THG to spin off Ingenuity into private company, reports continued growth in Q3
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THG reported third quarter revenue of 433.1 million pounds, down 0.6 percent. The company however witnessed continued growth in THG Beauty and THG Ingenuity, with improving trends in THG Nutrition during the quarter.
The company said in a statement that it is demerging Ingenuity into an independent private company at an equity valuation of up to 100 million pounds.
Commenting on the company’s trading update, Matthew Moulding, CEO of THG said: "Today we have separately announced significant progress on our strategy to demerge THG Ingenuity into a private company supported by major shareholders. It was especially pleasing to see another solid quarter of delivery from both our Beauty and Ingenuity businesses, rewarding the significant overhaul of their respective operating models during 2022 and 2023."
THG shares details of Ingenuity demerger
On September 17, 2024 THG announced that it was progressing options for the demerger of its Ingenuity division, with the remaining group consisting of beauty and nutrition divisions.
Given IngenuityCo's ongoing funding requirements, THG also announced its intention to raise approximately 75 million pounds by way of a placing and subscription, with additional proceeds from a retail offer of new ordinary shares of 0.005p each.
Review of THG’s Q3 results
Results in the UK comprising over half of online beauty revenue saw 5 percent growth in active customers during the period. THG added that Lookfantastic launched its first flagship store during the quarter.
The sales have recovered from July and improved steadily through the quarter as the effect from the Myprotein rebrand fades, with September marking the second-best sales performance of the year, finishing the month in online growth excluding Asia.
Offline revenue growth of 17 percent in the quarter supported the company’s expectations of 25 percent of total brand sales coming from offline channels over the medium-term.
Monthly recurring revenue for THG Ingenuity continued to build in September at 44.9 percent.