Lovisa Holdings – 1H25 Results Summary
Overall Report Tone
📈 Lovisa Holdings delivered a strong performance in 1H25, with revenue growth of 8.8% and profit before tax increasing by 10.8%. The expansion strategy remains on track, with 43 net new stores opened, boosting global presence. Gross margin expanded to 82.4%, highlighting pricing strength and cost efficiencies, although cost pressures and a pending class action pose potential challenges.
📊 Financial Results
| Metric | 1H25 | 1H24 | % Change |
|---|---|---|---|
| Revenue | $405.93M | $373.02M | +8.8% |
| Profit Before Tax | $80.56M | $72.69M | +10.8% |
| Net Profit After Tax | $56.93M | $53.47M | +6.5% |
| Gross Profit | $334.67M | $301.15M | +11.1% |
| Gross Margin | 82.4% | 80.7% | +170 bps |
| EPS (Basic) | 51.61c | 49.08c | +5.2% |
| Dividend (Interim) | 50.0c (unfranked) | 50.0c (30% franked) | N/A |
🆕 New Information Provided
✅ Opened 57 new stores, offset by 14 closures, expanding into Ivory Coast, Republic of Congo, and Panama.
✅ Gross margin expanded to 82.4%, driven by pricing discipline and efficient cost management.
✅ Store network now at 943 locations, strengthening global brand footprint.
✅ Net tangible asset per share rose to $0.90 (vs. $0.69 in 1H24), reflecting balance sheet strength.
✅ Pending class action lawsuit regarding employee wage agreements, which remains in early stages.
🔥 Positive Surprises / Strengths
🚀 Revenue growth of 8.8%, supported by store expansions and resilient demand.
🚀 Profit before tax grew 10.8%, exceeding expectations.
🚀 Higher gross margin (82.4%), demonstrating pricing power and supply chain efficiency.
🚀 Dividend maintained at 50.0c, despite increased investments in growth.
⚠️ Potential Concerns / Risks
🔴 Operating costs increased, driven by higher wages and logistics expenses.
🔴 Net cash flow from operations declined 8.1% YoY, due to higher working capital needs.
🔴 Class action lawsuit related to alleged employee underpayments, creating legal risk.
🔴 Global economic uncertainty may impact consumer spending, particularly in key markets.
📉 Results vs Market Expectations
📌 Revenue and profit met or slightly exceeded analyst expectations, supported by store rollouts and strong margins.
📌 EPS of 51.61c aligned with forecasts, reflecting steady earnings growth.
📌 Dividend decision was in line with market expectations, maintaining consistency for shareholders.
📌 Class action uncertainty may weigh on investor sentiment, despite strong fundamentals.
🔭 Outlook and Guidance
🔹 Further store expansions planned, with a focus on emerging markets and high-growth regions.
🔹 Continued emphasis on margin protection, with pricing discipline and cost efficiency measures.
🔹 Legal proceedings may impact financial outlook, depending on the outcome of the class action.
🔹 Expecting solid revenue growth in 2H25, supported by holiday season demand and expansion strategy.
🌍 Market Positioning
💡 Lovisa remains a dominant player in the global fashion jewellery market, with a growing international presence.
💡 New store openings in Africa and Latin America diversify revenue streams and reduce regional risk.
💡 Strong inventory and pricing strategy enhance profitability and competitive positioning.
💡 Balance sheet strength provides flexibility, ensuring long-term stability and investment capacity.
📈 Share Price Performance
Disclaimer: This information is provided purely for educational purposes. It takes no account of an individual’s personal financial circumstances and hence can in no way constitute financial advice. The above data may be subject to errors or inconsistencies for which the author takes no liability. It is imperative that all investors do their own research or if they need advice, seek it from a qualified financial adviser.
Quick Take: H1FY25 ASX:LOV