THG sees 'significant increase' in first-half profitability

THG said on Wednesday that it expects a significant increase in first-half profitability following a strong second quarter.

In an update ahead of its annual general meeting, the company pointed to its "successful focus on profitability and cash generation". It now expects adjusted EBITDA for the first half of between £44m and £47m, up from £32.3m a year earlier, and continuing adjusted EBITDA of £47m to £50m. Full-year guidance remained unchanged.

THG said its free cash flow performance for the 12 months to 30 June is ahead of expectations and expected to be a circa £40m outflow. The group remains "well on track" to deliver free cash flow neutrality for the full year, with adjusting items materially lower than the prior year, it said.

The ecommerce firm hailed a particularly strong start to the year for its nutrition business, "with the pricing decision to support consumers through exceptional market-wide inflationary conditions in FY 2022 now paying dividends".

THG also said on Wednesday that founder and chief executive Matthew Moulding has given up the special share he held that allowed him to veto hostile takeovers - a move that will allow the group to enter the FTSE 250.