Boohoo Suffers Record Losses As Struggles Mount For Online Fashion Retailer

Boohoo has announced unprecedented annual losses of £348m, marking the steepest deficit in its history. Executives at the online fashion group are grappling with a turbulent period, following a previous year’s loss of £160m, as sales tumbled by nearly a fifth to £790m. The sharp downturn arrives amid sustained underperformance and a strategic identity shift as bosses seek a path to profitability.

Chief executive Dan Finley described the past year as “very challenging,” acknowledging that Boohoo’s efforts to arrest its decline are ongoing. Market sentiment has reflected the company’s malaise, with its share value slumping to just £200m—down dramatically from a peak exceeding £5bn at the height of the pandemic.

In pursuit of a revival, the retailer has shifted emphasis away from its core younger-focussed brands, pinning future hopes on the Debenhams name, acquired earlier this year. The rebranding move is intended to capitalise on Debenhams’ established presence, offering a new direction as the company attempts to regain its competitive footing.

Boohoo has also revealed plans to divest PrettyLittleThing, a brand that had once bolstered its fast fashion portfolio. Industry observers note that the business faces aggressive competition from cut-price online players like Shein, which has placed additional strain on the group’s finances. While no sale price has been confirmed, internal accounts point to a significant markdown for PrettyLittleThing.

The pressure is further visible in Boohoo’s balance sheet, with net assets plummeting from £280m to just £3.9m in a single year. Clive Black of Shore Capital has remarked on the “very constrained” position facing the company, warning that falling valuations could impede Boohoo’s ability to raise capital in the market, thereby perpetuating a negative cycle.

Last week, Boohoo secured a £175m borrowing facility at an interest rate 7.3 percentage points above the Bank of England base rate. This high-cost financing arrangement has drawn criticism from its main shareholder, Mike Ashley’s Frasers Group, who openly questioned whether more favourable borrowing terms could have been negotiated, and suggested a potential shareholder meeting regarding the chair’s position.

As Boohoo contends with external criticism and internal restructuring, the company’s outlook remains the subject of close scrutiny throughout the retail sector.