Revolution Beauty plunged into loss in its first half on the back of a 20% sales plunge in what its new CEO said was “a year of transformation”.
The beauty brand made a £10.9m pre-tax loss in the half to 31 August, down from a £400,000 profit last year as sales plunged to £72.4m, which it blamed on the planned simplification of its product portfolio, the discontinuation of unproductive SKUs, and “significant” stock clearance activity.
The group kickstarted its ‘Reigniting the Revolution’ strategy in February, where it sought to reduce its portfolio from seven brands across eleven categories to three brands across seven categories.
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Revolution Beauty CEO Lauren Brindley said: “This is a year of transformation for Revolution Beauty, and our performance in the first half reflects the steps we have taken to position the group for long-term, profitable growth.
“Since launching our new strategy in February, we have substantially cut a long tail of unproductive SKUs, improved our operational delivery and made good progress with our cost savings programmes.
“Consequently, we now have a core portfolio that is growing globally with a significantly improved underlying gross margin.”
Underlying adjusted EBITDA edged up from £3.3m to £3.9m over the half, as underlying gross profit margin improved 20 basis points.
Looking ahead, the retailer expects full-year sales to decline “at a slightly lower rate” than the first half as it forecasts a return to growth in the fourth quarter.
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