Adore Beauty reports solid H1 FY24 results

SYDNEY: Adore Beauty Group Limited (ASX: ABY), Australia’s number one pureplay online beauty retailer, has announced its financial results for the six months ended 31 December 2023 (H1 FY24), showing revenue growth, profitability improvement, and strategic progress.

The Company reported revenue of $100.7 million, up 7% on the prior corresponding period (PCP), driven by record average order values and annual spend per customer. The trading momentum continued in the first six weeks of H2 with revenue up 8.1% on PCP.

Adore Beauty also achieved reported EBITDA of $2.4 million and margin of 2.3%, in line with guidance and reflecting revenue growth, cost optimisation, and re-investment in margin expansion initiatives. The Company remains on track to achieve an EBITDA margin of 2-4% in FY24.

The Company’s loyal customer base grew to 507K returning customers, up 5% on PCP and up 22% on a three-year CAGR, representing 81% of product sales. Active customers increased 0.5% on PCP to 804k. The Company had a strong cash balance of $32.3 million and no debt at the end of H1 FY24.

Adore Beauty’s CEO Tamalin Morton said, “Adore Beauty has had a solid start to FY24, delivering growth across key metrics as we continue to build momentum in a challenging retail environment. Our performance reflects the impact of our strategic initiatives, improved operational efficiency, and our compelling customer value proposition.”

The Company is progressing its refined strategy, which includes increasing brand awareness, growing mobile app contribution, launching a subscription service, exploring a physical store format, and actively pursuing M&A opportunities.

Morton added, “Adore Beauty’s refined strategy will drive future growth, as the category benefits from the long-term shift to e-commerce. Our strategic initiatives continue to mature, and we remain focused on being at the forefront of the evolving customer and competitive landscape. Our brand and product portfolio continues to expand, focused on growing our range including trending, luxury, and owned brand offerings. We have also enhanced our proposition with a new subscription service and are leveraging technology to drive app adoption.”

Adore Beauty expects retail trading conditions to remain challenging for most of 2024, given higher cost of living pressures and subdued consumer sentiment. However, the Company’s strong balance sheet is facilitating disciplined re-investment in key strategic initiatives designed to deliver revenue and customer growth, operating leverage, and long-term shareholder value.