THG is contemplating the separation of its Ingenuity service as part of its strategic review to enhance shareholder value.
- The aim of the demerger is to streamline THG into two main segments: THG Beauty and THG Nutrition.
- No specific timeline for this demerger has been established, though tax clearances have been secured by HMRC.
- Any future demerger will require approval from THG shareholders, with further details to be disclosed later.
- Revenue has decreased by 3.6% in the half-year report, although adjusted EBITDA showed slight growth.
THG has disclosed plans to potentially demerge its Ingenuity ecommerce service as a component of its broader strategy to maximise shareholder value. Following this potential separation, THG would comprise two primary entities: THG Beauty and THG Nutrition, both described by the company as globally leading, profitable, and capable of generating cash dividends.
The company, however, has not committed to any specific timeline for the demerger. While tax clearances have been secured from HMRC, the company notes that details, including the exact timeline, remain undetermined.
THG has clarified that any proposal regarding the demerger would ultimately require the approval of its shareholders. As such, more comprehensive information on the proposal will be provided to them in due course.
The update emerged amidst THG’s announcement of its interim financial results for the first half of 2024, revealing a 3.6% dip in total revenue to £934 million. Despite this, adjusted EBITDA saw modest growth, increasing by 1.6% to £32.6 million, showcasing the company’s operational resilience.
In other strategic moves, Frasers Group confirmed a partnership with THG, acquiring luxury etailer Coggles and benefiting from THG’s courier services. This move aligns with THG’s approach to strengthening its business collaborations and expanding its service offerings.
THG’s strategic considerations for the demerger of Ingenuity reflect its ongoing efforts for corporate optimisation and shareholder value enhancement.
