THG PLC has announced that its revenue growth has picked up speed in the first quarter, indicating ongoing improvements in sales following significant changes implemented last year. However, certain segments of the business still experienced slower sales.
In the three months leading up to March, the online cosmetics and nutrition retailer recorded a 2.1% increase in revenue, amounting to £455.4 million. On a constant currency basis, this represents a 4.5% rise compared to the same period last year. This growth marks an improvement from the 1.1% growth seen in the final quarter of the previous year, as well as the negative growth observed earlier in the year. Within the THG Beauty division, revenue increased by 11% to £267.6 million, whereas THG Nutrition saw a decline of 5.8%, amounting to £150.8 million.
The positive momentum persisted into the first quarter, with growth observed across all channels. THG Beauty channels consist of Retail (approximately 80% of revenue), own-brand (approximately 10%), and manufacturing (approximately 10%). Performance in the UK, which accounts for over half of online Beauty revenue, was particularly strong, with growth reaching +11.1%, surpassing the overall Beauty business growth. THG Beauty expanded its market share in the UK’s total premium beauty market and bolstered its fragrance offerings with the launch of 10 new brands.
Customer engagement remains healthy, with active customer numbers rebounding (from 8.5 million in FY 2023), driven by the UK and MENA regions, largely due to the success of our loyalty program, which now boasts approximately 2.3 million members since its launch in 2022.
Matthew Moulding, CEO of THG said, “The Q1 performance of our largest business THG Beauty, is especially encouraging. The operating model changes made throughout 2023, including focusing on more profitable territories and customers, temporarily impacted growth for much of last year, however, since Q4, we are seeing tangible benefits from these actions. This is reflected in THG Beauty’s loyalty membership reaching 2.3m people at the end of Q1, less than two years after launch. Beauty delivered double digit growth in the quarter, with a high-quality, loyal customer base bringing greater profitability per order across a more efficient cost base. “
