Revolution Beauty announces strong results amid Boohoo’s call to remove key board members
- Revolution Beauty said first quarter sales for fiscal year 2024 are up 60%
- The Kent-based company fervently opposes Boohoo’s proposed shake-up in the boardroom
- Boohoo Wants to Unseat Board Members Bob Holt, Derek Zissman & Elizabeth Lake
Revolution Beauty revealed a great trading performance as it continued to reject Boohoo’s demands to create a stir in the boardroom.
The embattled cosmetics retailer said first-quarter sales for fiscal year 2024 were up 60 per cent, while underlying profit rose to a profit of £3.5m from a loss of £7.3m last year.
It told investors it was “appropriate” to announce the results given Boohoo’s call to remove CEO Bob Holt, chairman Derek Zissman and finance boss Elizabeth Lake at the group’s upcoming annual general meeting.
Performance: Revolution Beauty stated first quarter sales for FY 2024 were up 60 per cent, while underlying revenue rose to a profit of £3.5m
Boohoo, which owns a 26.6 percent stake in Revolution Beauty, believes the trio’s departure is necessary to ensure the company’s focus on “turning to growth” and delivering higher shareholder value.
The online fast fashion company is seeking to appoint former Matalan and Littlewoods boss Alasdair McGeorge, former chief financial officer Neil Catto and ex-THG Beauty CEO Rachel Horsefield to its board of directors.
Revolution Beauty has reacted fervently to the proposals, describing them as “value-destroying, opportunistic and selfish” and contrary to investor interests.
It alleges that McGeorge and Catto lack the “relevant experience” of running a beauty business or supplying high street stores and product ranges.
At Horsefield, the company said her appointment was not necessary because the board with former Body Shop CEO Jeremy Schwartz “already had a director with a wealth of experience in the beauty industry.”
Holt said Revolution Beauty’s first quarter result was a testament to the quality of our offerings and the strength of our leadership team, and demonstrates that we are delivering on our global retailer strategy.
“This has been achieved simultaneously with resolving the historical issues overseen by previous management and implementing improved cost controls and processes across the company.”
The Kent-based company has struggled since going public in the summer of 2021, amid a major slowdown in online sales due to a rising cost of living and Britons increasingly buying cosmetics in stores.
The difficulties were further compounded when trading of its shares on the AIM index was suspended last September after accountants failed to sign the accounts for the previous financial year on time.
Investigators found the group had overestimated its turnover by £9 million to meet its annual targets, while ex-CEO Adam Minto and co-founder Tom Allsworth took out £1 million in loans without the board’s knowledge.
Allsworth resigned as chairman in May, just before Revolution Beauty finally released its 2022 results, which showed losses more than doubling to £44.9m.
Minto, who quit in November, can now face legal action from his former employer, who sent him a letter earlier this month claiming he breached his duties to the company.
He has until July 7 to respond. Revolution Beauty said Wednesday it had not received a “substantive” response to the claim.