Boohoo share price plummets to record low as etailer issues profit warning

Boohoo's share price has plummeted by around 40 per cent after the etailer issued a profit warning this morning. 

 

Although the fast fashion etailer said it had a record week over Black Friday, when demand was 2.4-times higher than its previous busiest day, it warned that full year results would be below market expectations. 

 

Despite ramping up its marketing to stimulate sales, Boohoo said the response was “less than anticipated”. 

 

“We believe this was principally due to heavy promotional activity on the UK high street arising from the warm autumn season,” it added. 

 

However the business, which went public last year, is still growing ahead of the wider market: revenues are expected to be up 25 per cent, in line with the last four months of the year, and EBITDA should be up around 10 per cent, in line with the first half of the year. 

 

Shares in Boohoo.com (LON:BOO) fell to a record low of 21.7p – more than half the offer price when it listed in March 2014, as investors reacted to the surprise news.

 

Joint chief executives Mahmud Kamani and Carol Kane said: "While the period proved a challenging trading environment, we have still grown the business by 25 per cent, albeit short of our previous expectations. 

 

“We are very confident that our fashion credentials, pure play online model and the significant investment in infrastructure will continue to drive growth in the UK and internationally."