In its results for the 12 months ended 28 February 2023, Boohoo (BOO) , an online clothing retailer, reported revenue of £1.769 billion, down 11% from the previous year but up 43% compared to 2020. Adjusted EBITDA was £63.3 million, down 49%, with a margin of 3.6%. 

But boohoo’s cash performance was standout, achieving free cash flow of £30.2 million through improved inventory and working capital management. It holds £5.9 million net cash and a £325 million revolving credit facility, providing £331 million of liquidity headroom.

Boohoo expanded its customer base to 18 million, up from 13 million since 2020, through organic growth and an expanded brand portfolio, with aims to tap into a target market of up to 500 million potential customers. The company is developing its global infrastructure, leveraging automation at its Sheffield warehouse and an international distribution center in the US.

Efforts to improve lead times include targeted reinvestment of supply chain savings into faster freight methods. Inventory has been tightly managed, reduced by 36% YoY as of February, with an emphasis on nearshore sourcing to manage lead times and enhance free cash flow.

Boohoo's CEO John Lyttle said he remained confident in the company's future growth. Investments in automation, US fulfillment capacity, and global brand awareness are expected to drive improved profitability and double-digit revenue growth.

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These numbers from Boohoo indicate a promising trajectory towards recovery, even if it has a little while to go yet before it returns to former glories.  

This being said, Boohoo remains in much better shape than its industry competitors. Asos(ASC,) released results for the six months to 28 February 2023, reporting a loss of £87.4m compared to  a £14.8m profit in the same period last year, alongside employing cost-cutting measures to lead to a return to profitability in H2 FY23. 

Boohoo’s results saw active customers falling 10% to 18.0 million, reflecting the switch back to offline following the pandemic, which contrasts with the fashion retailers' dominance over high street brands during lockdown. Over this period, online retailers enjoyed the advantages of increased online shopping activity, particularly among younger adults who were confined to their homes. Post-lockdown combined with the cost of living continuing to rise has left online retailers feeling the burn, now having to compete once again with high-street brands that don't incur shipping costs. 

Boohoo said its focus for the year ahead is on rebuilding profitability and getting back to growth. For FY24, revenues are expected to be between flat and a decline of 5% against the prior year, with increased emphasis on driving profitable sales. Looking ahead, the group's focus on automation, US fulfillment capacity, and global brand awareness are laying solid foundations for Boohoo's future growth.

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