THG revenues improve as beauty bolsters Q3 sales

By Alessandro Carrara | Published: 17-Oct-2023

The improved constant currency earnings has resulted in THG’s full-year outlook for 2023 remaining unchanged at 0% to -5%

THG has returned to growth on a constant currency basis in Q3, amid a boost in beauty sales.

Overall group revenue was reported at -4.4% (£466.5m), but was still an increase on the -9.3% low seen during the brand owner’s half-year 2023 results.

On a constant currency basis, revenue growth reached 3.2% in September, which THG said was largely driven by a “strong performance” across its Beauty division.

The impact of global destocking on THG’s beauty manufacturing business also eased in Q3, which supported the stabilised earnings.

"Q3 has been another strong quarter of progress across the group, with each division delivering improved performances,” said Matthew Moulding, CEO of THG.

“The pivots made within each division to ensure they thrive in a high inflation global environment are bearing fruit.”

The British retailer said it also reduced orders during the quarter that did not deliver an immediate financial return, which supported the increased margin performance.

As a result of the slightly improved earnings, THG’s full-year outlook for 2023 remains unchanged at 0% to -5%.

"The group is exceptionally well invested with a strong balance sheet, with each division well positioned to grow market share in any market conditions,” added Moulding.

The improved results has provided THG with some breathing room in what has been a financing challenging year for the company.

Last quarter the Lookfantastic owner’s shares sank by 12% after it posted lowered half-year results for 2023.

This was largely the result of losses increasing to £99.5m, which were impacted by a one-off charge related to its discontinued categories.

Moulding also found himself at the centre of a spat with US hedge fund Quintessential Capital Management (QCM).

The business owner has frequently and publicly expressed his frustrations with the press, hedge funds and bank analysts throughout the year.

In April, Moulding hit back on social media about the UK media’s coverage of the beauty company, following a takeover proposal from US buyout firm Apollo.

A LinkedIn post by Moulding targeted the British, which he said “regularly build negative coverage” against UK listed companies.

Moulding also purchased City AM in June this year, a London-based finance newspaper.

He acquired the company through a pre-pack administration process for an undisclosed sum, after it was put up for sale in July 2023 by its owners seeking either investment or disposal.

Read more on THG:

THG shares plummet after half-year revenues fall short
Meet the Buyer: how to land a deal with THG Beauty’s Head of Buying
THG sells ‘loss-making’ OnDemand division to streamline core operations
THG CEO Matthew Moulding mulling sale of company’s £250 million headquarters

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