The Hut Group (THG) has impressed once again with its strong performance in the third quarter, according to its latest trading update. Following its recent IPO on the London Stock Exchange, the company revealed a remarkable 38.6% increase in group sales, reaching £378.1 million for the three-month period ending in September. This growth rate in Q3 surpasses the figures seen in the first half, which were significantly impacted by lockdown measures in the UK.

One of the notable highlights from the update was the outstanding £320.2 million in Direct-to-Consumer (D2C) online revenues, showing an impressive year-on-year increase of 51.3%. This outperforms the 47.8% growth seen in the first half of the year. Additionally, the company emphasized its successful customer acquisition efforts and improved repeat purchase rates from both new and existing customers, further boosting its overall performance.

THG Beauty, the largest unit within the group, experienced substantial sales growth of 45% to reach £157.5 million. This includes the revenue generated from the company’s webstores and subscription stores, such as Lookfantastic, Skinstore, Mankind, and Glossybox. THG’s other units, THG Nutrition and THG Lifestyle, which house popular brands like Coggles, AllSole, Mybag, Zavvi, Iwoot, and Pop In A Box, also witnessed a significant increase in sales, rising by 79.6% to £24.4 million.

One division that particularly stands out is THG Ingenuity, which showcases THG’s transition into a technology-focused business. This division utilizes THG’s technology to power the online stores of external retailers. Sales for this division grew by 10.1% to £35.4 million in Q3. Notably, THG Ingenuity’s high-margin Ingenuity Commerce revenues skyrocketed by a remarkable 171.4% to £5.1 million. During this period, THG expanded Ingenuity’s capabilities and global reach by establishing three new warehouses in the US, UK, and Singapore. This brings the total number of warehouses and fulfillment sites to 17 across four continents. The company also expressed satisfaction with the strong Ingenuity Commerce pipeline, which currently boasts several advanced-stage partnerships.

Based on the outstanding Q3 performance and positive momentum observed in Q4, THG has revised its guidance for FY20 revenue. Initially, the company projected revenue to be approximately £1.43 billion, indicating a growth rate of over 25%. However, given the strong results and ongoing momentum, THG now expects revenue to fall within the range of £1.48 billion to £1.52 billion, reflecting a growth rate of 30% to 33%. Despite the disruptions caused by the pandemic, THG emphasizes the crucial role of Q4 as a key trading period, traditionally accounting for 30% to 32% of annual group revenue, with Black Friday playing a significant role.

Overall, The Hut Group’s impressive performance in Q3 across all business units, particularly in D2C and THG Ingenuity, showcases its continuous growth and success. The company’s ability to adapt and leverage its technology-driven capabilities positions it favorably for future expansion and increased market presence.

Useful Links:
1. The Hut Group Official Website
2. London Stock Exchange Official Website