LONDON – Analysts expect ultra fast fashion business, Boohoo, to announce an almost doubling of sales this year. A 95 per cent increase in revenues is forecast when the company posts its full year results this week, to £574.6m.
City AM reports the market consensus is for pre-tax profits of around £47m. The growing popularity of Boohoo brands, PrettyLittleThings, is helping drive sales. “Given the sales trajectory of the company we are now entering a phase of increased capital expenditure, as it continues to build out its infrastructure to help facilitate future growth,” said analysts at Shore Capital.
The expected results offer further evidence of the rapidly changing nature of the apparel space. Department stores such as Debenhams and House of Fraser in the UK and Macys and Sears in the US have all been posting underwhelming financials of late. In addition, H&M has shown the first evidence for a decade that growth has plateaued while there are serious long term questions about medium sized players such as New Look.
Boohoo has been investing in infrastructure in a process which has seen significant capital expenditure in recent months. Previous guidance had indicated that £62m would be invested this year, while another £40m would be earmarked for further development.
Founded in Manchester in 2006, boohoo is an innovative online brand targeting young, value-orientated customers.
