Fast fashion firm Boohoo has insisted it is on the path to recovery after revealing a steep jump in annual losses and sales down by nearly a fifth.
The group reported pre-tax losses of £159.9 million for the year to February 29, against losses of £90.7 million the previous year.
Revenues tumbled 17% to £1.5 billion, which the firm blamed on its “increased focus on profitability and difficult market conditions”.
The group said it saw improved trading of its core brands – boohoo, boohooMAN, PLT, Karen Millen and Debenhams – with declines in sales by gross merchandise value (GMV) across these brands paring back from 9% in the first half to 4% in the final six months.
The group said it is aiming for GMV growth in 2024-25 and is on track for annual cost savings of £125 million.
Chief executive John Lyttle said: “Despite difficult market conditions, caused by high levels of inflation and weakened consumer demand, we made continued progress in the year.
“The group is now well positioned to return to growth, and we are focused on ensuring that growth is both sustainable and profitable.”
The results showed the impact of a tough trading backdrop, with active customer numbers down 11% to 16 million, while average order values also fell 3% and average order frequency per year dropped 9%.
Spending among its customer base has been hit by the cost-of-living crisis, while it has also faced pressure from online rivals such as Shein.
The figures follow further allegations over its manufacturing practices, with a BBC Panorama investigation earlier this year revealing Boohoo mislabelled items of clothing made in South Asia as “Made in the UK”.
Boohoo said at the time that it was an “isolated incident” and impacted less than 1% of clothing supply.
The group revealed plans in January to close its Leicester factory and relocate operations, although it said this was not connected with the probe.
Around three years previously, the company overhauled its ethical practices after a supply chain scandal and allegations over factory staff pay and working conditions.
Guy Lawson-Johns, equity analyst at Hargreaves Lansdown, said: “For now, it remains a struggling company with a tarnished reputation, reflected in the group’s valuation, which has come down significantly over the last few years.”
He added: “And with customer key performance indicators continuing to trend in the wrong direction, it doesn’t look like a miraculous recovery is around the corner.”