Boohoo Group “clear commitment to the highest standards of ethics, compliance and transparency” says Zeus Capital

  • Independent review launched: Boohoo Group plc (LON:BOO) has announced the launch of an immediate independent review of its UK supply chain, intended to identify any areas of risk and non-compliance and to further strengthen the Group’s compliance procedures to ensure similar allegations will not recur in the future. The review is to be led by Alison Levitt QC, a highly experienced advocate who has previously reported on complex issues, including safeguarding enquiries. Boohoo has also announced an initial additional £10m investment in ensuring any supply chain malpractice is eradicated and is accelerating its independent third-party supply chain review with ethical audit and compliance specialists Verismo and Bureau Veritas.
  • Findings to date: To date the Group has found no evidence to support claims of suppliers paying workers £3.50 per hour. Evidence of non-compliance with the Group’s Code of Conduct relating to record keeping has resulted in the immediate termination of relationship with both the suppliers in question, Revolution Clothing Co Limited and Morefray Limited with the Group stressing it will not hesitate to terminate relationships where non-compliance with the Group’s Code of Conduct is found.
  • Commitment to UK manufacturing: The Group has reaffirmed its commitment to UK manufacturing, which currently produces c.40% of the Group’s products. Producing products in the UK does not create a cost advantage for the Group, its strength lies in its proximity to UK distribution centres which allows for maximum flexibility to react to the latest trends. The Group is committed to supporting thousands of UK jobs that may otherwise be lost to overseas markets, and has industry leading 14-day payment terms for its UK suppliers to ensure they have reliable and consistent cash flows to responsibly carry out their business.
  • Wholesale: The Group’s wholesale business is a relatively small part of its overall operations, contributing just 1.4% of Group turnover in the first four months of the current financial year with the Group having ceased trading with Amazon several years ago. Wholesale revenues generate a lower margin contribution versus retail and as such we believe represent <1.4% of Group profitability YTD.
  • Board composition & Governance: The Group is currently in the process of strengthening its PLC board through the appointment of two additional NEDs with a focus on candidates with experience in dealing with ESG matters.

Zeus Capital believe today’s announcement affirms Boohoo Group’s clear commitment to the highest standards of ethics, compliance and transparency. The Group has the operating flexibility and resources to take swift and comprehensive action to address concerns raised. Trading on a FY21 PE of 28.4x we believe the shares currently present an opportunity for investors able to support the Group’s ongoing progress in developing and strengthening its ESG profile.

Click to view all articles for the EPIC: ,
Or click to view the full company profile:
    Share on facebook
    Facebook
    Share on twitter
    Twitter
    Share on linkedin
    LinkedIn
    boohoo Plc

    More articles like this

    Fintel plc

    Fintel core revenue growth is higher than Zeus forecast

    Fintel plc (LON:FNTL), the leading provider of Fintech and support services to the UK retail financial services sector, has released a trading update for the six months to 30 June 2022, which reveals: Core revenue grew c.9% to

    Shoe Zone plc

    Shoe Zone analyst Zeus upgrades FY22 adjusted PBT forecast

    Shoe Zone plc (LON:SHOE) Better than expected demand and further strong margin performance leads to an upgrade in FY22E adjusted PBT from “no less than £8.5m” to “no less than £9.5m”. Zeus revenue forecasts increase by £1.5m (1.0%)

    OnTheMarket Plc

    OnTheMarket analyst Zeus confident in forecasts

    Foxtons, one of London’s leading estate agencies with more than 50 interconnected branches across London, has signed an agreement to advertise its UK residential sales and letting properties at OnTheMarket plc (LON:OTMP). Zeus view: Foxtons, the well-known London

    SpaceandPeople analyst Zeus restores estimates and valuation

    SpaceandPeople plc (LON:SAL) secures, sells, and manages flexible space for brand experiences, short term promotions and retailing in high footfall venues for its customers, including in shopping centres and travel hubs. The Group has issued a positive pre-close

    Lookers Plc

    Lookers shares are still undervalued says Zeus

    Lookers plc (LON:LOOK) has released an H1 trading update reporting a continuation of strong performance year to date. H1 2022 underlying PBT is expected to be c. £45m and Management anticipate full year PBT will also be ahead

    SysGroup plc

    SysGroup analyst Zeus forecast a 39.0% increase in revenue in FY23

    SysGroup plc (LON:SYS) is an award-winning provider of managed IT services, cyber security, cloud hosting and IT consultancy. The Group offers investors an attractive business model with high recurring revenue and a diversified customer base. SysGroup is competitively

    AFC Energy

    AFC Energy’s long term opportunity remains vast says Zeus

    AFC Energy plc (LON:AFC) has signed an agreement with another leading UK construction/infrastructure player, this time in Kier Group. We believe this further endorses our long term thesis that AFC will play an active role in encouraging the

    Inchcape

    Inchcape performance exceeding expectations says Zeus

    Inchcape plc (LON:INCH) has released another positive trading update, with performance exceeding expectations so far this year. This follows on from a positive Q1 update on 28 April. Through quarterly improvement in Distribution volumes and operating margin, the

    boohoo Plc

    Boohoo Group analyst Zeus sees a strong performance in Q1

    ¨ Q1 financial highlights: Boohoo Group plc (LON:BOO) revenue of £445.7m is -8.3% YOY vs. a strong comp (Q1 FY22 revenue +32.1%), in line with Zeus’s forecast and management’s previously stated guidance. Gross sales growth remained positive +9%

    No more posts to show