial information contained in this preliminary
announcement for the years ended 28 February 2019 and 28 February
2018 does not comprise the group's statutory financial statements
within the meaning of Companies (Jersey) Law 1991. Statutory
accounts for the year ended 28 February 2019 will be filed with the
Jersey Companies Registry in due course. The auditors' report on
the statutory accounts for each of the years ended 28 February 2019
and 28 February 2018 is unqualified, does not draw attention to any
matters by way of emphasis and does not contain any statement under
any matters that are required to be reported by exception under
Companies (Jersey) Law 1991.
Standards, amendments and interpretations to standards that are
effective and have been adopted by the group and/or company.
IFRS 9, "Financial instruments" (effective 1 January 2018). It
has been determined that all existing effective hedging instruments
continued to qualify for hedge accounting under IFRS 9. The
adoption of the standard has therefore had no effect on the
financial statements. Changes to the classification, impairment and
measurement of financial assets and liabilities have been
considered and it has been concluded these changes do not impact
the group.
IFRS 15, "Revenue from contracts with customers" (effective 1
January 2018). Revenue is recognised in the financial statements
when the customer receives the goods ordered. Revenue from the
purchase of annual delivery services is spread over the period of
the service. The adoption of the standard has therefore had no
impact on existing revenue recognition policies.
Going concern
The directors have reviewed the group's forecast and
projections, including assumptions concerning capital expenditure
and expenditure commitments and their impact on cash flows, and
have a reasonable expectation that the group has adequate financial
resources to continue its operations for the foreseeable future.
For this reason they have continued to adopt the going concern
basis in preparing the financial statements.
In preparing the preliminary announcement, the directors have
also made reasonable and prudent judgements and estimates and
prepared the preliminary announcement on the going concern basis.
The preliminary announcement and management report contained herein
give a true and fair view of the assets, liabilities, financial
position and profit and loss of the group.
2 Segmental analysis
IFRS 8, "Operating Segments", requires operating segments to be
determined based on the group's internal reporting to the chief
operating decision maker. The chief operating decision maker is
considered to be the executive board, which has determined that the
primary segmental reporting format of the group for 2019 is by
business unit. This is based on the group's management and internal
reporting structure, i.e. boohoo including boohooMAN,
PrettyLittleThing ("PLT") and Nasty Gal.
The executive board assesses the performance of each segment
based on revenue and gross profit after distribution expenses and
before administrative expenses.
Year ended 28 February 2019
boohoo PLT Nasty Gal Total
GBP000 GBP000 GBP000 GBP000
--------------------------- --------- --------- --------- -----------
Revenue 434,565 374,445 47,910 856,920
Cost of sales (204,474) (162,687) (20,765) (387,926)
---------------------------- --------- --------- --------- -----------
Gross profit 230,091 211,758 27,145 468,994
Distribution costs (98,901) (90,000) (12,020) (200,921)
Exceptional distribution
costs - (6,162) - (6,162)
Segment result 131,190 115,596 15,125 261,911
Administrative expenses
- other - - - (198,516)
Exceptional administrative
expenses - - - (505)
Amortisation of acquired
intangibles - - - (4,449)
Other income - - - 239
---------------------------- --------- --------- --------- -----------
Operating profit - - - 58,680
Finance income - - - 1,320
Finance expense - - - (144)
---------------------------- --------- --------- --------- -----------
Profit before tax - - - 59,856
============================ ========= ========= ========= ===========
Year ended 28 February 2018
boohoo PLT Nasty Gal Total
GBP000 GBP000 GBP000 GBP000
--------------------------- --------- --------- --------- ---------
Revenue 374,115 181,269 24,416 579,800
Cost of sales (182,394) (81,175) (9,876) (273,445)
---------------------------- --------- --------- --------- ---------
Gross profit 191,721 100,094 14,540 306,355
Distribution costs (80,417) (40,661) (5,679) (126,757)
---------------------------- --------- --------- --------- ---------
Segment result 111,304 59,433 8,861 179,598
Administrative expenses
- other - - - (132,623)
Amortisation of acquired
intangibles - - - (4,449)
Other income - - - 159
---------------------------- --------- --------- --------- ---------
Operating profit - - - 42,685
Finance income - - - 774
Finance expense - - - (146)
--------- --------- --------- ---------
Profit before tax - - - 43,313
============================ ========= ========= ========= =========
Revenue by geographic region
2019 2018
GBP000 GBP000
--------------- ------- -------
UK 488,199 355,614
Rest of Europe 115,124 66,281
USA 166,262 92,690
Rest of world 87,335 65,215
