Boohoo shares fall amid leadership change, debt refinancing

Online fashion retailer Boohoo Group's (LON: BOO) shares declined in early Friday trading after a series of corporate announcements, including a leadership change and a new debt refinancing deal.

The company revealed that its CEO, John Lyttle, would be stepping down after five years at the helm. Lyttle will be replaced by a yet-to-be-named successor.

“Over the last five years, I have been proud to lead the Group, and I believe there is huge potential in this business, and I will continue to work with the Board to drive value for all shareholders whilst a successor is found,” commented Lyttle.

Boohoo said Lyttle will continue to work with Boohoo's leadership team over the coming months while they search for a successor and to ensure a smooth transition.

In addition, Boohoo announced that it had successfully secured a £222 million debt financing agreement, providing the necessary funds for its future growth.

The new debt facility is with a consortium of the company's existing relationship banking group. The facility compromises a £125m revolving credit facility that runs to October 2026 and a £97m term loan that is repayable by August 2025.

Boohoo also said it is now exploring options to unlock and maximise shareholder value.

Despite the challenges, Boohoo remains optimistic about its prospects. The company highlighted the progress it has made in recent years, including the reinvigoration of its Debenhams and Karen Millen brands and the expansion of its online marketplace.

The online fashion retailer also reported a trading update for the six months to August 31, 2024. It revealed a 7% decline in gross merchandise value (GMV) pre-returns to £1.18 billion, while revenue came in at £620 million, down 15% year on year. Adjusted EBITDA decreased 32% to £21 million.