Updates

THG

October 2023

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

THG’s latest H1 shows that a stronger, leaner cost base has helped reduce its cash outflow to just £21m, a £350m improvement year-on-year with the group also confirming it expects positive free cash generation in H2, resulting in free cash flow breakeven for FY 23. Sales were down 9% to £969m as had been anticipated as THG honed its focus. Ebitda was £50.1m (+23%), at a margin of 5.3%, up from 4%. The Beauty division was held back in H1 by short-term global de-stocking impacting both revenue (-10% to £539m) and EBITDA (-40% to £10.6m). THG has reduced its customer acquisition strategy to focus only on acquiring customers close to hubs where distribution costs are lower and there is a greater chance of profit on the first or ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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