StockMarketWire.com - Fashion retailer Boohoo downgraded its outlook on full-year performance after reporting a lower first-half profit as the pandemic-led boost to sales waned, return rates increased and costs remained elevated.

Full year sales were now expected between 20% and 25%, compared with a previous estimate of 25%.

Adjusted margin for earnings before interest, taxes, depreciation and amortization, or EBITDA, was now expected to be between 9% and 9.5%, compared with a previous range of 9.5% to 10%,

The company said international shipping costs have increased by £26 million, from rates two years ago, due 'to the effects of the pandemic on airfreight capacity and pricing.'

For the six months ended 31 August 2021, pre-tax fell to £24.6 million from £68.1 million year-on-year, while revenue grew 20% to £976 million.

The company flagged several headwinds on performance in Q2 including UK 'returns rates returning to pre-pandemic levels, physical stores reopening, consumer uncertainty in markets.'

Looking ahead, the company said elevated short-term cost headwinds experienced in the first half were expected to continue in H2 alongside recent freight inflation in its supply chain and wage inflation within its distribution centres.

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