THG PLC on Thursday reported a weaker first half of 2023 with revenue plummeting and loss widening on a setback in its Beauty division, but maintains a hopeful outlook as sales trends improve and earnings in line with forecasts.

Shares in THG were trading 15% lower at 74.60 pence each in London on Thursday morning.

The Manchester-based e-commerce firm, which trades as The Hut Group, said pretax loss widened to £133.0 million from £108.2 million a year prior, as revenue plunged to £969.3 million from £1.07 billion the year before.

This was driven by ‘short-term volume reductions’ in its THG Beauty division manufacturing, THG said. As a result, revenue for the division dropped by 10% to £538.7 million from £601.2 million in the first half of 2022.

Adjusted earnings before interest, tax, depreciation and amortisation, however, grew by 46% to £47.1 million from £32.2 million a year ago.

THG gave a hopeful outlook, however, citing ‘gradually improving’ sales trends in the second half of 2023, and expects continuing revenue in the third quarter to be ‘marginally ahead’ of the second quarter. The firm also noted its full-year adjusted Ebitda is in line with market expectations of €119.1 million.

Chief Executive Officer Matthew Moulding commented: ‘The Beauty division was held back in [the first half of 2023] by short-term global de-stocking impacting manufacturing volumes. The situation has now started to reverse with the Beauty division returning to growth since August, at the same time margin progression continues.

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