Revolution Beauty has reported an “excellent” sales boost during the ongoing leadership battle with its largest shareholder Boohoo.
The fast beauty retailer’s business has soared during the first three months of the 2023 financial year, with sales up 60% versus 2022.
It has also reported earnings of £3.5m – from a loss of £7.4m a year prior – which the business said demonstrates the quality of its products and offer.
Gross margins came in at 48.2% compared with 41.7% in the same period last year.
“The excellent trading performance in the first quarter of the year is testament to the quality of our offer and the strength of our leadership team,” said Revolution Beauty CEO Bob Holt.
“And shows that we are delivering on our global retailer strategy.”
Holt added: “Boohoo’s stated rationale for the proposed changes to the Revolution Beauty board is that the focus of the group must switch to growth.
“The company hopes that shareholders are reassured that the current board is similarly minded and that growth is being delivered without one shareholder taking control of the board at the expense of the interests of other shareholders.
“It is also noteworthy that the group’s trading performance has been delivered at the same time as rectifying the significant historical issues that occurred under previous management.”
This news comes a week after Boohoo revealed it is looking to oust the cosmetic retailer’s leadership team after expressing concerns that it is not delivering shareholder value.
Boohoo is planning to vote against the reappointment of Holt, Non-Executive Chair Derek Zissman and CFO Elizabeth Lake at Revolution Beauty’s AGM on 27 June.
The Manchester-based company approached ex-THG Beauty CEO Rachel Horsefield to join its independent leadership team for the attempted takeover.
Boohoo has a 26.5% stake in Revolution Beauty, which makes it the cosmetics group's biggest shareholder.
Revolution Beauty has hit back at Boohoo’s attempted coup, calling it “value-destructive, opportunistic and self-serving”.
It claims that Boohoo’s actions are a “cynical attempt” to seize control of the company without financial outlay.
It is a rocky time for Revolution Beauty as it also deals with the outcomes from a damning investigation into management failures at the company.
The report listed a series of issues, including that co-founders Adam Minto and Tom Allsworth had made personal loans of around £1m to distributors and a senior employee.
However, none of these arrangements were disclosed to the board at an appropriate time.
Revolution Beauty is now seeking to recover funds relating to the “exceptional costs” it incurred as a result of the situation.
A letter of claim has been sent to Minto.
Trading in Revolution Beauty was suspended last year after the company missed releasing final results for the year ended 28 February 2022.
The brand said it failed to release the results due to accounting issues and this prompted the group’s auditor BDO to order a probe into the company.