THG LON:THG has reported interim results for the six months to 30 June 2025, pointing to early signs of recovery after a turbulent period marked by restructuring, high input costs and sluggish beauty sales.
The online retailer and nutrition group, founded by Matthew Moulding, said trading momentum built steadily through the first half and accelerated into the third quarter. The company reiterated full-year guidance, underpinned by strategic changes to its beauty and nutrition divisions during 2024.
Group revenue fell 2.6 per cent on a constant currency basis to £783.4m, reflecting weakness in THG Beauty, while adjusted earnings before interest, tax, depreciation and amortisation dropped 35 per cent to £24m. Gross margins contracted to 41.1 per cent from 42.6 per cent a year earlier, largely because of elevated whey prices.
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Despite the earnings decline, the business pointed to improving trends. The second quarter accounted for the majority of first-half profit, with management expecting materially stronger performance in the third quarter. Beauty revenues returned to growth in the period, while nutrition recorded its fastest quarterly expansion since early 2022.
Reshaping the THG portfolio
The company has pressed ahead with portfolio rationalisation, completing the demerger of THG Ingenuity at the start of the year and selling its Claremont Ingredients unit to Nactarome Group for £103mn. The disposal proceeds, combined with a March refinancing of long-term debt, put the group on what it described as an accelerated path towards a net cash position.
Net debt stood at £321.4m at the half-year but falls to about £220m on a pro forma basis once the Claremont proceeds are included. Refinancing reduced gross debt by £374m, with new facilities stretching out to 2029. THG held cash and available facilities of £279.4m at the period end.
Moulding, who serves as chief executive, said the business was “set up well for our most profitable and cash generative period in H2”, adding that “momentum is positive and Q3 will be our strongest trading period of the year so far”.
THG divisional performance analysis
Beauty sales fell 5.9 per cent on a constant currency basis to £479.9m, reflecting the withdrawal from selected European and Asian markets and the disposal of certain assets, including THG’s luxury portfolio. Adjusted EBITDA dropped 29 per cent to £20.2m. Nonetheless, the company said resilience in UK retail helped secure market share gains, supported by loyalty schemes, new brand launches and greater customer retention.
Nutrition revenue grew 3.1 per cent to £303.6m, aided by higher selling prices and the rebranding of Myprotein, which was confirmed as Europe’s leading sports nutrition brand by sales.
Partnerships with US retailers, including a broad roll-out across Walmart stores, have expanded Myprotein’s offline presence to 8,400 outlets. The division also announced licensing agreements with consumer goods groups, including a multi-year deal in European food-to-go and a product tie-up with a global confectionery brand.
Elevated whey costs pressured margins, which fell to 43.4 per cent from 45.9 per cent, resulting in a 39 per cent drop in nutrition EBITDA to £12m.
Outlook for THG
Looking ahead to the peak trading period, management guided for beauty revenue growth of 1–3 per cent in the second half and nutrition growth of 10–12 per cent. The group said Myprotein would limit price increases to drive further customer acquisition, while structural efficiencies in its vertically integrated model were expected to support margin expansion in the medium term.
The company reported a statutory profit of £76.3mn, compared with a £121.2mn loss in the prior year, largely due to the gain booked on the Ingenuity demerger. Free cash outflow narrowed to £77.7mn, reflecting lower capital expenditure and financing costs.
THG said its medium-term aim remains to achieve a net cash position while continuing to invest in brand partnerships and customer growth.
