THG has returned to growth in Q4 after reporting a 1.1% jump in revenues.
The financial boost was attributed to the brand owner’s beauty division, which saw a 2.6% increase in revenues to £387m compared with Q4.
This was driven by a strong performance from THG's own beauty brands Perricone MD and ESPA, as well as its retail platform Cult Beauty.
THG’s performance in the UK, which accounted for more than half of total beauty revenue, also saw a 9% increase in revenue growth.
However, on a year-over-year basis, THG’s beauty revenues were down 4.3% to £1.17bn.
In a Linkedin post, THG CEO Matthew Moulding compared the growth of the business to the Netflix series Squid Game.
“On a good day, building THG is like a game of dodge ball (great film!). On a bad day it’s more like Squid Games for entrepreneurs,” he wrote in the post.
“Like in Squid Games, there were a raft of business casualties last year, albeit those affected in 2023 were very different.
“Rapidly rising interest rates caused a scarcity of both capital and debt, especially in the UK."
While beauty sales were an increase on the previous quarter, on a year-over-year basis THG’s beauty revenues were down 4.3% to £1.17bn.
"2023 was a year that threw up many challenges for all businesses, and I'm delighted in how the Group not only responded to these challenges, but grew stronger through the year,” added Moulding.
"A combination of automation and significant cost initiatives delivered in 2022, in addition to a receding inflationary environment.
“Each played a key role in the group delivering an expected record EBITDA performance after cash-adjusting items during 2023.”
THG has also partnered with wellness retailer Holland & Barrett, and will provide fulfilment services to the brand through its operations and technology platform Ingenuity.
The company’s $20m acquisition of US beauty brand Biossance was completed in late December 2023.
"While the economic background remains uncertain there are some optimistic signs, with consumer cost of living pressures set to ease further in 2024,” added Moulding.
“We are confident that the investments and decisions made throughout the year position the group well to build upon the positive exit momentum."
The positive Q4 growth builds on the revenue recovery seen during THG’s third quarter performance.
Revenue was reported at -4.4% (£466.5m), but was an increase on the -9.3% low seen during the brand owner’s half-year 2023 results.
THG recently defended its decision to retain Non-Executive Director Iain McDonald, despite shareholder opposition.
McDonald will remain on the British retail group’s board despite his re-election being opposed by almost a quarter of investors.
At THG’s annual general meeting (AGM) in June 2023, McDonald stepped down from the group’s remuneration committee.
Around 24% of shareholders then voted against his re-election as a Director.
However, the company formerly known as The Hut Group backed McDonald.
THG has defended its decision, and stated at the time that McDonald was a “valuable member” of the board with more than 13 years experience.