The Hut Group has incurred an operating loss for the last financial year due to a series of “non-recurring, non-cash events”, most notably linked to its IPO during the period.

For the financial year ending December 31, 2020, THG said it had incurred operating losses of £481.8m driven by four non-recurring, mostly one-off, costs. 

THG said the costs were: a £331.6m non-cash share-based payments charge; a £105.1m non-cash impact of the impairment on assets held for sale and sale and leaseback charges; £14.3m cash IPO fees; and £39.2m in Covid-related costs. 

The retailer said without those costs, it would have generated an operating profit in the year of £45.5m.

During the period, THG saw revenues soar 41.5% to £1.6bn while adjusted EBITDA was £150.8m.

The retailer also said it paid £2.6m during the period to staff that were furloughed and did not rely on government money during the pandemic. 

During the year, THG said it gained more than 10.7 million new customers, beauty box subscriptions grew by 39% and orders for nutrition and beauty products grew 41% and 58% respectively. 

THG also updated the City on its first quarter of the financial year and said it would soon be opening Icon Studios, “Europe’s largest content studio house”, in Manchester. 

It also unveiled plans to invest in a further 3.6 million sq ft of new distribution infrastructure to support its partner brands. 

Founder and chief executive Matt Moulding said: “We approach FY21 with confidence having navigated successfully through a milestone year in the group’s history. I am particularly proud of how our people have responded to the changing environment, displaying determination to make a difference across all aspects of our operations from new product development, to digital marketing, M&A, fulfilment and THG (eco).

“Our global direct-to-consumer brand-building capabilities and proprietary Ingenuity technology platform has enabled us to further develop both our external brand relationships, and our expanding portfolio of beauty and nutrition own brands. Leveraging the platform to build an impressive client base of blue-chip consumer brands has been a highlight of the year, supported by encouraging momentum in the current year Ingenuity commerce pipeline.

“Management’s purpose for the IPO was to step-change THG’s access to funding in order to capitalise on Covid-19 accelerated market changes. As we progressed through 2020, those changes became more apparent in terms of the volume and scale of opportunities available to the group, as evidenced by the £400m committed to acquisitions since IPO, most notably the acquisition of Dermstore in the US.

“After highlighting our commitment to reducing the environmental impact of group operations with the launch of THG (eco) in 2020, we have announced significant investment to support the group’s strategy to offset existing usage and footprint. Plastics are a real and immediate problem for THG’s operational sites, our consumers, and for Ingenuity partners. We are investing in best-in-class plastic recycling operations that at first help us off-et our plastic footprint, but in time enable us to close the loop and reuse the plastic we process within THG directly”

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