---------------- ------- -------
856,920 579,800
=============== ======= =======
3 Other income
2019 2018
GBP000 GBP000
----------------------- ------ ------
Property rental income 239 159
------------------------ ------ ------
4 Finance income and expense
2019 2018
GBP000 GBP000
--------------------------------------- ------ ------
Finance income: Bank interest received 1,320 774
Finance expense: Loan interest paid (144) (146)
---------------------------------------- ------ ------
5 Auditors' remuneration
2019 2018
GBP000 GBP000
----------------------------------------------------------------------------- ------ ------
Audit of these financial statements 10 10
Disclosure below based on amounts receivable in respect of services to the group
Amounts receivable by auditors and their associates in respect of:
Audit of financial statements of subsidiaries pursuant to legislation 138 120
Other services relating to taxation 96 104
Other advisory services 81 52
----------------------------------------------------------------------------- ------ ------
325 286
============================================================================= ====== ======
6 Profit before tax
Profit before tax is stated after charging: 2019 2018
GBP000 GBP000
---------------------------------------------- ------ ------
Operating lease rentals for buildings 2,235 1,509
Equity-settled share-based payment charges 5,278 3,269
Exceptional items - warehouse relocation 6,667 -
Depreciation of property, plant and equipment 6,972 3,997
Amortisation of intangible assets 2,500 2,532
Amortisation of acquired intangible assets 4,449 4,449
---------------------------------------------- ------ ------
The exceptional items relate to the additional costs of
relocation of all the inventory held by PrettyLittleThing to a
third-party managed warehouse in July 2018.
7 Earnings per share
Basic earnings per share is calculated by dividing profit after
tax attributable to members of the holding company by the weighted
average number of shares in issue during the year. Own shares held
by the Employee Benefit Trust are eliminated from the weighted
average number of shares. Diluted earnings per share is calculated
by dividing the profit after tax attributable to members of the
holding company by the weighted average number of shares in issue
during the year, adjusted for potentially dilutive share
options.
2019 2018
---------------------------------------------- -------------- --------------
Weighted average shares in issue for basic
earnings per share 1,154,130,568 1,138,722,751
Dilutive share options 20,304,294 27,108,839
----------------------------------------------- -------------- --------------
Weighted average shares in issue for diluted
earnings per share 1,174,434,862 1,165,831,590
=============================================== ============== ==============
Earnings (GBP000) 37,772 31,652
Basic earnings per share 3.27p 2.78p
Diluted earnings per share 3.22p 2.71p
----------------------------------------------- -------------- --------------
Earnings (GBP000) 37,772 31,652
Adjusting items:
Amortisation of intangible assets arising
on acquisitions 4,449 4,449
Share-based payment charges 5,278 3,269
Exceptional items - warehouse relocation 6,667 -
Adjustment for tax (3,050) (1,408)
Adjustment for non-controlling interest (2,335) (352)
----------------------------------------------- -------------- --------------
Adjusted earnings 48,781 37,610
----------------------------------------------- -------------- --------------
Adjusted basic earnings per share 4.23p 3.30p
Adjusted diluted earnings per share 4.15p 3.23p
----------------------------------------------- -------------- --------------
Adjusted earnings and adjusted earnings per share gives a more
consistent measure of the underlying performance of the business
excluding non-cash accounting charges relating to the amortisation
of intangible assets valued upon acquisitions, non-cash share-based
payment charges and other exceptional items.
8 Staff numbers and costs
The average monthly number of persons employed by the group
(including directors) during the year, analysed by category, was as
follows:
Number of employees
2019 2018
--------------- ---------- ---------
Administration 1,303 955
Distribution 885 1,220
--------------- ---------- ---------
2,188 2,175
=============== ========== =========
The aggregate payroll costs of these persons were as
follows:
2019 2018
GBP000 GBP000
------------------------------------------- ------ ------
Wages and salaries 62,505 49,510
Social security costs 6,419 5,553
Post-employment benefits 1,123 647
Equity-settled share-based payment charges 5,278 3,269
------------------------------------------- ------ ------
75,325 58,979
=========================================== ====== ======
9 Directors' and key management compensation
2019 2018
GBP000 GBP000
------------------------------------------- ------ ------
Short-term employee benefits 10,616 5,856
Post-employment benefits 217 131
Equity-settled share-based payment charges 907 454
11,740 6,441
=========================================== ====== ======
Directors' and key management compensation comprises the group
directors and executive committee members.
