Online fashion retailer boohoo (LON: BOO) has reported lower revenues, although it has been able to reduce inventory and thereby working capital levels. The share price slumped by 10.5% to 42.41p.
Overall revenues in the four months to December 2022 were 11% lower at £637.7m. The largest drop was in the US with a 17% decline, while the rest of the world sales were 15% lower. UK and Europe sales declined by lower percentages. Freight and materials costs reduced the gross margin, although overheads are being reduced.
In the ten months to December 2022, revenues were 12% lower at £945.4m. The reduction in US revenues was 27% during that period.
The 27% reduction inventories have boosted cash generation, but there is also higher capital spending. Net debt is expected to fall to £50.4m by the end of February 2022.
In the year to February 2022, boohoo is set to report revenues of £1.74bn, but it is no longer expected to report a pre-tax profit for the period. A loss is also forecast for 2023-24.
The full year figures will be published in May. Cost inflation is expected to ease later in 2023.
The boohoo share price has fallen by nearly two-thirds since the end of 2021.
