The Lovisa Holdings Ltd (ASX: LOV) share price is down 4% after the company announced its FY25 half-year result.
Lovisa sells low-price jewellery across a global store network.
Lovisa HY25 result
Here are some of the main highlights from the half-year result for the first six months of FY25:
- Revenue grew 8.8% to $405.9 million
- Gross profit increased 11.1% to $334.7 million
- EBIT rose 10.7% to $90.2 million
- Net profit before tax increased 10.8% to $80.6 million
- Profit after tax (NPAT) rose 6.5% to $56.9 million
- Dividend per share flat at $0.50
Growth was almost entirely delivered by an expanding store network because comparable store sales growth was only 0.1%. That’s positive, but only just.
The gross profit margin increased by 170 basis points (1.70%) to 82.4%, on top of the 40 basis point (0.40%) rise in HY24.
The store network finished with 943 global locations, which was a rise of around 90 (or 10%) year on year. Compared to the end of FY24, it as an increase of 43 (or 4.8%) half on half.
There was a slight increase in stores in a number of countries, with sizeable increases in Canada, Ireland, Germany and New Zealand.
Outlook for the Lovisa share price
Lovisa reported that that in its trading for the first seven weeks of FY25, comparable store sales grew by 3.7% and total sales increased 12.9% year on year. That’s good, and stronger than HY25.
Since the end of the half it has opened 16 new stores, with two closures and one relocation, taking the total store count to 956. It planning to open its first Zambia in the coming week to unlock its 50th market globally.
The company said it’s focused on expanding its physical and digital store network. It’s expecting the store rollout momentum “to continue”.
Lovisa also said its balance sheet “remains strong” with both cash and debt facilities supporting its growth.
The company is one of the impressive global growth stories on the ASX right now. Its store rollout clearly has more to go, which could help underlying net profit continue to rise at more than 10%. The company’s comparable store sales growth will become increasingly important as the store growth slows in percentage terms.
But, after a strong rise of the Lovisa share price in the past 18 months or so, there are other ASX growth shares I’d rather look at first as more compelling ideas.
