Revolution Beauty experienced notable declines in sales and profits, highlighting challenges amid its transformative strategy year.
- The company’s half-year profits fell by 11%, dropping to £3.1 million compared to last year.
- Sales saw a significant decline of 20%, aligning with a planned reduction of its product portfolio and discontinuation of less effective SKUs.
- Despite overall declines, core range sales increased by 6% first half and surged 16% in the second quarter.
- Revolution Beauty is expanding its presence with strategic partnerships, including an expansion with Boots and entering Walmart and Amazon.
Revolution Beauty has reported a significant downturn in sales and half-year profits as it undergoes what it terms a “transformational” year. The cosmetics retailer recorded an 11% dip in underlying adjusted EBITDA, which has decreased to £3.1 million from £3.5 million the previous year.
Total net sales plummeted by 20%, reaching £72 million. This decrease was largely due to the company’s deliberate strategy to simplify its product portfolio by discontinuing unproductive SKUs. Meanwhile, the brand’s core range experienced a positive trend, with sales rising 6% year on year in the first half, and notably spiking by 16% in the second quarter.
In a move to bolster its market presence, Revolution Beauty is set to expand its partnership with Boots by adding 250 new stores across the UK. The company is also enhancing its distribution reach through the inclusion of Boots owner, the US retail giant Walmart, with plans to launch a shop on Amazon in the coming year.
According to Revolution Beauty’s chief executive, Lauren Brindley, significant progress has been accomplished within the framework of the ‘Reigniting the Revolution’ strategy over the past six months. Brindley emphasized the reduction of the SKU portfolio, which has allowed for improved gross margin performance across a set of globally growing core SKUs.
This year has been pivotal for the company, marked by efforts to streamline operations, enhance efficiency, and build a foundation for sustainable future success. Anticipating renewed growth in the final quarter, the company is embarking on new growth initiatives, including launching a refreshed pipeline of makeup innovations, a new skincare line, and the global expansion of their budget brand, Relove.
Revolution Beauty’s strategic initiatives aim to restore its growth trajectory through operational simplification and global market expansion.