10 Taxation
2019 2018
GBP000 GBP000
----------------------------------------------------------------------------------------------- ------ -------
Analysis of charge in year
Current tax on income for the year 12,411 9,294
Adjustments in respect of prior year taxes (54) (1,323)
Deferred taxation 40 (658)
Tax on profit on ordinary activities 12,397 7,313
=============================================================================================== ====== =======
The total tax charge differs from the amount computed by applying the blended UK rate of 19.0%
for the year (2018: 19.08%) to profit before tax as a result of the following:
Profit on ordinary activities before tax 59,856 43,313
----------------------------------------------------------------------------------------------- ------ -------
Profit before tax multiplied by the standard rate of corporation tax of the UK of 19.0% (2018:
19.08%) 11,373 8,273
Effects of:
Expenses not deductible for tax purposes 454 375
Adjustments in respect of prior year taxes (54) (1,323)
Overseas tax differentials 5 9
Depreciation in excess of/(less than) capital allowances 619 (21)
Tax on profit on ordinary activities 12,397 7,313
=============================================================================================== ====== =======
Tax recognised in the statement of changes in equity
Deferred tax credit on movement in tax base of share options 3,342 1,823
------------------------------------------------------------- ----- -----
No current tax was recognised in other comprehensive income
(2018: GBPnil).
A change to reduce the main rate of corporation tax to 17% from
1 April 2020 was announced in the Chancellor's budget on 16 March
2016. Changes to reduce the UK corporation tax rate to 17% from 1
April 2020 were substantively enacted on 15 September 2016. The
prior year tax adjustment is in respect of tax incentives for
research and development expenditure.
11 Intangible assets
Patents and licences Trademarks Customer lists Computer software Total
GBP000 GBP000 GBP000 GBP000 GBP000
Cost
Balance at 1 March 2017 310 25,070 5,826 9,208 40,414
Additions 9 - - 2,403 2,412
Disposals - - - (567) (567)
----------------------------- --------------------- ----------- --------------- ------------------ --------
Balance at 28 February 2018 319 25,070 5,826 11,044 42,259
Additions 307 - - 2,930 3,237
Disposals - - - (2,096) (2,096)
Balance at 28 February 2019 626 25,070 5,826 11,878 43,400
============================= ===================== =========== =============== ================== ========
Accumulated amortisation
Balance at 1 March 2017 180 167 267 4,354 4,968
Amortisation for year 31 2,507 1,942 2,501 6,981
Disposals - - - (567) (567)
----------------------------- --------------------- ----------- --------------- ------------------ --------
Balance at 28 February 2018 211 2,674 2,209 6,288 11,382
Amortisation for year 74 2,507 1,942 2,426 6,949
Disposals - - - (2,096) (2,096)
Balance at 28 February 2019 285 5,181 4,151 6,618 16,235
============================= ===================== =========== =============== ================== ========
Net book value
At 29 February 2017 130 24,903 5,559 4,854 35,446
At 28 February 2018 108 22,396 3,617 4,756 30,877
--------------------- ----------- --------------- ------------------ --------
At 28 February 2019 341 19,889 1,675 5,260 27,165
============================= ===================== =========== =============== ================== ========
Within the statement of comprehensive income, amortisation of
acquired intangible assets (trademarks and customer lists) of
GBP4,449,000 (2018: GBP4,449,000) is shown separately. The amount
of amortisation included in distribution costs is GBP648,000 (2018:
GBP629,000) and in administrative expenses is GBP1,852,000 (2018:
GBP1,903,000).
