REG - Boohoo Group Plc - Trading Statement

BoohooAnnouncement

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RNS Number : 5577Y  Boohoo Group Plc  30 March 2026

For Immediate Release

30 March 2026

This announcement contains inside information for the purposes of the Market
Abuse Regulation (EU) No. 596/2014 (as amended) as it forms part of the
domestic law of the United Kingdom by virtue of the European Union
(Withdrawal) Act 2018 (as amended).

boohoo group plc

("Debenhams Group", the "Group" or the "Company")

 

Trading update for the year to 28 February 2026

 

·      Comfortably ahead of previous guidance at £53m Adjusted EBITDA
delivered for FY26 (+36%)

·      76% increase in H2 Adjusted EBITDA

·      FY27 guidance raised with the higher £53m FY26 Adjusted EBITDA
outturn expected to grow double-digit % in FY27(1)

·      Net debt under 2x Adjusted EBITDA and guiding to 1x Adjusted
EBTDA at the end of the current year to February 2027

The Board is pleased to announce its forecast delivery of £53 million
Adjusted EBITDA(2) in the financial year to 28 February 2026 ("FY26"). This
is comfortably ahead of the previously upgraded guidance in the Company's
Trading Update announcement dated 28 January 2026. This year on year 36%
increase in full year Adjusted EBITDA is driven by a 76% increase in H2
Adjusted EBITDA.

The Board remains confident of double-digit Adjusted EBITDA growth in the
financial year ending 28 February 2027 ("FY27"). The final quarter of 2026
continued to see material improvements in the Group's GMV trend, delivering
three consecutive quarters of GMV decline improvement, exiting February -5%
below last year.

Dan Finley, Group CEO, said:

"Our multi-year turnaround strategy continues at pace. We are pleased with the
76% increase in H2 Adjusted EBITDA and £53m full year Adjusted EBITDA. Our
pivot to the stock-lite, capital-lite, highly profitable marketplace is
working.

The cost base has been reset, the warehouse consolidation completed, the tech
re-platform delivered, the stock base rightsized, most of the onerous costs
exited and the brand management teams strengthened. This is significant
progress, ahead of our plan, but there is still more to be delivered and we
now focus on growth."

The Group's cost out strategy delivered a fixed cost exit rate of £119m
(£11m less than the £130 million guided in February 2026), reduced from
£175 million for FY26, with the Group remaining on track to meet its target
of £100 million in FY27. The Board is pleased to provide the further
financial guidance below, resulting from the progress of its move to an
increasingly asset-lite model driven by the Debenhams brand.

All brands continue to trade profitably on an Adjusted EBITDA basis.

It has been the Board's intention to reduce the Group's debt and associated
cost of interest. This reduction of debt was greatly helped by the fund raise
in February 2026 of £40m. Net debt as at the end of February was £90m which
is less than 2x Adjusted EBITDA for the year just ended and is expected to be
at under 1x at the end of FY2027.

The Group is transitioning to an asset-lite model through marketplace, which
remains at the core of the turnaround plan, and enables it to capitalise on
the increased momentum in the turnaround plan that recent trading has
generated, allowing the Group to maximise value from its other deleveraging
options.

As stated in the previous guidance on 17(th) February 2026 the Board will
increasingly focus on free cash flow as a financial metric as to the
performance of the business which the Board expects to materially improve in
the coming year.

We expect cash flow from operating activities to improve significantly. This
is a result of materially lower exceptional costs. The cost base has been
reset, the warehouse consolidation completed, the tech re-platform delivered,
the stock base rightsized and most of the onerous costs exited.

Cash flow from non-operating activities are expected to improve, below are the
main features in the current year and for next.

In FY26 cash lease costs were £18 million which includes the costs of leased
property that is now vacant. The Board now anticipates that lease costs in
FY27 will reduce to c.£13 million. In addition, when the Group's vacant US
property lease is exited, lease costs are estimated to fall further to c.£6
million. These remaining lease costs will predominantly relate to the Group's
Manchester head office, the fully automated warehouse in Sheffield and a small
London footprint. The expected reductions in lease costs will have a positive
impact on cash flow. Lease costs are principally shown under depreciation from
an accounting perspective.

Similarly, the Group's capex fell in the year from £28m to c.£16 million. In
the FY 2027 capex is expected to fall to c.£8 million in FY27, further
enhancing cash generation.

Interest costs in the year to February 2026 was £21m and is expected in the
year ahead to fall as non core property assets are disposed as the business
deleverages resulting in lower debt year on year.

Working capital in the year to FY26 is expected to be marginally cash flow
positive and the Board is anticipating further reductions as the growth of
marketplace continues.

As a result, the Group expects net debt to fall below 1x Adjusted EBITDA in
the year ahead. This reduction will be driven by operating cashflows and
expected disposals as outlined above with small exceptional costs.

Depreciation in FY27 is expected to fall from c. £59 million in the year to
February 2026 to c. £20 million reflecting the lower asset base post write
offs relating to the transformation. These include the consolidation of the DC
operations and the technology platforms.

As a result of this simplification of the Group's business, the continued
focus on improving and growing the asset-lite marketplace model, getting our
brands back to growth and the resulting impact of significantly improving the
Group's cash generation, the Directors remain confident in the outlook for
FY27.

( 1 ) Previous guidance as at 17 February 2026 for FY27 outlook.

 

( 2 ) Adjusted EBITDA is calculated as loss before tax, interest,
depreciation, amortisation, share-based payment charges and exceptional items.
This figure is unaudited.

 

 Enquiries
 Debenhams Group
 Phil Ellis, Chief Financial Officer         Tel: +44 (0)161 233 2050

 Zeus - Nominated Adviser and Joint Broker
 Dan Bate / James Edis / Emma Burn           Tel: +44 (0)161 831 1512
 Benjamin Robertson / Dominic King           Tel: +44 (0)20 3829 5000

 Panmure Liberum - Joint Broker                                    Tel: +44 (0)20 3100 2000
 Mark Dickenson / James Sinclair-Ford / Gaya Bhatt

 Sodali & Co - Financial PR Adviser
 Ben Foster / Louisa Henry                                         Tel: +44 (0)20 3984 0114

 

About Debenhams Group

 

Debenhams Group is an online platform, for fashion, home, and beauty, serving
millions of customers across five shopping destinations: Debenhams, Karen
Millen, boohoo, MAN and PLT. Debenhams Group dates back to 1778 when William
Clark, a retail pioneer of the time, opened the UK's first department store.
Today, the Group is home to Debenhams, Britain's online department store and
leading fashion-led marketplaces, boohoo, PLT, MAN, and Karen Millen.

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