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The Hut Group reports full-year losses due to acquisitions and investments

Tom Shearsmith
15 April 2021

The Hut Group, owners brands including Coggles, Lookfantastic and AllSole, has reported £1.6 billion of revenues for the financial year 2020, with an operating loss of £481.8m, driven by one-off costs from investment and acquisitions.

THG reported that it had made £365 million in strategic acquisitions, including Dermstore (in February 2021). It also made investments in people, fulfilment and manufacturing capacity within UK, Europe, US and Asia including the addition of 5 global locations and over 3,000 roles created.

Strong revenue growth is reported at +41.5%, increasing Group revenues to the £1.6 billion detailed, with 61.4% international revenue participation, broadly spread across all major territories. Following the acquisition of Dermstore, US revenue participation is expected to account for over 20% of Group revenues.

Overall, the group made a gross profit of £729.6 million, a growth of 42.8% compared to 2019, with a gross profit margin of 45.2%. It ended the year with net cash of £283 million.

The founder of The Hut Group has also pledged to donate £100 million of the the company's shares to charity and hand all his salary to good causes following the firm’s stock market debut last year.

Executive chairman and chief executive Matthew Moulding will give the mammoth stake to the Moulding Foundation, set up by the entrepreneur and his family last year. The move – which comes just seven months after THG’s IPO – sees him become one of the UK’s biggest philanthropists.

THG said it had already donated £300,000 to charities between last September’s IPO and the end of 2020, instead of paying Mr Moulding and co-director John Gallemore their base salaries.

Matthew Moulding

The Hut Group CEO, Matthew Moulding

The Hut Group CEO, Matthew Moulding, commented: "We approach FY21 with confidence having navigated successfully through a milestone year in the Group's history. I am particularly proud of how our people have responded to the changing environment, displaying determination to make a difference across all aspects of our operations from new product development, to digital marketing, M&A, fulfilment and THG (eco).

"Our global D2C brand building capabilities and proprietary Ingenuity technology platform has enabled us to further develop both our external brand relationships, and our expanding portfolio of Beauty and Nutrition own brands. Leveraging the platform to build an impressive client base of blue-chip consumer brands has been a highlight of the year, supported by encouraging momentum in the current year Ingenuity Commerce pipeline.

"Management's purpose for the IPO was to step change THG's access to funding in order to capitalise on COVID-19 accelerated market changes. As we progressed through 2020, those changes became more apparent in terms of the volume and scale of opportunities available to the Group, as evidenced by the £400m committed to acquisitions since IPO, most notably the acquisition of Dermstore in the US.

"We have delivered exceptionally well on our commitments at IPO and we move forward with purpose, to advance our strategy with investment in talent, infrastructure, THG (eco) and targeted M&A, and to continue to deliver growth on a global scale."

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