12 Property, plant and equipment
Short Fixtures Computer Motor Land & Total
leasehold and fittings equipment vehicles buildings
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------------------------- ----------- -------------- ----------- ---------- ----------- --------
Cost
Balance at 1 March
2017 1,121 15,605 2,484 285 17,896 37,391
Additions 1,156 19,911 1,593 228 21,084 43,972
Disposals (54) (72) (540) (74) - (740)
Balance at 28 February
2018 2,223 35,444 3,537 439 38,980 80,623
Additions 3,896 36,775 1,575 115 1,269 43,630
Exchange differences - - - - (73) (73)
Disposals (94) (375) (592) (123) - (1,184)
Balance at 28 February
2019 6,025 71,844 4,520 431 40,176 122,996
Accumulated depreciation
Balance at 1 March
2017 437 2,702 1,511 122 600 5,372
Depreciation charge
for the year 328 2,463 763 85 358 3,997
Disposals (54) (72) (540) (74) - (740)
-------------------------- ----------- -------------- ----------- ---------- ----------- --------
Balance at 28 February
2018 711 5,093 1,734 133 958 8,629
Depreciation charge
for the year 566 4,646 1,144 127 489 6,972
Exchange differences - - - - (2) (2)
Disposals (94) (364) (592) (51) - (1,101)
Balance at 28 February
2019 1,183 9,375 2,286 209 1,445 14,498
========================== =========== ============== =========== ========== =========== ========
Net book value
At 28 February 2017 684 12,903 973 163 17,296 32,019
At 28 February 2018 1,512 30,351 1,803 306 38,022 71,994
----------- -------------- ----------- ---------- ----------- --------
At 28 February 2019 4,842 62,469 2,234 222 38,731 108,498
========================== =========== ============== =========== ========== =========== ========
The amounts of depreciation included in the statement of
comprehensive income in distribution costs is GBP4,003,000 (2018:
GBP2,440,000) and in administrative expenses is GBP2,969,000 (2018:
GBP1,557,000). Depreciation of the automation equipment contained
in the GBP37 million of additions to fixtures and fittings will
commence in April 2019 when the assets are entered into
service.
13 Investments
The subsidiaries held and consolidated in these financial
statements are set out below:
Name of company Principal activity Country of Address Percentage ownership
incorporation
---------------------- ----------------------- ---------------------- ---------------------- ---------------------
12 Castle St, St
ABK Limited Holding company Jersey Helier, Jersey 100%
49-51 Dale St,
boohoo.com UK Limited Trading company UK Manchester 100%
49-51 Dale St,
Boo Who Limited Dormant company UK Manchester 100%
boohoo.com USA 49-51 Dale St,
Limited Dormant company UK Manchester 100%
3 West 13th Street,
boohoo.com USA Inc Marketing office USA New York 100%
boohoo.com Australia 468 St Kilda Road,
Pty Ltd Marketing office Australia Melbourne 100%
15, rue Bachaumont,
boohoo France SAS Marketing office France Paris 100%
Wellington Mill,
PrettyLittleThing.com Internet fashion Pollard Street East,
Limited retail UK Manchester 66%
Wellington Mill,
21Three Clothing Pollard Street East,
Company Limited Dormant company UK Manchester 66%
PrettyLittleThing.com 1209 Orange Street,
USA Inc Marketing office USA Delaware 66%
49-51 Dale St,
Nasty Gal.com Limited Trading company UK Manchester 100%
6600 W Sunset
Boulevard, Los
Nasty Gal.com USA Inc Marketing office USA Angeles 100%
Shanghai Wasabi Frog 49-51 Dale St,
Boohoo Ltd Dormant company China Manchester 100%
---------------------- ----------------------- ---------------------- ---------------------- ---------------------
14 Deferred tax
Assets
Depreciation in excess of capital Share-based payments Total
allowances
GBP000 GBP000 GBP000
------------------------------------------ ----------------------------------------- --------------------- --------
Asset at 1 March 2017 232 4,262 4,494
Recognised in statement of comprehensive
income (72) 234 162
Credit in equity - 1,823 1,823
------------------------------------------ ----------------------------------------- --------------------- --------
Asset at 28 February 2018 160 6,319 6,479
Recognised in statement of comprehensive
income (73) 32 (41)
Debit in equity - (2,404) (2,404)
------------------------------------------ ----------------------------------------- --------------------- --------
Asset at 28 February 2019 87 3,947 4,034
========================================== ========================================= ===================== ========
Liabilities
Capital allowances in excess of Business combinations Total
depreciation
GBP000 GBP000 GBP000
----------------------------------------- ----------------------------------------- ---------------------- --------
Liability at 28 February 2017 - (2,597) (2,597)
Recognised in statement of comprehensive
income - 496 496
----------------------------------------- ----------------------------------------- ---------------------- --------
Liability at 28 February 2018 - (2,101) (2,101)
Recognised in statement of comprehensive
income (495) 494 (1)
Liability at 28 February 2019 (495) (1,607) (2,102)
----------------------------------------- ----------------------------------------- ---------------------- --------
Recognition of the deferred tax assets is based upon the
expected generation of future taxable profits. The deferred tax
asset is expected to be recovered in more than one year's time and
the deferred tax liability will reverse in more than one year's
time as the intangible assets are amortised.
