Revolution Beauty Group PLC said sales should return to growth later this year after declining by a fifth in the first half.
Sales over the six months to August came in at £72 million, the beauty retailer said in a trading update on Wednesday, while underlying adjusted earnings dropped 11% to £3.1 million after swinging back into positive territory in the first half of the year.
The decline came on the back of significant stock clearing as part of a planned simplification of its product portfolio.
A one-off, non-cash stock provision of £11.3 million was unveiled as a result, which Revolution said was not reflected in the interim figures.
A return to growth was guided for the fourth quarter, with sales over the full year expected to fall at a slower rate than in the first.
Management guided to underlying adjusted earnings to be in line with last year’s £12.6 million was reiterated in the meantime.
Revolution added underlying sales margins had improved due to efficiencies of running a simplified portfolio, including its core SKU range, of which sales climbed by 6%.
“This year is a transformational year for the company, as we focus on simplifying the business, improving our operational efficiency and positioning ourselves for profitable and sustained success,” chief executive Lauren Brindley said.
“We expect a return to growth [...] as we begin landing our new growth initiatives, including a reinvigorated pipeline of make-up innovation, the launch of our new skincare range and the global expansion of our budget brand.”