×
91 469
Fashion Jobs
L'OREAL GROUP
Outside Sales Representative - Everett, wa
Permanent · Seattle
L'OREAL GROUP
Account Executive - Sales
Permanent · St. Louis
L'OREAL GROUP
Associate Principal Engineer/Manager - Packaging
Permanent · Clark
JCREW
Assistant Production Manager - Wovens
Permanent · New York
JCREW
sr. Art Director
Permanent · New York
VF CORPORATION
Dickies sr. Manager, Retention Marketing
Permanent · Fort Worth
ALL SAINTS
Third Shift Supervisor - Bolingbrook Distribution Centre
Permanent · Bolingbrook
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Deerbrook
Permanent · Humble
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Clinton Crossing Premium Outlet
Permanent · Clinton
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Clinton Crossing Premium Outlet
Permanent · Clinton
ABERCROMBIE KIDS STORES
Abercrombie Kids - Manager in Training, Aventura
Permanent · Aventura
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Gardens
Permanent · Palm Beach Gardens
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Garden State
Permanent · Paramus
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Park City Outlet
Permanent · Park City
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Grapevine Mills Outlet
Permanent · Grapevine
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Brandon Town Center
Permanent · Brandon
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Burlington
Permanent · Burlington
ABERCROMBIE KIDS STORES
Abercrombie Kids - Manager in Training, Polaris Fashion Place
Permanent · Columbus
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Westfarms
Permanent · West Hartford
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Hanes
Permanent · Winston-Salem
ABERCROMBIE KIDS STORES
Abercrombie Kids - Manager in Training, Garden State
Permanent · Paramus
ABERCROMBIE AND FITCH STORES
Abercrombie & Fitch - Manager in Training, Fayette
Permanent · Lexington
Published
Mar 31, 2022
Reading time
2 minutes
Share
Download
Download the article
Print
Click here to print
Text size
aA+ aA-

Boohoo's current problems are "entirely transitory" says management

Published
Mar 31, 2022

Boohoo Group may have been hit by supply chain scandals, delivery hold-ups, a plummeting share price, and questions of whether it can maintain its crown as an online fast fashion market leader, but its problems are “entirely transitory”, according to management, an analyst note said on Thursday.


Reuters



Jefferies said the company had attended its Pan-Euro Mid-Cap Conference this week and the takeaways from the group meetings were that the headwinds are set to ease... but not yet.

And those headwinds are certainly considerable. As management reiterated, it had faced “sharply higher inbound and outbound freight costs, a year-on-year step-up in returns rates, international revenue shortfalls from an impaired delivery proposition, and resultant impacts of inefficient marketing and higher clearance”.

But the note said: “Crucially, management continues to view these factors as almost entirely transitory and remains firm in its belief that Boohoo can return to being a business delivering +25% [annual] sales growth and an EBITDA margin of [around] 10%.”

While the company is budgeting for these issues to “largely persist” in the current financial year (FY23), the inbound freight increases and the higher level of returns are “set to annualise by the half year”. 

The company is taking a certain number of actions that are within its control, such as “buying tighter, balancing sourcing regions to manage the mix of sea/air freight, and looking to bring more sourcing closer to the UK to reduce cost volatility and shorten lead times”.

But it’s limited in what it can do for this year until external issues (such as logistics problems) improve and year-on-year comparisons become easier.

Jefferies also said that management highlighted the development of Boohoo's wholesale business as “providing a different route for growth”.

The company also emphasised the actions it’s taking to support the margin, including reduced clearance, more efficient marketing spend (“likely to run at 9-10% of sales vs. c.11.5% in FY22”) and the Sheffield automation project that should drive cost efficiencies. 

The analysts “remain positive” on the business’s prospects and “like management, continue to believe that the pressures facing Boohoo are almost entirely transitory in nature, even if the reversal of those pressures will clearly take time”.

Copyright © 2022 FashionNetwork.com All rights reserved.