15 Inventories
2019 2018
GBP000 GBP000
--------------- ------ ------
Finished goods 66,806 48,248
The value of inventories included within cost of sales for the
year was GBP393,766,000 (2018: GBP270,032,000). An impairment
provision of GBP5,181,000 (2018: GBP4,150,000) was charged to the
statement of comprehensive income. There were no write-backs of
prior period provisions during the year.
16 Trade and other receivables
2019 2018
GBP000 GBP000
------------------------------------- ------ ------
Trade receivables 14,201 13,381
Prepayments 5,126 3,658
Accrued income 386 460
Taxes and social security receivable 2,863 -
------------------------------------- ------ ------
22,576 17,499
===================================== ====== ======
Trade receivables represent amounts due from wholesale customers
and advance payments to suppliers.
The fair value of trade and other receivables is not materially
different from the carrying value.
The provision for impairment of receivables is charged to
administrative expenses in the statement of comprehensive income.
The maturing profile of unsecured trade receivables and the
provisions for impairment are as follows:
2019 2018
GBP000 GBP000
------------------------------- ------- ------
Due within 30 days 7,943 7,411
Provision for impairment - (26)
Due in 31 to 90 days 7,972 6,304
Provision for impairment (1,714) (596)
Past due 295 339
Provision for impairment (295) (51)
Total amounts due and past due 16,210 14,054
Total provision for impairment (2,009) (673)
------------------------------- ------- ------
14,201 13,381
=============================== ======= ======
17 Cash and cash equivalents
2019 2018
GBP000 GBP000
------------------------- ------- -------
At start of year 142,575 70,330
Net movement during year 55,350 72,638
Effect of exchange rates (53) (393)
------------------------- ------- -------
At end of year 197,872 142,575
========================= ======= =======
18 Trade and other payables
2019 2018
GBP000 GBP000
------------------------------------------- ------- ------
Trade payables 33,930 34,203
Amounts owed to related party undertakings - 31
Other creditors 1,730 1,084
Accruals 81,930 41,378
Provision for liabilities 18,912 9,021
Deferred income 8,453 5,556
Taxes and social security payable 9,396 5,397
------------------------------------------- ------- ------
154,351 96,670
=========================================== ======= ======
The fair value of trade payables is not materially different
from the carrying value.
The provision for liabilities comprises:
Dilapidations Returns Total
GBP000 GBP000 GBP000
---------------------------------------------------------------- -------------- -------- --------
Provision at 1 March 2018 750 8,271 9,021
Movements in provision charged/(credited) to income statement:
Release of provision from prior year - (8,271) (8,271)
Increase in provision in current year 800 17,362 18,162
---------------------------------------------------------------- -------------- -------- --------
Provision at 28 February 2019 1,550 17,362 18,912
================================================================ ============== ======== ========
19 Interest-bearing loans and borrowings
This note provides information about the contractual terms of
the group's interest-bearing loans and borrowings, which are
measured at amortised cost.
2019 2018
GBP000 GBP000
-------------------------------------- ------ ------
Non-current liabilities
Secured bank loans 4,764 7,146
====================================== ====== ======
Current liabilities
-------------------------------------- ------ ------
Current portion of secured bank loans 2,382 2,382
====================================== ====== ======
Terms and debt repayment schedule
Nominal
interest Year of 2019 2018
Currency rate maturity GBP000 GBP000
------------------ --------- -------------- --------- ------ ------
Secured bank loan GBGBP LIBOR + 0.95% 2022 7,146 9,528
The loan is repayable in instalments over the five years to
2022. The loan is secured by a debenture comprising fixed and
floating charges over all the assets and undertakings of boohoo.com
UK Limited of GBP131.7 million (2018: GBP99.4 million), including
all present and future freehold property, book and other debts,
chattels and goodwill, both present and future.
