Boohoo credits floral prints for sales surge

Surging demand for floral prints and soft tailored dresses have helped Boohoo post a huge jump in revenue for three months to the end of May.

The fast fashion retailer, which also owns PrettyLittleThing and Nasty Gal, said strong block colours and ankle boots had also sold well.

Group sales jumped 39% to £254.3m, although Boohoo’s lofty profit margins dipped.

It came as Zara-owner Inditex posted record sales of €5.9bn for the quarter.

The growth contrasts with tough times seen at many other retailers – particularly those focused on the UK High Street.

Just this week shares in Ted Baker dived 24% after it posted a profit warning.

Meanwhile, the future of Philip Green’s Arcadia, which owns Topshop and Dorothy Perkins, is hanging in the balance as it tries to secure a rescue deal to avoid going into administration.

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“Boohoo continues to defy the broader gloom on the High Street thanks to its appeal among younger shoppers with the tight marketing focus around celebs and social media paying off.

“There are doubts though about whether it can maintain margins as well as this rapid sales growth, but for now it’s the one of the brightest stars in an otherwise pretty dark sky,” said analyst Neil Wilson from Markets.com.

Founded in Manchester in 2006, Boohoo has become a hit with millennial shoppers by selling cut price, own-brand clothing that mirrors the latest celebrity trends.

It does all its trade online, avoiding the challenges faced by bricks-and-mortar retailers such as high shop rents and business rates.

However, it has faced questions about its production processes and its approach to workers’ rights.

On Wednesday shares in the firm opened lower amid concerns about its profit margins, but later rebounded. The company’s shares are up more than 40% this year.

It also said it was on course to post revenue growth of 25-30% for the full year.

It came as Spain’s Inditex, which as well as Zara also owns such brands as Bershka and Pull & Bear, reported a 10% jump in profits for the first quarter as online sales surged.

The firm, which operates in 90 countries, said sales in the first six weeks of the second quarter were also up, as shoppers snapped up items like jewel-toned blazers and long-printed dresses from Zara’s spring collections.

[“source=bbc”]