Better-than-expected trading means full year sales are expected to grow 33-38%, ahead of previous guidance of 25-30%. Investments in new brands acquired in the first half, means cash profit margins will be around 10%, in line with previous expectations.
Further guidance will be given at half year results on 25 September.
Following the news, boohoo shares rose 16.5%.
boohoo's combination of popular collections and cheap price tags has cooked up a storm. We can't really knock its performance.
An exclusively online presence means the group can stock small quantities of lots of different styles, and ramp up marketing and stock for the most popular. This 'test and repeat' model means boohoo is ideally placed to keep up with the frantic pace of fast fashion. An online model also means expansion is easier than a bricks and mortar retailer, which helps boohoo pursue growth at a snappy pace.
The opportunistic approach to acquisitions is also a point in the group's favour, with the likes of PrettyLittleThing and Nasty Gal meaningfully boosting sales since they were bought in 2017. We don't know how the latest addition, Miss Pap, will fare yet, but so far boohoo's had a good eye, and upgraded forecasts suggests early signs are good.
All that potential comes at a price though. The shares currently change hands for a lofty 43.2 timeÂ s expected earnings, which means near-perfect execution will be needed to avoid the share price reacting. A lot is expected from the US market in particular, and growth here has slowed a bit recently. The smaller brands will need to keep delivering, and looking ahead, it's hard to see how sales momentum can be maintained without spending ramping up.
There are logistical challenges with growing fast too. Rival ASOS had issues with new US operations, leading to unforeseen costs. boohoo's managed its expansion well so far, but there are higher risks when things are moving this fast.
There are other challenges too. The retail environment is particularly tough, with profit warnings from rival online giant ASOS showing the troubles aren't just on the high street. boohoo's certainly managing to buck the trend, but tough trading conditions elsewhere means it's something to keep an eye on going forwards.
All-in-all, it's hard not to be impressed by boohoo's performance. Sales are racing, and if the group can manage its expansion plans and keep growing the international business fast enough to satisfy the share price, the group offers an exciting proposition.
Trading details (figures at constant exchange rates) 12 June Â 2019
Excluding exchange rate effects, first quarter revenues increased 39% to £254.3m. However, revenue growth in the key US market slowed from 81% last year to 66%.
Revenue across all geographic regions increased year-on-year, with the biggest improvement coming from Europe (excluding the UK), up 71% to £38.3m.The USA saw a 66% rise, and the UK was 27% ahead of last year with revenues of £140.6m. The Rest of World region grew 28%.
boohoo's own-branded line posted a 28% increase in sales, compared to 10% growth seen at the same time lastÂ year, reaching £123.5m. PrettyLittleThing saw sales rise 42% to £112.1m, and Nasty Gal revenues climbed 157% to hit £18.2m.
The group achieved a gross margin of 55% - which represents a slight decrease year-on-year.
In March 2019 boohoo added to its portfolio by acquiring the Miss Pap brand.
Net cash now stands at £194m, compared to £151m last year.
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