- THG reveals that its continuous turnover increased by 4.5% in the first quarter
- Revenue from the company’s beauty business rose 11.1% to £267.6m.
THG expects revenue to grow in the first half after sales were boosted by an “outstanding” performance from its beauty division in the first three months of 2024.
The online retailer, formerly known as The Hut Group, revealed continued turnover growth of 4.5 per cent in constant currency to £455.4 million for the first quarter, up from 1.1 per cent. cent in the previous three months.
Revenue from its beauty business rose 11.1 per cent to £267.6m, which the company attributed to excellent demand in the UK and a greater focus on more profitable markets and customers.
Improved growth: THG’s ongoing turnover rose 4.5 per cent to £455.4 million in the first three months of this year, compared with 1.1 per cent in the previous quarter.
THG said the “outstanding” result offset a decline in trading in its nutrition division caused by the devaluation of the Japanese yen and product availability issues, due to the rebranding of brands such as supplement maker Myprotein.
E-commerce services platform Ingenuity saw external revenue growth of 5.9 per cent to £37m thanks to multiple deals secured, including one with lifestyle brand White Stuff ahead of its relaunch in Germany.
Ingenuity’s internal revenue fell 8 per cent to £112.6 million, but this was mainly due to the discontinuation of unprofitable categories and the sale of the OnDemand division to its management team last summer.
The sale, which included entertainment retailer Zavvi, marked the conclusion of THG’s strategy to offload non-core assets, having sold cycling equipment supplier ProBikeKit to retail giant Frasers Group in early 2023.
THG now expects turnover growth of 2 to 5 percent in the first half of this year and high single digits in the next six months.
THG stock rose 4.7 per cent to 64.9p early on Tuesday afternoon, although they remain well below their initial public offering price of 500p.
When the company debuted in September 2020 in what was the biggest listing on the London Stock Exchange in seven years, it was at the height of a Covid-induced boom in e-retailing.
But it has since struggled with slowing online sales, corporate governance issues, pressure from short sellers and successive profit warnings.
THG reported a pre-tax loss of £252m last year, although losses more than halved from the £549.7m recorded in 2023.
To turn things around, the company has eliminated thousands of jobs, expanded automation in its warehouses and abandoned some loss-making businesses.
THG was founded in 2004 by Matthew Molding and John Gallemore, who initially sold CDs, DVDs and other entertainment products online before moving into selling beauty and lifestyle products.
The company’s brands range from skincare retailer Dermstore to makeup brand Illamasqua, City AM newspaper and film distributor Arrow Films.
Commenting on THG’s first quarter results, Molding said they were “a testament to the hard work and dedication of our people, who have remained focused on the task at hand despite the difficult macroeconomic backdrop.”