THG (LSE: THG) narrowed its pre-tax losses for 2023 to £252.0 million, down from £549.7 million the year before, despite a fall in revenue. The e-commerce company remains optimistic, citing a return to revenue growth and improved profitability metrics.
While revenue dipped 8.7% to £2.05 billion, THG attributed this to a strategic decision to discontinue unprofitable categories. They reported positive developments, however, with improving revenue trends and strong momentum in the Beauty segment year-to-date.
THG highlighted a significant rise in adjusted EBITDA, a key profitability metric, which jumped 78% to £114.1 million. The company expects a return to 9% adjusted EBITDA margins in the medium term and a group-wide revenue increase throughout 2024.
CEO Matthew Moulding pointed to the completion of their infrastructure investment program as a driver of improved efficiency. He also underlined the optimisation of their fulfilment network through automation and the onboarding of new clients.
THG’s share price sits at 67.53 pence, down 9.6% year-to-date. Despite the revenue dip, the company’s focus on profitability and positive outlook for future growth suggests a reason for optimism among investors.
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