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Boohoo profit jumps as younger shoppers fuel online sales

Boohoo profit jumps as younger shoppers fuel online sales
FILE PHOTO: A shopper walks pass advertising billboards for Boohoo and 'PrettyLittleThing', a Boohoo brand, at Canary Wharf DLR station in central London, Britain, September 17, 2018. REUTERS/James Akena -
James Akena(Reuters)
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(Reuters) – Fashion chain Boohoo <BOOH.L> defied weak consumer confidence and reported a jump in its first-half pretax profit on Wednesday because of strong demand for brands such as PrettyLittleThing and Nasty Gal, and helped by celebrity campaigns.

Manchester-based Boohoo has been an online success story with millions of active customer accounts across brands, drawing in more younger consumers who shop on their mobile phones and share fashion tips through social media.

The social-media friendly company, which has teamed up with television celebrities and models, said it has 6 million followers on Instagram and 3 million Facebook likes.

The online retailer, which raised its full-year revenue forecast earlier this month, said pretax profit rose 83% to 45.2 million pounds for the six months ended Aug. 31.

“Other retailers may suffer from weak consumer confidence and hot weather, but Boohoo has posted an acceleration in total sales growth … but the surprise came from UK multi-brand sales growth,” Jefferies analysts said of the first-half, which beat the brokerage’s expectations.

Revenue rose 43% to 564.9 million pounds, with PrettyLittleThing growing in France and the United States while Nasty Gal, whose revenue more than doubled, performed well in the U.S.

AIM-listed Boohoo’s shares, which are up nearly 60% for the year, were down 1.9% at 0803 GMT, in what one trader said was due to profit-taking.

(Reporting by Tanishaa Nadkar and Pushkala Aripaka in Bengaluru; editing by Uttaresh.V)

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