Movement in financial liabilities
2019 2018
GBP000 GBP000
----------------- ------- -------
Opening balance 9,528 11,910
Interest accrued 144 146
Interest paid (144) (146)
Capital paid (2,382) (2,382)
Closing balance 7,146 9,528
================= ======= =======
20 Share capital and reserves
2019 2018
GBP000 GBP000
------------------------------------------------------------------- ------ ------
1,163,143,830 authorised and fully paid ordinary shares of 1p each
(2018: 1,149,574,495) 11,631 11,496
------------------------------------------------------------------- ------ ------
During the year, a total of 13,574,314 shares were issued under
the share incentive plans (2018: 3,451,205). On 27 February 2019,
31,223 (2018: 35,224) new ordinary shares were issued to
non-executive directors as part of their annual remuneration.
The directors do not recommend the payment of a dividend so that
cash is retained in the group for capital expenditure projects that
are required for the rapid growth and efficiency improvements of
the business and for suitable business acquisitions (2018:
GBPnil).
21 Capital commitments
Capital expenditure contracted for at the end of the reporting
year but not yet incurred is as follows:
2019 2018
GBP000 GBP000
------------------------------ ------ ------
Property, plant and equipment - 27,999
22 Operating Leases
The group has lease agreements in respect of property, plant and
equipment, for which the payments extend over a number of years.
The totals of future minimum lease payments under non-cancellable
operating leases due in each period are:
2019 2018
GBP000 GBP000
------------------------- ------ ------
Within one year 1,966 1,028
Within two to five years 4,032 3,066
In more than five years 261 792
------------------------- ------ ------
6,259 4,886
========================= ====== ======
23 Contingent liabilities
From time to time, the group can be subject to various legal
proceedings and claims that arise in the ordinary course of
business which may include cases relating to the group's brand and
trading name. All such cases brought against the group are robustly
defended and a liability is recorded only when it is probable that
the case will result in a future economic outflow and that the
outflow can be reliably measured.
As at 28 February 2019, there are no pending claims or
proceedings against the group which are expected to have a material
adverse effect on its liquidity or operations.
Appendix - prior period revenues by region
Revenue by period for the year to 28 February 2019 (FY19)
GBP'000 4m to 31 December 2m to 28 February 12m to 28 February
--------------------------------- -------------------------------
FY19 FY18 yoy yoy FY19 FY18 yoy yoy FY19 FY18 yoy yoy
% % CER % % % %
CER CER
-------- -------- ---- ------- -------- ------- ----- ----- -------- -------- ---- -----
Total 328,231 228,215 44% 43% 133,375 88,710 50% 50% 856,920 579,800 48% 47%
-------- -------- ---- ------- -------- ------- ----- ----- -------- -------- ---- -----
Revenue by region
-------------------------------------------- -------- ------- ----- ----- -------- -----
UK 179,952 135,642 33% 33% 74,185 56,592 31% 31% 488,199 355,614 37% 37%
-------- -------- ---- ------- -------- ------- ----- ----- -------- -----
ROE 44,431 28,232 57% 54% 19,443 10,258 90% 86% 115,124 66,281 74% 67%
-------- -------- ---- ------- -------- ------- ----- ----- -------- -------- ---- -----
USA 70,427 39,618 78% 80% 27,664 13,475 105% 101% 166,262 92,690 79% 81%
-------- -------- ---- ------- -------- ------- ----- ----- -------- -------- ---- -----
ROW 33,421 24,723 35% 32% 12,083 8,385 44% 44% 87,335 65,215 34% 30%
-------- -------- ---- ------- -------- ------- ----- ----- -------- -------- ---- -----
GBP'000 3m to 31 May 3m to 31 August 6m to 31 August
