Revolution Beauty, a leading mass-market beauty retailer, has reported improved financial performance in the first half of FY23. Despite a 4.2% decline in revenue to £75.3 million, the company saw a significant increase in gross profit, which rose by 35.6% to £31.2 million. This improvement was driven by a rise in gross margin from 29.3% to 41.4% compared to the previous year.

While Revolution Beauty still experienced a loss on an adjusted EBITDA basis, the loss narrowed from £9.5 million to £7.5 million. The operating loss also decreased by 48.9% to £12.1 million, and the net loss reduced by 53.6% to £13.4 million. These positive trends indicate the company’s efforts to improve its financial position.

Revolution Beauty achieved growth in UK stores revenue, recording a year-on-year increase of 21%. This was mainly due to new distribution in Boots and strong performance in Superdrug stores. In the US, revenue remained stable as the retailer recovered from the impact of the pandemic. However, the rest of the world store groups witnessed a 6% decline primarily due to timing issues in order placement. Digital wholesale revenue also declined by 22% due to overstocking in the digital sector, as consumers returned to physical stores.

Despite these challenges, Revolution Beauty focused on expanding its global presence by establishing new retail relationships, expanding existing ones, and entering new territories. Notably, the company successfully rolled out its products in Walmart stores in the US. Furthermore, Revolution Beauty experienced growth in its direct-to-consumer customer base, with a 3% increase in the total customer base and a 6% increase in returning customers.

CEO Bob Holt expressed confidence in the future growth of Revolution Beauty, highlighting the company’s global retail strategy. While the digital business was affected by the shift back to physical stores, the company’s omnichannel approach helped offset the decline. Revolution Beauty expects to achieve single-digit revenue growth in both FY23 and FY24.

The publication of the H1 FY23 interim results is a significant milestone for Revolution Beauty, as it marks progress towards the lifting of the share suspension that was imposed due to concerns over accounting and business practices. This positive financial performance is a promising indication of the company’s ability to overcome challenges and drive future growth.

Useful links:
1. Revolution Beauty Official Website
2. Boots (UK retailer mentioned in the article)