Boohoo’s £1 Billion Plan

Boohoo.com, the fashion etailer which debuted on the stock market today, has told investors it could reach £1 billion sales under current plans.

The retailer has laid down plans to the City for a 'multi-stage' infrastructure strategy which is 'scalable' and would support the target which is around nine times its current turnover.

Boohoo, which only sells its own product, is more profitable than many other retailers and has gross margins of around 60 per cent. Profit last year is understood to have been around £15 million on sales of £115 million.

Boohoo, whose parent company was Wasabi Frog Limited before changing its name to Boohoo Plc for the IPO (Initial Public Offering of shares), grew by 70 per cent last year. It has been boosted by demand in the UK and increasing appetite for the brand overseas in Europe, Australia and the US.

The shares were priced at 50 pence ahead of today's IPO but had climbed more than 70 per cent in early trading to 85 pence. They settled at around 77 pence by mid-morning valuing the firm at about £850 million.

It currently ships to 100 countries and about a third of sales are generated from overseas orders. It has a web site in French that accepts euros and plans to launch more sites in other languages.

Founders and joint chief executives Mahmud Kamani and Carol Kane said today: 'The IPO of boohoo.com marks an exciting milestone in the company’s development and will support us in our continued ambition to provide high quality, fast fashion at affordable prices for our fashion conscious customers around the world.'

They said: 'We view the support from investors as a strong endorsement of the company’s growth plans and we look forward to creating value for our new shareholders as we begin life as a public company.'

It is also examining international markets which could have independent distribution hubs and generate further turnover.

The retailer revealed the growth plans to City investors ahead of its £560 million listing on Aim this morning.

It has received criticism for its high price tag but has argued that it is growing much faster than other firms and that its online model is not confined by the restraints of ‘bricks and mortar’ rivals.