19th Aug 2025 13:06
(Alliance News) - Revolution Beauty Group PLC on Tuesday said it will report weaker than expected annual profit, as it agreed with its auditor to "change the definition" of provision charges for non-strategic stock.
The London-based cosmetics retailer will now report adjusted earnings before interest, tax, depreciation and amortisation for the year ended February 28 of around GBP4.7 million. It would represent a fall of 63% from GBP12.6 million in financial 2024.
Revolution Beauty had previously expected to report an adjusted Ebitda between GBP6.0 million and GBP6.5 million. The sum included an adjusting item related to stock provision charges for non-strategic stock worth GBP10.3 million.
"In the interests of agreeing the sign off of its accounts, the company, has agreed with its auditors to change the definition of the adjusting item such that it now relates solely to inventory that was sold, or is expected to be sold, through outlet channels. As a result of the change in definition, the value of the adjusting item is now expected to be approximately GBP8.5 million," Revolution Beauty added.
"The adjusting item is non-cash and non-recurring in nature, owing to a significant rationalisation of the company's product portfolio. As part of the audit process, the company has concluded that the revised definition is preferable, given that it requires less judgement to arrive at the estimated value."
Revolution Beauty expects to release annual results by the end of August.
The firm added that a formal sale process "continues to progress with ongoing engagement with a number of parties". It is also progressing discussions with stakeholders, including for a "potential equity raise".
Shares in the company were 2.4% higher at 3.85 pence each in London on Tuesday afternoon.
In June, Frasers Group PLC cooled its takeover interest in Revolution Beauty. The Sports Direct and Flannels owner ruled out a bid for the London-based cosmetics retailer. Frasers had earlier that month confirmed it was evaluating a possible all-cash offer for Revolution Beauty, which has been in a formal sale process since May.
By Eric Cunha, Alliance News news editor
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