30th Mar 2026 10:39
(Alliance News) - boohoo Group PLC on Monday hailed stronger-than-expected trading in financial 2026, and provided upbeat guidance for the year ahead.
The Manchester-based fast fashion e-retailer, which trades as Debenhams, owns brands such as Karen Millen, Nasty Gal, boohoo, boohooMan and PrettyLittleThing, though it said in August that it is "actively pursuing a disposal" of PrettyLittleThing.
As boohoo reiterated its focus on "getting our brands back to growth", its directors reaffirmed a "confident" outlook for the coming year.
The company's shares rose 2.1% to 17.70 pence on Monday morning in London, but are down 32% over the past year.
According to the company, adjusted earnings before interest, tax, depreciation, amortisation, share-based payment charges and exceptional items had grown "comfortably ahead of previous guidance" during the financial year that ended February 28.
boohoo estimated adjusted Ebitda rose 36% to GBP53 million. This is ahead of the GBP50 million target the company had set last month. In financial 2025, boohoo reported adjusted Ebitda from continuing operations as GBP41.6 million, which implies a rise of 27% to GBP53 million. Adjusted Ebitda including discontinued operations totalled GBP39.6 million in financial 2025, which implies an increase of 34% to GBP53 million.
The company said adjusted Ebitda jumped 76% in the second half of financial 2026 alone. It estimated net debt at GBP90 million at the end of February, for an adjusted Ebitda ratio under two times, partly helped by a GBP38.7 million fundraise in February.
Cash lease costs were GBP18 million in financial 2026. The year prior, boohoo had reported a negative cash flow of GBP13.7 million from lease payments. In the year ahead, it sees cash lease costs falling to GBP13 million. Following a planned exit from a vacant US property, it sees this reducing further to GBP6 million.
Capital expenditure decreased to roughly GBP16 million in financial 2026 from GBP28 million the previous year. In financial 2027, it is expected to fall again to GBP8 million.
Interest costs were GBP21 million in financial 2026 and are forecast lower in the new year thanks to non-core property disposals.
"Working capital in the year to FY26 is expected to be marginally cash flow positive and the board is anticipating further reductions as the growth of marketplace continues," boohoo added.
In financial 2027, the company sees adjusted Ebitda growing at a double-digit percentage rate, and a debt/Ebitda ratio of 1x by the year-end. It also expects a significant improvement in free cash flow resulting from "materially lower exceptional costs".
"Our multi-year turnaround strategy continues at pace," stressed Chief Executive Dan Finley.
"Our pivot to the stock-lite, capital-lite, highly profitable marketplace is working. The cost base has been reset, the warehouse consolidation completed, the tech re-platform delivered, the stock base rightsized, most of the onerous costs exited and the brand management teams strengthened. This is significant progress, ahead of our plan, but there is still more to be delivered and we now focus on growth."
boohoo pointed to improvements in its gross merchandise value trend, with GMV "exiting February 5% below last year", it said.
GMV before returns from continuing operations was GBP1.6 million at the end of financial 2025, and including discontinued operations, was GBP2.3 million.
By Holly Munks, Alliance News reporter
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