Adore Beauty Group Delivers Strong Growth in H1 FY25 Amid Strategy Refresh

Highlights

  • EBITDA: $4.6 million, up 94% year-on-year; EBITDA margin expanded to 4.4%.
  • EBIT: $2.7 million, up 118% year-on-year; EBIT margin at 2.6%.
  • Gross Margin: Record 35.9%, an increase of 240 basis points.
  • Revenue: $103.0 million, up 2.3% year-on-year.
  • Cash Balance: $11.7 million as of 31 December 2024.
  • Retail Expansion: First physical store opening at Westfield Southland on 1 February 2025, with plans for 25+ stores over three years.

CEO Commentary

Sacha Laing, CEO of Adore Beauty, stated:

“Our first-half results reflect the success of our strategy refresh, with disciplined execution driving both profit growth and margin expansion. As we evolve into a leading omni-channel beauty retailer, our plans for physical store rollouts represent a transformative shift in our growth trajectory.”

Key Drivers of Performance

Adore Beauty’s progress stems from the implementation of its 3-year strategy to improve earnings quality and long-term profitability:

  1. Disciplined Promotions: Enhanced execution of promotional campaigns to drive revenue while protecting margins.
  2. Owned Brands Expansion: Accelerated growth of high-margin private label products.
  3. Retail Media Contribution: Increased revenue from high-margin advertising opportunities.
  4. Operational Efficiencies: Improved cost management and working capital.

Retail Expansion Plans

Adore Beauty is advancing its transition to an omni-channel retailer with physical stores to complement its online dominance:

  • First Store Launch: Westfield Southland (VIC) on 1 February 2025.
  • Second Store: Opening at Watergardens (VIC) in March 2025.
  • iKOU Stores: New locations in Berry (NSW) and Melbourne CBD opening in March 2025.
  • Additional Stores: Plans for 4-6 more Adore Beauty outlets by the end of CY2025, with a long-term target of 25+ stores.

Outlook

Adore Beauty reaffirms its FY25 EBITDA margin guidance of 4-5% and anticipates continued momentum from its omni-channel strategy. The retail expansion and growth in owned brands are expected to deliver a material uplift in revenue and profitability over the next three years.

With strong early results from its strategy refresh, Adore Beauty is positioned for sustained growth as it redefines itself as a leader in the omni-channel beauty retail space.