THG, the e-commerce and consumer brands group, has raised its full-year earnings guidance after stronger-than-expected performance in its nutrition division pushed profits ahead of market forecasts.
The company now expects full-year adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of £103 million, above both its previous expectations and market consensus.
Rolling 12-month adjusted EBITDA reached £100.6 million at 30 September, up 50% year on year, with the company also on track to deliver its first year of positive free cash flow since its 2020 stock market listing.
Free cash flow for the full year is expected to come in between £25 million and £35 million, in line with analyst expectations.
Group revenue grew 1.5% in the third quarter on a constant currency continuing basis, with core brands and markets, representing around 87% of group revenue, growing 6.1%.
THG Nutrition, home to the Myprotein sports supplements brand, was the standout performer, with revenue up 5.3% to £152.4 million in the quarter, driven by a 36.2% jump in Myprotein branded unit volumes.
A sharp fall in whey protein commodity prices adds to the positive outlook, with WPC80 prices, the benchmark raw material for protein supplements, declining around 20% since THG's interim results in September.
The company has secured fourth-quarter raw material requirements at more favourable prices than the third quarter and is now locking in first-quarter 2027 coverage below current market rates.
THG Beauty revenues dipped 0.6% in the quarter, partly due to a timing shift in advent calendar dispatches into October, which the company says would have added around 0.9 percentage points to third-quarter growth.
The division's AI Beauty Advisor is now handling around 250,000 customer conversations per month, while its loyalty programmes have surpassed 3.9 million members.
Chief executive Matthew Moulding said the group enters the crucial fourth quarter with confidence, expecting revenue growth to accelerate from the third-quarter pace.
THG is also awaiting a substantive update from HMRC on outstanding VAT claims, with the company expecting a response by the end of October.
