THG celebrates 'standout' beauty performance as Q1 revenues rise

THG, the owner of Lookfantastic and Cult Beauty, has hailed a strong performance across its beauty division in the first quarter ending 31 March 2024.

It comes as the group reports a 2.1% increase in continuing revenue to £455.4 million, reflecting the benefits of THG's strategic focus on higher-margin sales through FY23.

Growth was largely driven by the beauty division, which saw revenues rise 9.3% year-on-year to £267.6 million.

It follows targeted changes to THG's geographic strategy through 2023, with the group focusing on more profitable customers and territories closest to its global distribution hubs.

As a result, the division's performance in the UK, which amounts to over half of online beauty revenue, was "strong".

THG Ingenuity, the group's e-commerce solution that provides technology, global fulfilment and digital performance solutions for brands, also delivered growth in the first quarter.

It follows a number of recent business moves for the division, including the group's D2C partnership with Holland & Barrett and the appointment of Alistair Crane as Ingenuity's first Chairman to help accelerate growth in core markets.

Despite growth across beauty and Ingenuity, THG's nutrition division saw revenues drop 9% to £150.8 million.

Growth was held back by a c.16% devaluation of the Japanese Yen, according to the business, as well as expected availability gaps as its Myprotein product range transitioned into the new branding, which it said is now making "good progress".

Matthew Moulding, CEO of THG, said: "Following the group’s return to revenue growth in Q4 2023, it’s pleasing to report an acceleration in Q1, which is testament to the hard work and dedication of our people, who’ve remained focused on the task in hand despite the tough macro-economic backdrop.

"The Q1 performance of our largest business, THG Beauty, is especially encouraging. The operating model changes made throughout 2023, including focusing on more profitable territories and customers, temporarily impacted growth for much of last year, however, since Q4, we are seeing tangible benefits from these actions. This is reflected in THG Beauty’s loyalty membership reaching 2.3 million people at the end of the first quarter, less than two years after launch."