PARIS — Shares in online beauty retailer THG, formerly known as The Hut Group, fell more than 20 percent on the London Stock Exchange Thursday after the company lowered its sales outlook for 2023.
The owner of online retailers such as Cult Beauty and Look Fantastic, and brands such as Perricone MD and Espa, published its half-yearly results Thursday morning.
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“Inflationary pressures provided significant challenges to consumers and businesses alike over the past 18 months,” said Matthew Moulding, cofounder and chief executive officer of THG, in a statement.
He underlined the company’s beauty division’s business was dampened in the six-month period by short-term global destocking that negatively impacted manufacturing volumes.
THG said it expects continued revenue growth for 2023 to range between 0 percent and 5 percent. In April, the company had said it was expecting low- to midsingle-digit growth for the year.
In first-half 2023, group pre-tax losses were 133 million pounds, against 108.2 million pounds in the same prior-year period. Earnings before interest, taxes, depreciation and amortization of 50.1 million pounds slightly beat guidance of 50 million pounds. Meanwhile, company sales declined 9.3 percent to 969.3 million pounds.
Despite a blockbuster IPO in 2020, with a market capitalization of about 5.4 billion pounds, THG had a rocky start on the public markets, with investors questioning Moulding’s oversight of the company, and the value of the Ingenuity platform, which licenses end-to-end e-commerce solutions to brand owners, provides various other digital services and undertakes beauty product development and manufacturing for third parties.
THG has since taken steps to rectify those issues, with Moulding stepping down as joint chairman and CEO, and giving up his golden shares in the company, which gave him special veto powers and the ability to block takeover attempts.
In May, THG walked away from acquisition talks with private equity firm Apollo Global Management Inc. Last year, THG rejected several other bids.
THG stock, which closed Thursday down 21.6 percent to 68.62 pence, has lost about 90 percent of its value since a high in 2021.
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