--------------------------------- -------------------------------
FY19 FY18 yoy yoy FY19 FY18 yoy yoy FY19 FY18 yoy yoy
% % CER % % % %
CER CER
-------- -------- ---- ------- -------- -------- ---- ----- -------- -------- ---- -----
Total 183,561 120,077 53% 52% 211,748 142,798 48% 47% 395,309 262,875 50% 49%
-------- -------- ---- ------- -------- -------- ---- ----- -------- -------- ---- -----
Revenue by region
-------------------------------------------- -------- -------- ---- ----- -------- -----
UK 110,738 74,532 49% 49% 123,319 88,849 39% 39% 234,057 163,381 43% 43%
-------- -------- ---- ------- -------- -------- ---- ----- -------- -----
ROE 22,257 12,220 82% 71% 28,993 15,571 86% 73% 51,250 27,791 84% 72%
-------- -------- ---- ------- -------- -------- ---- ----- -------- -------- ---- -----
USA 31,389 17,906 75% 78% 36,782 21,690 70% 71% 68,171 39,596 72% 74%
-------- -------- ---- ------- -------- -------- ---- ----- -------- -------- ---- -----
ROW 19,177 15,419 24% 22% 22,654 16,688 36% 31% 41,831 32,107 30% 27%
-------- -------- ---- ------- -------- -------- ---- ----- -------- -------- ---- -----
Revenue by period for the year to 28 February 2018 (FY18)
GBP'000 4m to 31 December 2m to 28 February 12m to 28 February
---------------------------------- ------------------------------
FY18 FY17 yoy yoy FY18 FY17 yoy yoy FY18 FY17 yoy yoy
% % CER % % % %
CER CER
-------- -------- ----- ------- ------- ------- ----- ----- -------- -------- ----- -----
Total 228,215 114,294 100% 93% 88,710 53,025 67% 65% 579,800 294,635 97% 92%
-------- -------- ----- ------- ------- ------- ----- ----- -------- -------- ----- -----
Revenue by region
--------------------------------------------- ------- ------- ----- ----- -------- -----
UK 135,642 65,465 107% 107% 56,592 34,820 63% 63% 355,614 181,981 95% 95%
-------- -------- ----- ------- ------- ------- ----- ----- -------- -----
ROE 28,232 13,963 102% 76% 10,258 6,059 69% 54% 66,281 34,735 91% 73%
-------- -------- ----- ------- ------- ------- ----- ----- -------- -------- ----- -----
USA 39,618 19,299 105% 102% 13,475 5,910 128% 133% 92,690 40,435 129% 122%
-------- -------- ----- ------- ------- ------- ----- ----- -------- -------- ----- -----
ROW 24,723 15,567 59% 46% 8,385 6,236 34% 29% 65,215 37,484 74% 64%
-------- -------- ----- ------- ------- ------- ----- ----- -------- -------- ----- -----
GBP'000 3m to 31 May 3m to 31 August 6m to 31 August
--------------------------------- -------------------------------
FY18 FY17 yoy yoy FY18 FY17 yoy yoy FY18 FY17 yoy yoy
% % CER % % % %
CER CER
-------- ------- ----- ------- -------- ------- ----- ----- -------- -------- ----- -----
Total 120,077 58,222 106% 98% 142,798 69,094 107% 104% 262,875 127,316 106% 101%
-------- ------- ----- ------- -------- ------- ----- ----- -------- -------- ----- -----
Revenue by region
-------------------------------------------- -------- ------- ----- ----- -------- -----
UK 74,532 37,396 99% 99% 88,849 44,300 101% 101% 163,381 81,696 100% 100%
-------- ------- ----- ------- -------- ------- ----- ----- -------- -----
ROE 12,220 6,938 76% 61% 15,571 7,775 100% 92% 27,791 14,713 89% 77%
-------- ------- ----- ------- -------- ------- ----- ----- -------- -------- ----- -----
USA 17,906 6,385 180% 155% 21,690 8,841 145% 136% 39,596 15,226 160% 145%
-------- ------- ----- ------- -------- ------- ----- ----- -------- -------- ----- -----
ROW 15,419 7,503 105% 80% 16,688 8,178 104% 98% 32,107 15,681 105% 89%
-------- ------- ----- ------- -------- ------- ----- ----- -------- -------- ----- -----
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR EAXLDAFDNEFF
(END) Dow Jones Newswires
April 24, 2019 02:00 ET (06:00 GMT)
Boohoo (LSE:BOO)
Historical Stock Chart
From Mar 2024 to Apr 2024
Boohoo (LSE:BOO)
Historical Stock Chart
From Apr 2023 to Apr 2024
