Growth accelerates at boohoo.com

Online fashion retailer boohoo.com's first six months as a quoted company has been bumpier than any catwalk - boohoo's share price has halved since topping 85p on its first day. But management has confirmed that sales grew rapidly during the first-half and the company is on track to hit ambitious full-year forecasts.

Revenue for the six months ended 31 August surged by 31% to about £67 million, or by 36% if currency fluctuations are stripped out. And business improved throughout the period - first-quarter growth of 24% and 28%, respectively, turned into 37% and 41% in the second quarter.

Encouragingly, growth improved everywhere during the final three months of the period - up by 50% in the UK and by 61% in the rest of Europe at constant currency. Unfortunately, the strong pound wiped out underlying growth in the rest of the world. Boohoo will confirm the numbers on 14 October.

Boohoo is investing heavily to support rapid sales growth - of the £300 million raised from the IPO at 50p, £50 million was pumped into the business and £240 million to repay convertible loan notes. Earnings per share (EPS) are tipped to grow by an average of 29% over the next three years, too, according to Investec Securities, which expects full-year adjusted pre-tax profit of £16.6 million, giving adjusted EPS of 1.2p.

The broker reckons an enterprise value-to-cash profits ratio of 15 is "undemanding" and values the shares at 85p. Chairman Peter Williams is clearly convinced. In June, he bought 100,000 shares at 50.68p. They're 43p now, but if the company continues to meet forecasts, Mr Williams should be sitting pretty.

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