THG sales hurt by beauty weakness but nutrition shows recovery
THG has reported lower first-quarter turnover as weaker sales in its beauty business offset improvement in the group's nutrition unit.
The e-commerce retailer, which owns the Cult Beauty and Myprotein brands, saw overall revenue feal by 8 per cent at constant currency rates to £375.6million in the three months ending March.
Sales in its beauty arm declined by 9.8 per cent to £223.6million, partly because the equivalent period last year included the Easter weekend occurring in late March.
THG also blamed the drop on the scaling back of sales activity in certain Asian and European markets in order to focus on attracting higher-margin customers.
Weaker demand for beauty products offset nutrition-related sales rising in February and March thanks to the number of online customers increasing in the UK.
THG's nutrition division saw revenue slump by 8.7 per cent to £579.8million in 2024 after the company slashed prices to try and clear old stock as part of a rebrand.
As a result, the Manchester-based company's total revenue last year shrank by more than £100million to about £1.9billion, although its 'post-demerger' sales were only 0.4 per cent down at £1.7billion.
THG spun off loss-making technology platform Ingenuity in January to simplify operations, revive shareholder value, and bolster its finances.
Following the demerger, the group completed a debt refinancing deal up to 2029, conducted an equity raise, and entered the FTSE 250 Index.
Matthew Moulding, chief executive and co-founder of THG, said: 'We are now fully focused on THG Beauty and THG Nutrition, and I'm incredibly proud of the progress each business has made.'
He added: 'Both our businesses have undertaken extensive model changes over the past 24 months.
'Beauty has focused on more profitable markets and building loyalty schemes, while Myprotein has pressed ahead in undertaking a successful rebrand, underpinning rapid growth across global offline retail and licensing.'
THG also revealed its adjusted earnings before nasties flatlined at £114.4million last year.
Since listing on the London Stock Exchange in 2020, THG has struggled with heavy losses, slowing online trade, and corporate governance concerns.
Moulding has expressed regret for taking the company public in the UK, once saying it 'just sucked from start to finish.'
THG shares have plunged by around 95 per cent from their initial public offering price of 500 pence per share to 26.1p as of mid-Tuesday afternoon.
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