Boohoo looking to 'rebound strongly' after profits plunge by more than 90%

Boohoo has vowed to "rebound strongly" after its pre-tax profits plunged by more than 90% during its latest financial year.

The Manchester-headquartered fashion giant said the slump was due to costs related to the Covid-19 pandemic and a rise in return rates.

The company has posted profits of £7.8m for the 12 months to February 28, 2022, down from the £124.7m it reported during the prior year.

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The fall was despite Boohoo's revenue increasing from £1.745bn to £1.982bn.

Boohoo's brands include BoohooMAN, Karen Millen, Nasty Gal, PrettyLittleThing, Coast, Misspap, Oasis, Warehouse, Burton, Wallis, Dorothy Perkins and Debenhams.

In a statement issued to the London Stock Exchange, the company said it had suffered a rise in distribution costs while customer demand decreased.

Bosses also warned that they expect high costs to persist throughout the rest of this year but have a series of cost-cutting initiatives in place to manage the business.

Despite the cost-cutting, prices for products could also rise, with the company only committing to "mitigate where possible before passing prices on to consumers".

Chief executive John Lyttle said: "Over the past two years, we have significantly increased market share in our core geographies of the UK and the US, and we have grown active customer numbers by 43% across the group to 20 million.

"Our focus over the past two years has been on investing to build a strong platform, with the right infrastructure, supported by increased capacity to better serve our customers.

"In the year ahead we are focussed on optimising our operations through increasing flexibility within our supply chain, landing key efficiency